Der Sachverhalt


„The Moon Has Set“

Kleopatra Selene had recently given birth to a son, which she and her husband named Ptolemy.30 Proud of her Lagide legacy, Selene tasks one of the scholars of her court to catalogue papers from her mother’s court to make them accessible for the little prince when he grows up.
After a few weeks, the archivist comes across a contract between Kleopatra VII and King Herod concerning the lease of revenues for territories gifted to Kleopatra VII by Antony. The archivist brings this contract to the attention of the queen and her legal scholars. The legal scholars then explain that, in addition to the contract, there was a treaty between Egypt and Judea, concluded by Kleopatra VII and Herod, which concerned investments in Judea and opened the possibility of arbitration in case of disputes. Kleopatra Selene decides it is time for her to take action.
Kleopatra Selene addresses a letter to Herod of Judea:
“We, Kleopatra Selene, Philometor, Queen of Mauritania, rightful Queen of Egypt following our mother Kleopatra Philopatris Nea Isis, to Herod of Judea greetings.
We give hereby notice of a dispute under Article 9 of the Treaty of Friendship between the Kingdom of Egypt and Kingdom of Judea concluded on the occasion of my mother’s visit to Judea on [13 of May of 34 BC] (“Treaty of Friendship”) as well as under the Contract between Kleopatra of Egypt and Herod of Judea of the same day regarding the Lease of Revenues of Certain Properties (“Revenue Lease Agreement”).31 We hereby accept the offer to arbitrate in accordance with Article 9 (2) (b) of the Treaty of Friendship.
As of [31 BC], you have ceased to make payments under the Revenue Lease Agreement in breach of said Agreement. In addition, as of the spring of [30BC] you have illegally claimed title to the property of our mother in the territory of Judea [as well as in the territory of the Nabateans].
Your actions violate the Treaty of Friendship. We task you to make amends and reinstitute us in our rights and pay compensation for the time during which the benefits of our ownership and of our enjoyment under the Revenue LeaseAgreement have been withheld from us. Should you not comply with this letter within three months from receipt of this letter, we will commence proceedings in accordance with Article 9 (2) (b) of the Treaty of Friendship. Done on the [1 January of 10 BC].”
The letter is delivered to Herod on [23 January of 10 BC]. Herod intends to answer immediately. However, before handing his response to Selene’s messenger, he consults his council of friends who – as previously – advise against rash action. Selene’s messenger returns to Mauretania unharmed but also without a message from Herod.
As no reaction is forthcoming from Jerusalem, Selene instructs her legal scholars to commence arbitration. A Notice of Arbitration of 31 July 10 BC under the UNCITRAL Rules, which states that it also serves as Statement of Claim, is submitted by hand-delivery both to Herod’s ambassadors to Mauretania and to Rome as well as to Herod’s court in Judea (the latter on 19 August of 10 BC). In this Notice, Selene appoints Comosicus of Dacia32 as her party-appointed arbitrator. Selene also has a stele engraved with the key-points of the Notice, which she erects on the market place of Iol/Caesarea, the capital of Mauretania, for everyone to see.
In its Response of 19 September 10 BC, which states that it shall also serve as Statement of Defence, Judea raises the following objections to jurisdiction and admissibility (his friends manage to dissuade Herod who initially insisted on writing the Response himself):
1. No jurisdiction ratione materiae. The properties that Kleopatra VII received through the actions of Marcus Antonius cannot be qualified as “investments”. Nothing was invested, no capital was inserted. As regards the properties in the territory of the Nabateans and the revenues therefrom, those are not investments in Judea.
2. Kleopatra Selene has no standing. Despite the irregular bestowment of the properties by Marcus Antonius, such gifts would naturally have been gifts to the Queen of Egypt and hence to the State of Egypt, not to Kleopatra VII as an individual. This means that they fell to Caesar Augustus when Egypt was conquered by him and could not have been inherited by Kleopatra Selene.
