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Soprim Construction v. Republic of Djibouti, LCIA

Short Name:

Soprim Construction v. Djibouti

Applicable Procedural Rules:
Seat of Arbitration:
Applicable Treaty:
Applicable Legal Instruments:
Economic Sector:
Amount of Damages:
US $56,000,000
Other Remedy:
US$28,000,000 in compound interest (plus continuing compound interest at 1% over US Prime) and £4,150,000 in legal costs awarded in Partial Final Award dated 6 July 2018.

Available documents

12 Mar 2015
Award
Document Details:
Participants listed are for this document only and may not include all participants involved in the entire case. Always consult the original documents.
Claimant appointee
Respondent appointee
Tribunal/Panel chair
Arbitrator(s)
Sole Arbitrator
ICSID Annulment Committee president
ICSID Annulment Committee members
WTO Appellate Body members
WTO Appellate Body chair
Judges
Claimant's counsel
Respondent's counsel
Other counsel
Claimant's expert
Respondent's expert
Claimant's witness
Respondent's witness
Other witnesses
Tribunal secretary
Tribunal assistant
Country
Print reporter
Entities
This summary note is machine-generated. Always consult the original materials.


23 Mar 2015
italaw181104 - Soprim Construction v. Djibouti, Judgment of the High Court of Justice of England and Wales,March 23, 2015
Document Details:
PARTICIPANTS
italaw181104 - Soprim Construction v. Djibouti, Judgment of the High Court of Justice of England and Wales,March 23, 2015
Participants listed are for this document only and may not include all participants involved in the entire case. Always consult the original documents.
Claimant appointee
Respondent appointee
Tribunal/Panel chair
Arbitrator(s)
Sole Arbitrator
ICSID Annulment Committee president
ICSID Annulment Committee members
WTO Appellate Body members
WTO Appellate Body chair
Claimant's expert
Respondent's expert
Claimant's witness
Respondent's witness
Other witnesses
Tribunal secretary
Tribunal assistant
Country
Country in which this occurs:
Print reporter
Document Summary
italaw181104 - Soprim Construction v. Djibouti, Judgment of the High Court of Justice of England and Wales,March 23, 2015
This summary note is machine-generated. Always consult the original materials.

Procedural Posture

This document is a judgment of the High Court of Justice, Queen's Bench Division, Commercial Court, concerning an application by the First Defendant, Mr. Boreh, to set aside a freezing injunction and proprietary injunction granted in favor of the Claimants, the Republic of Djibouti and its state-owned port authorities, on 11 September 2013. The application was predicated on allegations that the Claimants and their legal representatives deliberately and/or recklessly misled the court during the initial injunction proceedings.

Principal Legal Issues

The primary issue before the court was whether the Claimants' lead solicitor had deliberately misled the court regarding the dating of intercepted telephone transcripts, which had been used to support a terrorism conviction against Mr. Boreh in Djibouti and to establish a risk of dissipation of assets. Consequently, the court had to determine whether the freezing and proprietary injunctions should be discharged as a sanction for such misconduct, applying principles analogous to the duty of full and frank disclosure and the equitable doctrine of "clean hands."

Tribunal's Analysis and Findings

Applying the two-stage Twinsectra test for dishonesty, Mr. Justice Flaux found that the Claimants' solicitor had acted both objectively and subjectively dishonestly. The court determined that the solicitor was aware that the telephone transcripts were misdated (having occurred before, rather than after, a grenade attack), which rendered the terrorism conviction and the evidence supporting it fundamentally unsafe. Despite this knowledge, the solicitor engaged in a deliberate strategy of evasion and concealment, allowing the court and his own counsel to proceed under a misapprehension during the September 2013 hearing.

The court held that the duty not to mislead the court applies at all stages of litigation. Drawing an analogy to the duty of full and frank disclosure in ex parte applications, the court emphasized that deliberate deception warrants the discharge of equitable relief to deprive the wrongdoer of any improperly obtained advantage. Furthermore, the court found that the Claimants themselves were complicit in the strategy of concealment and had exerted improper commercial pressure on the Defendant, thereby failing to come to equity with clean hands.

Decision

As a result of the deliberate misconduct and the breach of the clean hands doctrine, the court ordered that the worldwide freezing injunction against Mr. Boreh be set aside. However, the court declined to discharge the proprietary injunction over specific shares, reasoning that a proprietary injunction is fundamentally different and less intrusive, and that discharging it would unjustly render the substantive claim nugatory.



