Colombia Avoids Massive International Lawsuit Over Reficar Modernization
In a major victory for Colombia, the nation has been freed from a potentially crippling international judicial process that could have resulted in a hefty fine of over 700 million dollars. The lawsuit, filed by CB&I UK, was related to deficiencies in the modernization of the Reficar refinery.
According to Jhon Jairo Camargo, the director (e) of the National Legal Defense Agency of the State, the pressure on the investor led to the withdrawal of the lawsuit after it was demonstrated that serious faults were committed by the investor-builder in question.
The discontinuation of the investment arbitration comes after an arbitration tribunal ruled in favor of Refinería de Cartagena SAS over the CB&I group, awarding more than 1 billion dollars due to negligence during the execution of the project. Additionally, the Comptroller General of the Republic confirmed a ruling of fiscal responsibility for over 2.9 trillion pesos, sanctioning several individuals and contractors for the loss of public resources.
In response to these legal challenges, McDermott International, Ltd., the company controlling CB&I UK, announced a liability restructuring plan to avoid payment of the fines imposed by the courts. This decision followed allegations of a state-led effort to hold the company accountable for project overruns at the Cartagena Refinery.
CB&I UK’s request for a suspension of the investment arbitration was denied, leading to the ultimate discontinuation of the proceedings. This marks a significant victory for Colombia and highlights the importance of accountability and oversight in large-scale projects.
Source: El Tiempo
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