31 May 2017

Ethiopia: Sabir Argaw Sees Significant Gains in Court Fighting Wilmar

Sabir Argaw has won a milestone ruling over his business partners, Wilmar, after judges at the Federal High Court passed a verdict yesterday, that they have the jurisdiction to litigate the case.

Sabir, a major shareholder and managing director of AL-SAM Plc, and his Singapore based partners, Wilmar Europe Holdings BV, Wilmar Edible Oils BV and Wilmar Resources PTE Ltd, fight over a 370 million Br dispute, after their fallout on their joint venture in Repi-Wilmar Detergent S.C.

The two parties have been fighting in a court of law since February 2017, following a dispute over a possible buyout of shares held in the company by Sabir. Represented by Million Assefa, Sabir filed a legal suit demanding for an enforcement of the buyout allegedly agreed before. The two parties created a joint venture company pledging to setup 14 factories in agro-processing, with a projected investment of seven billion Birr. The total asset of the company was valued by a consultant to have reached over 740 million Br.

The defendants argued in their response that the court has no jurisdiction to litigate the case for the parties had agreed to take their dispute to an international body of arbitration. Their lawyer, Mesfin Tafesse, has also pleaded to the Judge that the plaintiff has no "cause and effect" to establish, claiming the communications of the two companies was conducted only via email and there was no contract.

During a session held yesterday, May 30, 2017, the Presiding Judge of the Ninth Civil Bench, Ashenafi Yirga, rejected the preliminary objections of the defendants, establishing its jurisdictions to review the case.

The Judge has also ruled that the Court cannot decide whether the case does not have a cause and effect at this level of the litigation, and rather after preceding the case. It is adjourned for June 28, 2017.

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