2 Mar 2016
Judgment of the High Court of Justice of England and Wales
Document Details:
PARTICIPANTS
Judgment of the High Court of Justice of England and Wales
Participants listed are for this document only and may not include all participants involved in the entire case. Always consult the original documents.
Claimant appointee
Respondent appointee
Tribunal/Panel chair
Arbitrator(s)
Sole Arbitrator
ICSID Annulment Committee president
ICSID Annulment Committee members
WTO Appellate Body members
WTO Appellate Body chair
Other counsel
Other witnesses
Tribunal secretary
Tribunal assistant
Country
Country in which this occurs:
Print reporter
Document Summary
Judgment of the High Court of Justice of England and Wales
This summary note is machine-generated. Always consult the original materials.

Procedural Posture

This document is a judgment on liability rendered by the High Court of Justice of England and Wales (Commercial Court) in a civil action brought by the Republic of Djibouti and its port authorities (the Claimants) against Mr. Abdourahman Boreh and his corporate vehicles (the Defendants). The Claimants alleged fraud, bribery, and breach of duty under Djiboutian and French law arising from Mr. Boreh's involvement in the development of the Doraleh port complex, specifically the Horizon Oil Terminal and the Doraleh Container Terminal (DCT).

Principal Legal Issues and Parties' Positions

The Claimants contended that Mr. Boreh, acting as a mandataire (agent) or agent public (public official) in his capacity as Chairman of the Djibouti Ports and Free Zones Authority (DPFZA), breached his private and public law duties of probity and loyalty. Specifically, the Claimants alleged that Mr. Boreh secretly acquired shareholdings in the port joint ventures, misappropriated land sale proceeds, and accepted sham consultancy fees from DP World as bribes to negotiate "soft terms" in the DCT concession agreements. The Claimants sought damages and the disgorgement of profits under Articles 1382 and 1993 of the Civil Code.

Mr. Boreh denied the allegations, asserting that the President of Djibouti was fully informed of and had approved his private investments and the commercial terms of the port projects. He maintained that the consultancy agreements with DP World remunerated genuine services and that the litigation was a politically motivated campaign of persecution initiated after he refused to support the President's unconstitutional bid for a third term.

Court's Analysis and Findings

Mr Justice Flaux dismissed all claims against the Defendants, finding the Claimants' allegations to be entirely unfounded. The Court determined that the President of Djibouti was intimately involved in the port projects, possessed full knowledge of Mr. Boreh's shareholdings, and had expressly approved the commercial arrangements, including the allocation of land sale proceeds to settle state debts. The Court drew adverse inferences from the President's refusal to testify and heavily criticized the Republic's prior reprehensible conduct, including its reliance on a fabricated terrorism conviction to secure a worldwide freezing order.

Applying French and Djiboutian law, the Court held that Mr. Boreh acted as a collaborateur (service provider) rather than a mandataire with the power to bind the State during the Horizon negotiations, meaning the strict disgorgement provisions of Article 1993 of the Civil Code did not apply. While acknowledging Mr. Boreh's status as an agent public during the DCT negotiations, the Court found no breach of the duty of probity. The Court concluded that the consultancy agreements with DP World were genuine and that the concession terms were not "soft" but rather commercially sound, resulting in highly profitable ventures for the Republic.

Decision

The High Court dismissed all of the Claimants' claims against Mr. Boreh and his companies in their entirety, concluding that the action was driven by political motivation rather than legitimate legal grievances.



18 May 2016
Judgment of the High Court of Justice of England and Wales
Document Details:
PARTICIPANTS
Judgment of the High Court of Justice of England and Wales
Participants listed are for this document only and may not include all participants involved in the entire case. Always consult the original documents.
Claimant appointee
Respondent appointee
Tribunal/Panel chair
Arbitrator(s)
Sole Arbitrator
ICSID Annulment Committee president
ICSID Annulment Committee members
WTO Appellate Body members
WTO Appellate Body chair
Respondent's counsel
Other counsel
Claimant's expert
Respondent's expert
Claimant's witness
Respondent's witness
Other witnesses
Tribunal secretary
Tribunal assistant
Country
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Document Summary
Judgment of the High Court of Justice of England and Wales
This summary note is machine-generated. Always consult the original materials.

Procedural Posture

This document is a judgment of the English High Court of Justice (Commercial Court) concerning a challenge brought by the Claimant under Section 67 of the Arbitration Act 1996. The Claimant sought to set aside an interim arbitral award on jurisdiction rendered by a sole arbitrator, which had concluded that the tribunal lacked substantive jurisdiction over the dispute.

