logo logo

Glencore awarded just $19 mln by tribunal in Colombia lawsuit

Reuters | 27 August 2019

Glencore awarded just $19 mln by tribunal in Colombia lawsuit

BOGOTA, Aug 27 (Reuters) - A World Bank tribunal has ordered Colombia to repay a $19 million fine it levied on Glencore’s coal mining subsidiary Prodeco but declined the company’s petition for $575 million in damages, the government said on Tuesday.

Prodeco is one of the largest coal miners in the Andean country, which is the world’s fifth-biggest exporter of coal.

Glencore had asked the World Bank’s International Center for Settlement of Investment Disputes to award it damages after Colombia’s national comptroller fined it the $19 million in January 2016.

The comptroller said the company had incorrectly calculated the royalties it should have paid on its Otrosi contract, revoking the agreement. The comptroller then fined Prodeco for not complying with the terms of the contract.

“The tribunal only ordered the return of the $19.1 million plus interest and rejected all of the other demands - confirming its confidence in the integrity and the institutions of the comptroller and Colombian judges,” Colombia’s national agency for judicial defense of the state said in a statement.

In its decision, the tribunal said the comptroller’s conduct in calculating the damage caused by the contract problems was “unreasonable” and had “impaired (Glencore’s) investment in Colombia.”

Colombia must also pay interest on the fine and reimburse the company for $1.69 million in legal expenses, the tribunal said.

Prodeco had no immediate comment.

(Reporting by Julia Symmes Cobb Editing by Leslie Adler)

 source: Reuters