Why is AVZ Minerals Engaged in International Arbitration Proceedings?
Avz Minerals Limited
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Why is AVZ Minerals Engaged in International Arbitration Proceedings?

AVZ Minerals Limited, a mining company listed on the Australian Securities Exchange (ASX: AVZ) and the OTC market (OTC: AZZVF), has provided an update to its shareholders regarding ongoing international arbitration proceedings.

The company, along with its subsidiaries AVZ International Pty Ltd (AVZI) and Green Lithium Holdings Pte Ltd (GLH), as well as Dathcom Mining SA (Dathcom), has initiated these proceedings against the Democratic Republic of Congo (DRC) under the DRC's Mining Code and the Convention on the Settlement of Investment Disputes between States and the Nationals of Other State (ICSID Convention). The hearings are taking place at the International Centre for Settlement of Investment Disputes (ICSID) in Washington.

Purpose and Status of the ICSID Proceedings

The ICSID proceedings serve two main purposes for AVZ Minerals Limited:

Supporting Negotiations with DRC Government: One objective of these proceedings is to provide support to the company's ongoing negotiations with the DRC government.

Seeking Relief for Non-Compliance with Mining Code: In the alternative, AVZ Minerals Limited aims to seek relief related to the DRC government's failure to comply with the Mining Code regarding PR 13359 and the granting of a mining lease (PE) for the Manono Project.

Different Nature of These Proceedings

Fat Tail Holdings Pty Ltd (Fat Tail), in its statements on the Mining, Minerals, and Green Approvals (MMGA) website and to shareholders, has indicated that the international arbitration proceedings may result in awarded damages but are unlikely to secure PR 13359 or the grant of the PE. However, it's important to note that these specific proceedings differ from typical cases brought before ICSID under a bilateral investment treaty.

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These proceedings are specifically brought under the DRC Mining Code, which effectively empowers ICSID to hear any dispute related to the interpretation or enforcement of the Mining Code provisions. In this case, AVZ Minerals Limited primarily seeks a declaration confirming its title to PR13359 for the entire Manono Project and an order compelling the grant of the PE for the entire project.

Appointment of the ICSID Tribunal

The ICSID tribunal responsible for overseeing these proceedings has now been appointed. The tribunal consists of the following members:

Jan Paulsson (Chairman)
Salim H. Moollan (appointed by AVZI, GLH, and Dathcom)
Mohamed Shelbaya (appointed by the DRC)

This appointment marks a significant step in the arbitration process and demonstrates the progress being made towards resolving the dispute between AVZ Minerals Limited and the DRC government.

In conclusion, AVZ Minerals Limited's engagement in international arbitration proceedings under the DRC Mining Code showcases its determination to protect its rights and interests concerning PR 13359 and the Manono Project. These proceedings, which are distinct from traditional cases, aim to support negotiations with the DRC government and seek relief for non-compliance with the Mining Code. The appointment of the ICSID tribunal further demonstrates the commitment towards resolving this ongoing dispute.

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