Factual Background and Principal Issues

The underlying arbitration arises from a Concession Agreement governed by English law, under which the Respondent State granted a concession to construct and operate a container terminal. The Claimant, a sub-contractor, initiated arbitration seeking compensation for alleged politically motivated interference and seizure of equipment, relying on third-party rights to enforce tax and property protections under Article 12.1.3 of the Concession Agreement. The principal legal issue before the Court (the "addendum issue") was whether Article 1.2.5(a) of a subsequent Addendum extinguished the Claimant's statutory entitlement to enforce the original agreement under Section 1(1)(b) of the Contracts (Rights of Third Parties) Act 1999.

Court's Analysis and Reasoning

Conducting a de novo rehearing of the jurisdictional question, the Court analyzed the competing contractual interpretations of the Addendum's saving provision. The Respondent argued that the provision excluded all third-party rights except those expressly granted under Section 1(1)(a) of the 1999 Act. The Claimant contended that the saving provision preserved rights arising under Section 1(1)(b).

The Court observed that interpreting the contract is an objective exercise. It found the Respondent's interpretation untenable, as it would render the saving provision entirely devoid of purpose and irrationally strip away third-party rights—including those of project financiers—that had been intentionally conferred only months prior. While acknowledging that both proposed interpretations presented textual difficulties, the Court concluded that the Claimant's construction was the more commercially rational outcome and the lesser of two evils.

Decision

The Court ruled in favor of the Claimant, holding that Article 1.2.5(a) of the Addendum did not vary the Concession Agreement in a manner that extinguished the Claimant's right to enforce Article 12.1.3. Accordingly, the Court determined that the arbitral tribunal possesses substantive jurisdiction over the dispute.



17 May 2018
Award
Document Details:
Participants listed are for this document only and may not include all participants involved in the entire case. Always consult the original documents.
Claimant appointee
Respondent appointee
Tribunal/Panel chair
Arbitrator(s)
Sole Arbitrator
ICSID Annulment Committee president
ICSID Annulment Committee members
WTO Appellate Body members
WTO Appellate Body chair
Judges
Claimant's counsel
Respondent's counsel
Other counsel
Claimant's expert
Respondent's expert
Claimant's witness
Respondent's witness
Other witnesses
Tribunal secretary
Tribunal assistant
Country
Print reporter
Entities
This summary note is machine-generated. Always consult the original materials.


6 Jul 2018
Award
Document Details:
Participants listed are for this document only and may not include all participants involved in the entire case. Always consult the original documents.
Claimant appointee
Respondent appointee
Tribunal/Panel chair
Arbitrator(s)
Sole Arbitrator
ICSID Annulment Committee president
ICSID Annulment Committee members
WTO Appellate Body members
WTO Appellate Body chair
Judges
Claimant's counsel
Respondent's counsel
Other counsel
Claimant's expert
Respondent's expert
Claimant's witness
Respondent's witness
Other witnesses
Tribunal secretary
Tribunal assistant
Country
Print reporter
Entities
This summary note is machine-generated. Always consult the original materials.


27 Feb 2026
Judgment of the High Court of Justice of England and Wales
Document Details:
PARTICIPANTS
Judgment of the High Court of Justice of England and Wales
Participants listed are for this document only and may not include all participants involved in the entire case. Always consult the original documents.
Claimant appointee
Respondent appointee
Tribunal/Panel chair
Arbitrator(s)
Sole Arbitrator
ICSID Annulment Committee president
ICSID Annulment Committee members
WTO Appellate Body members
WTO Appellate Body chair
Claimant's counsel
Respondent's counsel
Other counsel
Claimant's expert
Respondent's expert
Claimant's witness
Respondent's witness
Other witnesses
Tribunal secretary
Tribunal assistant
Country
Country in which this occurs:
Print reporter
Document Summary
Judgment of the High Court of Justice of England and Wales
This summary note is machine-generated. Always consult the original materials.

Procedural Posture

This document is a judgment rendered by the High Court of Justice of England and Wales (Commercial Court) concerning an application for security for costs. The application was brought by DP World Djibouti (DPW), acting as the First Objecting Party and Additional Respondent, against the Claimant, Soprim Construction. The underlying proceedings involve Soprim's efforts to enforce arbitral awards against the Republic of Djibouti by seeking a final charging order (FCO) over funds held in London by Doraleh Container Terminal (DCT), which Soprim alleges are beneficially owned by Djibouti.

Principal Legal Issues

The primary legal issue before the Court was whether DPW qualified as a "defendant" within the meaning of Civil Procedure Rule (CPR) 25.26, thereby granting the Court jurisdiction to order security for costs against the Claimant. The analysis required the Court to determine whether an intervening party, joined to protect its own economic and contractual interests in the assets targeted by a charging order, assumes the substantive status of a defendant for the purposes of the rule.

