The most relevant updates from Middle East and Africa from the global International Arbitration and ADR practice group at Garrigues.
Egypt obtains stay of enforcement of a US$ 2 billion award in favor of Unión Fenosa
The U.S. District Court for the District of Columbia has granted Egypt’s request to stay proceedings of enforcement of a US$ 2 billion ICSID award brought by Unión Fenosa Gas, S.A. (UFG) against the state.
The U.S. court has decided to pause UFG’s efforts to enforce the award until the petition for annulment of the award filed by Egypt before the ICSID is resolved.
The award derived from a gas supply dispute between Egypt and UFG –a joint venture between Spain’s Naturgy and Italy’s Eni–, regarding the Damietta natural gas liquefaction plant in northern Egypt.
French court refuses to allow Iraq to revive a US$ 1.3 billionICC claim filed 30 years ago
The French Court of Cassation has issued a ruling rejecting Iraq’s request to set aside the ICC award issued in 2006 dismissing Iraq’s US$1.3 billion claim against the Italian Fincantieri Cantieri Navali Italiani (Fincantieri) and Finmeccanica over an agreement signed in 1980 regarding some contracts concluded by the government of Iraq with those companies.
Specifically, Fincantieri and Iraq concluded an agreement for the delivery of several warships and assistance in the construction of a shipyard, whereas Finmeccanica signed a contract for the delivery of missiles and ammunition for the ships.
These companies fulfilled part of their contracts, but had to suspend outstanding deliveries as a result of sanctions imposed by the UN Security Council against Iraq in response to its invasion of Kuwait.
In 1992, Iraq filed a US$ 1.3 billion ICC claim against the Italian companies seeking reimbursement of the advances it had paid them and damages for wrongful termination. This claim was declared inadmissible on the grounds that a 1992 European Economic Community regulation prohibiting the satisfaction of Iraqi claims relating to the 1990 sanctions had not been expressly repealed, even though the UN sanctions against the country were lifted in 2003.
Iraq sought to set aside the award before the Paris Court of Appeal on the grounds that it was vitiated by a denial of justice and contravened international public order, but the French court has understood that none of the alleged exceptions applied and denied Iraq’s claim.
Cairo court sets aside billion-dollar award against Libya
The US$ 1 billion award won in 2013 by al-Kharafi –a Kuwaiti construction company– against Libya has been set aside by a Cairo court, after two previous failed attempts to annul it by the state which had been dismissed by the Egyptian Court of Cassation.
The claim filed in 2011 by al-Kharafi was based on the 1980 Unified Agreement for the Investment of Arab Capital in the Arab States.
Specifically, the dispute concerns a contract that al-Kharafi signed in 2006 with the Libyan tourism development authority to transform a suburb of Tripoli into a tourist hotspot on the Mediterranean coast. The project included the construction of a five-star hotel, a shopping mall, apartments and restaurants.
During the construction, Kuwaiti company workers allegedly suffered several assaults by Libyan police and some people claiming ownership of the land on which the project was being developed. These assaults led the state to propose to the company to develop the project on an alternative plot, which the company refused to do. As a result of these disagreements, in 2010 the government of Libya put an end to the project.