12th June 2023, Kathmandu
Axiata Group Berhad and Ncell Axiata Limited have confirmed the receipt of an arbitration award from the International Centre for Settlement of Investment Disputes (ICSID) in relation to their dispute with the Federal Democratic Republic of Nepal.
The arbitration proceedings were initiated by Axiata Investments UK Limited, a subsidiary of Axiata, and Ncell, regarding Nepal’s conduct towards Ncell following Axiata UK’s acquisition of an 80% shareholding in the company in 2016.
The tribunal overseeing the case rendered an award on June 9, 2023, dismissing the claims made by Axiata UK and Ncell.
The Award also instructs Nepal to abstain from demanding any additional tax, fees, penalties, or interests related to the transaction.
Due to Nepal’s non-compliance with tribunal orders during the early stages of the process, the country has been ordered to make certain payments.
Axiata UK is set to receive approximately USD 1.4 million, while Ncell will be reimbursed for the cost of a loan it took out. Neither Axiata UK nor Ncell is required to make any payments under the Award.
Axiata Group respects the decision of the Tribunal and is seeking advice from legal advisors regarding the Award.
The company will provide further updates as significant developments arise from the matter.
Axiata acknowledges the International Centre for Settlement of Investment Disputes and all participants involved in the proceedings and intends to maintain constructive engagement with the Government of Nepal.
Axiata and Ncell have played a significant role in Nepal’s socioeconomic development. As the country’s largest taxpayer, Ncell has contributed NPR 283 billion in taxes and fees since its establishment, up until the last fiscal year.
Ncell has also been instrumental in creating over 25,000 direct and indirect job opportunities and providing telecommunication services to more than 16 million customers.
Additionally, Ncell has invested over NPR 1.75 billion in various social projects focused on education, health, and the environment, as part of its corporate social responsibility efforts.
Despite the arbitration proceedings, Ncell remains fully committed to serving its customers and supporting the people of Nepal.
