Fraport considers more legal moves over MNL airport

[Pieter C. 5]

Fraport Considers More Legal Moves Over Manila Airport

 

September 3, 2007

Frankfurt airport operator Fraport said it may apply for an annulment of a recent World Bank decision to dismiss its claim for more than USD$400 million in compensation over a Manila airport terminal project.

 

Fraport said only two out of three judges at the arbitration tribunal considered its involvement in the Manila project was not protected under a German-Philippine agreement and argued the court did not have jurisdiction for the case. The World Bank announced its decision earlier this month.

 

"Fraport currently believes that essential documents presented at the proceedings, as well as argumentations and other aspects submitted by Fraport, were not or insufficiently taken into consideration by the court," the company said.

 

"Therefore, Fraport's executive board is examining all legal options, including application for annulment," Fraport added in a statement.

 

A successful plea for annulment could lead to the arbitration procedure being restarted, Fraport said, reopening the possibility of winning more compensation from the Philippine government.

 

Fraport headed a consortium that built and was meant to operate the new terminal, which was designed to handle 13 million passengers a year and was originally set to open in late 2002.

 

The Philippine government seized the terminal in December 2004 in a contract dispute, triggering Fraport's compensation claim for USD$425 million plus interest via the World Bank.

 

Fraport received an initial USD$29 million payment from the Philippine government in September. Fraport wrote down all its investment in the project in 2001 and 2002.

 

(Reuters)