13.1 All claims, differences and disputes arising between the parties as to any matter arising, whether directly or indirectly out of, or in connection with this Agreement shall be referred for determination by International Arbitration under the rules and regulations of the International Chamber of Commerce ("ICC") by a board of three (3) arbitrators which shall be appointed and shall carry out the arbitration in accordance with the ICC Rules.
13.2 The Arbitrators shall state in their award in detail, the facts of the case and the reasons for their decision.
13.3 The award of the arbitrators shall be final and binding on the parties and may be enforced in any Court of competent jurisdiction.
(the Arbitration Clause).
(a) Pursuant to Article 6(2) of the Rules, that the arbitration shall proceed.
(b) Pursuant to Article 9(1) of the Rules, to confirm the arbitrator nominated by the Claimants and Professor Ndulo nominated by the Respondent.
(c) To grant the co-arbitrators 30 days to nominate jointly the Chairman of the Tribunal, failing which the Court would take the necessary steps to make such an appointment.
(d) To fix an advance on costs, confirming that the file would be transmitted to the Tribunal once the advance had been paid in full.
(a) By executing the Terms of Reference, the arbitrators confirmed the acceptance of their designation, and the Parties confirmed that at the time of signing they knew of no reason or basis to challenge the arbitrators and had no reservations or objections to express with regard to the constitution of the Tribunal.12
(b) The Tribunal shall resolve all issues of fact and law arising from the claims and pleadings as submitted by the Parties, including those relevant to decide on the relief sought by the Parties and the costs and expenses of and incidental to the arbitration and how costs should be allocated between the Parties.13
(c) The place of arbitration would be London, United Kingdom, but the Tribunal could meet between themselves at any other location; and any Award or Awards may be signed by the Tribunal at a place other than the place of arbitration but would be deemed conclusively to be made at the place of arbitration.14
(d) The Tribunal shall apply the substantive law of Ghana to the Agreement, and may also have regard to relevant principles of international law in the determination of the dispute.15
(e) The Tribunal shall be entitled to determine any issue as to Ghanaian law on the basis of the Parties' submissions (including any legal authorities relied on), and/or expert evidence (if the Tribunal calls for expert evidence or the Parties, with the leave of the Tribunal, submit such evidence).16
(a) The proceeding shall be conducted in accordance with the ICC Rules and the directions of the Tribunal in accordance with those Rules, but subject always to any relevant procedural rules contained of the law of the place of the arbitration to the extent that such rules are mandatory.
(b) The International Bar Association Rules on the Taking of Evidence in International Commercial Arbitration 2010 (IBA Rules) may be used as guidelines to the extent considered appropriate by the Tribunal in the exercise of its overall procedural discretion.
(c) The Tribunal is not bound by any strict rules of evidence, but may receive and rely upon any evidence is considers helpful and will determine the relevance, materiality and weight of evidence before it.
(d) The language of the arbitration is English, and any original documents in a language other than English shall be accompanied by an English translation.
(e) The arbitrators and the Parties agree that the Chairman may make procedural rulings alone provided that he shall first consult with his co-arbitrators to the extent possible, and the full Tribunal shall hear and determine any procedural matter if requested by either party.
SO. For the Claimants:
Mr. Manjeet Singh Basi (witness of fact);
Mr. Krishan (Kris) Kapoor (witness offact);
Mr. Adu Boadi Acheampong (witness offact);
Mr. Christian Addo Manu (witness offact);
Mr. Paul Robinson Keteku (witness offact);
Mr. Ebenezer Amos Sac key (witness of fact);
Mr. Ferdinand Agbemadu (witness offact);
Prof. Joseph Ayee (expert witness);
Mr. Michael F. Wick (expert witness); and
Ms. Antoinette Pincott (expert witness).
Baiju S. Vasani (Jones Day);
Sylvia Tonova (Jones Day);
Anastasiya Ugale (Jones Day);
Charlene Bourliout (Jones Day);
Jack Logan (Jones Day);
Victoria Banson (Jones Day);
Angelika Bialowas (Jones Day);
Richard Frimpong Oppong (Thompson Rivers University);
Robert Rhodes, Q.C. (Outer Temple Chambers);
Gordon Rodgers (Continental Construction, PLC);
Rinku Kapoor Handa (PM I of Canada, Inc.);
Paul Oppoku (E. Allotei & Mingle Co, Accra);
Joseph Jandrasits (John T. Boyd Company).
