A World Bank court ordered Colombia to reimburse a fine of $ 19.1 million that it imposed on Prodeco, a Glencore mining subsidiary, but rejected a claim for damages from the company for $ 575 million, the government said Tuesday.
View of the Glencore office building in Baar, Switzerland. / Via REUTERS
Reuters | Nelson Bocanegra
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Prodeco is the third largest coal producer in the South American country, the fourth largest fossil fuel exporter in the world.
Glencore had asked the International Center for Settlement of Investment Disputes of the World Bank to recognize damages after the General Comptroller of Colombia imposed a fine of $ 19.1 million in January 2016.
The Comptroller's Office argued that the company incorrectly calculated the royalties that it should have paid for an addition to a contract, revoking the agreement. The control agency later fined Prodeco for not complying with the terms of the contract.
"The Arbitral Tribunal only ordered the return of $ 19.1 million, plus interest and rejected all other claims confirming the confidence in the integrity and institutionality of the Comptroller and Colombian judges," said the National Agency of Legal Defense of the State in a statement.
"The effectiveness of the State's legal defense strategy reduced the economic claims claimed by Glencore by 97%," he added.
In its decision, the court said that the Comptroller's conduct in calculating the damage caused by the contract problems was an unreasonable measure that hurt Glencore and Prodeco's investment in the South American country.
Colombia must also pay interest on the fine and reimburse the company $ 1.69 million in legal expenses, according to the court.
Prodeco said in a statement that it was important that the dispute had been resolved and that they hope to continue developing its long-term investments in Colombia.
The company, which operates the Calenturitas and La Jagua mines in the north of the country, produced 11.7 million tons of coal last year.