International Law in Brief
ICSID Tribunal Orders Tanzania to Pay USD 185 Million in Damages to Standard Chartered Bank in Hong Kong
By: Justine N. Stefanelli | October 16, 2019 - 9:33am
On October 11, 2019, a tribunal of the International Centre for the Settlement of Disputes (ICSID) found the Government of Tanzania to be in breach of 1995 Implementation Agreement under which Tanzania made various undertakings and assurances in favor of Independent Power Tanzania Limited (IPTL), "including undertakings against discriminatory action and expropriation". Tanzania also "granted IPTL the exclusive right to design, finance, insure, construct, complete, own, operate and maintain" its facility in Tanzania. Tanzania also agreed to a guarantee to pay IPTL any unpaid costs owed to IPTL by Tanzania Electric Supply Company Limited (TANESCO) as a result of arrangements made under a separate Power Purchase Agreement in which IPTL agreed to delivery electricity to TANESCO for an initial period of 20 years. The tribunal found that Tanzania had violated the Agreement because it transferred control over IPTL to Pan Africa Power Solutions, a local company, and because Tanzania failed to honor the guarantee with respect to funds owed by TANESCO. Tanzania was ordered to pay USD 185 million in damages, plus interest.