Benard V. Preziosi (Curtis, Mallet-Prevost, Colt & Mosie, LLP);
Justin M. Jacinto (Curtis, Mallet-Prevost, Colt & Mosie, LLP);
Peter F. Stewart (Curtis, Mallet-Prevost, Colt & Mosie, LLP);
Alexandra Maier (Curtis, Mallet-Prevost, Colt & Mosie, LLP);
Anne-Sophie Petitdemange (Curtis, Mallet-Prevost, Colt & Mosie, LLP);
Sena Tsikata (Curtis, Mallet-Prevost, Colt & Mosie, LLP);
Matt Getz (Curtis, Mallet-Prevost, Colt & Mosie, LLP);
Dominic Akuritinga Ayine (Deputy Attorney-General, Ghana);
Dorothy Afriyie-Ansah (Chief State Attorney, Ghana);
Zeinab Ayariga (Assistant State Attorney, Ghana);
Charles Afeku (Senior Legal Officer, Minerals Commission, Ghana);
Kwasi Anokye-Yesu (Manager, SGMC Desk, Minerals Commission, Ghana);
Dr. Daniel Flores (Econ One Research, Inc.);
Professor Daniel Mireku-Gyimah (University of Mines & Technology, Tarkwa).
WHEREAS SGMC is the controlling shareholder of [DGL] (a state controlled enterprise) which conducts Gold mining operations utilizing dredges within a concession area in Ghana which includes all mineral rights in areas which are listed in Annexure A and partly covered by C.Vs. and in all the areas depicted and described in the maps attached as Annexure B, together with ancillary land rights, timber operation and agriculture use grants and licenses contiguous to all the areas covered by Annexures A & B
1.1 The Government warrants jointly and severally with SGMC and [DGL] that the Concession is fully valid and enforceable and will remain so for the duration of these Heads and any agreement between the parties which replaces or supersedes them.
(a) Phase I was to consist of 'due diligence and management assistance', and was anticipated to last up to 4 months (cl2.1).
(b) Within 60 days of completing Phase I, CCML could elect whether to proceed to Phase II. On notice of the election being given, the parties would be deemed to have entered into a participation agreement, and CCML would 'take over all operations and assets of [DGL] which shall include the movable and immovable assets of the Dunkwa mine belonging to [DGL]' (cl 2.2).
(c) Phase II would be a 'feasibility and limited Refurbishment phase' and last 24 months (cl 3.1). During this period, CCML would conduct a programme that 'will include any of the following: complete re-engineering of old dredges, [sampling]... and feasibility study'. Clause 3.1 records:
The feasibility studies shall also extend to any other operation(s) which could generate extra revenue in the area of logging/timber, agriculture, import substitution, manufacture of engineering goods and plants for small/medium scale mining which could be economically viable and support local economy.
(d) Clause 3.2 provides that CCML would spend approximately US$6,120,500 on Phase II and 'On completion of phase II, CCML shall source further loan/funds to do what is needed to economically operate the mine and any other auxiliary project it may enter into.' CCML would make two further payments of $125,000 each as consideration (ell 3.3 & 3.4).
(a) Part 4 & 5 describe the anticipated agreement that would be entered into by the Government and CCML (described as a participation agreement or joint mining venture agreement), and provide for the creation of a new vehicle for the purpose. Clause 5.5 provides for assignment by CCML of its rights and obligations on certain terms.
(b) Part 7 (Liability) provides that while Phase I was in progress, SGMC would retain management of the mine. Operations would be restricted to one dredge, but could be increased to two dredges (in CCML's discretion) if such an operation would not deteriorate the condition of the dredges (cl7.1).
(c) Part 8 provides for the Government to arrange certain financial assistance for CCML:
i. During Phase I the Government would obtain US$600,000 from the World Bank to partially rehabilitate one dredge, to carry out tests and to protect the remaining dredges from further deterioration. If CCML elected to proceed to Phase II, those funds would 'become part of a soft loan' to CCML or the joint mining venture (cl8.1).
ii. The Government would assist in obtaining a soft loan of US$2m to supplement CCML's own funds in implementing Phase II, which would be disbursed at the commencement of Phase II (cl 8.2).
(d) Part 10 begins by recognising 'that the rate of return on the investment on this project would be marginal', and goes on to record certain 'concessions, exemptions and privileges' to be granted by the government. In particular, clause 10.4 provides that CCML 'plans to use the concession areas to establish agriculture based projects. No further approval shall be required to use land for such purposes.'
