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Fighting with investors

28 7 0
14.09.2017

IN case you missed it, Pakistan just suffered a bit of a setback in its ongoing arbitration with the Tethyan Copper Company over the cancellation of its mining lease in Reko Diq when its request to disqualify one of the arbitrators on the World Bank tribunal was denied a few days ago.

It appears Pakistan was counting on dragging the case out long enough to force TCC into an out-of-court settlement, something that could still happen, and one key plank in that strategy was to keep raising doubts about the arbitrators appointed to the tribunal. That strategy is now at an end, and a new approach will have to be adopted if dragging the proceedings out is still the main game plan. Given that upwards of $10 billion, as per reported figures, is at stake in the damages claim, any ruling that goes against Pakistan is a significant milestone.

Some background first. The dispute went into international arbitration back in 2012 when TCC and its parent company, Antofagasta, decided to seek damages after Pakistani courts cancelled their mining lease for the copper and gold deposits at Reko Diq in Balochistan. The World Bank’s International Centre for the Settlement of Investment Disputes was chosen as the forum for seeking damages. ICSID rules say that, in such an event, a tribunal of arbitrators is set up where one person is nominated by the bank, and the parties to the case get to nominate one person each. Both parties have the right to question the other’s nominee and seek disqualification if they feel that the person selected is not fit to serve on the........

© Dawn