Venezuela: Venezuela Plans to Nationalize Telecommunications and Electricity Sectors Timelines: K-Erdgas-Erdöl, N-Venezuela, N-Venezuela-takeover, US-Imperialismus

• Mondaq: Venezuela: Venezuela Plans to Nationalize Telecommunications and Electricity Sectors

President Hugo Chávez yesterday announced his policy for his third term in office. He heralded a “new era” in the transformation of Venezuela to socialism: the “Simón Bolívar national project 2007-2021.” The project contemplates the nationalization of strategic industry sectors, such as telecommunications and electricity, through special powers to be sought from the Legislature.

President Chávez plans to nationalize CANTV (Compañía Anónima Nacional de Teléfonos de Venezuela), the former public telecommunications monopoly privatized in 1991 as part of Venezuela’s telecommunications sector reform, which actually extended to President Chávez’s first term with the opening the industry to private investors. The current plans also include the nationalization of electricity utility EdC (Electricidad de Caracas). Other operators and utilities could face similar measures. President Chávez is expected to detail his plan tomorrow during his swearing-in ceremony.

Foreign investors in Venezuela have three basic routes for enforcing their rights: (1) Venezuelan courts; (2) international commercial arbitration; and (3) investment treaty arbitration. This note highlights the last two options.