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[size=35]World Bank body dismisses Agility's claims against Iraq[/size]
By [size=16]Reuters Staff
4 MIN READ
DUBAI (Reuters) - Kuwaiti logistics company Agility’s claim to recover more than $380 million it said it lost in Iraq has been rejected by an international tribunal, a document seen by Reuters showed.
Agility, one of the largest Gulf logistics companies, was also ordered to pay Iraq more than $5 million for costs related to the case.
The company filed for arbitration in 2017 with the International Centre for Settlement of Investment Disputes (ICSID), which is part of the World Bank Group and handles disputes between international investors.
Agility has said Iraq indirectly confiscated its investment, which was worth over $380 million, and violated a 2015 bilateral protocol between Kuwait and Iraq on encouraging the movement of capital and investment between the two countries.
Agility said Iraq denied the company and its subsidiaries the ability to challenge a 2014 decision by Iraq’s National Communications and Media Commission (CMC) to annul Agility’s investment in Korek Telecom, an Iraqi mobile phone operator.
CMC’s decision was based on Korek’s not meeting conditions related to improving its services and expanding coverage, a source in the Iraqi prime minister’s office said, asking not to be named.
The World Bank body tribunal on Monday dismissed Agility’s claims, and ordered the company to pay Iraq nearly $5.2 million to cover fees related to the case, the document, a copy of the tribunal’s final decision, said.
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If it does not do so within 30 days, Agility must pay Iraq interest at the six-month U.S. dollar rate of LIBOR plus 2%, as of the time of the decision, on any outstanding amount, compounded semi-annually.
In a statement on Tuesday, Agility called ICSID’s ruling “fundamentally flawed” and said it was considering its options to apply for the decision’s annulment.
Iraq’s government said in a statement it was delighted with the outcome.
In its statement, Agility said it was pursuing claims of more than $700 million directly against Korek, one of its top executives and others through a separate arbitration pursuant to International Chamber of Commerce rules.
CMC’s CEO Ali Khwildi and the Iraqi source said the amount claimed by Agility neared $800 million.
Korek had no immediate comment.
Agility’s position was that Iraq “failed to accord (Agility’s) investment fair and equitable treatment when it prevented the claimant access to the administrative court proceedings in Iraq to challenge the CMC,” the document said.
It also said the World Bank tribunal said it has no jurisdiction on whether the CMC’s order was lawful.
Agility said the tribunal made its decision “without investigating or considering evidence of corruption by key members of Iraq’s Communications and Media Commission (CMC).”
“The ICSID tribunal has sent the message - not only to the Republic of Iraq, but to the international community of civilised nations - that states can expropriate investments without providing compensation to their foreign investors,” Agility said in its statement.
Iraq’s government said Agility’s response was unfair.
“Agility continues to have other business interests in Iraq which are successful. Therefore, a bad commercial investment decision on its part should not be extrapolated to criticise the Iraqi investment climate,” it said in its statement to Reuters.
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By [size=16]Reuters Staff
4 MIN READ
DUBAI (Reuters) - Kuwaiti logistics company Agility’s claim to recover more than $380 million it said it lost in Iraq has been rejected by an international tribunal, a document seen by Reuters showed.
Agility, one of the largest Gulf logistics companies, was also ordered to pay Iraq more than $5 million for costs related to the case.
The company filed for arbitration in 2017 with the International Centre for Settlement of Investment Disputes (ICSID), which is part of the World Bank Group and handles disputes between international investors.
Agility has said Iraq indirectly confiscated its investment, which was worth over $380 million, and violated a 2015 bilateral protocol between Kuwait and Iraq on encouraging the movement of capital and investment between the two countries.
Agility said Iraq denied the company and its subsidiaries the ability to challenge a 2014 decision by Iraq’s National Communications and Media Commission (CMC) to annul Agility’s investment in Korek Telecom, an Iraqi mobile phone operator.
CMC’s decision was based on Korek’s not meeting conditions related to improving its services and expanding coverage, a source in the Iraqi prime minister’s office said, asking not to be named.
The World Bank body tribunal on Monday dismissed Agility’s claims, and ordered the company to pay Iraq nearly $5.2 million to cover fees related to the case, the document, a copy of the tribunal’s final decision, said.
ADVERTISEMENT
If it does not do so within 30 days, Agility must pay Iraq interest at the six-month U.S. dollar rate of LIBOR plus 2%, as of the time of the decision, on any outstanding amount, compounded semi-annually.
In a statement on Tuesday, Agility called ICSID’s ruling “fundamentally flawed” and said it was considering its options to apply for the decision’s annulment.
Iraq’s government said in a statement it was delighted with the outcome.
IRAQI AVENUES
The tribunal’s decision hinged on the fact that the dispute predated the Kuwait-Iraq protocol and that Agility did not use all the legal avenues available in Iraq to challenge the CMC’s decision, the Iraqi source said.In its statement, Agility said it was pursuing claims of more than $700 million directly against Korek, one of its top executives and others through a separate arbitration pursuant to International Chamber of Commerce rules.
CMC’s CEO Ali Khwildi and the Iraqi source said the amount claimed by Agility neared $800 million.
Korek had no immediate comment.
Agility’s position was that Iraq “failed to accord (Agility’s) investment fair and equitable treatment when it prevented the claimant access to the administrative court proceedings in Iraq to challenge the CMC,” the document said.
It also said the World Bank tribunal said it has no jurisdiction on whether the CMC’s order was lawful.
Agility said the tribunal made its decision “without investigating or considering evidence of corruption by key members of Iraq’s Communications and Media Commission (CMC).”
“The ICSID tribunal has sent the message - not only to the Republic of Iraq, but to the international community of civilised nations - that states can expropriate investments without providing compensation to their foreign investors,” Agility said in its statement.
Iraq’s government said Agility’s response was unfair.
“Agility continues to have other business interests in Iraq which are successful. Therefore, a bad commercial investment decision on its part should not be extrapolated to criticise the Iraqi investment climate,” it said in its statement to Reuters.
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