Doraleh Container Terminal Deal Still in Force, DP World Says

Image Courtesy: DP World

Dubai-based port operator DP World insists that its concession agreement awarded by the Government of Djibouti to operate Doraleh Container Terminal remains in force despite Djibouti’s termination of the deal in February.

According to DP World, on February 22, 2018, the Government of Djibouti “unlawfully seized control of the terminal, forced DP World employees to leave the country and purported to terminate the concession agreement.”

Djibouti said the decision was triggered by the poor performance of the container terminal, and Doraleh Container Terminal Management Company has reportedly assumed management of the terminal since.

However, DP World said the claimed termination is invalid under English law, adding that the agreement remains in full force and effect.

“There have been reports that the Government of Djibouti is contracting with other companies to build and operate other port facilities in Djibouti in violation of DP World and DCT’s exclusivity rights,” the port operator said.

Namely, several reports surfaced saying Djibouti was in talks with CMA CGM on developing a new container terminal in the country, with an initial investment estimated to be worth USD 660 million.

When approached by World Maritime News CMA CGM said it was not making any comment on the matter.

In addition, at the beginning of March, Doraleh Container Terminal Management Company signed a contract with Singapore-based Pacific International Lines (PIL) with the aim of bolstering cargo volume at the terminal.

“Take notice that DP World and DCT are the lawful holders of rights in respect of the ownership and operation of the container shipping terminal at Doraleh, Djibouti, and will pursue all available legal recourse, including claims for damages, against any other entities that tortiously interfere or otherwise violate their rights with respect to the concession agreement,” DP World added.

Following the termination, DP World has launched a new arbitration case against the Government of Djibouti.

According to Aboubakar Omar Hadi, Chairman of the Djibouti Ports and Free Zone Authority (DPFZA), cited by Reuters, the port authority was ready to buy out the 33 pct stake in DCT from DP World in order to end the arbitration proceedings.

World Maritime News Staff

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