MTD Capital wins case against Chile
The Daily Edge, Kuala Lumpur, 28 May 2004
MTD Capital Bhd has won in its legal dispute against the government of Chile in respect of its investment in a housing project in the country.
In a statement yesterday, MTD Capital said the International Centre for Settlement of Investment Disputes in Washington DC had ruled in favour of its wholly owned MTD Equity Sdn Bhd and MTD Chile SA and ordered Chile to pay damages of US$5.87 million (RM22.31 million) plus interest.
The MTD Capital units had invested about US$17.5 million in 1996 and 1997 in a real estate project 40km south of Santiago on the understanding that Chile would grant all the necessary regulatory approvals. Chile subsequently refused to grant the approvals on grounds that the project was contrary to government policy.
MTD Capital said the hearing of the arbitration was completed in December 2003 after which the arbitral tribunal unanimously decided that Chile had breached its obligations under the Bilateral Investment Treaty.