## Facts

- In 1971, Holiday Inns, S.A. and Occidental Petroleum Corporation commenced ICSID arbitration against the Government of Morocco concerning a joint venture to construct and operate hotels in Morocco.
- The claimants also acted in their own name and on behalf of related project companies involved in the hotel structure.
- The claimants appointed one arbitrator; Morocco appointed Professor Paul Reuter as its arbitrator.
- The two party-appointed arbitrators selected Judge Sture Petrén as the tribunal’s president.
- In 1976, while the arbitration was pending, the claimants’ arbitrator accepted an appointment as an outside director of Occidental Petroleum Corporation.
- After accepting that corporate role, the claimants’ arbitrator notified the other tribunal members of his intent to resign.
- The arbitrator sought to condition his resignation on the claimants retaining the right to name the replacement arbitrator.
- The annual report entry (11 ICSID Ann. Rep. (W. Bank) 32, 34 (1977)) records this resignation episode as part of the proceeding’s procedural history and raises the question of how a vacancy is handled under the ICSID framework.

## Issues

1. Can an ICSID arbitrator make a resignation effective only on the condition that the appointing party controls the replacement appointment?
2. When an arbitrator’s new relationship with a party creates an independence concern, must the vacancy be filled only through the ICSID Convention and Arbitration Rules’ vacancy procedure?

## Decision

- The arbitrator’s attempted condition was not treated as controlling over the vacancy-filling process.
- The resignation and any resulting vacancy were handled through the ICSID Convention and Arbitration Rules mechanisms for replacement, rather than through conditions set by the departing arbitrator.
- The tribunal’s composition was to be reconstituted through the Convention-based method applicable to vacancies, so the arbitration could continue with a properly constituted tribunal.

## Legal Principles

- ICSID arbitrators must be, and remain, independent and impartial; acceptance of a role with a party during the proceeding can call that independence into question.
- An arbitrator cannot use resignation to impose unilateral terms that alter the Convention’s prescribed method for filling tribunal vacancies.
- Vacancies on an ICSID tribunal are filled through the Convention and Arbitration Rules process, which applies regardless of any preferences stated by the departing arbitrator.
- The integrity of ICSID proceedings depends on applying the institutional appointment and replacement framework, rather than permitting ad hoc conditions that could affect the tribunal’s legitimacy.

## Conclusion

Holiday Inns/Occidental Petroleum v. Morocco, as summarized in the 1977 ICSID Annual Report, is a procedural reference point for the proposition that a party-appointed arbitrator’s conflict-related departure cannot be made contingent on arbitrator-imposed conditions, and that any resulting vacancy must be filled through the ICSID Convention and Arbitration Rules process to maintain a properly constituted, independent tribunal.


Holiday Inns/Occidental Petroleum v. Morocco, 11 ICSID Ann. Rep. (W. Bank) 32, 34 (1977)