Tuesday , March 2 2021

The back of the new arbitration that shakes the lithium market

Next December 10 is a key date for Corfo and Albemarle. That day is the closing date for the corporation to submit its arbitration claim before the International Chamber of Commerce (ICC) against the United States for differences in the favorable prices of lithium that must & # 39; The company is presented to the specialized producers specified by the State.

After the new conflicts that created non-metallurgy mining, a series of talks are held by state and old Rockwoood representatives, whose situation has caused discomfort among companies trying to industrialize lithium in northern Chile. All meetings ended without agreement.

The Third PM He confirmed that the last hearing between the parties took place on October 17. He had not registered by the Lobby Platform, because – as Corfo- the law did not need it, as Albemarle was a member of the company through current contract.

It was a key meeting, because when Corfo completed, Albemarle was shocked by announcing that he would file an arbitration court case requiring the contract to be carried out. Who and what topics did you discuss at the meeting? I am kept under an absolute reserve by the parties concerned.

The USA, Vice President and Counsel General Albemarle, Terry Hammons, traveled specially with the Vice President, together with Ignacio Mehech, Regional Prosecutor and Cristián Conejero, lawyer Philippi Prietocarrizosa Ferrero UK & Uría (PPU), which advises the company as a result of the conflict.

At the meeting, the US executive insisted on the site of the mining company, and yet there was no type of approach to Corfo.

Similarly, the recent reach of Ellen Lenny-Pessagno, the new mining company manager of the company – could open at least a window to change the course of current talks in a dead game.

He noted the same sources that it was consulted that the representatives of the mining company have always offered as an outlet to the inconsistency with the alternative alternatives in the state. However, all of them are in general a reduction of royalties or sales commission, claiming that the tax burden is very high. However, this state proposal was rejected clearly.

The company states that "the contract signed with Corfo establishes that Albemarle has the duty to" offer its lithium products at the lowest price of export market equality (FOB Puerto Chileno) from the last six months to producers of specialized products of added value. "However, in Corfu's order for companies that are interested in settling in the country and in the subsequent criticism, market and equality concepts are omitted, which have given Corfo's interpretation an opportunity to criticize"

For Albemarle, according to the contract, it is required to offer up to 25% of the lowest price production, export market equality. The problem is that the word "equality" and "market" have been waived in the call for applications from specialist companies. There would be no conditions. It is even more committed to producing lithium hydroxide, which does not produce in Chile.

On the other hand, signing, Corfo has continued to prepare and add professionals to his legal team to face the conflicts, whose sentence would be known known later than in the next two years .

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According to experts in the field, the content of related third parties – outside the market – and prohibiting the equality price to determine "the lowest price of market equality" contradicts the language of the agreement and its origin the argument that can be settled by arbitration.

In this process, Corfo has sought legal advice. In this way, he asked Felipe Bulnes for advice to intervene in arbitration, but he asked the lawyer to be disqualified to leave the possibility of being a future witness if necessary. Chile's former agent in Hague took part in the discussions that led to the transaction that ended the arbitration between Corfo and Soquimich. He also advised in discussions with Albemarle.

In fact, the Dependent agency of Economy does not even refuse to include in the list of witnesses, once the arbitration experiment has developed, former Vice President of Corfo, Eduardo Bitran.

Today, Corfo's legal team is led by Andrés Jana, along with Rodrigo Gil, solicitors, Bofill Mir & Álvarez Jana partners. Then, the technical-legal team is Corio Lithium Unit where Eliana Muñoz, Leonardo Valenzuela, Enrique Mandiola, Pamela Bórquez and prosecutor María Elina Cruz are.

Corfo's legal strategy is co-ordinated by the main staff of Corfo's Executive Vice President, Sebastián Sichel, Andrés Baytelman.

* This note was last updated on 14.01.

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