Thursday, 10 January 2013
UK oil firm Tullow Oil sues Ugandan government in tax dispute
It has emerged that the Ugandan government are being taken
to court by a UK-based oil giant named Tullow Oil, a firm with extensive
interests across Africa. The dispute, which will be heard in an international
court based in the United States, relates to tax imposed on goods and services
Tullow paid for during its work in Uganda. The case was filed at the World
Bank-created International Centre for Settlement of Investment Disputes
(ICSID), which could have serious ramifications for the Ugandan government if
it loses the case; if found in breach of trade and investment agreements signed
with the UK (where Tullow is based), the World Bank could sanction Uganda.
Somewhat controversially, Tullow is being represented in the court case by a
Ugandan law firm, Kampala Associated Advocates (KAA), the founder of which
(Elly Karuhanga) is the president of Tullow Uganda. Furthermore, one of KAA’s
partners, Peter Kabatsi was the solicitor-general of Uganda from 1990 to 2002,
a tenure during which he may have negotiated agreements with foreign oil firms,
thus presenting a massive conflict of interest - a claim that Kabatsi denies.
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