1. What is the current legal landscape for your practice area in your jurisdiction?

The current legal landscape for international arbitration in Bolivia leaves considerable room for improvement; however, the future is promising.

Arbitration in Bolivia is currently governed by Law No. 708 on Conciliation and Arbitration of 25 June 2015 (“Law 708”). Law 708 departs in significant respects from the UNCITRAL Model Law on International Commercial Arbitration and has proven restrictive in several ways. For example, save for certain limited exceptions, Law 708 treats disputes arising from administrative contracts as non-arbitrable. This has been a significant obstacle to the use of international arbitration in many major projects to which the State is a party, as foreign investors and contractors are frequently left without access to a neutral forum for the resolution of their disputes with public entities and must instead resort to the local courts.

The Political Constitution of the State also imposes significant restrictions on international arbitration. In the hydrocarbons sector, an industry of particular importance to the Bolivian economy, Article 366 of the Constitution provides that all foreign companies carrying out activities in the hydrocarbons production chain on behalf of and in representation of the State are subject to the sovereignty of the State and to its laws and authorities. It further provides that no foreign court or jurisdiction shall be recognized, and that such companies may not invoke any exceptional situation to resort to international arbitration or to diplomatic claims.

In addition, Bolivia is not a party to the Convention on the Settlement of Investment Disputes between States and Nationals of Other States (“ICSID Convention”) and it has also terminated its bilateral investment treaties. As a result, a significant number of foreign companies investing in Bolivia no longer have access to investment treaty arbitration, subject to any survival (sunset) clauses in the terminated treaties that may continue to protect investments made before termination. Their protection therefore depends largely on the dispute resolution mechanisms available under domestic law and on the terms of their individual contracts.

In 2025, a new President took office, and the arbitration community regards the new administration as an opportunity to modernize the legal framework governing arbitration and foreign investment and to restore investor confidence.

Through a joint effort between arbitration practitioners and chambers of commerce, a new draft law has been prepared to replace Law 708. The draft law is intended to align Bolivian arbitration legislation more closely with international best practice, and to make Bolivia a more arbitration-friendly seat. As of the date of this guide, the draft law has not been enacted; however, significant progress has been made, and it is expected to be considered by the Plurinational Legislative Assembly.

There have also been discussions regarding the amendment of certain provisions of the Constitution, including those restricting recourse to international arbitration, in order to give international investment arbitration greater legal certainty. If approved, such amendments would represent a major shift in the Bolivian legal landscape and could significantly strengthen investor confidence in the country.

2. What three essential pieces of advice would you give to clients involved in your practice area matters?

a. One size does not fit all: arbitration agreements should be assessed on a case-by-case basis.

As mentioned above, Bolivian law imposes significant restrictions on matters such as the arbitrable subject matter, the criteria for determining whether an arbitration is international, and other aspects of the arbitral process. However, these restrictions do not apply uniformly in all cases, and certain circumstances fall within exceptions to the general rule.

To navigate this complex landscape and secure a valid and enforceable arbitration agreement, clients should carefully analyze, before entering into a contract, how arbitration can be incorporated into the specific legal relationship. This includes assessing the nature of the counterparty (in particular, whether it is a public entity), the subject matter of the contract, the choice of seat, the applicable law and arbitral rules, any required authorizations, and the enforceability of an eventual award both in Bolivia and abroad, including under the New York Convention, to which Bolivia is a party. A carefully tailored clause will reduce the risk of jurisdictional objections and of later challenges to the award.

b. Do not leave communications unanswered.

We have seen many cases in which misunderstandings arose because letters, emails or other communications were left without a clear response, or without any response at all. Clear communication between contracting parties is essential. When sent in a timely manner and drafted with care, communications can help the parties avoid a dispute or, if one has already arisen, resolve it through amicable negotiation. Failing that, they create a documentary record that may prove decisive in a subsequent arbitration. Contractual correspondence often becomes key evidence, and unanswered notices or claims may be interpreted against the silent party or may trigger contractual deadlines, deemed acceptances and other consequences. Clients should therefore respond to every relevant communication promptly, in writing and in accordance with the notice provisions of the contract.

c. Be prepared to work alongside your legal team from the outset.

Arbitral tribunals show great interest in understanding the underlying business relationship and its particularities beyond the legal dispute itself. When arbitrators understand the project, it is easier for them to understand the dispute between the parties and the relief each party seeks. For this reason, we have found that involving the dispute resolution team at an early stage is highly beneficial to the success of a case, as it allows counsel to learn the complete history of the conflict in real time, preserve relevant evidence and shape the case strategy before positions become entrenched. It is equally important that clients be actively involved in building the case and in preparing the written submissions and hearings, including by providing technical and commercial input and by making key personnel available as fact witnesses. Although this can be time-consuming, it has consistently produced very good results in practice.

3. What are the greatest threats and opportunities in your practice area law in the next 12 months?

Stagnation is the greatest threat to arbitration in Bolivia. As mentioned above, the current legal framework is not particularly arbitration-friendly and, without a meaningful legislative reform, arbitration faces a clear limit to its growth and to its ability to serve as an effective dispute resolution mechanism.

