A decision by the government of Djibouti to apply to the country’s high court to rule all previous international adjudications null and void in the Doraleh Container Terminal case is “a complete disregard for and contravention of the global legal system and existing contracts” said DP World.
DCT, a Djibouti port operator owned 33.34% by DP World Group, and 66.66% by Port de Djibouti S.A., an entity of the Republic of Djibouti, was seized by the government of Djibouti in February 2018, but five subsequent rulings against the seizure by the London Court for International Arbitration (LCIA) and the High Court of England and Wales have been ignored by Djibouti, despite the original contract for the concession being written under English law.
“The move is proof of Djibouti’s complete disregard for recognized legal practice and respect for contracts calling into question any investment in the country both now and in the future,” said DP World.
In April, the Djibouti government was ordered to pay US$385m plus interest to DCT for breaching its exclusivity rights by developing container facilities at Doraleh Multipurpose Terminal.
Ruling on the case of DCT, an LCIA tribunnal found that by developing new container port opportunities with Hong-Kong based port operator China Merchants, Djibouti breached the rights of DCT under the 2006 Concession Agreement to develop a container terminal at Doraleh, in Djibouti, specifically, its exclusivity over all container handling facilities in the territory of Djibouti.
The Djibouti government awarded DP World a concession to design, build and operate Doraleh in 2006 and the terminal began operations in 2008. The tribunal’s award recognises that the 2006 Concession Agreement remains valid and binding, said DP World.
Litigation against China Merchants also continues before the Hong Kong courts.
