line | Peruvian State | After seven years the jury closes, what does the award say? | ICSID | economy

Ultimately the offer went in favor of the companyAccording to Kosabi, the arbitral tribunal compels the Peruvian government to pay compensation for three points: cost increases due to changes in the design of Metro's Line 2; economic construction damages; Compensation for financial damages, together with interest from December 31, 2018 till effective payment of such compensation.

“In this sense, considering the fact that our participation in the concession company and in the construction consortium of Metro Line 2 is a minority, we are waiting for the official calculations of the said companies to assess the impact that these compensations will create in the financial statements. From Kosabi”, The company added.

read more: Metro Line 2: MTC seeks to advance station work by Panamericanos.

What does the award mean? Management It was found that the document “Declares that the court has jurisdiction over all claims of the merchant”. Therefore, condemning the issuer (which is the Peruvian state) “The grantee shall pay an amount of USD 52,655,852.45 as additional cost due to the grantor's design change instructions”.

Further “Ordering the Issuer to pay the Grantee the following amounts for punitive economic damages: US$ 181,059,132.78; Euro 32,461,059.69; and S/ 27,594,283.55″.

In addition, the award condemns the grantors to pay S/ 84,700,000.00 in financial damages and losses for Metro de Lima Line 2.

read more: MEF targets five measures amid weak private investment

Interests

The award is payable to the Government of Peru at a rate equal to LIBOR+2% from December 31, 2018 until the date of payment of US$ 52,655,852.45. (Related to cost overruns due to grantor's design change mechanisms).

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It should be noted that Libor is the interbank rate of 16 major banks in London and unlike other reference rates, it is not a negotiable asset.

Simple interest equal to LIBOR+2% from the date of payment of penalties related to Engineering Courses (EDI) 1A-14 and 1A-17 to the date of refund in the amount of S/ 60,725.21. and S/ 146,150.

as well as interest at a rate equal to LIBOR+2% from December 13, 2018 to the date of payment of the relevant amounts for the remaining damages; and at a rate of interest equal to LIBOR+2% from 30 days from the date of this award to the date of payment of the sums relating to the expenses.

Cases against Peru at ICSID

It should be noted that Peru is one of the Latin American countries with the highest demand in ICSID. While the Lima Metro Line 2 arbitration has concluded, 21 other cases against the country are still pending.

























Pending cases at ICSID against Peru
Cases no. Plaintiff(s) Respondents) condition
ARB/23/37 TV Azteca SAB de CV and Azteca Communicaciones Perú SAC Peru earring
ARB/23/11 Titicaca SAC's ecological operator Peru earring
ARB/22/30 Bank of Nova Scotia Peru earring
ARB/21/65 Enakas International SLU Peru earring
ARB/21/60 VINCI Highways SAS and VINCI Concessions SAS Peru earring
ARB/21/57 Lima Metro Line 2, SA Peru earring
ARB/21/45 Peruvian Road Concessionaire – Covinca, SA Peru earring
ARB/21/41 Lima Metro Line 2, SA Peru earring
ARB/21/29 Galotti Metals & Logistics, LLC Peru earring
ARB/21/28 APM Terminals Callao SA Peru earring
ARB/21/10 Telefonica S.A Peru earring
ARB/21/1 Quanta Services Netherlands B.V Peru earring
ARB/20/46 Lubaka Gold Corp Peru earring
ARB/20/18 Road Development of the Andes SAC Peru earring
ARB/20/14 SMM Cerro Verde Netherlands B.V Peru earring
ARB/20/8 Freeport-McMoRan Inc. Peru earring
ARB/20/4 Odebrecht Latininvest S.à.rl Peru earring
ARB/19/19 IC Power Limited and Kenan Holdings Limited Peru earring
ARB/18/27 Guntur Vasi Airport Society SA and America Corporation SA Peru earring
ARB/18/26 ENAGÁS SA (Spain) and ENAGÁS International SLU (Spain) Peru earring
ARB/18/17 Autopista del Norte SAC Peru earring
Source: ICSID

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