(e) Clause 12 contains a force majeure clause, and clause 13 contains an arbitration clause in similar terms to the arbitration clause in the Project Agreement,56 save that the Heads of Agreement expressly provides that the place of the arbitration would be London or Toronto, and the proceedings should be conducted in English.57
1.1 Operating Profit Not Used in Above Calculations
1.2 Total Estimated Capital Expenditures for 15 Years Span of Project $35,000,000
WHEREAS SGMC is the controlling shareholder of [DGL] (a wholly owned state enterprise) which conducts Gold mining operations utilizing dredges within a concession area in Ghana which includes all mineral rights in areas which are listed in Annexure A and partly covered by C.Vs and in all the areas depicted and described in the map attached as Annexure B, together with ancillary rights to timber and agricultural use of areas covered by annexures "A & B"; and
WHEREAS the Government has decided to privatize the Dunkwa concessions and operations; and
WHEREAS CCML in response to the Government Divestiture programme has indicated its desire to participate in the Dunkwa mining operations under the terms hereinafter agreed between the parties thereto; and
WHEREAS CCML possess the necessary mining and management skills and experience, as well as the financial strength and resources to take over and carry out the Dunkwa operations; and
WHEREAS the parties have in principle reached agreement to proceed expeditiously.
NOW THEREFORE, the parties hereto agree subject to the conditions set forth in this Agrement.
1.1 The Government warrants jointly and severally with SGMC and [DGL] that the concessions and rights granted to CCML hereunder are effective, fully valid and enforceable and will remain so for the duration of this Agreement and any extension or variation thereof. 
1.2 CCML shall have the exclusive right to carry out due diligence (Phase 1) as per clause 2.1 and to take over the mining operations and assets of [DGL] at the end of Phase I or earlier if CCML prefers to do so, or start Phase II earlier than what is envisaged under clause 3.1.
1.3 Existing liabilities of SGMC/[DGL] to any third party... shall not be the responsibility of CCML if CCML should decide to take over the assets and operations of [DGL]
1.4 Furthermore, Government, SGMC and [DGL] warrant that there shall not be any hindrance or obstruction to the exercise by CCML of the rights hereby granted.
(a) It begins by recording the parties' agreement to divide the project into 'the following phases', beginning with Phase 1: Due Diligence and Management Assistance.
(b) Clause 2.1 describes Phase I, which would start on 9 June 1994 and last for a period of up to 4 months. In this phase, CCML would review and assess the existing records on the Concessions, and conduct inspections and studies 'in order to determine whether economically viable gold ore resources exist and to evaluate these resources.' CCML intended to spend approximately $850,000 on this phase, as described in Annexure C.
(c) Clause 2.2.1 records that within 60 days of the completion of Phase I, CCML and/or its nominee would have the option whether to proceed to Phase II, but cl 2.2.2 records that CCML had given such notice by letter of 6 October 1994. The start date of Phase II would be no later than 31 March 1995.76 Clause 2.2.3 provides that on the commencement of Phase II, 'CCML shall take over the management of all operations and assets of [DGL] including the movable and immovable assets of the Dunkwa mine belonging to [DGL], including (without derogating from the generality thereof) the surface development, dredges and associated accessories, structures, buildings, [etc]... but excluding cash reserves and consumables'.
(d) Within 30 days of the Agreement being signed, CCML would pay $250,000 as a first payment for the acquisition of the DGL assets and operations (cl2.3).
(e) CCML would provide quarterly reports during each phase and a final report within 60 days of completion of each phase (cl2.5).
(f) Clause 2.6 provides that if CCML decided not to proceed with Phase II, CCML would give 'appropriate notice to the other parties and thereafter this agreement or any JMVA that may have been entered shall terminate', provided that CCML would provide for the orderly handing over of all machinery, equipment etc to SGMC/DGL.
(a) Clause 3.1 provided that Phase II would be a 'feasibility and limited refurbishment phase' lasting 36 months. This would include re-engineering dredges, mapping and surveying and feasibility studies. The clause provided that:
3.1... The feasibility studies shall also extend to any other operation(s) which could generate extra revenue in the areas of logging/timber, agriculture, import substitution, manufacture of engineering goods and plants for small/medium scale mining which could be economically viable and support the local economy.
(b) Clause 3.2 records that CCML expected to spend approximately $6m on Phase II. It provided that '[o]n completion of Phase II, CCML shall source further loan/funds to do what is needed to economically operate the mine and any other auxiliary project it may be permitted to enter into.'
(c) CCML would make two further payments towards the acquisition price: $125,000 after each of 12 and 24 months (ell 3.3 and 3.4).
(d) Clause 3.6 records that it was 'agreed that upon take over of all operations and assets of [DGL], the title to all the assets of Dunkwa shall vest in CCML.' That was subject to a reservation that CCML would not have the right to sell the acquired assets of CCML until the later of the end of Phase II and the payment of the final $125,000.
