Claimant, a European company, wished to acquire the business of Respondent 3, a South American company. To this end, it sent a letter of intent to Respondent 2, a European company, addressed to the attention of its chairman, Respondent 1. The transaction contemplated in the letter of intent was the purchase by Claimant of 50% of the shares of a company to which Respondent 3 would transfer its business and certain assets. The letter of intent was governed by Swiss law and contained a confidentiality provision prohibiting the disclosure of any information about the contemplated transaction. Following Respondent 2's termination of the letter of intent prior to the realization of the transaction, Claimant sought the payment of a contractual penalty, alleging that, by entering into an agreement with Company X before the end of the negotiating period, Respondent 1 had infringed his undertaking not to conduct parallel negotiations with any third company. Respondents objected to the arbitral tribunal's jurisdiction over Respondents 1 and 3, arguing that the letter of intent containing the arbitration agreement had been executed by Respondent 2 only. In a partial award, the arbitral tribunal held that it had jurisdiction over the Claimant and Respondent 2, but not over Respondent 3. It reserved its decision on jurisdiction over Respondent 1 to its final award.

Le demandeur, une société européenne, souhaitait acquérir l'activité du défendeur 3, une société sud-américaine. À cet effet, il avait envoyé une lettre d'intention au défendeur 2, une société européenne, qu'il avait adressée à l'attention de son président, le défendeur 1. La transaction envisagée dans la lettre d'intention portait sur l'acquisition par le demandeur de 50 % des actions d'une société à laquelle le défendeur 3 devait céder son activité ainsi que certains actifs. La lettre d'intention était régie par la loi suisse et contenait une clause de confidentialité interdisant la divulgation de toute information sur la transaction envisagée. À la suite de la résiliation de la lettre d'intention par le défendeur 2 avant la réalisation de la transaction, le demandeur a cherché à obtenir le paiement d'une pénalité contractuelle, faisant valoir que le défendeur 1, en concluant un accord avec la société X avant la fin de la période de négociation, avait failli à son engagement de ne pas mener de négociations parallèles avec des sociétés tierces. Les défendeurs ont contesté la compétence du tribunal arbitral sur les défendeurs 1 et 3, plaidant que la lettre d'intention contenait une convention d'arbitrage qui n'avait été signée que par le défendeur 2. Dans une sentence partielle, le tribunal arbitral s'est déclaré compétent vis-à-vis du demandeur et du défendeur 2, mais pas du défendeur 3. Il a réservé pour sa sentence finale sa décision quant à sa compétence sur le défendeur 1.

El demandante, una empresa europea, deseaba adquirir el negocio del demandado 3, una empresa sudamericana. A tal efecto, este envió una declaración de intenciones al demandado 2, una empresa europea, dirigida a la atención de su presidente, el demandado 1. La operación prevista en la declaración de intenciones era la compra, por parte del demandante, del 50 % de las acciones de una empresa a la cual el demandado 3 debía transferir su actividad empresarial y determinados activos. La declaración de intenciones estaba regida por la ley suiza e incluía una disposición de confidencialidad que prohibía la divulgación de toda información relativa a la operación prevista. Tras la rescisión, por parte del demandado 2, de la declaración de intenciones antes de la realización de la operación, el demandante solicitó el pago de una penalización contractual alegando que, al celebrar un contrato con la empresa X antes de que finalizara el período de negociación, el demandado 1 había infringido el compromiso asumido de no mantener negociaciones paralelas con una tercera empresa. Los demandados pusieron objeciones a la competencia del tribunal arbitral sobre los demandados 1 y 3 afirmando que la declaración de intenciones que contenía el acuerdo de arbitraje solo había sido ejecutada por el demandado 2. En un laudo parcial, el tribunal arbitral declaró que tenía jurisdicción sobre el demandante y el demandado 2, pero no sobre el demandado 3. Además se reservó su decisión acerca de la competencia sobre el demandado 1 para el laudo final.

'VI. Jurisdictional issue with respect to [Respondent 2]

... ... ...

87... . the Letter of Intent is sent by [Claimant] to [Respondent 2] and signed for the latter "accepted and agreed to".

The Tribunal notes that [Respondent 3] is neither the originator nor an addressee of the LoI and that it does not appear as a party to the LoI.

