The administration of Venezuelan President Hugo Chavez faces new demands for compensation worth at least $600 million at the World Bank after companies rushed to present their claims before the South American nation pulled out of the arbitration system.
Spain’s Valle Verde Sociedad Financiera SL and Barbados- based companies Blue Bank International & Trust Ltd and Transban Investment Corp. filed separate claims to the bank’s International Centre for Settlement of Investment Disputes, said DLA Piper LLP, the law firm representing the investment firms.
Venezuela’s government officially requested to leave the Washington-based ICSID on Jan. 25 after being a member since 1993, and companies faced a July 25 deadline to file new suits. The court was already considering more than 20 claims filed by companies against Venezuela, stemming mainly from the seizure of private assets by the state.
“These cases have been in gestation for a long period of time,” Miami-based DLA Piper partner Pedro Martinez-Fraga said today in a telephone interview from Miami. “The decision to file, sometimes it’s precipitated by knowing that you won’t have that remedy anymore.”
Valle Verde, which had a stake in the Casa Propia Entidad de Ahorro y Prestamo lending and savings bank shut down by Chavez last year, is seeking $200 million in compensation at the ICSID, Martinez-Fraga said. Transban, which imported luxury BMW and Mini Cooper automobiles into Venezuela, is seeking about $100 million after currency controls implemented by Chavez forced the company out of business, he said.
Blue Bank, which had a stake in a venture to develop the iconic Humboldt hotel and cable car on the Avila mountain in Caracas that was taken over by the government, is seeking as much as $300 million.
Chavez said on Jan. 27 that Venezuela won’t accept any rulings from the arbitration court.
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