Parties' Positions

DPW contended that the Court should look to the substance rather than the form of the proceedings. It argued that it was compelled to oppose the FCO to protect its contractual rights and its share of unpaid dividends held in the targeted bank accounts, effectively placing it in a defensive posture akin to a defendant. Soprim conceded that it was resident abroad and impecunious but maintained that DPW was not a defendant to its claim, meaning the jurisdictional gateway for security for costs under CPR 25.26 was not met.

Court's Analysis and Findings

Mr Justice Waksman conducted a detailed review of the jurisprudence surrounding the definition of a "defendant" for security for costs. The Court emphasized that while substance prevails over form, the mere fact that an interested party joins proceedings to protect its interests does not automatically render it a defendant. The Court found that the true target of Soprim's enforcement action was the Republic of Djibouti, not DPW. DPW's assets were not under direct attack; rather, DPW intervened as a competing creditor and shareholder seeking to preserve the funds for its own putative claims against DCT. Consequently, the Court determined that DPW's role was not "simply defensive" against a direct claim, and it could not be characterized as a defendant under CPR 25.26.

Decision

Having concluded that DPW was not a "defendant" for the purposes of the application, the Court held that it lacked jurisdiction to order security for costs. The Court further noted obiter that, even if jurisdiction existed, it would have declined to exercise its discretion to award security. DPW's application for security for costs was accordingly dismissed.



24 Jul 2026
Judgment of the High Court of Justice of England and Wales
Document Details:
PARTICIPANTS
Judgment of the High Court of Justice of England and Wales
Participants listed are for this document only and may not include all participants involved in the entire case. Always consult the original documents.
Claimant appointee
Respondent appointee
Tribunal/Panel chair
Arbitrator(s)
Sole Arbitrator
ICSID Annulment Committee president
ICSID Annulment Committee members
WTO Appellate Body members
WTO Appellate Body chair
Respondent's counsel
Other counsel
Claimant's expert
Respondent's expert
Claimant's witness
Respondent's witness
Other witnesses
Tribunal secretary
Tribunal assistant
Country
Country in which this occurs:
Print reporter
Document Summary
Judgment of the High Court of Justice of England and Wales
This summary note is machine-generated. Always consult the original materials.

Procedural Posture

This judgment of the English High Court (Commercial Court) addresses applications by the Claimant, Soprim Construction SARL, to enforce arbitral awards against the Respondent, the Republic of Djibouti. Soprim sought a final charging order over approximately US$41 million held in London bank accounts in the name of Doraleh Container Terminal SA (DCT). The Objecting Parties, DP World Djibouti FZCO and DCT, opposed the application and sought to set aside the arbitration claim form.

Principal Legal Issues

The Court was required to determine whether the funds in the accounts were beneficially owned by Djibouti, rendering them amenable to enforcement. This involved analyzing whether DCT held the funds on a bare trust for the State under English law. The Objecting Parties challenged the authority of DCT's state-appointed administrators to create such a trust, arguing that the Djiboutian court judgments appointing them should be refused recognition in England on the grounds of public policy, breach of English anti-suit injunctions, breach of arbitration agreements, and natural justice violations. The Court also considered whether to pierce DCT's corporate veil and whether Soprim had breached its duty of full and frank disclosure during the ex parte application.

Tribunal's Analysis and Findings

The Court first determined that English law governed the alleged trust under Article 7 of the Hague Trusts Convention, given the situs of the bank accounts in London. Drawing inferences from the factual matrix, including Djibouti's extensive control over DCT's administrators, the Court concluded that an agreement was reached for DCT to hold the funds on bare trust for the Republic.

Addressing the recognition of the Djiboutian judgments, the Court rejected the Objecting Parties' arguments. It found no breach of the English injunctions, as they were directed at a different entity (PDSA) and did not bind the Republic. Furthermore, the Republic was not bound by the arbitration agreements in the joint venture documents, as it was not a shareholder. The Court also dismissed the natural justice objections, finding that the Djiboutian court had provided a properly reasoned decision that did not meet the high threshold for refusing recognition based on systemic bias.

While the Court declined to pierce DCT's corporate veil—noting the strong presumption of separate legal personality for state-owned entities—it held that the bare trust was successfully established. The Court found no material breach of the duty of full and frank disclosure by Soprim.