88. No evidence has been led to the effect that [Respondent 3] was in any manner represented at the LoI. Claimant stated that [Respondent 1] was chairman of [Respondent 3], but it does not result from the evidence submitted to the Tribunal that [Respondent 1], ex officio, was empowered to take commitments on behalf of [Respondent 3] or to sign any binding agreement on behalf of [Respondent 3]

89. Claimant contends that it was the intention of the parties that [Respondent 3] be "directly and ab initio bound by the Letter of Intent", and quotes the context in which the relationship between [Claimant] and "the [Respondent] Group" has developed over the years. The Tribunal fails to find in the facts and events set forth by Claimant the evidence that the intention of [Respondent 3] was to be part of the successive contracts that were contemplated and/or executed. Neither the fact that the shares of [Respondent 3] were the subject of certain agreements nor the fact that, pursuant to the LoI, [Respondent 3] was to contribute part of its assets to another company, mean, in the Tribunal's view, that [Respondent 3] was intended to be a party to the LoI or to be bound by it.

90. As to Claimant's position when it asserts that clauses 5, 6 and 8 of the LoI impose binding obligations on Respondent 3 making it thus a party to the LoI and, therefore, to the arbitration agreement contained in clause 9, the Tribunal cannot follow Claimant's position. Apart from the fact that clause 8 (exclusivity during the negotiating period) does not impose an obligation on Respondent 3, the obligations mentioned in clauses 5 (obligation to make available to the Purchaser various information and documents) and 6 (confidentiality clause) could only be binding on Respondent 3 if it had become a party to the LoI. The pure mention of obligations imposed on Respondent 3 in the LoI, a contract to which it was not a signatory party, does not make it a party to said LoI; rather a contract containing such obligations is to be qualified as a contract imposing an obligation only upon the signatory party which has promised a third party's act but which as such has no obligatory effects towards the third party under applicable Swiss law (see Article 111 of the Swiss Code of Obligations).

91. To conclude, the Tribunal finds that it does not have jurisdiction to make a determination on the claims asserted by Claimant against Respondent 3.

VIII. Jurisdictional issue with respect to [Respondent 1]

1. Summary of Claimant's position

92. As already mentioned, Claimant takes the various successive agreements into account in order to determine the actual intention of the Parties, pursuant to the principles of Swiss law.

93. The intention of having [Respondent 1] as a party to the LoI results not only from the text of the Letter but also from the context of the relationship between the [Respondent] Group and the [Claimant] Group.

Claimant goes back [several years]-when it acquired 25 % of the voting capital stock of [Respondent 3]-then to the Share Purchase Agreement ("SPA") [also several years earlier] whereby these shares were resold to the [Respondent] Group.

94. [Respondent 1] conducted the negotiations during which he was assisted by his legal and financial advisers ... Several companies belonging to the [Respondent] Group-including a company which became Respondent 2-participated in the SPA; Claimant points out that [Respondent 1] signed "for all four of his companies" ...; it is [Respondent 1] who requested several postponements for the payment of a third instalment under the SPA, and he did so using the stationery of various companies.

95. Negotiations were resumed by [Respondent 1] and his advisers with respect to the sale of [Respondent 3] or of its assets to [Claimant ]. [An earlier] LoI was finalized ..., which document, Claimant states, is very similar to the LoI, but never went ahead ...

96. Contacts were resumed between [Respondent 1] and [Claimant] in the [following year], the purpose of which being the acquisition by [Claimant] of 50 % interest in a company "to be newly established by [Respondent 3] and to which [Respondent 3] would have contributed the major part of its assets" ...

97. It is Claimant's claim on the merits that [Respondent 1] breached the exclusivity obligation set forth in the LoI and that [Respondent 1] "negotiated behind [Claimant]'s back with at least two other companies : ... for the acquisition of [Respondent 3]'s assets".

98. Claimant affirms that during the negotiations (leading to the [LoIs]), [Claimant] dealt solely with [Respondent 1], and [his advisers]. [Respondent 1] was acting as owner and sole leader of his group.

