London court extends Djibouti injunction forbidding interference in port management
Djibouti government took control of Doraleh Container Terminal earlier this year from DP World
A London court has extended an injunction on the Djibouti government, forbidding it from interfering in the management of the Doraleh Container Terminal that was seized earlier this year from DP World.
The High Court of England and Wales in London extended the injunction, first made on August 31, to include all affiliates of the Djibouti’s port company, Port de Djibouti (PDSA), at DP World's request, the Dubai Government said in a statement on Sunday.
"The ruling means neither the government nor PDSA can control DCT or give valid instructions to third parties on behalf of DCT without DP World’s consent," said Dubai Government, which is the majority owner of DP World.
PDSA is majority owned by the Government of Djibouti and its chief executive is the chairman of the country’s Ports and Free Zones Authority. Hong Kong’s China Merchants is a minority shareholder in PDSA.
In February, Djibouti authorities abruptly cancelled the Dubai port operator’s contract to run the terminal and seized its facilities, which the port operator had designed, built and operated. A UK tribunal earlier ruled that Djibouti’s cancellation of DP World’s contract was unlawful. The operator called the seizure illegal.
The injunction, which was extended on September 14, states that Djibouti cannot act as if the joint venture with DP World has been terminated, cannot appoint or remove directors without the operator's consent or take action on terminal-related matters.
The London court ordered that the injunction continues until it makes a further order or an award of the ruling at the London Court of International Arbitration that will be formed "imminently" to consider the dispute.
“This is yet another in a series of rulings – all in favour of DP World – that demonstrate Djibouti’s continuing disregard for the rule of law, a DP World spokesperson said. "We underline our belief that companies intending to operate in such a country or already operating there need to seriously consider their dealings with this government in the face of such behaviour.”
The Dubai company is determined to continue to defend its rights as a shareholder in the Doraleh terminal and rejected an out of court settlement with the Djibouti government.
Updated: September 24, 2018 12:08 PM