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Miner files mega-claim against Congo

Global Arbitration Review | 7 June 2021

Miner files mega-claim against Congo

By Cosmo Sanderson

Avima Iron Ore has become the latest mining company to file for ICC arbitration against the Republic of the Congo over the revocation of its licences, claiming US$27 billion in damages.

The ICC claim was filed on 4 June, Saint Kitts and Nevis-registered Avima announced today.

Avima is represented by a Clifford Chance team led by Paris partner Simon Greenberg and has appointed French King & Spalding partner Laurent Jaeger as its arbitrator.

Counsel to Congo has not yet been identified. The state has been using French firms Jeantet and Cabinet Grossmann in similar disputes with two Australian mining companies, Sundance Resources and Equatorial Resources.

Avima, Sundance and Equatorial all had licences to mine adjacent areas at the Mbalam-Nabeba iron ore project, which straddles the boundary between Congo and Cameroon in central Africa. About two-thirds of the iron ore is in Congo and a third in Cameroon, with the railway that would have transported the iron ore to the Atlantic also being situated in Cameroon.

Late last year, Congo revoked all three companies’ licences and handed them to a little-known operator called Sangha Mining Development Sasu, which is backed by Chinese investment and is said to have no previous experience of mining in Congo.

In March, Avima sent a letter to the Congolese government demanding that its licence be restored or that the state pay for its losses. It said that the revocation was in breach of the state’s contractual obligations and constitution as well as international law.

Avima said that the removal of its licence amounts to an expropriation and “seems to have been carried out for the personal benefit of certain Congolese officials and complicit third parties.”

It also wants Congo to pay money that it says is still owed under their investment agreement.

In its press release today, Avima executive chairman Socrates Vasiliades accused Congo and its Minister of Mines of “stealing the property of others” and said there were many examples of investors who had been “lured into the country with the promise of government support and a stable legal framework only to discover they have been deceived”.

In March, Sundance made good on its threat to file an US$8.8 billion ICC claim against Congo over the revocation. Earlier this month, it also announced it had filed a related ICC claim against Cameroon. Both cases are being funded by Burford Capital.

Equatorial has also threatened arbitration against Congo through a Mauritian subsidiary, EEPL Holdings, under the Mauritius-Congo bilateral investment treaty.

Sundance and Equatorial are using a Clifford Chance team led by partner Sam Luttrell in Perth.

Avima v Republic of the Congo

Tribunal

  • Laurent Jaeger (France) (appointed by Avima)

Other arbitrators still to be appointed

Counsel to Avima

  • Clifford Chance

Partner Simon Greenberg, senior associates Alexis Foucard and Marie-Isabelle Delleur and avocat Alix de Zitter in Paris

Counsel to Congo

Unconfirmed

Sundance Resources v Congo

Counsel to Sundance

  • Clifford Chance

Partner Sam Luttrell in Perth

Counsel to Congo

  • Jeantet

Thierry Lauriol in Paris

  • Cabinet Grossmann

Kevin Grossman in Paris

Sundance Resources v Cameroon

Counsel to Sundance

  • Clifford Chance

Partner Sam Luttrell in Perth

Counsel to Cameroon

  • Jeantet

Thierry Lauriol in Paris

  • Cabinet Grossmann

Kevin Grossman in Paris

Equatorial Resources v Congo

Counsel to Sundance

  • Clifford Chance

Partner Sam Luttrell in Perth

Counsel to Congo

  • Jeantet

Thierry Lauriol in Paris

  • Cabinet Grossmann

Kevin Grossman in Paris


 source: Global Arbitration Review