Samaná port’s concession contract raised from US$10M to US$100M

SANTO DOMINGO.- The Dominican Government raised from 10 to 100 million dollars the concession contract for Samaná’s Arroyo Barril (Duarte) port, signed with the company Valley Forge Corporation for the project’s construction, newspaper Diario Libre reports.

The addendum 023/2008 modified the contract that dates from 2001 and has a 30-year period, was signed about three months between the Dominican Port Authority (Apordom), in name of the Dominican State and executives of the company.

It stipulates that the signature is also for the construction of the Pirate port, the extension and new construction of Arroyo Barril’s current footer, a passenger terminal, offices, preparation of the area, and the construction of a second pier next to the present one.

According to Apordom legal consultant Carlos Marmolejos, the variation was done at the investors’ request, who changed their tender of 100 million dollars, 90 million more than the commitment assumed in 2001.

The new signature was done, just like the original contract, without the Congressional approval and without calling for tender offers.


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Dominican Government to cancel Codacsa contract, finish Eastern Motorway

SANTO DOMINGO.- The Government will assume the works to conclude the Eastern Motorway once Congress terminates the contract with Codacsa, the company hired to build the road in 2001, said Public Works minister Victor Diaz Rúa Tuesday.

The official, after meeting with Senate Public Works Commission president Euclides Sanchez, said it’s not necessary to seek new tenders for the work.

Diaz said Codacsa, which has already taken the case to the International Arbitration Court in Paris, alleging breach of contract, has spent only the taxpayers’ money in the project.

He revealed that RD$1.6 billion have been spent in the project, and that the company has failed to meet the contract’s terms when it failed to materialize its pledged investment.

“The company doesn’t want that contract terminated because they have the best deal in the world, the decision to cancel is now in the hands of the senators and deputies,” Diaz said, adding that the contract signed in 2001 doesn’t correspond with the terms of the bidding Codacsa won in 1998.

For his part, Sanchez deplored that the company hasn’t reponded to the Senate’s invitation to defend their position. "They, in a discourteous manner didn’t attend the invitation, we already met with Public Works and once we receive the documents we’ll render a report to the Senate’s plenary session."


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Business Wire: Dominican Government loses court round in US$680M suit

SANTO DOMINGO.- An arbitration tribunal constituted under the France-Dominican Republic Bilateral Investment Treaty released an award last week ruling on the jurisdictional objections raised by the Dominican Republic in a claim brought by TCW and its parent company.

“The claim involves an investment in EDE ESTE, an electric distribution company in the Dominican Republic that serves approximately 600,000 customers and has 1,200 employees. The tribunal rejected the objections raised by the Dominican Government and allowed US$680 million in claims against the Republic to proceed to a final hearing and an award on the merits of the dispute,” Business Wire said.

“We are extremely pleased that the tribunal convincingly rejected the Government's position. This arbitration proceeding goes to the heart of the problems affecting the Dominican electric sector and the unstable legal and regulatory framework. By holding the Government accountable we hope to finally advance the prospect of having a reliable and efficient electric sector for our customers,” said R. Blair Thomas, president of EDE ESTE and group managing Director of TCW, quoted by the Web site.

“On March 15, 2007, TCW and its parent company initiated an arbitration under the bilateral treaty to resolve its allegations that the Republic's treatment of the investment in EDE ESTE has greatly diminished the value of EDE ESTE. The Republic raised objections to the jurisdiction of the tribunal to hear the claims under the Treaty. The Tribunal's decision rejected these objections and now the arbitration will proceed to a final hearing in 2009,” said Business Wire.

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