Turkish textile company loses $700 million lawsuit to Uzbekistan

On October 10, 2024, the Arbitration Tribunal of the International Center for Settlement of Investment Disputes (ICSID) announced its decision on the international arbitration case initiated against the Republic of Uzbekistan by the company "Bursel Tekstil Sanayi Ve Diş Ticaret A.Ş." (Turkey) and citizens of the Republic of Turkey (Bursel Company). This was reported by the Ministry of Justice.

The Arbitration Tribunal in the case, the amount of which amounted to approximately 700 million US dollars, rejected all claims of Bursel Company and ordered them to reimburse the arbitration costs of the Uzbek side.

The arbitration case began in July 2017 at the initiative of Bursel Company and lasted almost 7 years. The Turkish company claimed that the Uzbek government had failed to fulfill its promises to sell cotton at reduced prices and exempt exports from value-added tax. According to the plaintiff, this led to the bankruptcy of the company.

According to the rules of arbitration, the decision of the arbitration tribunal is final and binding.

It is noted that the interests of the Republic of Uzbekistan in the arbitration case were protected by the Ministry of Justice of Uzbekistan and the international law firm White&Case (USA).

Bursel Tekstil Sanayi Ve Diş Ticaret A.Ş. is a Turkish textile company that invested in the textile industry of Uzbekistan in the early 2000s. In particular, it participated in the project to build a textile factory in Tashkent, financed by the OPEC Fund for International Development and the European Bank for Reconstruction and Development (EBRD). In 2011, it had three factories in Uzbekistan. Read 'Zamin' on Telegram!