Engaged in an arm wrestling match with the Zambian government to control the Konkola copper mine, the Vedanta Resources mining group confirms that it has filed a request for arbitration.
For Indian businessman Anil Agarwal, who built Vedanta Resources into a multinational mining company (copper, zinc, aluminium), the time for a counter-attack has come in his conflict with the Zambian authorities. After last week’s High Court of South Africa ordered the Zambian government to suspend the sale of Vedanta Resources’ shares in the Konkola copper mine (79.4% of the capital) on the grounds that the « applicant (Vedanta Resources) has a reasonable fear of harm », the company confirmed by press release on Wednesday 31 July the launch of an arbitration proceedings. For Vedanta Resources, which fears that Zambian justice will be at the behest of the political authorities, the objective is that its dispute with ZCCM (Zambia Consolidated Copper Mines, the public holding company that controls the remaining 20.6% of the capital of the Konkola mine) should, according to the statement, be « settled in accordance with the rules laid down by the United Nations Commission on International Trade Law (UNCITRAL) ». This sentiment echoes the conclusions of the South African High Court’s judgment, which stated that « there was no chance that the applicants’ situation would improve before the Zambian courts ».
It remains to be seen how the Lusaka authorities will react, as they have not yet expressed their views on this new development. As a reminder, accusing Vedanta Resources of violating the terms of its license in Zambia, the State appointed a liquidator in May to manage the operations of the Konkola mine, the Indian company’s subsidiary in the country.