The government is reportedly in talks with the Turkish government and M/s Karkey for an out-of-court settlement to avert attachment of Pakistan's properties in Europe, well-informed sources told Business Recorder. A four-member Pakistani team, comprising Power Ministry, Attorney General Office and intelligence agency personnel recently visited Turkey on a mission to get an out-of-court settlement with the Karkey Karadeniz Elektrik Uretim. National Accountability Bureau (NAB) has arrested a 'front man' during investigation for corruption, 'corrupt' practices and misuse of authority in the award of RPP's contract to M/s Karkey. The sources said NAB has unveiled the information that $365,000 was "illegally" transferred by Raja Babar Ali Zulqarnain from a bank of his offshore company M/s Lead Burn Global Ltd to BVI-based offshore company CGEL of the accused. However, this information cannot be presented before the international court as an evidence. According to sources, Pakistan has hired a Swiss firm against payment of a heavy fee which will help obtain proof of illegal transfer of the amount and present it in the court and the arrest of the 'front man' will be used as leverage to get a "deal". The sources further stated that during Shahid Khaqan Abbasi-led government, Power Division had also sought about $35 million for an out-of-court settlement but the then government delayed it saying "it will look into it" but did nothing. A couple of months ago, the federal cabinet approved a supplementary grant of $ 1.37 million to contest cases filed by M/s Karkey in courts of different countries as Pakistan's assets abroad are facing "attachment" threat. M/s Karkey had set up a 332 ship-mounted Rental Power Project (RPP) at Port Qasim, Karachi, pursuant to Rental Power Policy 2008, announced by the then government of Pakistan (GoP). M/s Karkey entered into Rental Services Contract (RSC) on April 23, 2009 for generation of electric power with the Lakhra Power Generation Company Limited (LPGCL). Pursuant to the terms of the RSC, the GoP issued a sovereign guarantee to secure payment obligations of LPGCL and Karkey achieved commercial operations in April 2011. In the meanwhile, the Supreme Court in exercise of its original jurisdiction initiated suo motu proceedings against RPPs and through its detailed judgment of March 30, 2012, declared all RSCs void ab initio, being illegal and against public policy. The Supreme Court also directed National Accountability Bureau (NAB) to carry out investigation under the NAB Ordinance 1999. The sources said that pursuant to the judgment of SC, NAB commenced investigation and placed caution on M/s Karkey ships, restraining them from leaving territorial waters of Pakistan. Meanwhile, M/s Karkey filed an arbitration claim against the GoP for various unilateral termination of the RSC and detention of its ships before the International Centre for Settlement of Investment Disputes (ICSID) under Pakistan-Turkey Bilateral Investment Treaty (BIT), 1995. The proceedings before ICSID were held between March 23 and March 26, 2018. On August 22, 2018, the ICSID awarded against GoP an amount of $ 760 million along with interest thereupon. After the award, Karkey has gone into enforcement of arbitration award against Pakistan in various jurisdictions including the US, the UK, Germany and France. "With this action, the government of Pakistan's assets abroad are at potential threat of being attached or lien being created on them and will result in huge financial implications," the sources added. The estimated cost for completing the ongoing investigation is $ 1 million, of which $ 0.3 million is required immediately whereas $ 0.7 million will be paid within a month's time. Estimated cost for engagement of Swiss lawyer and proceedings before the Swiss Federal Prosecutor is $ 0.15 million of which $ 75,000 is required immediately and the remaining $ 75,000 within due course. The Attorney General's Office further stated that $ 20,000 is required for filing revision of the award and $ 0.2 million as initial cost for defending enforcement proceedings.
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