The International Chamber of Commerce’s (ICC’s) International Court of Arbitration has awarded damages to affiliates of Kuwaiti Logistics firm Agility over allegations of corruption and fraud relating to the expropriation of Agility’s investment in Iraq mobile provider Korek Telecom. Agility announced that the court had found Korek Telecom and its controlling shareholder Sirwan Barzani liable and awarded damages totalling USD1.65 billion to Iraq Telecom Limited (ITL) and International Holdings (a subsidiary and an affiliate of Agility, respectively).
Agility Vice Chairman Tarek Sultan said of the ruling: ‘We hope that this outcome brings resolution and closure to the issue and that the respondents will now honour their obligations in a manner commensurate with that of businesses operating in countries that respect the rule of law.’
TeleGeography’s GlobalComms Database notes that ITL – a joint venture between Agility and France’s Orange Group – acquired a 44% stake in Kurdistan-based telco Korek Telecom in March 2011 but the Communications and Media Commission (CMC) ordered the purchase annulled in mid-2014, and in March 2019 the CMC confiscated the stake. Agility and Orange have disputed the seizure in local and international courts and several lawsuits are understood to be ongoing. As part of earlier legal proceedings, the pair accused Korek’s directors of mismanagement and misappropriation of millions of dollars of the company’s funds, and of paying bribes to CMC officials.
As previously reported by CommsUpdate, the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) rejected one claim from Agility in early 2021 on the grounds that the dispute pre-dated the bilateral investment protection treaty upon which the claim was based.