Dubai: DP World said on Tuesday it will continue to pursue all legal means to defend its rights as a shareholder in the Doraleh Container Terminal (DCT) in Djibouti.
The statement comes after the government of Djibouti ordered the nationalisation of the DCT immediately by issuing a presidential decree to that effect. The decree moves ownership in the Terminal from the Port de Djibouti SA to the government.
It also states that the government will name a new set of company officials to run the Terminal.
DP World responded, saying that the transfer of ownership appears to be an attempt to flout an injunction of the English High Court that restrained the Port de Djibouti from using its shares to take control of the Terminal.
Last week, the High Court of England and Wales issued a restraining order to stop the Port de Djibouti from terminating its deal with DP World to operate the port. The High Court also prohibited Port de Djibouti from removing directors appointed by DP World, hence the government’s move to transfer ownership away from Port de Djibouti.
“Investors across the world must think twice about investing in Djibouti and reassess any agreements they may have with a government that has no respect for legal agreements and changes them at will without agreement or consent,” a DP World spokesperson said.
The latest ruling by the English court was the third one on the Doraleh Container Terminal following two previous decisions from the London Court of International Arbitration that were also in favour of DP World.
In early August, the London Court of International Arbitration ruled that the Djibouti government’s seizure of control of the terminal from DP World was illegal. The African government refused to acknowledge the ruling, to which DP World said this means the government does not “recognise the international rule of the law.”
This all comes after the government of Djibouti in late February seized control of the Doraleh Terminal from a DP World entity that built and operated the terminal. Government-owned Port de Djibouti later gave operational control of the Djibouti Freezone to China Merchants Group in breach of DP World’s exclusivity rights.
DP World won a concession deal to design, build, and operate the container terminal in 2006. Under the deal, Djibouti’s government retains 67 per cent ownership of the terminal, while DP World owns 33 per cent.
— With additional inputs from AFP