A judge orders Chile to compensate the Spanish shareholders of a newspaper confiscated by Pinochet with 520 million euros

The head of Court 101 of Madrid, Pedro José Puerta, has issued a resolution ordering the Chilean State to pay 551.77 million dollars (around 520 million euros) to the Spanish owners of the newspaper El Clarín, confiscated by the dictator Augusto Pinochet the same day he staged the coup, September 11, 1973, even before directing the tanks towards La Moneda, the seat of the Chilean government presided over by the socialist Salvador Allende at that time. The newspaper's assets in Chile are still occupied by the military almost half a century later.

The newspaper was, at that time, the one with the largest assets and sales in the country -more than 250,000 daily copies- and with a democratic line, bought in 1972 by businessman Víctor Pey, a Spanish Republican exiled in Chile who died in 2018 at 103 years. The current owners of the shares of the publishing companies are the Fundación Española Presidente Allende, with 90%, and Pey's daughter, Coral Pey Grebe (10%). Currently, El Clarín is only published in digital format.

Court 101 in Madrid, which historically specialized in arbitration matters, is the same as in 2013 executed the costs that this same award imposed on Chile: more than three million dollars, which the State has already paid. The new resolution now continues the enforcement of other provisions of the same award by the International Center for Settlement of Investment Disputes (ICSID), the international arbitration body of the World Bank, after more than a decade of attempts by Chile to prevent the obligation to compensate Spanish investors ordered by the 2008 award could materialize.

The ICSID settled the legal dispute in 2020 by reiterating that the owners of El Clarín have the right to be compensated "for any damage susceptible to financial evaluation that they may establish" and that their 1972 investment is under the protection of the Investment Protection Agreement foreigners between Spain and Chile. This right has the authority of “res judicata” since 2008 in the 155 countries that have ratified the ICSID Convention, including Spain and Chile.

In 2020, the owners of El Clarín presented their request to continue the execution in Madrid, together with a quantification of the value of the shares prepared by the experts of Accuracy, an international consulting firm based in Paris and one of the international references in arbitration, as well as as an opinion of the professor of Commercial Law Francisco Vicent Chuliá, honorary partner of the Cuatrecasas law firm, Gonçalves Pereira.

The execution resolution of Judge Puerta has set the amount of the principal of the compensation at 429.797 million dollars (382.45 million euros). To this amount, add another 121.972 million dollars (108.53 million euros) for interest and estimated costs. In 2008, the ICSID award set late-payment interest at 5% per annum compounded until full payment of the compensation, with which the delays of the successive governments of Chile, both the Concertación and Sebastián Piñera, will have as Consequently, update the compensation, which will now have to be faced by the new Executive of Gabriel Boric, who has had nothing to do with the longest arbitration in the history of ICSID and Chile.

On the merits of the award, which agreed with the Spanish investors and obliges Chile to compensate them, there is no recourse. The order of the Spanish court indicates that the State can oppose the enforcement office in the terms established by the procedural law. Boric's government has not responded to questions asked by elDiario.es on this matter.

When communicating the order on December 20 to the representation of the Chilean State in Madrid and its Attorney before the court, the Government of Sebastián Piñera refused to receive it and asked to send it to Santiago, which the court did. However, when it is still to be resolved whether the communication had the legal effects established by the procedural law in December, it is on the Government of Boric that the consequences fall that Piñera in his two terms at the head of the country has not fulfilled the obligation to compensate, even though he publicly promised to do so.

In reality, as a signatory State of the ICSID agreement, the international organization of reference for disputes between foreign investors and States, Chile has no margin to avoid the award or its execution. Article 54 of the agreement is blunt: “Every Contracting State shall recognize the award issued in accordance with this agreement as binding and shall enforce within its territories the pecuniary obligations imposed by the award as if it were a final judgment issued by an existing court in said State”.

Judge Puerta's decision brings the end of this lengthy procedure closer to the end, which initially seemed like a chimera and has turned out to be a kind of contemporary version of the myth of David against Goliath. On one side, the Chilean State, advised by the best international law firms and practically unlimited resources. On the other, a small team of solidarity jurists led by the Spanish lawyer Joan Garcés, who was Allende's advisor.

The other great driving force behind the cause, Víctor Pey, did not live to see the happy ending of his odyssey, despite the fact that he never stopped believing in it and remained involved until the very day of his death, at the age of 103. Pey was always a fighter: an engineer by training, when the Spanish Civil War broke out he enrolled in the Durruti Column until his friend, Minister Josep Tarradellas, entrusted him with the direction of the War Industries Commission of Catalonia. In September 1939 he arrived in Chile on the Winnipeg, the emblematic ship whose departure with exiles Pablo Neruda organized.

In Chile, Pey began a new life as a businessman, maintaining his links with the cause of the Republic and democracy until on September 11, 1973, he relived the nightmare of a military coup d'état, which he had already suffered in Spain 37 years earlier. , and had to go into exile again, this time to Venezuela and Spain. The legendary figure of him inspired the novel by the writer Isabel Allende Long petal of the sea.

In the 1990s, with the formal return of democracy to Chile, Pey returned to the South American country and tried to recover El Clarín with the purpose of restoring it in a media context monopolized by the newspapers and groups that had supported the Pinochet coup. However, the documents that proved that he had bought all the shares of the newspaper had been stolen by the secret police of the Pinochet regime, although finally in 1995 they ended up appearing in a process unrelated to Pey and the judge restored them to him. Even then, his requests to recover his rights fell on deaf ears from an institutional system heavily conditioned by the legacy of the dictatorship.

Faced with the impossibility of advancing the claim in Chile, in 1997 Pey and Garcés sought justice and reparation in international law by resorting to arbitration at the ICSID court, the most important world court attended by foreign investors who consider that their rights have not been been respected. Spain and Chile had signed their bilateral foreign investment protection treaty in 1991, with retroactive application in the specific circumstances of Pey's investment.

And there began the very long and complex international battle, which is now nearing its end, 25 years after it began and almost half a century of confiscation, with the execution of the Madrid judge who ordered the Chilean State to consign almost 500 million euros to the Spanish investors.

Source link