(a) Clause 5.1 provides that CCML with Government participation would choose the 'vehicle most suitable and efficient in terms of Ghanaian law for the conduct of the operations of DCGL and in compliance with investment guidelines in effect in Ghana, which vehicle could be a foreign registered company or a Ghanaian registered company.'
(b) Clause 5.2 provides that funding was detailed in Annexure C, that until DCGL was established CCML would fund the enterprise and then those liabilities would be transferred as the 'direct financial liability' of DCGL.
(c) Clause 5.3 provides for CCML to assign its rights and obligations in the following terms:
5.3 CCML shall be entitled at any time from the date of signing this Agreement to assign part or all of its rights and obligations under this Agreement in whatever form such rights and obligations then existed, to a company which is its affiliate or subsidiary provided that such company undertakes to be bound by the provisions of this Agreement or any other agreement which may replace it.
In the event of any assignment by CCML to another company, CCML shall continue to be liable with the assignee for the performance of its obligations.
5.5 Should CCML wish to assign part or all of its rights and obligations to a party which is not an affiliate or subsidiary, or should Government likewise wish to assign part or all of its rights and obligations to a party which is not controlled by Government or is not a representative of the owners of the land on which the mining operations are carried out, the other party shall have the right offirst refusal to acquire such interest.
(a) During Phase I, SGMC would retain management of operations of the mine, restricted to one dredge or increased to two dredges (on CCML's advice) if that would not deteriorate their condition (cl7.1).
(b) Clause 7.3 addresses an anticipated concern with 'turbidity', and requires the Claimants to provide boreholes for villages affected by the problem.
(a) Clause 8.1 provided that during Phase I, the Government/SGMC would procure a loan of $700,000 from the World Bank for the partial rehabilitation of a dredge and maintenance of the other dredges. If CCML elected to proceed to Phase II, 'such funds obtained from the World Bank or other source by Government/SGMC shall become part of a loan to CCML/DCGL for Phase II operations.'
(b) Furthermore, the Government parties would use their best endeavours to assist CCML/DCGL to procure a loan of 'at least' US$2m from the World Bank, 'Caisse Francais de Development' or another international development funding agency (cl 8.2).
(a) Clause 10.1 provides that 'All benefits allowed by existing or new Mining Laws shall also be applicable to this project and special/additional concessions or benefits approved in the Agreement shall be in addition to what may be allowed by the Mining Laws.'
(b) Clause 10.2 provides certain tax relief.
(c) Clause 10.3 allows for CCML/DCGL to maintain overseas retention accounts.
(d) Clause 10.4 of the Heads of Agreement, which recorded that CCML had planned to conduct agriculture-based projects and that no approval would be required for those projects, was deleted and not replaced. Mr Kapoor's evidence is that the Government told CCMl that permits for that activity would not be required and that is why the provision was removed.79 Mr Ansah maintains, to the contrary, that the provision was removed because the DIC did not have authority to grant such dispensation.80
(e) The remainder of clause 10 concerns miscellaneous concessions: clause 10.4 permits the Claimants to add value to minerals and sell them; clause 10.5 exempts Claimants from Selective Alien Employment Tax in accordance with the Minerals and Mining law 1986; and clause 10.6 provides that the Government could defer payment of royalties.
• In parallel with existing on going activities, undertake limited gold/silica mining through rehabilitation or acquiring a new Dredge (or partially building in Ghana) to generate cash flow for the repair/provision of other dry mining plants/ machinery. This depends to a large extent on a sustained high price of gold
• Enter into agreement with an interested firm or firms, to pursue the project
• Enter into an agreement with an interested firm(s) to transfer DCGL's current mining rights and its assets
(a) Failure to carry out effective mining operations: the letter asserts that section 53(1) of 1986 Law required DCGL to 'commence commercial production on or before the date specified in the programme of mining operations' and to mine the minerals covered by the lease.
(b) Payment of royalties: under section 22 of the 1986 Law and clause 10.6 of the Project Agreement, DCGL was required to pay royalties. It had not sought a deferment of royalties pursuant to clause 10.6, and had owed the sum of US$119,036 since it ceased mining in 1999.
(c) Provision of quarterly reports: the letter asserts that DCGL had failed to provide quarterly reports to the Minerals Commission and SGMC pursuant to clause 2.5 of the Project Agreement.
(d) Repayment of loans: the letter asserts that DCGL had failed to repay the $700,000 World Bank loan contemplated by clause 8.1 of the Project Agreement.
