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Chavimochic III: Odebrecht loses again US$118.5 million lawsuit with the Peruvian State

Chavimochic III: Odebrecht loses again US$118.5 million lawsuit with the Peruvian State

The First Permanent Commercial Chamber of the Superior Court of Justice of Lima rejected the annulment of the arbitration award that, in October 2022, ended the concession contract for the III stage of chavimochicin La Libertad, signed between the Peruvian State and the concessionaire of the same name, made up of the companies Novonor, exOdebrecht, and Aenza, exGraña and Montero.

The concessionaire considered that there had been defects in the process that paralyzed the irrigation project since December 2016, for which reason it risked a lawsuit to annul the partial award on February 17.

It is the ordinary way. According to the arbitration rules of Peru, if any of the parties is not satisfied with the award, they can go to the Judiciary requesting its annulment, but only for issues related to the form, but not to the substance.

With this new ruling from the First Permanent Commercial Chamber, the award that put an end to the controversy with the Peruvian State remains firm, and all that remains is to proceed with its execution.

“The Chamber has resolved in accordance with what we expected, because the claim for annulment filed by the concessionaire had no basis. In this sense, the award has been validated, with which it is now firm and there is no act that can be interposed to execution,” he said to The Republic the attorney of the Ministry of Agrarian Development and Irrigation (Midagri), Katty Aquize Cáceres.

In 2016, the concessionaire had tried to appeal to ICSID, but its request was rejected. For this reason, and under the rules of the United Nations Commission for Commercial Law (Uncitral), the arbitration has been heard in an ad hoc international court since 2017.

Since then, Midagri has made progress in the execution of the award regarding the points that were not again in dispute (remember that this is a partial claim). For example, he continued with the evaluation of the new form of contracting to complete the Palo Redondo dam.

That is why, last week, Midagri and the Foreign Ministry publicly participated in the launch of the “International Call for the Adjudication Process of the Chavimochic III Stage Special Project”, which will be developed under the government-to-government (G2G) format.

“This ruling is positive for our country, because it has prevented us from disbursing US$118.5 million and preventing the concessionaire from continuing with the work, which would have meant a much higher expense for the Peruvian State,” Aquize sent.

Source: Larepublica

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