POLAND: 2008 REPORT ON INVESTMENT DISPUTES AND

UNCLAS WARSAW 000687

SENSITIVE
SIPDIS

STATE FOR EB/IFDD/OIA HGOETHERT, EEB/IFD/OIA KBUTLER, L/CID
GSWINEY & CHOLLAND

E.O. 12958: N/A
TAGS: ECON EINV KIDE PL
SUBJECT: POLAND: 2008 REPORT ON INVESTMENT DISPUTES AND
EXPROPRIATION CLAIMS

REF: STATE 43784


1. (U) In response to reftel, post provides the following
information, in the format requested in reftel para. 15.


2. (U) Post is aware of two (2) claims of U.S. Claimants
that may be outstanding against the Government of Poland.


3. (SBU) (A). Claimant designation: Claimant A.
(B) Approximate year dispute arose: 2003.
(C) Case history: In 1995, Claimant A, an American company,
invested in a sugar substitute production facility, which
opened in May 2001. In late 2001, the Polish government
implemented a national production quota on sugar substitutes.
Then in EU accession discussions, the Polish government
agreed to an even lower quota on sugar substitutes within the
EU. These quotas limit the ability of Claimant A to utilize
its investment. In February 2003, Claimant A notified the
Polish government that it would seek international
arbitration under Article 3 of the UNCITRAL rules. In Spring
2008, the arbitration panel determined that Claimant A was
entitled to a monetary award, with interest. Claimant A is
awaiting a response from the Polish government regarding when
the Polish government will either seek an appeal or satisfy
the arbitral decision.


4. (SBU) (A) Claimant designation: Claimant B.
(B) Approximate year dispute arose: 2003.
(C) Case history: In 1999, Claimant B began construction of
an import/export facility on land leased from a
Polish-government controlled port authority. After several
investors withdrew from the project, construction halted in

2003. The port authority refused to pay Claimant B for work
accomplished. Claimant B found a potential buyer to take
over the project, but the sale fell through because, Claimant
B alleges, of the port authority's actions. In 2005, the
Polish Arbitration Court determined that Claimant B owed the
port authority arrears, and declared that the land lease
remained in effect. In 2006, the lease was terminated. In
February 2008, Claimant B filed a counterclaim with the
Polish Arbitration Court, seeking US$75 million-$US180
million in damages. That case is still pending.


5. (SBU) This paragraph contains business proprietary
information, and is not for public release. Post has no
information to indicate that either Claimant A or Claimant B
has signed a Privacy Act waiver. As reported in prior years,
Claimant A. is Cargill. Claimant B is Europort, a
Canada-U.S. consortium. All shares of Europort are owned by
Renaissance Trust LP and Dessaport International
Corportation. Renaissance Trust LP is owned by U.S. citizen
Joseph D'Andrea.
Min