(a) The legal regime applicable to the Claimants' investment was not the 1986 Law, but a sui generis regime based on the terms of the Head Leases/CVs which were divested to the Claimants pursuant to the Project Agreement, and it is those CVs (governed by the Concessions Act 1962) which define the scope of the Parties' rights and obligations.
(b) The Government failed to comply with the process for cancellation of the CVs required by the Concessions Act 1962, and even if the 1986 Law governed then the Respondent failed to follow the process required by that regime as well. In any case, the grounds for termination were spurious; the purported 'vesting' of assets in the Respondent is unlawful and amounts to expropriation; and the Respondent's unlawful termination of the Project Agreement breached the warranties in clauses 1.1 and 1.4.
(c) The Respondent's expropriation of CCML's property violated the Constitution of Ghana, and particularly Article 20.
(d) The Respondent is, in any case, liable to CCML for negligence.
(e) Finally, CCML asserts claims under customary international law: that the Respondent violated the international minimum standard of treatment of aliens, and the rule against expropriation.
(f) The Claimants say that they are entitled to damages in the sum of approximately US$94m.
(a) The Tribunal does not have jurisdiction to entertain the Claimants' claims (or they are inadmissible).
(b) The applicable legal regime is the 1986 Law.
(c) DCGL was in breach of its obligations under the Project Agreement, the Government was entitled to terminate it, and the Minister complied with the 1986 Law in doing so.
(d) The termination did not breach Article 20 of the Constitution; the Claimants' tort claim is an improper relabeling of the contract claim; and the Respondent did not breach its international obligations.
(e) The Respondent counterclaims for recovery of the World Bank loan and royalties that remain unpaid.
(f) In the circumstances, even if the Claimants establish that the Tribunal has jurisdiction over some of the claims and establish some of them on the merits, the Claimants' entitlement to damages is nil.
The jurisdiction of the Tribunal must be answered by reference to the scope of consent contained in the arbitration agreement itself, which agreement in the present case is founded upon contract not treaty. Moreover, if and to the extent that the Tribunal were to come to the view that the arbitration agreement conferred jurisdiction upon it in relation to a claim under international law, it would need to be satisfied that all of the applicable requirements of public international law, including any question of the standing of the Claimants as Ghanaian nationals to assert such a claim, were satisfied.
(a) Their primary argument is that the Claimants' mining rights were governed not by the 1986 Law, but by a combination of the terms of the Project Agreement itself and the relevant provisions of the Concessions Act 1962, and it was only in accordance with those provisions that their rights could be taken away.
(b) They say that after the Government contracted in a private capacity to sell assets owned by DGL (including the mining rights), it could not then use the 1986 Law as a basis to either terminate the Project Agreement or expropriate the Claimants' assets, and on any view the Government did not have the right to terminate the Agreement.
(c) Even if the Project Agreement had been breached by the Claimants, that did not give the Government the right to expropriate assets (including mining rights) that had been irrevocably divested to the Claimants.317
(d) The Claimants then argue that the Respondent's conduct also constituted a breach of the rule against expropriation in Article 20 of the Constitution, breached a duty of care owed by the Respondent, and violated customary international law standards oftreatment.
(1) Notwithstanding any right or title which any person may have to any land in, upon or under which minerals are situated, no person shall conduct reconnaissance of, prospect for or mine any mineral in Ghana unless he has been granted a mineral right by the Secretary in the form of a licence or lease as the case may be.
(2) The Secretary shall on behalf of the Republic have power to negotiate, grant, revoke, suspend or renew any mineral right under this Law subject to a power of disallowance exercisable by the Council within thirty days of such grant, revocation, suspension or renewals. The powers of the Secretary under this subsection shall be exercised on the advice of the Minerals Commission.
