Kuwait’s Agility receives new opportunity to arbitrate against Iraq

Kuwaiti logistics giant, Agility, has been granted a renewed chance to present its grievances before a fresh arbitration panel, facilitated by the International Center for Settlement of Investment Disputes (ICSID), concerning its investments within Iraq.

Previously, in 2021, Agility’s lawsuit seeking to recoup over $380 million in losses incurred in Iraq was dismissed by the arbitration panel under the ICSID, a subsidiary of the World Bank Group. Additionally, Agility was directed to pay upwards of $5 million to Iraq for associated legal expenses.

However, in a recent development, Agility disclosed through an official statement on Sunday that a committee within the ICSID had partially invalidated the earlier ruling, thereby accepting Agility’s appeal. Consequently, the Kuwaiti corporation revealed that the initial decision issued in 2021 had been partially rescinded, paving the way for Agility to restate its claims before the arbitration panel.

The genesis of this legal saga traces back to 2017 when Agility first petitioned the ICSID, alleging that Iraq had effectively expropriated investments totaling more than $380 million and contravened a bilateral agreement established in 2015 between Kuwait and Iraq, governing capital movement and investment between the two nations.

Specifically, Agility contended that Iraq had deprived both itself and its subsidiaries of the right to challenge a verdict handed down by Iraq’s Communications and Media Commission (CMC) in 2014. This verdict, according to Agility, annulled the company’s investment in Korek Telecom, an Iraqi Kurdish telecommunications company headquartered in Erbil.

With this recent development, Agility is poised to reassert its claims before the arbitration panel, potentially altering the trajectory of this protracted legal dispute that has spanned several years.