The Government of Djibouti has illegally seized control of a terminal managed by Dubai Ports World-owned company at the Port of Doraleh in the country.
The seizure of Doraleh Container Terminal is the latest move in a long-running campaign to force DP World to renegotiate the terms of a 30-year concession that was signed in 2006.
The Doraleh terminal was designed and built and, has been operated since 2006, by a company owned by DP World under contract to the Government of Djibouti.
DP World began arbitration proceedings before the London Court of International Arbitration to protect its rights, and secure damages and compensation for its breach or expropriation.
In a statement issued last night by DP World, the company said the terms of the original agreement were described as “fair and reasonable” by the London Court of International Arbitration. The tribunal was led by Lord Leonard Hoffman and Sir Richard Aikens, both respected former English jurists, the statement read.
Since December 2017, the Djibouti Government has sought to use the law against the contract between DP World and Doraleh Container Terminal and the government.
“This effort culminated in a final demand that the contract be renegotiated by February 21, and the termination of that contract by Presidential Decree on Thursday and expropriation of all of the assets of Doraleh Container Terminal SA,” said DP World.
“We consider the law, the attempt of the Government to enforce its terms, the purported termination and expropriation to be in breach of the Government’s obligations under its agreements with us, in force since 2004, and international law,” the company said.
“Moreover, the government’s conduct is particularly oppressive and cynical. The government only recently failed in its attempts to unravel the contracts by alleging the contracts were corrupt both before the High Court of England and Wales and before an arbitral Tribunal in London, which dismissed the government’s allegations that the contracts were unfair in their entirety.
“To protect our interests, we have been compelled to commence a new arbitration on February 20 against the government in London, seeking a declaration that the contracts are valid and binding on the government and to obtain urgent interim relief.
“We demand that the government will cease its unlawful conduct and continue to work as partners with us in the same spirit of cooperation that has been in place for the last 18 years, which has yielded hundreds of millions of dollars of direct and indirect benefits to Djibouti and enhanced its attractiveness as a leading investment destination in East Africa.”
The National, UAE