The fourth claim of Agrofert Holding against PKN ORLEN dismissed by the Court
The fourth and largest claim of Agrofert Holding a.s. brought against PKN ORLEN S.A. in Czech arbitration proceedings has been dismissed by the Court.
The Court of Arbitration at the Economic Chamber of the Czech Republic and the Agrarian Chamber of the Czech Republic dismissed the fourth arbitration claim brought by the Czech company Agrofert Holding a.s. against PKN ORLEN S.A. in connection with the privatization of Unipetrol. The judgment of the Court of Arbitration is final.
The statement of claim filed by Agrofert Holding a.s. against PKN ORLEN S.A. requested the payment of compensation in alleged damages totalling 19,464,473,000 CZK (approx. 3,144m PLN according to the average exchange rate of CZK as of 3 November 2010) which, according to the claimant, was caused by unfair competition, damage to the goodwill of Agrofert Holding a.s. and/or the intentional failure to perform certain agreements signed by PKN ORLEN S.A. and Agrofert Holding a.s. in the years 2003-2004.
The allegations submitted by Agrofert Holding a.s. in this proceeding were not only dismissed in their entirety by yesterday's Court decision but Agrofert Holding a.s. was also obliged to cover costs incurred by PKN ORLEN S.A.
- The decision of the Court of Arbitration is consistent with the position of the Management Board of the Company from the outset of this dispute – that the agreements signed by PKN ORLEN S.A. and Agrofert Holding a.s. were performed by PKN ORLEN S.A. to the extent of the applicable legal requirements and the best interests of PKN ORLEN S.A. This is an important decision which allows us to accelerate the realization of our strategic plans concerning the development of our business in Czech Republic - commented Mr Jacek Krawiec, CEO of PKN ORLEN S.A.
This decision is another success of PKN ORLEN S.A. following the dismissal by Czech Court of Arbitration on 30 June 2009 of two other claims filed by Agrofert Holding a.s. As a result, PKN ORLEN S.A. has now succeeded in three of the four arbitration proceedings initiated by Agrofert Holding a.s. Under the virtue of various Court decisions, 90% of the total damages claimed by Agrofert Holding a.s. from PKN ORLEN S.A. in arbitration proceedings have been held to be unsubstantiated.
The Prague Office of Hogan Lovells acted for PKN ORLEN S.A. in all four arbitration proceedings held before the Czech Court of Arbitration.
