International court orders Tanzania to pay $22 million as compensation to Italian investor

A six-man strong team of legal experts from the government of Tanzania has failed to rescue the taxpayers’ money amounting to 50.6 billion Tanzania Shillings (USD 22 million) from being dished out to an Italian investor as a compensation following an international court ruling.

The investor, Sunlodges Tanzania Limited which is registered in Tanzania, is also listed in offshore jurisdiction – in British Virgin Island (BVI) – filed the dispute in Italy and Tanzania in 2001 citing that the government of Tanzania had illegally breached the contract between the two parties.

Immediately after the award which was made on April 30, 2021 by the permanent Court of Arbitration (PCA), the Italian investor attempted to seize three aircrafts that were purchased by Tanzania and which are the in final stage to be delivered in the East African country.

Three aircraft, paid for upfront by the government under President John Magufuli, are still in Canada. SAUTI KUBWA has leant that the amount has been paid to the investor.

Tanzania’s Minister for Constitution and Legal Affairs Prof. Palamagamba Kabudi was asked over this court award, and he immediately said; “where did you get this information, who gave you this, go and ask him, I don’t know anything you are talking about.” He hanged up the phone.

The dispute involved claims that arose following the government’s alleged seizure of the claimants’ cattle farming land at Mikindani area in Mtwara Region in order to build a cement works and a power station.

SAUTI KUBWA knows that the investment arbitration with case number 2018-09 was filed with the initial claim amounting to USD 30 million, but only 22 million was awarded by the court.

In the case, Tanzania was represented by highline law experts from the government including, Dr. Clement Mashamba, the then Solicitor General of the United Republic of Tanzania; George Nathaniel Mandepo, Director of Litigations & Arbitration, Attorney General’s Chambers; Vicent Tangoh, Assistant Director of Arbitration, Attorney General’s Chambers; Michael Luena, Director of Legal Services Ministry of Lands; David Zacharia Kakwaya, Principal State Attorney, Attorney General’s Chambers and; Cresencia Lubuva, State Attorney, Attorney General’s Chambers.

Sunlodge Tanzania Limited was registered in Tanzania in October 01, 1997 and given registration No.: 32742. The investor bought a huge land for farming and agricultural activities in Mikindani.