Dubai Ports Authority loses Long Dispute with Djibouti

Djibouti –Sudanhorizon

A British international court issued a final ruling that could not be appealed once again, against DP World, which had sought billions of dollars in compensation from a Djibouti company following the Djibouti government’s decision to terminate its contract with the the UAE company, deeming it incompatible with its national sovereignty.

The Djibouti government welcomed the arbitration award issued on September 29, 2025, by the London Court of International Arbitration, stating that it represented a legal setback for DP World before the court competent to hear such disputes.

The Djibouti government noted that the court’s decision was final and could not be challenged and considered it a significant victory for the Republic of Djibouti and the Port of Djibouti Public Company (PDSA) in their dispute with DP World.

The statement emphasized that in this case, DP World had unjustifiably demanded nearly one billion US dollars in compensation from the Port of Djibouti Public Company, allegedly related to the Republic of Djibouti’s termination of the Doraleh Container Terminal concession in February 2018.

The arbitrator confirmed that the Port of Djibouti Public Company, a private legal entity, had no connection to the termination of the concession. It stated that the termination was a sovereign decision by the Republic of Djibouti, and the company was not liable for the “losses” claimed by DP World.

The British international court ruled that DP World’s claim was unfounded and dismissed it in its entirety. The court also ordered DP World to pay all arbitration costs and reimburse the Port of Djibouti for its defense costs of $1.85 million.

The Government of Djibouti stated in a press release issued on Tuesday and published on its X (formerly Twitter) account in French that the decision represents “a reaffirmation of the legitimate rights of the Republic of Djibouti, and undermines the strategy of DP World, which is based on arbitrary legal proceedings and media pressure against the Djiboutian government and companies operating in the national port sector.”

The press release further stated that the Government of Djibouti reiterates its position, which it has stated repeatedly: a direct agreement between DP World and the Republic of Djibouti, one that guarantees mutual interests and the state’s sovereignty over its strategic infrastructure, is the only way to resolve the commercial dispute with DP World.

The saga began in October 2006 when Djibouti and Doraleh Container Terminal (DCT) signed a concession agreement, under which DCT undertook to build, develop, and operate a container port. DCT is a joint venture in which DP World holds a share. DP World was not a party to the agreement, but it granted DCT certain rights, including revenue collection rights, sales tax exemptions, and shareholder protection. The agreement included an arbitration clause stipulating that any dispute would be resolved according to the rules of the London Court of International Arbitration. Djibouti found certain provisions of the agreement incompatible with its sovereignty and requested its renegotiation.

In December 2017, Djibouti terminated the agreement, took control of the port, and expelled DP World from Djibouti.

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