Vivendi awarded EUR1.9b damages for Elektrim spat

24 Feb 2009

On 12 February 2009 the London Court of International Arbitration (LCIA) issued its final award in the dispute between French media conglomerate Vivendi and Polish firm Elektrim. The tribunal awarded damages of EUR1.876 billion (USD2.41 billion, plus accrued interest from February 2005) to Vivendi for intentional breaches by Elektrim of the investment agreement entered into in September 2001 regarding their joint venture Elektrim Telekomunikacja (Telco) and their investment in Polish wireless network operator Polska Telefonia Cyfrowa (PTC).

The final award follows a partial award made on 19 March 2008 which declared that ‘Elektrim breached the basic premise of the [investment agreement] by systematically acting against the interests of Telco in furtherance of its own interests and by refusing to acknowledge Telco’s right to the economic benefit of the PTC shares.’ All of Elektrim’s counterclaims against Vivendi have been dismissed. The confirmation of Telco’s ownership rights on the PTC shares is still pending before the Polish courts. According to the PTC website, its ownership at the end of 2008 was T-Mobile Deutschland (70.5%), T-Mobile Poland Holding No. 1 (22.5%), Polpager (4.0%), CARCOM Warszawa (1.9%) and Elektrim Autoinvest (1.1%).

Poland, T-Mobile Poland