3. The case was brought against the wrong Respondent and must hence fail under the Oil Platforms test. Judea did not expropriate or take in any way the properties. The properties, which Kleopatra VII received by Marcus Antonius were reassigned by Caesar in [30 BC]. What Marcus Antonius gave, Caesar has taken away.
4. This Tribunal also does not have competence to decide this dispute: it concerns the legal position of the Republic of Rome, a most sovereign State which is not a party to these proceedings. No tribunal constituted under international law may decide a matter touching on the sovereignty of a State which has not submitted to its jurisdiction.
5. This Tribunal does not have competence to rule upon a dispute between two Roman citizens. Herod of Judea is a King and Friend of Rome and a Roman citizen. Kleopatra Selene is the daughter of Marcus Antonius, a Roman citizen. She is married to Iuba II, also a Roman citizen. This dispute should have been brought before thepraetor urbanus in Rome. In support of this argument, a letter from Gaius Ateius Capito rendering a responsum on behalf of Augustus Caesar is attached to this Response urging the tribunal to decline jurisdiction.
6. The case is filed out of time. Twenty years have passed since the alleged actions. The case must fail on grounds of limitation, waiver and laches.
7. Article 12 (2) of the Treaty of Friendship is not an “umbrella clause” which could “umbrella in” the content of the Revenue Lease Agreement. Also, if at all, the Revenue Lease Agreement would be “umbrella’d in” in its entirety, including its force majeure clause. The Nabateans prevented Herod – with force (!) – from complying with the payment obligations. Also, Kleopatra VII actively assisted the Nabateans and therefore lost all claims on the grounds of unclean hands.
8. Respondent strongly objects to the making public of this dispute. This is in breach of the principle that arbitration is private. Moreover, the placing of a commemorative stele on the market in Caesarea clearly shows Claimant’s intention to aggravate the dispute. Respondent asks the Tribunal to stop this unconscionable behavior. It requests an order from the Tribunal to oblige Claimant not to publicize the pleadings in this case. Also, it requests an order from the Tribunal that the hearing shall be held in camera. The Revenue Lease Agreement signed by Queen Kleopatra VII and Herod expressly provides that the arbitration be confidential. Such agreement between two sovereigns is valid and enforceable.
In its Response, Judea in turn nominates Marcus Tullius Tiro, Cicero’s freedman, as its arbitrator.
The Response is received in Iol Caesarea on 22 September 10 BC.
Kleopatra Selene is not at all happy when she sees that Tiro was appointed. Given that under the Treaty challenges are heard initially by the two other members of the Tribunal, Kleopatra Selene’s lawyers apply to the Permanent Court of Arbitration for appointment of the presiding arbitrator.
The PCA appoints Wang Mang of China as President of the Tribunal on 15 October 10 BC.
On receipt of the notification that the Tribunal has been constituted on 10 November 10 BC, Kleopatra’s counsel write to the Tribunal and Respondent:
9. “Respondent has appointed Marcus Tullius Tiro, a Roman citizen, as its party-appointed arbitrator. Besides the issue of his nationality, Tiro has failed to disclose that he sat as arbitrator in the case of Publius Canidius Crassus Filius and Middle East Fine Wines and Spirits Ltd. vs. Rome in [30 BC].33 This case also dealt with the invasion of Egypt by Octavius Caesar and the status of Egypt. The relevancy of this is proven by Respondent’s objection no. 2. By the time of his appointment, Tiro must have been aware of these arguments, which should have prompted a disclosure. An issue conflict also arises in relation to further arguments that Claimant will make in its forthcoming Reply. Moreover, the award in the Canidius Crassus arbitration has been rendered, but has not been made public. Claimant has no means of determining how the tribunal in that case, including Tiro, decided.”

Herod is livid (and submits his reply on 2 December 10 BC before the lawyers have time to advise on it):
9. “With regard to the nationality of Tiro we point to the fact that both Claimant and myself are Roman citizens. Also, I appointed Tiro because he is a scholar, despite the fact that he was a close friend of Marcus Tullius Cicero. Obviously, he did not read our submission. Moreover, while certainly the impact of Article 2 (4) of the UN Charter was relevant as an underlying issue in the previous arbitration it was never raised expressly by the Parties as far as can be gleaned from the published arguments.34 For the avoidance of doubt, I have also not seen the award. Nor have I asked Caesar Augustus, my most elevated friend for a copy.