Decision

Exercising its discretion under the Charging Orders Act 1979, the Court applied the "first past the post" principle and granted the final charging order over the entirety of the funds in the accounts. The Court dismissed the Objecting Parties' set-aside application and rejected Soprim's alternative applications for a third-party debt order and receivership.



Case Summary
This summary note is machine-generated. Always consult the original materials.

Underlying Dispute

Soprim Construction SARL ('Soprim'), a Djiboutian construction enterprise managed by Abdourahman Mohamed Mahmoud Boreh, served as a primary contractor and sub-contractor for the construction of the Doraleh Container Terminal in Djibouti. The project operated under a Concession Agreement dated 30 October 2006 (as amended by an Addendum dated 22 May 2007) between the Republic of Djibouti ('Djibouti') and Doraleh Container Terminal SARL ('DCT'). The Concession Agreement was governed by English law and contained a London-seated LCIA arbitration clause.

Following a political rift in 2007–2008 between Mr. Boreh and Djibouti's President Ismail Omar Guelleh, state authorities conducted a retaliatory campaign against Soprim and Mr. Boreh. This included levying unjustified tax assessments, seizing and liquidating Soprim's construction machinery, deporting key personnel, and instigating fabricated criminal and terrorism charges against Mr. Boreh. Soprim asserted that these state actions destroyed its commercial operations, breaching guarantees in Article 12.1.3 of the Concession Agreement that secured tax exemptions, protected private property against nationalisation or restrictive measures, and guaranteed unhindered operational access for sub-contractors.

LCIA Arbitral Proceedings

In July 2012, Soprim commenced LCIA arbitration against Djibouti before sole arbitrator Sir Gordon Langley. In an interim award rendered on 12 March 2015, the arbitrator evaluated preliminary jurisdictional issues. He determined that Soprim was a sub-contractor under Article 12.1.3 entitled to enforce contract terms pursuant to Section 1(1)(b) of the UK Contracts (Rights of Third Parties) Act 1999. However, the arbitrator concluded that Article 1.2.5(a) of the 2007 Addendum excluded the operation of the 1999 Act, thereby extinguishing Soprim's third-party enforcement rights and depriving the tribunal of substantive jurisdiction.

Following the reinstatement of tribunal jurisdiction by the English High Court and Djibouti's subsequent withdrawal from the arbitration in July 2017, the tribunal proceeded to adjudicate the merits. On 17 May 2018, Sir Gordon Langley issued a Partial Final Award holding Djibouti liable for the unlawful destruction of Soprim's business and awarding US56millioninprincipaldamagescite:4.On6July2018,asecondPartialFinalAwardgrantedSoprimUS28 million in compound interest (with continuing post-award interest) and £4.15 million in legal costs.

UK High Court Challenges and Parallel Proceedings

Soprim challenged the arbitrator’s 2015 jurisdictional award under Section 67 of the UK Arbitration Act 1996. On 18 May 2016, Leggatt J of the English High Court set aside the arbitrator’s ruling. The Court held that boilerplate third-party exclusion language in the Addendum did not evince a clear intention to extinguish substantive statutory rights previously conferred on sub-contractors under the original Concession Agreement, thereby confirming the tribunal's substantive jurisdiction.

In parallel High Court proceedings brought by Djibouti against Mr. Boreh alleging corruption in negotiating the Concession Agreement, Flaux J discharged an ex parte freezing order on 23 March 2015 after finding that Djibouti and its legal representatives had deliberately misled the court regarding Mr. Boreh's false terrorism conviction. On 2 March 2016, Flaux J dismissed all of Djibouti's substantive claims, ruling that the allegations were part of a state-directed, politically motivated campaign to ruin Mr. Boreh.

Enforcement Litigation

Soprim initiated enforcement proceedings in England under Section 66 of the UK Arbitration Act 1996, obtaining leave from Teare J in March 2019 to enforce the Langley Awards as High Court judgments. In subsequent execution proceedings, Soprim sought a final charging order over approximately US$41.6 million held in London bank accounts ('SCB Accounts') in the name of DCT. On 27 February 2026, Waksman J dismissed a security for costs application brought by DP World Djibouti FZCO ('DPW'), holding that an objecting third party was not a "defendant" under CPR 25.26.

On 24 July 2026, Picken J granted Soprim a final charging order over the entirety of the SCB Accounts. The High Court held that the alleged trust was governed by English law under Article 7 of the Hague Trusts Convention, given the London situs of the accounts. Drawing inferences from Djibouti's complete de facto control over DCT's state-appointed administrators, the Court established that DCT held the funds on bare trust for Djibouti, rendering the monies beneficially owned by the State and subject to execution to satisfy Soprim's outstanding arbitral awards.