The Rhine Chlorides Arbitration concerning the Auditing of Accounts (The Netherlands/France)

This case concerned the parties' financial obligations under the 1991 Additional Protocol to the 1976 Convention on the Protection of the Rhine against Pollution by Chlorides (the “Additional Protocol”), signed by France, Germany, Luxembourg, the Netherlands, and Switzerland. The Additional Protocol required measures to be taken to reduce chloride discharges from the Alsace potassium mines into the Rhine river in the period 1991-1998. France was to reduce chloride discharges and temporarily store the chlorides on land when the chloride concentration in the Rhine at the German-Dutch border exceeded 200 milligrams per liter (“mg/l”).

 

The Additional Protocol established a scheme allocating the storage costs. The contracting parties were to make annual payments to France and France was to reimburse any surplus payments at the end of the period.

 

The quantities of chlorides actually stored by France remained well below the upper limits set out by the contracting parties; as a result there was a surplus to be repaid by France. The subject of the dispute was the manner in which the surplus should be calculated under Annex III of the Additional Protocol. As a result of the lower amounts stored, the costs of storage per ton were higher than predicted. The Netherlands argued that the costs of storage should be calculated at the rate per ton specified in the Additional Protocol. France argued that the actual costs per ton of storage should be used to calculate the surplus.
 
The Tribunal was asked to interpret the Additional Protocol in accordance with international law.  The Parties differed as to the relative importance of the various elements of the general rules of treaty interpretation, as expressed in Articles 31 and 32 of the Vienna Convention on the Law of Treaties.  For the Netherlands, the determining element was the ordinary meaning of the terms used; for France, those terms were only the point of departure and other factors must also be taken into account, such as good faith, context, and the object and purpose of the treaty.
 
The Tribunal considered that the various elements of Article 31 of the Vienna Convention should be viewed as an integral whole and that the supplementary means in Article 32 of the Vienna Convention may be used to confirm the meaning in Article 31 as well as being applicable when the latter leaves the meaning ambigious or obscure. Based on a close analysis of the text of the Additional Protocol, its context, object and purpose, and travaux préparatoires, as well as subsequent practice of the parties, the Tribunal found that the figure specified in the Additional Protocol, which was 61.5 French francs per ton, had been adopted as a lump sum figure, irrespective of subsequent variations in the amounts stored.   The Tribunal then set out its calculation of the excess paid by the Netherlands to France, and the interest due by France on that amount.
 
Judge Guillaume issued a declaration in which he made observations regarding Article 62(1) of the Vienna Convention, concerning fundamental change of circumstances, and took the view that that those conditions had been fulfilled in this case.   

Case information

Name(s) of Claimant(s)
Name(s) of Respondent(s) ()
Names of Parties

The Netherlands


Mr. Johan G. Lammers, Legal Adviser to the Ministry of Foreign Affairs

 

France

 

Mr. Ronny Abraham, Director of Legal Affairs at the Ministry of Foreign Affairs

Case number 2000-02
Administering institution Permanent Court of Arbitration (PCA)
Case status Concluded
Type of case Inter-state arbitration
Subject matter or economic sector Treaty interpretation
Rules used in arbitral proceedings Ad Hoc Rules of Procedure
Treaty or contract under which proceedings were commenced

[Multilateral treaty]
OTHER


Language of Proceeding French
Seat of Arbitration (by Country) Netherlands
Arbitrator(s)

Judge Krzysztof Skubiszewski (Presiding Arbitrator)

Judge Pieter H. Kooijmans

Judge Gilbert Guillaume

Representatives of the Claimant(s) -
Representatives of the Respondent(s) -
Representatives of the Parties
Number of Arbitrators in case 3
Date of commencement of proceeding 21 October 1999
Date of issue of final award 12 March 2004
Length of Proceedings More than 4 years
Additional notes -

Attachments

Award or other decision
Award - Part I (French)
Award - Part II (French)
Award (Unofficial English Translation)
Other
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