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ICSID rejects Karkey’s claim against Pakistan

Dawn, Pakistan

ICSID rejects Karkey’s claim against Pakistan

By Malik Asad

23 October 2013

ISLAMABAD, Oct 22: Giving official reaction to the claim of Turkish firm Karkey Karadeniz ElektrikUretim regarding release of a power vessel, a senior official in the Attorney General’s office on Tuesday said that the World Bank-affiliated International Centre for Settlement of Investment Disputes (ICSID) had rejected Turkish company’s Rental Power Project (RPP) Karkey claim against Pakistan.

He referred that the ICSID tribunal in its order on October 16 dismissed all requests for provisional measures by Karkey except temporary release of Turkish powership Kaya Bey that has been held up since April 2012.

The tribunal rejected company’s request for unconditional release of all four vessels, causing Pakistan to cease and desist from enforcing the judgment of the Supreme Court in the RPPs case, restraining Pakistan to cease and desist from making demands or taking action against Karkey and ordering that Pakistan release and unfreeze Karkey’s bank accounts, while suspending court proceedings initiated in Pakistan.

The only compensation the tribunal extended to Karkey is to consider its request that the Kaya Bey powership needed to undergo mandatory dry docking inspection in Dubai by 1 November 2013, otherwise it would lose its classification and flag-registry.

Accordingly, the tribunal allowed Kaya Bey, which is one of the four Karkey vessels, to temporarily sail to Dubai for the mandatory dry-docking where after it will have to return to Pakistan.

While allowing the temporary said of Kaya Bey, the tribunal emphasised that this is only a temporal suspension and that claimant will have the obligation to return the vessel as soon as it has compiled with the dry docking inspections and controls in Dubai.

The Karkey was asked to inform the tribunal and Pakistan on regular basis of all the steps taken in order to reach Dubai as soon as possible as well as of the progress of the dry docking inspection, the necessary repairs, the flag-registry and the class certification process.

The vessel is obliged to return to Pakistani waters once the inspection and any necessary repairs are finished and the arrest of other three vessels namely the Karadeniz powerbarge Alican Bey, the Enis Bey (Fuel Tanker) and the Iraq (Barge) remains in force, pursuant to the high court of Sindh order on May 28, 2013 and Karkey’s bank accounts remain froze, which covers the $128,135,897.

In a press release issued on Monday, Karkey Karadeniz ElektrikUretim welcomed the decision by the tribunal on October 16, 2013.

In the decision, the tribunal stated that the State of Pakistan shall grant all authorisations and clearance required for the vessel’s departure, and shall take any other action necessary or required to allow the vessel to depart lawfully into international waters.