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C. The Expropriation and the Arbitration
1. The Expropriation and the Agreement for Arbitration
On September 19, 1977, Kuwait terminated the concession and
expropriated all of Aminoil’s properties and assets in Kuwait and
the Neutral Zone (the expropriation date and the expropriation,
respectively). Aminoil protested the expropriation. The
expropriation was also of concern to the Government of the United
States, and, on October 27, 1977, at a meeting in Kuwait, the
Secretary of the Treasury of the United States, W. Michael
Blumenthal, discussed the expropriation with Kuwait’s Minister of
Finance. Secretary Blumenthal expressed the hope that Aminoil
would receive full and fair compensation from Kuwait.
Subsequently, representatives of the U.S. Department of State
encouraged Kuwait to agree to an arbitration proceeding. On
July 23, 1979, Aminoil and Kuwait entered into an agreement (the
arbitration agreement) providing for an arbitration (the
arbitration) of various differences and disagreements relating to
the concession agreement and the expropriation.2 The arbitration
agreement established a tribunal of three members to hear and
decide the dispute (the tribunal and the dispute, respectively).
The three members of the tribunal were (1) Sir Gerald G.
Fitzmaurice, Q.C., from the United Kingdom, appointed by Aminoil,
2 Hereafter, we shall use the term “parties” to refer to
Aminoil and Kuwait, as parties to the arbitration agreement,
except where the context indicates that we are referring to
petitioner and respondent as parties to this proceeding.
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