Caesar Augustus rightfully transferred Egypt to his private dominion. It is not a part of the Republic of Rome and the Senate is not involved in its administration. The territory formerly known as the Kingdom of Egypt has a special status which must be recognised by public international law. It is administered by Praefectus Aegypti, appointed by Princeps, from the ranks of the knights. In cultural matters the Praefectus is perceived by Egyptians as successor of the pharao in his ritual functions. He also is in command over troops and in charge of judicial functions. The prefect allocates the taxes due for each district. Taxes are – as you are well aware – collected by publicani under concession agreements. Nobody can dispute this, surely not Kleopatra Selene who owes her life, education and marriage to the Caesar Augustus.
This is not an issue conflict. Nothing needed to be disclosed.”
Tiro submits a statement on 26 November 10 BC to the effect that he is independent and intends to remain so.
The Tribunal then issues Procedural Order No. 1 on 15 January 9 BC. As agreed by the Parties, the Tribunal decides to bifurcate the proceedings and to hold a hearing of jurisdiction and admissibility from [6] to [10] March [2017] in [Frankfurt am Main]. The majority of the Tribunal (Tiro abstaining) decide to hear oral arguments on the issue of the challenge of Marcus Tullius Tiro also at the hearing.
As foreseen in Procedural Order No. 1, Kleopatra Selene’s counsel files her Reply:
1. There is jurisdiction ratione materiae. The properties that Kleopatra VII received through the actions of Marcus Antonius are “investments”. The definition of “investment” in the Treaty does not require an insertion of capital. How an investment was acquired is irrelevant. All of the investments are in Judea. This is also true for the lease of the revenues for the bitumen. The bitumen is in the territory of the Nabateans. However, this is not the investment. Herod has leased the revenues in exchange for a fixed fee of 200 talents per annum, irrespective of the annual revenues from the bitumen residues. As Herod himself pointed out this practice is standard. He himself refers to comparable practices of the publicani.
2. Kleopatra Selene has standing. She is the only surviving child and therefore heir of her mother. This concerns both her mother’s private property and the Kingdom of Egypt. Kleopatra VIII Selene is the rightful queen of Egypt. Caesar Octavius’ takingof Egypt was highly illegal. First, it violated Article 2 (4) of the UN Charter. Second, even if one were to set aside the treaty and customary rules against the use of force, the taking would be illegal. Octavius Caesar took Egypt as his “dominium”. Private parties cannot dissolve states. States are not hauls for robbers to carry away.
3. Judea is the right Respondent. Judea, through his king conspired in the taking of the investments. Moreover, even putting the conspiracy aside, Judea failed to protect the investments on its territory (as regards both the balsam and date plantations in Judea and the Revenue Lease Agreement).
4. This Tribunal has competence to decide this dispute: our case is solely against Judea. This case neither concerns the legal position of the Republic of Rome as we do not ask the Tribunal to issue an award against Rome, nor would Rome be bound by the res iudicata effect of the resulting award. Moreover, our case is just for monetary compensation, not for restitution.
5. This Tribunal has competence to rule upon a dispute. First, Kleopatra Selene is not a Roman citizen. Roman law never recognized the marriage of her mother with Marcus Antonius. Roman law does not recognize marriages between Roman citizens and non-citizens in the absence of conubium. For example, Octavius Caesar never recognized the birthright of Kleopatra Selene’s brother Ptolemaios Caesar. Moreover, Marcus Antonius was married at the time to Octavia, the sister of Octavius Caesar. In addition, children born out of wedlock are only recognized as Romans if the mother(!) was a Roman citizen. Whether the father was Roman is irrelevant.35
Second, even if she were, such enforced citizenship would not be opposable against her. It is unclear whether Kleopatra Selene was awarded citizenship before (or at the time) her marriage with Iuba II, whether it was a matter of conubium, or whether her marriage allegedly made her a Roman citizen (quod non). In any event, such citizenship would not be opposable. After the death of her parents and the murder of her brother, Kleopatra Selene was hauled away from Egypt. From that point, her decisions were not her own but those of Octavius Caesar and his sister. Even if Roman citizenship was forced upon her, such bestowment would not be illegal and opposable under international law.
