The People’s Committee of Binh Thuan province in central Vietnam has recently won a lawsuit initiated in 2011 by a US firm which asked for a US$3.75 billion compensation after its project in Vietnam was revoked a year earlier.
The ruling also forced South Fork to pay the costs of legal services and arbitration.
This is the first time regarding an international investment issue that the Vietnamese side emerged triumphant as judged by the international arbitration council, said a representative of International Legal Department under the Vietnamese Ministry of Justice at a meeting yesterday on the achievement of the local justice sector in 2013.
South Fork’s tourism project revoked
In early 2004, South Fork was licensed by the Vietnamese Ministry of Planning and Investment for an investment of a 600-hectare tourism project in Hoa Thang Commune in Bac Binh District, Binh Thuan Province.
For the first phase of this project, Binh Thuan province had allocated over 330 hectares for South Fork and asked the US company to complete allocating necessary capital in Vietnam within 3 months.
According to the deal between the two parties, if there was sufficient capital but the project investor failed to implement the project over the next 5 months, the project’s license would be revoked.
When checking the progress of the project in mid-2010, the provincial authorities found that the US investor had yet to take any move in realizing the project.
But before that, in July 2007, the province had licensed a local miner, Duong Lam Co, for a titanium mining project in an area covering 120 hectares inside the area allocated for South Fork.
This license was based on a memorandum of understanding between South Fork and Duong Lam Co.
The project by South Fork was later revoked in mid-2010.
South Fork hired US law firm Dardene & Boyd to complete procedures of international arbitration proceedings in September 2010.
| At the conference, Le Thanh Long, Deputy Minister of Justice, said the ministry resolved 37 out of 82 cases in 2013. The state paid VND38.5 billion ($1.8 million) as compensation in 2013, up 500% compared to the average rate in 2010-2012. |
Vietnam’s province wins $3.7 bln case lodged by US investor Related image(s)
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