The International Chamber of Commerce will continue to seek a ruling in a row between the Beirut government and a local GSM operator despite a high court ruling that the case can only be heard in Lebanon, the mobile company said Wednesday, August 1.
The Paris-based arbitration court decision contradicted a July 18 ruling by Lebanon's State Council that denied international arbitration for the dispute with LibanCell, since the majority of its shares were Lebanese-owned. Finland's Sonera owns a 14-percent stake in LibanCell.
The ICC "rejected a request by the Lebanese government for ending arbitration measures (abroad) and has thus decided to continue the arbitration," said the LibanCell statement.
It did not specify the date of the ICC decision, but a LibanCell source later told AFP that the company had been informed of the arbitration court's decision on Monday.
LibanCell Chairman and General Manager Hussain Rifai said in the statement that "we are pursuing arbitration measures according to the conditions of the contract...and we are confident that the government will review its position regarding the arbitration."
"The State Council's decision ...has shaken the confidence of international investors and has raised many questions from foreign investors on whether the Lebanese government would breach other contract clauses previously signed with the private sector," he said.
The State Council — the country's highest judicial authority for administrative arbitrage — had then also ruled that another longstanding conflict between the government and France Telecom's Cellis unit will be resolved at a Washington-based special arbitration authority.
It said the dispute with Cellis, considered a foreign firm since 65 percent of its shares are owned by France Telecom, will be referred to the International Center for Settlement of Investment Disputes (ICSID), which is affiliated to the World Bank.
On June 14, the Lebanese government decided to tear up the 10-year Build-Operate-Transfer (BOT) contracts signed in 1994 with Cellis and LibanCell, who have been operating the country's GSM network.
Earlier this month, the government pledged to pay indemnities to the two companies. The Lebanese government has decided to auction off the lucrative cell phone licenses, giving the winning bidder a 20-year franchise. The bidding would also be open to Cellis and LibanCell.
A few years ago, Cellis and LibanCell started opposing government limits on the number of subscribers they could have and how much they had to pay the state for subsidiary GSM services not covered in the contracts. The government was asking each firm to pay $300 million to increase their subscriber numbers.
Contrary to what Cellis and LibanCell claimed, the government said the original contracts had a limit of 250,000 subscribers for each company. The government said the firms were operating a total of 800,000 lines. ― (AFP, Beirut)
© Agence France Presse 2001
© 2001 Mena Report (www.menareport.com)
