London Court of International Arbitration (LCIA) Orders Djibouti to Pay DP World $385

The London Court of International Arbitration (LCIA) has ordered Djibouti to pay DP World US$385 million plus interest for breaking the 2006 Doraleh Container Terminal (DCT) concession agreement.

According to the Government of Dubai, the tribunal, which has already ruled against Djibouti four times in this case, has found that the East African state developed new container port opportunities with China Merchants Holdings International Co. (China Merchants).

The case goes back to Djibouti’s expulsion of DP World from the DCT in February 2018 and attempted termination of the 50-year concession agreement.

In July 2018, Djibouti then unveiled the $3.5 billion Djibouti International Free Trade Zone (DIFTZ) which was largely backed by Beijing through China Merchants

An LCIA judgment in August 2018 ruled that the concession agreement remained in force and that Djibouti’s actions were illegal.

Speaking about the latest development, the government of Dubai said: The Tribunal’s Award recognizes that the 2006 Concession Agreement remains valid and binding, as has also been confirmed by another LCIA arbitration tribunal and the London courts.

“This is the fifth substantial ruling in DCT and DP World’s favour on disputes relating to the Doraleh terminal.

“DCT and DP World continue to seek to uphold their legal rights in a number of legal fora, following Djibouti’s unlawful efforts to expel DP World from Djibouti and transfer the port operation to Chinese interests.

“Litigation against China Merchants also continues before the Hong Kong courts. DP World has previously issued public notices, following the confirmation of the validity of the 2006 Concession Agreement in a judgment in 2018, warning others against interfering with its and DCT’s concession rights.