British Virgin Islands court unfreezes PIA offshore assets

PIA – Pakistan International Airlines (PK, Islamabad Quaid-e-Azam Int’l) has won a case at the High Court of Justice in the British Virgin Islands, the British overseas territory where it is incorporated, in a dispute between its shareholder, the state of Pakistan, and gold and copper exploration firm Tethyan Copper Company, Pakistani media reported on May 25. Tethyan had asked the court in December to enforce a USD5.97 billion award against Pakistan by the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) arbitral tribunal, granted in July 2019. That award related to Pakistan’s province of Balochistan refusing a mining lease to the company in 2011 to develop a USD3.3 billion mine at Reko Diq, resulting in Tethyan filing a case against Pakistan at the ICSID in 2012. The award’s enforcement was stayed in September 2019, a decision that was again extended a year later, prompting the miner to initiate proceedings to enforce the award in the British Virgin Islands – with the attachment of assets belonging to Pakistani institutions, including two PIA-owned luxury hotels, the Roosevelt Hotel in New York and the Hotel Scribe Paris Opéra by Sofitel. “Pakistan has won the BVI case initiated by TCC to enforce the ICSID award,” Pakistan’s International Disputes Unit proclaimed, adding that all ex-parte orders Tethyan had obtained had been set aside. Attorney-General for Pakistan Khalid Jawed Khan confirmed the ruling to the newspaper Dawn, adding that it was “a great legal victory for Pakistan and for Pakistan International Airlines.” Khan explained that the British Virgin Islands court had recalled all orders passed against PIA as it had no jurisdiction to decide the matter and that the costs of litigation had also been awarded.