Arbitration Panama

Panama Hires Hughes Hubbard & Reed for $16.6 Million to Defend Mining ICSID Arbitrations

By ADR Journal Editorial Desk Published 1 source Arbitration ICSID Investment Disputes Mining Sector Panama Panama

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TL;DR

  • Panama approved $16.6 million in legal contracts with Hughes Hubbard & Reed LLP.
  • The contracts cover three ICSID arbitrations filed by mining companies.
  • ICSID proceedings involve First Quantum, Franco-Nevada, and KOMIR.
  • Hughes Hubbard replaces prior legal representatives in each case.

Overview

The Cabinet of Panama has approved contracts with Hughes Hubbard & Reed LLP to provide external legal representation and advice in three ongoing ICSID investment treaty arbitrations concerning mining. The total approved amount across all contracts is up to $16,611,188.16. The cases have been brought by Canadian and South Korean companies: First Quantum Minerals, Franco-Nevada Corporation, and Korea Mine Rehabilitation & Mineral Resources Corporation (KOMIR).

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What Happened

Panama's Cabinet approved three resolutions authorizing exceptional procedure contracts between the Ministry of Economy and Finance (MEF) and Hughes Hubbard & Reed LLP for a combined maximum total of $16,611,188.16 in professional fees.

These contracts are for the external legal defense of Panama in three ICSID-registered investment arbitration proceedings brought by companies involved in mining activities in Panama.

The first case, filed by First Quantum Minerals Ltd. (ICSID Case No. ARB/25/18), has a contract cap of $5,744,981.38. Hughes Hubbard replaced Sullivan & Cromwell LLP and Morgan & Morgan as of March 3, 2025.

The second contract, relating to Franco-Nevada Corporation (ICSID Case No. ARB/24/26), is capped at $5,749,578.81, with the firm taking over from Debevoise & Plimpton and Fábrega Molino as of May 22, 2025.

The third contract concerns KOMIR (ICSID Case No. ARB/25/20), with a maximum cap of $5,116,627.97 and a start date of April 8, 2025.

All contracts are multi-year commitments funded from the MEF's 2026 budget with provisions for future fiscal years, given the uncertain duration of the arbitrations. The caps cover legal fees only; other arbitration expenses will be reimbursed separately.

Context

The arbitrations arise in response to disputes related to mining activities in Panama by foreign investors, a key factor in the country's recent legal and economic landscape.

Arbitration at ICSID is common for investor-state disputes and involves significant costs and long procedural timelines.

Why It Matters

  • The proceedings are substantial investment arbitrations linked to the mining sector, with significant financial exposure for Panama.
  • Panama's retention of a new international law firm reflects strategic legal preparation in ongoing high-stakes disputes before ICSID.
  • The amount and structure of the contracts indicate Panama's commitment to robust legal defense in international arbitration.

Sources

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