Classifieds powered by Gulf News

DP World warns of legal action against Djibouti

Ports operator says concession deal with government still in force

Image Credit: AFP
The Doraleh Multi-Purpose Port in Djibouti. The government of Djibouti in late February 2018 illegally seized control of the container terminal from DP World.
Gulf News

Dubai

DP World on Thursday warned of legal actions it could take against the government of Djibouti following the opening of the first phase of a free-trade zone in the African nation.

The Dubai-based ports operator reiterated that its concession agreement with the government of Djibouti for the Doraleh Container Terminal remains in force. It said that the government’s seizure of the facility does not give the right to any third party to violate the terms of the deal.

DP World spokesperson said in a statement that the port operator “reserves the right to take all available legal actions, including claims for damages against any third parties that interfere or otherwise violate its contractual rights.”

“This is yet another clear example by the Djiboutian government of violating its contractual obligations and the rights of foreign investors,” the spokesperson said.

The statement comes after the opening of the first phase of the Chinese-built International Free Trade Zone, a move DP World described as being in violation of its “exclusive management rights.”

This also comes after the government of Djibouti in late February 2018 illegally seized control of the container terminal from DP World, which said its employees were forced leave the African country. DP World said the government appeared to terminate the concession deal.

In mid-March, at a press conference, the head of DP World described the government’s actions as “unfortunate” and “illegal”. “For Africa as a continent, this action [by Djibouti’s government] is going to set them back. If countries can change their policies, it is going to make it more difficult to attract investments in Africa in general. Banks will be very careful in financing in Africa,” Sultan Bin Sulayem, DP World Group chairman and chief executive officer, had said.

The company said it has commenced an arbitration case against the Government of Djibouti before the London Court of International Arbitration and is waiting for the outcome.

Loading...