Pakistan Steel on Friday confirmed that a ship carrying 50,000 tons of coal for Pakistan Steel and was expected to reach Port Qasim on June 13, 2011, has been detained near the Canadian shore. According to a press release issued by Pakistan Steel, although the matter is sub judice, however Pakistan Steel reserves the right to lodge an appeal based on facts.
It clarified that Pakistan Steel had entered an agreement in 2004 with an Indian company Messrs Fomento under which the latter had to provide good quality iron ore. But it supplied iron ore which didn't meet international standards. Consequently, Pakistan Steel cancelled this agreement in 2005 as per clauses mentioned in the tender document.
Fomento lodged a case against Pakistan Steel in the International Court of Arbitration in London. The court gave a divided judgement in this case. Actually as per the law and the agreement clauses Messrs Fomento should have approached the relevant court in Pakistan to decide the legal validity of the agreement before approaching the International Court of Arbitration but it did not follow this procedure.
Pakistan Steel representative further stated that Fomento obtained a verdict from the Supreme Court of British Columbia (Canada) which is contrary to normal practice because the said court did not issue any legal notice to Pakistan Steel nor did it provide any opportunity to Pakistan Steel to explain its position. Hence, Pakistan Steel reserves the rights to institute legal proceedings against this ex parte decision after consulting legal experts and the management is arranging for the necessary legal steps to be taken without delay.-PR