(a) If a lessee under a CV (being a state-owned company) assigns its interest with the consent of the Minister for Mines, that assigned interest included a mineral right in terms of the 1986 Law (because the Law saved existing mineral rights under CVs) but did not transform the mineral right into a right granted under section 14(1) of the Law.400 In other words, the Claimants say that Ghanaian law recognized two kinds of mineral rights: pre-1986 mineral rights and post-1986 mineral rights.401 As described below, pre-1986 mineral rights were only subject to the 1986 Law to the extent 'necessary' to give effect to the Law (and this did not require the application of the termination procedure). Thus, the assignee was not required to submit a programme of mining operations.402
(b) The lessor's mineral rights, surface rights and in personam rights were largely unaffected by the 1986 law.403 The Law preserved the validity of any mineral rights that had been granted by the lessor to third parties and validated by CVs before the 1986 Law.404 Sections 70 and 71 of the Law regulated the surface rights of the lessor, lessee and lawful occupiers; the Law did not seek to regulate in personam rights.405
(c) As to the rights of a lessee under a CV, after the 1986 Law, the Claimants say that the lessee's mineral rights persisted.406 Those rights were a combination of in personam and in rem rights; an instrument assigning the latter could be registered in the Lands Registry in order to give it that effect.407 The position was no different for a state-owned company such as SGMC.408
(d) Thus, on the facts, the Agreement itself did not constitute a mineral right in terms of the 1986 Law.409 It did, however, transfer an interest in mineral rights (being concessions backed by CVs);410 the 1986 Law did not extinguish those existing rights.411
(a) the pre-existing law must be shown to be 'not in conformity' with the new law;
(b) it is presumed that the legislature intended to save the earlier law if possible;
(c) only necessary modifications shall be made; and
(d) any deviation from the pre-existing law should not harm either party.414
(a) The 1986 Law saved existing mineral rights.436 It did not state that existing mineral rights were to be annulled or reduced to bare land use rights,437 and the continuing validity of CVs was recognized by the Court of Appeal after its enactment.438 There is no contemporaneous evidence that the Law was intended to have this effect.439 Rather, CVs would die a 'natural death' because of theirfixed terms.440
(b) The Respondent's interpretation would require reading words into section 14(1), which would constitute impermissible 'indirect repeal by inference'.441 The Law was intended to apply only prospectively to new applications;442 it refers to those with rights in land who wish to mine minerals, and is irrelevant to those already mining minerals;443 and is concerned with the grant of new licences, not the transfer of existing ones.444
(c) DGL's mining and clause 1.1 of the Project Agreement demonstrate that mining rights under CVs survived the Law. Otherwise DGL (an entity separate from the Government to whom the law applied as much as to a private company) would have been mining illegally from 1986 until the divestiture in 1995.445 That is also consistent with the fact the Government permitted DCGL to mine without a lease and claimed royalties accordingly.446 The Claimants say that clause 1.1 was not intended simply to guarantee the validity of the CVs as against the landowners: this is inconsistent with the Claimants' evidence; the Government had no authority to give such a guarantee on landowners' behalf; and is inconsistent with the same warranty given in the Project Development Agreement for the Prestea mine.447
(d) The Claimants say that a comparison with the Project Development Agreements for Tarkwa and Prestea makes the point: they both stipulated that the Government was to provide a mining lease because they contemplated exploration and new mining agreements. The Dunkwa Agreement did not because all the necessary rights had been divested.448
(e) The Claimants say that its interpretation is consistent with the contemporaneous correspondence. In relevant correspondence, the Government did not say that DCGL was required to have a mining lease.449 CCML's 10 January 1997 letter sought a single mining lease for the sake of convenience, and sought permission to transfer the assets into DCGL's name.450 The Minerals Commission did not object to the proposed clause that would make the mining lease subject to the Project Agreement, and the lease was never obtained because the Commission stalled.451 The Claimants reject the Respondent's suggestion that the process was paused because of the Claimants' request to extend Phase 11.452 The Government's request on 10 September 2001 is consistent with the construction that the Claimants were not required to obtain a lease.453 And the 30 August 2002 letter from the Minerals Commission to the DIC does not support the Respondent's interpretation because it was 7 years after the Project Agreement; it was an internal document; and it actually suggests that DCGL was entitled to mine gold without a lease.454 That is consistent with other statements by Ministers.455
(f) To the same effect, the Claimants argue that their request to extend Phase II was 'driven by commercial realities', tax considerations and accounting treatment of expenditure, not by the need for a mining lease.456
(a) Mr Aryee had advised the Minister of Mines to take action against the Claimants before the Minister met with Mr Kapoor.515
