$170 million judgment debt hangs on Ghana: As last-minute attempt proves futile

An attempt by the Republic of Ghana to appeal against a US $164 million judgment debt awarded to the Ghana Power Generation Company (GPGC) Limited by a  London-based United Nations Commission on International Trade Law (UNCITRAL) Tribunal for the unlawful termination of its electricity contract has proven futile.

In February 2015 under the John Mahama Administration, Ghana signed a contract with the Ghana Power Generation Company (GPGC) at an initial amount of US$ 24.9 million per annum over four years. Thus amounting to US$99.6 million to provide a fast-track power-generation solution.

The Akuffo-Addo administration after taking office in 2016, expressed concern about what it described as “substantial excess” capacity and its effects on the public purse.

It, therefore, had several engagements with the GPGC especially on the movement of the power plant from Aboadze in the Western Region to Kpone in the Greater Accra Region.

However, on February 18, 2018, the GPGC deal was terminated by the GoG based on the Attorney General’s recommendations.

After what the GPGC described as the unlawful cancellation of its contract to produce electricity in 2018, they settled on international arbitration.

It must be noted that the United Nations Commission International Trade Law (UNCITRAL) Tribunal arbitration process started on August 20, 2018, and ended on January 26, 2021, and all correspondence of the Republic of Ghana was through emails and letters.

Furthermore, it is a fact that even the hearing of the arbitration was done virtually in October 2020 due to the COVID-19 upsurge.

The former Attorney General, Gloria Akuffo was the leader of Ghana’s 22- man arbitration team, with the current AG, Godfred Yeboah Dame inclusive.

After failing to apply and set aside a January 26, 2021 decision of the United Nations Commission International Trade Law (UNCITRAL) Tribunal, Ghana rather turned up later at a Commercial Court in London to offer reasons for its failure to act earlier citing the 2020 General elections and COVID-19 as impediments to its action.

John Beechey, a former President of the International Criminal Court’s Arbitration chaired the three-member Arbitration Tribunal. Prof.Albert Fiadjoe, a Ghanaian academic was the co-chair.

The Tribunal upheld the claims of the Power-Producing Company and thus awarded a cost of about US$170 million including interest against Ghana.

Additionally, the Tribunal awarded US$614,353.86 as tribunal’s cost and an amount of US$3 million in favor of GPGC as legal fees spent during the arbitration.

The tribunal dismissed Ghana’s basis for the termination of GPGC’s contract and indicated that the Power Generation Company had a building permit for the Blue Ocean Site issued on August 15, 2017, by the Kpone-Katamanso District Assembly.

It further dismissed the Ahenkora Committee recommendation and described it as lacking enough grounds for concluding that the GPGC was entitled to only $US18 million as early termination fees.

The Government of Ghana had 28 days to challenge the Tribunal’s decision under U.K law but the country appeared in court exactly three days to the expiration of the above number of days to ask for an extension.

Omnia Strategy, a British law firm representing the Government of Ghana, made a case for 56 days extension.

At this point, March 8, 2021, was set by the court for the Government of Ghana to file its processes challenging the earlier Tribunal decision in January however the Government of Ghana filed on April 1, 2021.

Another British firm, Volterra Fietta was instructed at this time to commence the process.

According to Volterra Fietta, Ghana’s new Attorney General was only sworn in on March 5 and they received 10 days later that date an instruction to represent the country.

Notwithstanding, the court presided by Justice Butcher ruling on June 8, 2021, described the above excuses by the Republic of Ghana as unreasonable and “intrinsically weak” and further described Ghana’s delay in commencing the process as “significant and substantial.”

Additionally, the Judge noted that the huge sum of money awarded in the Arbitration is not enough ground for the appeal process to be delayed.