Mexico wins jurisdiction ruling in Cyrus Capital investment dispute

An arbitral tribunal has ruled that it lacks jurisdiction in the case of Cyrus Capital Partners, L.P. and Contrarian Capital Management, LLC v. United Mexican States. The decision, rendered on July 30, 2026, in ICSID Case No. ARB/23/33, determined that the claimants could not bring claims against Mexico under Chapter 11 of NAFTA or Annex 14-C of the USMCA.

The dispute originated from debt securities issued by the Mexican television company TV Azteca, S.A.B. de C.V. The claimants, acting as investment managers within fund structures, alleged that a September 2022 Mexican court injunction preventing the enforcement of these notes constituted a denial of justice and a breach of the minimum standard of treatment under NAFTA.

The tribunal upheld two preliminary objections: that Cyrus Capital Partners and Contrarian Capital Management did not qualify as “investors” under NAFTA, and that they did not hold a “legacy investment” as defined by the USMCA. The ruling establishes a distinction between managing an investment and owning or controlling it for treaty purposes.