ALMATY, JAN. 18 2016 (The Conway Bulletin) — An arbitration court in Stockholm ordered a Kazakh state- owned company to pay €22.7m ($24.8m) to Estonian construction company Windoor for reneging on a building deal in Astana.
The case is important as more and more infrastructure projects in Kazakhstan grind to a halt with the deepening economic slump.
In the Stockholm case, Windoor, which specialises in glass-aluminium structures, filed a lawsuit against state-owned Diplomat Stroi Servis for €18m ($19.7) after it failed to pay for work it had carried out on a conference centre.
In 2012, Windoor and Baltiiski Dom, a Kazakh construction company, agreed a deal to build a 40,000 square metres diplomatic conference centre behind the Kazakh ministry of foreign affairs.
In an interview via email with The Conway Bulletin, Mailis Lintlom, the Windoor chairman, said: “By early 2014, it became clear that the construction of the project was behind schedule and that Windoor would not be able to start the [installation] work of the facade at the agreed time.” In February 2015, in line with the worsening economy in Kazakhstan, Windoor was told that the project had been “frozen”, triggering Windoor’s arbitration action.
At the end of December 2015, the Stockholm court said Diplomat Stroi Servis, owned by the Economic Department of Kazakhstan’s ministry of foreign affairs, will have to pay a €4.7m premium on Windoor’s court claim.
A Kazakh court will have to enforce the payment and Windoor is still waiting for a judicial confirmation of the award.
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(News report from Issue No. 264, published on Jan. 22 2016)