Another threat is the improper use of constitutional proceedings against arbitration. Under Law 708, the action for annulment is the exclusive means of recourse against an arbitral award. Nevertheless, in some cases parties have filed constitutional actions (mainly “acciones de amparo constitucional”) against the judicial decision ruling on the annulment of the award. Through this strategy, parties have indirectly challenged the award itself, effectively creating an additional layer of review not contemplated by Law 708. This practice has produced case law detrimental to arbitration and has encouraged the misuse of constitutional remedies. However, in our most recent cases, we have observed a very positive shift in the attitude of judicial authorities towards arbitration, and this threat therefore has the potential to become an opportunity.

Historically, some judicial authorities were reluctant to accept arbitration as a valid alternative to litigation. This was reflected in decisions annulling awards in which the annulment judge effectively acted as an appellate court and reviewed the merits of the dispute, rather than limiting the review to the exhaustive grounds for annulment set out in the law. This is now changing: we have seen several cases in which judges have demonstrated a deep understanding of arbitration principles, such as party autonomy, competence-competence and minimal judicial intervention, and of the limits governing the interaction between the ordinary courts and arbitral tribunals. In practice, this change in mindset has resulted in fewer arbitral awards being set aside by the courts.

In our opinion, this change in attitude stems from one of the greatest opportunities for arbitration in Bolivia: the strong involvement of key stakeholders in the arbitration community in promoting the practice area. Arbitration centers in Bolivia are creating forums to discuss arbitration issues, practitioners are open to discussing good practices, and universities are promoting arbitration among their students. As a result, knowledge of arbitration and other alternative dispute resolution (ADR) mechanisms has become more accessible to everyone, including judges, public officials and in-house counsel.

Finally, the most important opportunity currently available is legislative reform. As mentioned above, stakeholders have actively participated in the preparation of a draft arbitration law that, if approved, will replace Law 708 with more arbitration-friendly legislation. We are convinced that such legislation would give Bolivia the potential to significantly strengthen arbitration within its territory and to position itself as a more attractive seat for domestic and even international disputes.

4. How do you ensure high client satisfaction levels are maintained by your practice?

We place great importance on understanding our clients’ businesses. Although a dispute may be legal in nature, it is extremely valuable for us to learn about the industry in which our clients operate and their specific business objectives in each matter. This allows us to design legal strategies that serve as tools for our clients to achieve what truly matters to them.

Our team has diverse backgrounds, which allows us to address the different facets of a dispute. For example, some team members have a strong background in administrative law, which has proven extremely useful where a dispute relates, directly or indirectly, to an administrative contract. We also have lawyers with postgraduate studies in management and finance, which is key when addressing quantum and other financial issues. In addition, we have lawyers with significant experience in insurance, energy and construction projects who understand the particularities of contracts and business relationships in these industries.

Communication is key for us. We remain in constant contact with our clients to keep them informed of the progress of their cases, to explain the risks and options available at each stage, and to answer promptly any questions they may have. We also seek our clients’ feedback at the conclusion of each matter in order to continuously improve our services.

5. What technological advancements are reshaping your practice area law and how clients benefit from them?

Artificial intelligence tools have been a key development that has allowed us to improve our practice. We use these tools to work more efficiently and accurately for our clients, for example in document review, legal research and the organization of large volumes of evidence, without sacrificing the critical thinking that underpins all our work. Clients benefit through faster turnaround times and more cost-effective services. We are committed to using AI tools ethically and responsibly, always under the supervision of our lawyers and in compliance with our confidentiality obligations; to that end, we continuously train our team, using local and international resources, so that these tools are implemented correctly in our practice.

We are also implementing internal platforms that allow us to exchange information with our clients more securely. Preserving the confidentiality of our cases is a priority; we therefore use our own platform to exchange information and documents with clients, without relying on third parties over which we have no control. All our technology services are subject to strict oversight by our IT team, so that our clients can be confident that their information will remain confidential. In addition, we make use of virtual hearing and electronic filing tools, which reduce costs and facilitate the participation of witnesses, experts and counsel located abroad.

6. Can you describe a particularly interesting or complex matter you have advised on recently, and explain the challenges involved, your approach, and the outcome achieved for the client?

We recently acted as counsel in a highly unusual matter that illustrated the different ways in which the ordinary courts and arbitration may interact.

A company (“Company X”), which owed a debt to our client, was the defendant in ordinary court proceedings brought by a natural person seeking payment of a separate debt owed to him by Company X. During those proceedings, the claimant and Company X sought, without any legal basis, to draw our client into the pending litigation, including by attempting to obtain precautionary measures (injunctions) against our client’s assets.

To counter this situation, and relying on the arbitration agreement contained in our client’s contract with Company X, we commenced arbitration proceedings against Company X to obtain a binding determination of the parties’ respective rights and obligations. The arbitral tribunal ruled in our client’s favor. Company X filed an action for annulment of the award, which the competent court dismissed. We then invoked the res judicata effect of the award before the court hearing the ordinary proceedings between Company X and its creditor.

Beyond the particular features of the litigation between Company X and its creditor, the case was of special interest because it required us to analyze the scope of the res judicata effect of an arbitral award, including its effect in proceedings involving third parties, and the limits on a judicial authority’s power to review or disregard matters already decided in arbitration. The principal challenge was to demonstrate that, although the creditor was not a party to the arbitration, the court could not adopt measures against our client that contradicted the rights already determined in the award.

Ultimately, the outcome was favorable to our client in both the arbitration and the judicial proceedings: the award confirmed our client’s rights against Company X, and the court gave effect to the award, protecting our client from the attempt to involve it in a dispute to which it was a stranger. The matter also reinforced the principle that a valid arbitral award must be respected by the ordinary courts.