99. As already mentioned, [Respondent 1] is a signatory of the LoI.

100. During the first step of the process, [Respondent 1] made commitments towards [Claimant] granting [Claimant] the rights necessary to conduct a due diligence exercise. [Respondent 1]'s behaviour during this phase of the negotiations was as it had been during the negotiation of the [previous] LoI.

101. [Claimant] insisted that an "exclusive negotiating period" be granted to it restricting not only [Respondent 1] but also companies of his group from conducting negotiations in parallel with third parties.

102. Analysing the LoI, Claimant points out that there are wordings and expressions which, in its view, can only mean [Respondent 1] personally.

103. Alternatively, Claimant argues that "[Respondent 1] necessarily must have guaranteed the performance of the LoI by Respondent no. 2 because, by that time, [Respondent 2] no longer held the shares of [Respondent 3] and thus could not perform the obligations set out in that agreement" ...; further, [Respondent 1] ought to be held as bound by the obligations contracted by [Respondent 2] as he "fraudulently concealed the liquidation of that company and thus deprived the Claimant of it as debtor of the LoI obligations" ...

104. Claimant then reviewed systematically the events which took place after the execution of the second Letter of Intent and concluded that [Respondent 1] misled [Claimant] as to the status of [Respondent 2] in his group as, at the time he approved and accepted the LoI, he knew that [Respondent 2] could not dispose of the shares or the assets of [Respondent 3].

105. From the facts and circumstances briefly summarised above, Claimant concludes that [Respondent 1] is personally bound by the obligations expressed in the LoI.

2. Summary of Respondent 1's position

106. [Respondent 1] denies having ever made an explicit or implied commitment as party to the LoI or as a guarantor of the obligations of [Respondent 2] ...

107. [Respondent 1] reviews in detail the relationship between "the [Claimant] Group and the [Respondent] Group" prior to the LoI, and concludes that he undertook no personal obligation and gave none of the personal guarantees requested by [Claimant].

108. Addressing the review of the events after the execution of the LoI as stated by Claimant, [Respondent 1] points out that Claimant's allegations "rely on a mere formal aspect" and that nothing in the content of the letters singled out during that period support the conclusion that [Respondent 1] was "writing in his own name or in the name of the group" ...

109. [Respondent 1] rejects as devoid of any meaning circumstances where the Tribunal could infer that the real intention of the parties was going beyond [Respondent 2] and [Claimant].

110. [Respondent 1] denies having acted improperly on the occasion of the restructuring of the [Respondent] Group and maintains that [Respondent 2] has not been eluding any of its obligations under the LoI.

111. [Respondent 1]'s conclusion is that this Tribunal has no jurisdiction over him.

3. Summary of the Tribunal's position

112. The Tribunal has carefully reviewed the Brief and the Reply as well as the documents produced by, respectively, Claimant and Respondent 1, in support of their respective positions.

113. The Tribunal has also reviewed the witness statements filed in these proceedings ...

114. Careful consideration has been given to the Authorized Comments on Claimant's witness statement submitted by Respondents' Counsel and to the Comments by Claimant's Counsel ...

115. It appears to the Tribunal that the relationship between the [Claimant] Group and the [Respondent] Group, which relationship apparently began [several years earlier], is made of a fairly complex set of facts with respect to the companies/persons making commitments and being granted rights under the various contracts, these facts, commitments, rights and contracts pertaining to the merits of the case.

116. Pursuant to Article 18 of the Swiss Code des obligations, which governs the LoI (pursuant to Article 178 of the Swiss Act on International Private Law, the arbitration agreement is governed by the law applicable to the contract-the LoI-in this case Swiss law), in case of doubt the Tribunal has to determine the jurisdiction issue on the basis of the actual and common intentions of the Parties.

117. So far, the Parties have essentially produced evidence in support of and discussed the jurisdiction issue. They have not fully briefed the Tribunal as to the factual aspects of the merits of the case.

118. It is the Tribunal's opinion that, under these circumstances, it is not in the position to make a determination on the jurisdiction issue between Claimant and Respondent 1 without reviewing the merits of the case.

119. Consequently, for the reasons stated above, the Tribunal reserves its determination on the issue of jurisdiction between Claimant and Respondent 1 until its decision on the merits, thereby joining the exception of jurisdiction to the determination of the merits of the claim.'