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23 December, 2019 12:46:38 AM / LAST MODIFIED: 23 December, 2019 03:55:03 PM

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Telenor accuses Bangladesh of breaching treaty

legal notice over GP-BTRC 1,2580cr audit dispute
STAFF REPORTER, Dhaka
Telenor accuses Bangladesh of breaching treaty

An allegation has been levelled that Bangladesh has breached its treaty obligations under international law over the arbitration to resolve the Tk. 1,2580-crore audit dispute between the country’s largest mobile operator Grameenphone and the Bangladesh Telecommunication Regulatory Commission (BTRC).

The allegation of the breach of laws has been brought against Bangladesh in a legal notice sent by Telenor Group, the main shareholder of GP, to President Abdul Hamid seeking arbitration to resolve the Tk. 1,2580-crore audit dispute between the operator and BTRC.

“If no amicable settlement is reached within six months from the date of this notice, which is sent to Bangladesh on October 14, 2019, Telenor Asia reserves the right to initiate the International Centre for Settlement of Investment Disputes (ICSID) under Promotion and Protection of Investment Treaty (2004) between Bangladesh and Singapore, the arbitration, without further notice to Bangladesh,” stated the legal notice.

The Independent has obtained a copy of the notice in the meantime. The notice was served by Hong Kong SAR-based law firm Allen & Overy. In the legal notice, Grameenphone’s parent company Telenor alleged that it wrote to the President over various actions and omissions of Bangladesh, particularly the BTRC, which amount to serious breaches of its obligations under the treaty and have caused significant damage to Telenor Asia’s investment and will cause further damage, if Bangladesh’s present course is not immediately altered.

The dispute arises out of unlawful and increasingly hostile action taken by the BTRC against GP since at least 2011, which resulted is a significant adverse impact on Telenor Asia investment in Bangladesh, the notice asserted.

“Despite continued communications from GP reiterating the flaws in the scope and methodology adopted in the 2015 audit and seeking an amicable resolution of the matter, on April 2019, the BTRC issued a demand letter claiming payment of BDT 84,940,104,730 (72.9 per cent of which comprises interest) as well as a further sum of BDT 40,859,371,405 allegedly owed by GP to NBR,” the notice said.

The notice also said, “The 2019 demand claims sums allegedly payable to the NBR, despite the fact that the BTRC does not have the authority to claim any sums on behalf of the NBR and that such claims are either sub-judice or have already been settled with the NBR.”

The 2019 notice demand is based on allegations pertaining to periods going as far back as 22 years, when the relevant limitation period for the claims made under most of the audit allegations have long since expired. The majority of the claims and the vast majority of the claimed amount are plainly time-barred as a matter of Bangladeshi law by the applicable limitation periods, the notice explained. The 22-year-long back dispute is highly prejudicial to GP as there are inevitably instances where GP is no longer in a position to defend itself properly due to the passage of time, giving rise to serious natural justice concerns.

The BTRC’s failure to raise the issue and the claims in a timely manner means that the claims are now also barred by the doctrine of laches, estoppels and waiver, Telenor noted. Bangladesh has breached its treaty obligations, namely to create favourable conditions for investment under Article3 (1), the obligation to grant fair and equitable treatment under Article 3 (2) and 4 (1) (2), the obligation to grant most-favoured nation treatment under 4(1), and the obligation to refrain from unlawful exportation under Article 5, the notice stated.

Bangladesh is obliged to compensate Telenor Asia for all losses suffered by reason of its breaches of its treaty obligations, the notice added.

Telenor invested a huge amount of money in Bangladesh’s leading mobile operator GP, which was protected under the agreement between the government of the Republic of Singapore and the government of the People’s Republic of Bangladesh for the treaty for the promotion and protection of investments of 2004. It sent the legal notice, saying that its investment faced significant damage due to the unlawful actions and omissions by the BTRC.

Despite repeated frenetic effort of GP to settle the dispute through amicable discussion and appointing arbitrator but the telco’s efforts went in vain and finally the Bangladeshi court also refused to appoint the arbitrators in response to GP’s petition.

AG’s reply to Telenor notice

Attorney General Mahbubey Alam on November 17 this year in replying to the legal notice said that GP has already filed a case with the court to settle the dispute, which is now pending before the Supreme Court for final disposal.

The AG also said that this is for kind information and record that the country’s apex court has already delivered an interim order over the matter in the meantime and kept it pending for final disposal.

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Editor : M. Shamsur Rahman

Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

Editor : M. Shamsur Rahman
Published by the Editor on behalf of Independent Publications Limited at Media Printers, 446/H, Tejgaon I/A, Dhaka-1215.
Editorial, News & Commercial Offices : Beximco Media Complex, 149-150 Tejgaon I/A, Dhaka-1208, Bangladesh. GPO Box No. 934, Dhaka-1000.

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