Court orders Djibouti pay $385m to DP World venture

Djiboutian youths perform a traditional dance at the outset of DP World’s involvement at the Doraleh container terminal, in 2009. (Reuters)
Updated 04 April 2019
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Court orders Djibouti pay $385m to DP World venture

  • A London court ordered the government of Djibouti to pay Doraleh Container Terminal (DCT) $385 million plus interest for breach of its exclusivity over port operations
  • The terminal had been run by DP World, but Djibouti unilaterally canceled the contract

LONDON: An international court has ordered Djibouti to pay compensation to a venture part-owned by Dubai-based global ports operator DP World over breach of contract, the UAE government said on Thursday.
The London Court of International Arbitration ordered the government of Djibouti pay Doraleh Container Terminal (DCT) $385 million plus interest for breach of its exclusivity over port operations in Djibouti.
The Djibouti port operator DCT is 33.34 percent owned by DP World, and 66.66 percent by Port de Djibouti, an entity of the Republic of Djibouti.
The tribunal found that by developing new container port opportunities with China Merchants Holdings International Co., a Hong-Kong-based port operator, Djibouti breached DCT’s rights under a 2006 concession agreement to develop a container terminal at Doraleh, in Djibouti.
The terminal had been run by DP World, but Djibouti unilaterally canceled the contract. Under the 2006 agreement DCT had exclusivity over all container handling facilities in the territory of Djibouti.
Further damages are possible if Djibouti develops a planned Doraleh International Container Terminal, DICT, with any other operator without the consent of DP World, according to UAE state news agency WAM.
China Merchants also operates a $3.5 billion free trade zone it developed under an agreement with Djibouti, which the UAE government said was subject of other litigation proceedings.
The tribunal also ordered Djibouti to pay DCT $148 million for historic non-payment of royalties for container traffic not transferred to DCT once it became operational, WAM reported. Djibouti is also ordered to pay DCT’s legal costs.
The London tribunal, which follows four other substantial rulings in DP World’s favor, recognized that the 2006 concession agreement remains valid and binding.


India suspends Kashmir border trade with Pakistan

Updated 7 min 11 sec ago
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India suspends Kashmir border trade with Pakistan

NEW DELHI: India has suspended trade across its disputed Kashmir border with Pakistan, alleging that weapons and drugs are being smuggled across the route, as tensions simmer between the nuclear-armed neighbors.
Kashmir has been on edge since a February suicide attack that killed 40 Indian paramilitaries and brought the two countries to the brink of war with cross-border air strikes.
On Thursday, India’s government, which is in the middle of a tough national election, said it had reports that trade on the border was being “misused by Pakistan-based elements for funnelling illegal weapons, narcotics and fake currency.”
It also said many of those trading across the Line of Control, which divides Kashmir into zones under Indian and Pakistani control, had links to militant organizations.
The home ministry said trade would be suspended until a stricter inspection mechanism is in place.
The cross-border trade is based on a barter system, with traders exchanging goods including chillies, cumin, mango and dried fruit.
It began in 2008 as a way to improve strained relations between New Delhi and Islamabad, who have fought two of their three wars over the disputed region.
The Indian Express newspaper said Friday that 35 trucks carrying fruit traveling from the Indian side of the border had been stopped after the government order.
Trade on the border has been suspended before, including in 2015, when India accused a Pakistani driver of drug trafficking.
The latest move comes after India withdrew “Most Favoured Nation Status” — covering trade links — from Pakistan after the February attack, which was claimed by the Pakistan-based Jaish-e-Mohammed Islamist group.
Islamabad has denied any involvement in the attack.
India’s Hindu nationalist Prime Minister Narendra Modi has made national security a key plank of his re-election campaign, pointing to the recent flare-up of violence as he battles the center-left opposition Congress party.
He is seeking a second term from the country’s 900 million voters in the mammoth election which kicked off on April 11 and runs till May 19. The results will be out on May 23.