Dar es Salaam. Canadian-based gold exploration company Winshear Gold Corp and the government of Tanzania have “successfully” concluded the settlement agreement in relation to the two’s dispute regarding the company’s SMP Gold Project in southwest Tanzania.
A statement released Monday indicated that the parties agreed on an amount of US$30,000,000, equivalent to Sh75 billion, to settle the case and terminate the arbitration proceedings.
The statement added that the Tanzanian government paid the money to the company on Monday, October 16, 2023. After payment of legal costs, the net amount to Winshear is approximately US$18,500,000.
Monday’s development comes barely a month since the parties suspended arbitration proceedings and reached a conditional settlement agreement.
Richard Williams, CEO of Winshear Gold, described the settlement as good for both Tanzania and Winshear, noting that he was pleased to reach a mutually acceptable conclusion to this matter.
“It is time for both parties to move on, and we wish Tanzania success in attracting new investment,” Mr Williams said. “The company sincerely thanks our legal team, Lalive, for their work preparing and presenting our case.”
Winshear Gold Corp. is a Canadian-based minerals exploration company advancing the Gaban Gold Project in the Puno region of Peru.
The evidentiary hearing between the company and the government of Tanzania commenced on February 13, 2023, in Washington D.C., where a three-person tribunal panel presided over the court hearings, which were expected to conclude on or before the close of business on Friday, February 17, 2023.
The company sued Tanzania over the decision by the latter to cancel the licenses of the former, which was operating the SMP Gold Project, located in southwest Tanzania.
Winshear’s licenses were cancelled immediately after the government amended the Mining Act 2010, whose regulations subsequently cancelled all Retention Licences, at which point they ceased to have any legal effect.
The government has removed Winshear’s ownership of the SMP Project, something that the company says by doing so, Tanzania breached its obligations to Winshear under the Canada-Tanzania Bilateral Investment Treaty (BIT) and international law.
Some of these include Tanzania’s obligation not to nationalise or expropriate the company’s investments or subject them to measures having an effect equivalent to nationalisation or expropriation without prompt, adequate and effective compensation under the BIT.
Another is Tanzania’s obligation to accord fair and equitable treatment and full protection and security to the company’s investment and not to impair by unreasonable or discriminatory measures the maintenance, use, enjoyment or disposal of the company’s investment under the BIT.
The International Centre for Settlement of Investment Disputes (ICSID) Convention has been ratified by 158 States, including Tanzania.
An award issued by an ICSID tribunal is enforceable in any of those 158 member States as if it were a judgment of one of their own courts.