(b) The Minister conflated the 'notice/remedy' and 'show cause' phases.516 Although the Claimants accept that reasonable minds might differ about whether this may be a one-step or must be a two-step process,517 they say that the policy of section 67 is to give companies notice of a breach and an opportunity to correct it, and only where it cannot be remedied to give them a second opportunity to show cause why the mineral right should not be withdrawn.518 This is said to be consistent with the Government's standard mining lease, which provides that the Government is to give three months for the company to rectify the breach, and then if the company fails to do so but disputes the Government's right to terminate, gives the company the right to commence international arbitration.519
(c) As to the 4 May 2005 meeting, the Claimants submit that Mr Kapoor was not even told what the meeting was about,520 there are no minutes of the meeting,521 and as noted above Mr Aryee could not say that the Minister had specifically mentioned a failure to mine pursuant to the 5-year plan or the '24 to 36 month' commitment.522
(d) The 6 May 2005 letter mentioned matters that the Claimants were not responsible for (and indeed that the Respondent was responsible for), such as the negative perception of the community and the extent of galamsey, and this demonstrates a failure to act fairly.523 The Claimants submit that it was prepared from notes that predated the meeting. They note that it does not mention the 5-year plan or the alleged commitment to restart mining.524
(e) The Claimants were not given an opportunity to remedy all of the breaches on which the Respondent ultimately purported to terminate, because the last three grounds in the 7 November 2005 letter were not raised in the show-cause letter or - according to the Claimants' evidence - in the meeting.525 Nor was the one ground of which notice was given -the failure to mine -sufficient because the Claimants were entitled to suspend mining and the Government had consented to the suspension.526 The Minister could not rely on either the 5-year plan or Mr Kapoor's alleged promise to restart mining because the Government never told the Claimants that the promise would be treated as a 'drop dead deadline', never followed up and never provided the minutes of the meeting when the commitment was supposedly made.527 Furthermore, the Minister did not rely on the Claimants' alleged promises to restart mining in making his termination decision.528
(f) Termination was only permitted where t~e alleged breaches could not be remedied, and DCGL's 8 August 2005 letter (which the Minister allegedly 'ignored') showed cause why the Claimants' rights should not be revoked.529 If DCGL was required to respond within 90 calendar days (instead of 90 business days) this should have been spelled out, and 90 days was not enough to produce the kind of response which the Government wanted.530 The Claimants also submit that the language of the Minister's letter was carefully chosen, and that he had in fact read the Claimants' response when he confirmed his decision to terminate.531
(g) Although the Minister sought the Minerals Commission's advice as he was required to do, this advice does not mention a failure to honour a prior commitment to recommence mining, and acknowledges that a mineral right may be granted in the form of a project development agreement.532
(h) Finally, the Government had not issued regulations governing the exercise of its discretion in violation of Article 296 of the Constitution.533
(b) Respondent's submissions
(a) The law does not require two distinct 'notice' and 'show cause' stages. Indeed, some breaches cannot be remedied.534
(b) There is nothing wrong with the Minister's letter conveying information that did not form the basis of his decision, and there is no substance to the claim that the Government was responsible for the community relations problems or galamsey.535
(c) While the letter did not mention the last three grounds for termination, the payment grounds were raised in the 4 May 2005 meeting and in 2003. Moreover, the Minister was entitled to cancel under the first ground alone.536
(d) DCGL's letter was outside the 90 day deadline (which could only have meant 90 calendar days) and, in any case, did not respond to the Minister's concerns or show cause why the Claimants' rights should not be revoked.537 The Respondent says that 90 days was sufficient.538
(e) It is clear that the Minister did obtain the Minerals Commission's advice.539
(f) Finally, the Supreme Court of Ghana has specifically held that the exercise of a statutory power is not invalid simply because regulations guiding its exercise had not been promulgated, and in the absence of such regulations the Minister was free to give notice as he deemed appropriate.540
(a) Failure to conduct mining operations : Neither the CVs nor the Project Agreement required DCGL to mine by a certain date or at all: they were entitled to do whatever was 'economical' (including auxiliary activities in place of mining).542 The Government also approved the suspension of mining, which is customary in the mining industry.543 Furthermore, the Minister knew or should have known that he had to assess DCGL's performance against the Project Agreement, not the Law.544 The 5-year business plan did not constitute a 'programme of mining operations' (in terms of the 1986 Law) against which the Government could enforce the Claimants' alleged obligation to mine (nor did the parties treat it as such545); nor Mr Kapoor's statement that DCGL would resume mining in 24 to 36 months.546 The Claimants' ability to implement the 5-Year Plan was frustrated by the government's failure to provide a peaceful and safe environment, and by the fact that financiers (including Maharishi) could not be persuaded to invest in such an environment with the low gold price.547 As the Claimants put it in closing, 'the five-year plan was stillborn.'548 The Claimants also submit that the Minister did not rely on any promises from the Claimants to restart mining in his decision to terminate.549
