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Dubai sets up tribunal to deal with Dubai World disputes

Page last updated at Thursday, December 17, 2009 7:07 AM // Leave Your Comment

Dubai WorldThe Dubai government set up on Monday a special tribunal to deal with disputes that might arise out of any future settlement of the financial position of the state-owned conglomerate Dubai World and its subsidiaries.

Ruler of Dubai Sheikh Mohammed bin Rashid Al Maktoum issued a decree envisaging the court’s establishment, official WAM news agency reported. Sheikh Mohammed is also vice president and prime minister of the United Arab Emirates (UAE).

“The decree is based on the keen interest of the Dubai government in preserving the rights of Dubai World creditors,” the report said.

Dubai will fulfill its commitment to further strengthen the emirate’s position in the global economy, it said.

The report added that Dubai has pledged that financial institutions will obtain all their rights “in view of the strength of its economy.”

The UAE economy “is capable of assimilating the consequences of the global financial crisis as well as on Dubai’s big and diverse infrastructure and structural assets,” it said.

“The issuance of the new decree comes as a realization of the Dubai government’s decision to fully transparently restructure Dubai World and its subsidiaries,” the report said.

According to WAM, the tribunal will be established in the Dubai International Financial Center and entitled to “hear and decide on any demand to dissolve or liquidate” Dubai World.

Earlier in the day, Sheikh Ahmad bin Saeed Al Maktoum, chairman of the Dubai Supreme Fiscal Committee, said the Abu Dhabi government has agreed to fund 10 billion U.S. dollars to Dubai to meet upcoming obligations on Dubai World.

“As a first action for the new fund, the government of Dubai has authorized 4.1 billion dollars to be used to pay the Sukuk (Islamic bond) obligations that are due today,” he said.

The government of Dubai, a member of the oil-rich federation UAE, announced on Nov. 25 that it would ask Dubai World’s creditors to agree to a debt moratorium of at least six months as a first step towards restructuring.

The announcement, described by ratings agency Standard and Poor’s as a default, provided the focus for global financial markets and media, affecting stock markets around the world.

On Dec. 1, Dubai World confirmed that its debt restructuring process is related to a total debt of 26 billion dollars, of which a 4.1-billion-dollar Sukuk is due on Dec. 14.

Source: GNA



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