Egypt’s government has reached a settlement deal with the largest steel producer in the world, ArcelorMittal in London.
On behalf of the Egyptian government, Ahmed Abdel Razek, chairman of the Industrial Development Authority (IDA), has signed the settlement agreement with Lakshmi Mittal, chairperson of ArcelorMittal, in the presence of Egyptian Minister of Investment Dalia Khorshed.
As pursuant to the settlement agreement, the arbitration lawsuit, filed by the company against the Egyptian government 18 months ago before the World Bank-affiliate Centre for Investment Dispute Resolution, has been annulled.
ArcelorMittal demanded in its lawsuit that the government would pay $600 million to compensate for company losses and its payment of licensing fees as well as lands.
The Committee for Settlement of Investment Contract Disputes, headed by the prime minister, has tasked the technical secretariat of the committee, headed by assistant to the Minister of Justice Mustafa El Bahbity, to carry out the negotiations of the settlement with ArcelorMittal.
Investment Minister and the technical secretariat have conducted several rounds of talks with the company in order to reach the friendly agreement, which according to the Egyptian government only repays what the company has paid before, including the value of licensing and lands, in instalments within a year.
Based on the settlement, ArcelorMittal has waived the lawsuit against the Egyptian government.
“The settlement emphasises the Egyptian government’s keenness to end all disputes with investors in a friendly manner so as to encourage them and give a boost to the investment climate in Egypt,” said Minister Dalia Khorshed.
She added that the Egyptian government is willing to overcome any obstacles before investors, solve problems, protect their rights, and provide friendly efficient mechanisms for investment disputes settlement to send investors, foreign and local, a message of reassurance to support their confidence in Egypt’s investment climate.
Earlier in 2008, ArcelorMittal won a licence to build a plant to produce three tonnes of iron pallet for 340 million Egyptian pounds.
The Ministry of Investment’s statement did not give further details on the amount to be reimbursed by the Egyptian government to ArcelorMittal.
Over the past few months, the Egyptian government managed to reach friendly settlements in three major international arbitration cases, including ArcelorMittal, Kuwait Gate Holding, and Italian ASA International.
ArcelorMittal S.A. is a Luxembourg-based multinational steel manufacturing corporation headquartered in Boulevard d’Avranches in Luxembourg. It is the world’s largest steel producer, and is ranked 108th in the 2016 Fortune Global 500 ranking of the world’s biggest corporations.
