As the Reko Diq mining case between Australia and Pakistan continues, the High Court of the British Virgin Islands on 25 May gave orders to unfreeze the assets owned by Pakistan International Airlines that were attached in the matter in which Australian mining company Tethyan Copper Company (TCC) had claimed USD 8.5 billion for the revocation of a contract signed with Balochistan for its Reko Diq mines.
Along with reinstating these assets, the British Virgin Island high court also imposed a litigation cost of $5 million and a penalty of $50,000 on TCC. The case was initiated by TCC for the attachment of Pakistan’s assets, in which The Roosevelt Hotel in New York and The Scribe Hotel in Paris were attached.
Highlights:
- British Virgin Islands high court releases hotels owned by Pakistan in NYC and Paris
- Pakistan’s Balochistan province revoked mining contract with Australian mining company TCC, dispute lands in ICSID
- Award of USD 5.9 billion issued against Pakistan in 2020, TCC approached BVI high court to enforce it
TCC and Pakistan had signed an agreement in 1998 to mine copper and gold from Reko Diq mines in Balochistan’s Chagai district, renowned for its natural resource reserves. In 2011, Pakistan revoked the agreement citing lack of transparency.
Hasnat Malik, a senior Pakistani journalist has been following the Reko Diq case since 2012. He told SBS Urdu that the case is essentially a dispute between Pakistan and TCC.
“TCC claimed USD 8.5 billion in damages from Pakistan for rejecting its mining application in 2011. TCC then approached the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) to resolve the dispute,” he said.
ICSID ruled against Pakistan in July 2019 and an award of $5.9 billion was issued in the favour of TCC.
The BVI high court had through an ex parte order on Dec 16, 2020 attached the assets belonging to Pakistan International Airlines Investment Limited (PIAIL) Source: Spencer Platt/Getty Images
“In that case, the tribunal was of the opinion that Pakistan’s denial to mine copper and gold deposits by the Australian mining giant was unlawful and against the Australia-Pakistan bilateral investment treaty,” Mr Malik added.
To enforce the award money, TCC took the matter to the British Virgin Island High Court of Justice in November 2020 as Pakistan’s ownership of the hotels was registered via a company there.
Mr Malik added that while the Pakistan government is looking at this reinstatement as a “legal victory,” he is of the opinion that this judgment pertains to only the release of Pakistan’s assets and not the revocation of the award against it.
Local officials visit the gold and copper mine site, in Reko Diq district in southwestern Pakistan's Baluchistan province March 18, 2017. Source: AAP Image/AP Photo/Naseem James
He said that this development in the case might give Pakistan a temporary sigh of relief but in the long run, the dispute remains to be resolved.
“The law minister of Pakistan has already expressed his willingness to work on an out-of-court settlement with TCC, as this decision was just to release the assets from the current case but the original award still remains,” he elaborates.
The BVI high court released the assets and imposed $5 million cost and $50,000 penalty on the company. Source: Guilhelm Vellut/Public Domain
William Hayes, chairman of TCC’s board of directors, had stated that the company was willing to negotiate with Pakistan.
Pakistan has appealed for the annulment of the USD 5.9 billion award before ICSID and is waiting for a decision on that.
- Listen to Urdu Podcasts on Spotify Podcast, Apple Podcasts, Google Podcast, Stitcher Podcast
- Learn How to Bookmark SBS URDU's website or make it your home page.
- SBS Urdu is broadcast every Wednesday and Sunday at 6 PM (AEST).
- How to Listen
- COVID 19 Latest Updates in Urdu
- Install “SBS Radio” mobile app
