A SUBSIDIARY of Philippine container terminal operator International Container Terminal Services Inc. (ICTSI) has finally reached a settlement on the dispute with its lessor in the Georgian port of Batumi.
Arthur Tabuena, ICTSI treasury director and head of investor relations, said in a disclosure to the Philippine Stock Exchange (PSE) on Monday that differences between ICTSI subsidiary Batumi International Container Terminal LLC (BICT) and its lessor Batumi Sea Port Ltd. (BSP have been settled in an amicable manner.
“After executing a standstill agreement, the parties settled their differences in an amicable manner which led to the execution of the Settlement Agreement,” it said.
ICTSI said that following the settlement agreement, BICT and BSP subsequently withdrew their claims and counterclaims before the London Court of International Arbitration (LCIA).
The withdrawal of the claims and counterclaims between the two parties led to the termination of the arbitration proceedings.
BICT has been operating a multipurpose container terminal and dry cargo and ferry terminal in the Black Sea Port of Batumi, Georgia under a lease agreement entered into with BSP in 2007.
The lease was issued by virtue of a concession agreement entered into by ICTSI with Batumi Port Holdings Limited (BPHL), which had management rights over BSP.
However, in 2011, BPHL was bought out by JSC KazTransOil group, gaining control over BSP. After the buyout, BSP sent a notice of alleged violation of the terms and conditions of the lease agreement by BICT.
BICT formally responded, disputing the allegation.
In 2013, BICT filed a request for arbitration with the LCIA to settle the dispute in accordance with the dispute resolution mechanism under the Lease Agreement. BICT will also apply for an injunction against BSP in the local courts of Georgia.
ICTSI, a publicly listed company on the PSE, was incorporated in 1987 to operate, manage and develop the Manila International Container Terminal (MICT)
As of December 2014, ICT was involved in 29 terminal concessions and port development projects in 21 countries worldwide.
These are 24 operating terminals in eight key ports in the Philippines; two in Indonesia; one each in Brunei, Japan, China, the United States, Ecuador, Brazil, Poland, Georgia, Madagascar, Croatia, Pakistan, India, Mexico, Honduras and Iraq; four ongoing port development projects in Argentina, Colombia, Congo and Australia; and a sub-concession agreement to develop, manage and operate a port in Nigeria.