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Published : 30 May 2024, 02:55 PM
The Appellate Division has upheld the status quo order on the transfer of Dhaka Elevated Expressway shares held by an Italian-Thai company to China’s Sinohydro Corporation Limited.
A full eight-member bench of justices led by Chief Justice Obaidul Hassan made the decision after a hearing on Thursday.
The order will remain in place until the first arbitration meeting is held between the Italian-Thai company and the Chinese company over the debt dispute, but afterwards there will be nothing blocking the transfer, lawyers said.
On May 16, the Appellate Division issued a two-week halt on the transfer of the shares.
Senior lawyer ABM Amin Uddin, Sheikh Mohammad Morshed and Imtiaz Faruk represented the Italian-Thai company while Advocates Mehdi Hasan Chodhury and Mostafizur Rahman Khan represented Sinohydro.
Mehdi said, “We told the court that work has stopped. The status quo order will be maintained until the day of the first meeting of the arbitration process. This means the status quo will not be in place after the first meeting, which means there will be nothing barring the transfer of shares.”
In 2013, the Bangladesh government gave a work order to the Italian development company to build the elevated expressway. But when they failed to start work, they formed a joint venture with two Chinese companies.
The three companies jointly took out the loan for the project. There was a condition that if any of the partners failed to pay the interest on the loan in January or June, that part of the interest would be paid to the other two guarantors and the shares of the company that failed to pay the interest would go to the rest. The Bangladesh government also approved the condition.
Mehdi Hasan had previously said that the Italian-Thai company failed to pay the interest on the loan in 2023. For that reason, when the Chinese bank that gave the loan wrote to the Italian company on Jan 23, 2024, they went to arbitration.
“In view of that arbitration, they filed a case in the High Court Division to stay the transfer of shares. The High Court dismissed the case as 'not acceptable'. Then they took the matter to the Appellate Division."
The main length of the Dhaka Elevated Expressway is 19.73 km. Including ramps, the total length will be 46.73 km. When the entire project is completed, there will be a total of 31 ramps for vehicles on the expressway.
Prime Minister Sheikh Hasina inaugurated the first section of the expressway on Sept 2 last year. The next day, the 11.5 km section of the airport from Kawla to Farmgate was opened to traffic. Later, the connecting road or down ramp to the Karwan Bazar (FDC) section was opened on Mar 19 this year.
The estimated budget for the project is over Tk 89.4 billion. The government is paying Tk 41.38 billion of the cost.
The Italian Thai Development Public Company Limited was to pay 51 percent, China Shandong International Economic and Technical Group 34 percent and Sinohydro Corporation 15 percent of the remaining cost.
