Q: What is reqodik case?

The Reko Diq case began when Tethyan Copper Company (TCC) mining contract with the
Balochistan government was terminated by the Supreme Court, then headed by Iftikhar
Muhammad Chaudhry. The company had filed claims for damages worth $11 billion with the
international arbitration tribunal. The tribunal had found last year that suspension of the
agreement from the Balochistan and the federal government was unlawful. It then started
quantum hearing and ruled against Pakistan in 2017. Pakistan filed a counter-memorial, but the
case was once again decided against Pakistan. Pakistan had presented various other briefs and
evidence, which did not meet the requirements put forward. The tribunal had then said, "The
Tribunal cannot assume that Claimant [TCC] does not have the rights or remedies to which it
asserts it is entitled, including any right capable of enforcement by specific performance. To
make this assumption woul d be tantamount to deciding the merits of the case in respondent’s
favour based only on the evidence and argumentation that has been presented thus far.
Accordingly, for the purpose of deciding on the request, the Tribunal will assume that claimant
will succeed on these points, and turn its focus to the question of whether the circumstances in
the present case require that provisional measures be ordered for the preservation of the asserted
rights."

Pakistan at least twice made efforts for an out of court settlement that could not come to fruition
due to various reasons such as the ruling handed down by the Supreme Court, lack of consensus
amongst various stakeholders, and slow decision-making.

Pakistan had to bear millions of dollars burden in the case as three international law firms were
hired at different stages of the case. At the initial stage, the law firm Omnia owned by former UK
prime minister’s wife Sherry Blair was hired and $0.37 million was paid to the firm. At the
second stage UK based law firm Allen and Overy was given $17 million and on the third stage
American law firm GST was hired and $10 million was paid.

Q;how reqodik case proceeds….what was its current status?

The award in famous Reko Diq case handed down by International Centre for Settlement of
International Disputes (ICSID) has provided a fresh impetus to the seemingly endless debate on
limitations to be observed in the exercise of powers of Supreme Court under Article 184 (3) of
the 1973 Constitution of Islamic Republic Of Pakistan. Additionally, the issue has also gained
traction owing to the humongous amount of the award for nearly USD 6.00 Billion and its effect
on already depleting foreign exchange reserves not to mention the collateral damage.which may
result in form of depreciation of investor confidence in case Pakistan has to finally pay the
awarded amount.

The dispute in the Reko Diq case arose out of the non granting of mining lease to Tethyan
Copper Company Ltd (TCC), operating in Pakistan through wholly-owned subsidiary i.e TCCP,
which pursuant to novation agreement dated 1.4.2006 became party to the Chaghai Hills
Exploration and Joint Venture Agreement (CHEJVA) executed on 29.7.1993 with Baluchistan
Development Authority(BDA) for exploring copper and gold in the Reko Diq area of
Balochistan

The international tribunal which provides facilities for conciliation and arbitration of
international investment disputes, rendered its judgement on Friday — a 700-page ruling against
Pakistan in the Reko Diq case.

The ICSID awarded a $4.08bn penalty and $1.87bn in interest. The full details of the case are yet
to be released by the tribunal. Special assistant to the prime minister on information Dr Firdous
Ashiq Awan when contacted said the law ministry and the attorney general were looking into the
matter in light of international laws. She expressed the hope that the government would come up
with a formal reaction on Sunday (today). “This is what I can say right now,” she said.

The management of the Tethyan Copper Company (TCC) had claimed $11.43bn in damages.
The company had filed claims for international arbitration before the ICSID in 2012 after the
Balochistan government rejected a leasing request from the company.

What has been the role of WTO in it?

International court had imposed $1.2 billion damages in Karkey rental power case and $6.2
billion damages in Reko Diq case. Pakistan assets could be seized following damages imposed
on Pakistan, Minister for Energy Omar Ayub Khan said this while addressing a news conference
here.

The minister said that Pakistan would go into appeal against these decisions awarded against
Pakistan. He blamed previous governments for taking unwise decision that resulted in such
damages against Pakistan.

Besides, the country Pakistan faced a burden of Rs24 trillion debt due to failed policies of the
previous governments and added that people should know about those behind such heavy loans.

Independent Power Producers (IPPs) and other parties went into international court against
Pakistani government due to failed policies of previous governments. He said that assets of
Pakistan abroad could be seized if damages were not paid.

Responding to question regarding circular debt, he said that 88 percent energy payments were
being made to power produces and claimed to end entire circular debt in 2020. There had been
loadshedding when PTI government came into power. However, he said that all feeders were
operational now due to improvement in electricity supply and there is zero loadshedding in the
country.

Regarding payment of Rs1.5 billion to Rosch Power Plant on account of capacity charges, he
said that Economic Coordination Committee (ECC) during tenure of PML-N had approved it in
2017. He said that past government had also decided to run this power plant on LNG instead of
indigenous gas. He said that this plant was being run in line with merit order instead of ‘must
run’.

Khan said that there was no money to pay to IPPs during past government. He said that Rosch
Power had preferred local arbitrator whereas remaining eleven companies had gone to
international arbitrator. He said that government had to pay Rs14 to Rs15 billion to these
companies due to award given in favour of these IPPs in international court. He said that
government was making out of court settlement with the power companies to stop them from
going into international court.