Third, even if both Herod of Judea and Kleopatra Selene were (also) Roman citizens (quod non), this would be irrelevant for the jurisdiction of this Tribunal. Egypt’s rape by Octavius Caesar cannot be recognized by international law. For the purposes of international law (and for this arbitration), Egypt remains an independent State. Moreover, the legal status of being amici of the Roman Republic does not deprive the “client states” of their statehood. They remain capable of concluding valid treaties between each other. Indeed, the conclusion of treaties of amity was actively encouraged by the Roman Republic. Rome’s (alleged) prerogative to act as arbitrator between such states, only relates to state-state disputes, not to disputes between an investor and a state. Moreover, a jurist writing a responsum at the behest of Caesar Augustus is not even internally competent to make such intervention under the Romanconstitution. This has been an issue in the case against Marcus Primus, a case in which Octavius Caesar himself testified.
Hence, such intervention is illegal. The submission of Gaius Ateius Capito on behalf of Rome as so-called amicus is not properly before this Tribunal.
6. The case is not “filed out of time”. First, there is no limitation period in the Treaty. Second, the concepts of limitation, waiver and laches have not been established by Respondent as applicable in this case. Third, given that Kleopatra Selene was not in a position to enforce her rights during her capture in Rome and was even unaware of the existence of the relevant contract until recently, those principles (even if they were generally applicable) cannot apply in the present case.
7. Article 12 (2) of the Treaty of Friendship is an “umbrella clause” which can “umbrella in” the content of the Revenue Lease Agreement. Indeed, UNCTAD “mapped” several treaties with clauses just like Article 12 (2) as having an umbrella clause.
While we agree that the umbrella clause does not allow for raisin picking, there are two important things: the Treaty has to be taken into account when assessing the division of responsibility and the allocation of (political) risk between the parties. Second, the force majeure clause in the Revenue Lease Agreement is inapplicable in the present context. As we said above, this is a publicanus-type contract. Herod cannot “pass” on the risk of non-collection from the Nabateans to Kleopatra VII. That is a risk he assumed. As a matter of fact, we object to and dispute the allegation of Kleopatra VII interfering with Herod’s campaign against the Nabateans. As a matter of law, there is no dogmatic foundation for the alleged legal principle of “clean hands”, for the establishment of which Herod bears the onus.
8. Respondent’s insinuation that investment arbitration is a secretive process is ludicrous. There is no prohibition anywhere in investment treaties, or arbitration rules for a party to make public the existence of the dispute and describe it. Indeed, ICSID as a leading institution for investment arbitration does the same. Moreover, it is a requirement of good governance to publish res gestae (to use a Roman expression). In the present case, however, we have a treaty right not only to publish the existence of the dispute but also all submissions. Also the hearing shall be public! The Treaty makes the UNCITRAL Transparency Rules applicable and allows for no derogation.

Procedural Order No. 2
Whereas the Parties have submitted their arguments on jurisdiction and admissibility, the Tribunal decides to hold a hearing on jurisdiction and admissibility from 6 to 10 March [2017].
The Tribunal asks the Parties to submit skeleton arguments by 10 February [2017].
The Tribunal further requests the parties to reserve 11 March [2017] for an evidentiary hearing, should the need arise.
The Tribunal intends to focus the oral hearing on the nine issues, set out in 1.-9. (pp. 8 – 12). It expects the Parties to address these in their skeleton arguments in preparation for the hearing.
Wang Mang on behalf of the Tribunal


Place of Arbitration: Frankfurt am Main