(b) In this connection, the Tribunal sought submissions on the question of what legal consequences would follow if the Claimants had ceased mining operations entirely after having completed Phase II (without having surrendered their rights or obtained the Government's consent to suspend mining). The Claimants accepted that if they had done so they would have been acting outside the terms of the 1986 Law, but in reality the Government 'de facto agreed to the suspension', and the Minister failed with his obligation under section 58(3) to set a date by which the mine had to resume full production, which gave rise to an estoppel.550 Legally the answer would be the same regardless of whether the cessation lasted 5 or 20 years, but 'practically and morally' it would not.551
(c) Royalties : The Claimants do not deny that payment of royalties was an obligation under the 1986 Law, but they say it was not an obligation under clause 10.6 of the Project Agreement - which just provided for deferral - so non-payment was not a breach of the Agreement.552 Moreover, they believed they had been deferred after the Ministry for Mines indicated that they were ready to grant a deferment but needed to consult with the Ministry of Finance.553 The Minister should have given DCGL an opportunity to pay, and otherwise pursued the royalties as a debt through the courts before terminating.554 1n any case, it was disproportionate and an improper exercise of discretion to terminate the project on that basis.555
(d) Quarterly reports : DCGL filed reports on a monthly basis, which satisfied this obligation because they contained everything that the quarterly reports would have.556 In any case, any failure did not justify termination because it did not (i) go to the root of the contract; (ii) make further performance of it impossible; or (iii) affect the very substance of the contract.557
(e) World Bank loan : While the Claimants acknowledge the loan, they say that the terms of repayment were not agreed, and in any case the failure to repay was not a breach of the 1986 Law or a condition of CCML's mining rights under the Project Agreeement, so did not entitle the Government to terminate.558 They also say that the loan obtained by the Government from the World Bank and then on-lent to DCGL was invalid because the loan agreement was not approved by Parliament.559
(a) Failure to mine : Section 53 of the Minerals and Mining Law 1986 required the leaseholder to mine in accordance with a 'programme of mining operations'.568 The 5-year plan submitted by DCGL- which was followed shortly by a request to declare Phase II complete - constituted such a programme against which the Government could enforce the Claimants' obligations.569 The government 'was not powerless simply because [the Claimants] refused to sign a mining lease and didn't have a piece of paper that in haec verba said: programme of mining operations.'570 The fact that the Claimants never obtained a mining lease should not excuse their failure to comply with the plan.571 Although Ghanaian law recognizes the possibility of a suspension, this must be authorized by the Minister and is subject to conditions imposed.572 In 2002, DCGL again committed to restarting operations in 24 to 36 months with efforts to resume within 24 months.573 The Government approved these plans - which constituted a mining activity not the suspension of mining574 - and encouraged DCGL to restart mining (alongside, but not replaced by, auxiliary projects).575
(b) The reality, according to the Respondent, was that the Claimants could not obtain the necessary financing. Having withdrawn their own support in 1998, they sought relief from the government in 1999 which was not forthcoming.576 After that, the only apparent attempts to finance the project were the approach to Maharashi- which the Respondent characterizes as either 'made up or wishful thinking'577 - and the payment to Mr Kapoor and Mr Basi of US $216,000 per year, which was added to the balance outstanding to Mr Basi's company and accrued interest.578
(c) In response to the Tribunal's question, the Respondent submits that if the Claimants ceased mining entirely after completing Phase II they would have simply concluded the Agreement without obtaining the required mining lease; even if the Head Leases/CVs or the Project Agreement constituted a mineral right that authorized mining after the end of Phase II, it would have been subject to the 1986 Law and suspension of mining without the Minister's approval would constitute a breach giving rise to the right to terminate.579
(d) Royalties : The Claimants were required to pay royalties under section 22 of the Minerals and Mining Law 1986, an obligation 'affirmed' by the right to seek a deferral under clause 10.6 of the Project Agreement.580 It is beside the point that the Project Agreement did not in terms require payment of royalties, because the breach of the Law entitled the Minister to cancel.581 It is not credible that the Claimants could infer from the absence of a, confirmation that royalties had been deferred, and any deferral would have been prospective in any event.582 The Respondent rejects the Claimants' alleged understanding that royalties had been automatically deferred during Phase 11.583 The Respondent says the suggestion of a deferral is a recent invention inconsistent with contemporary documents and the Government never understood that it had granted a deferral.584 The Respondent says the Claimants were informed of the outstanding royalties in May 2003 and the 4 May 2005 meeting.585 It says the· Minister's action was reasonable.586 Finally, the Respondent says that the Government's ability to pursue royalties as a debt through the courts pursuant to section 25 cannot have been intended to displace the Minister's right under section 67 to cancel a mineral right where the holder has failed to pay royalties.587
(e) World Bank loan : The Respondent says that the Claimants' obligation to repay the loan is not denied.588 In 1999 the Claimants' request for a waiver of the loan was denied, and in 2002 SGMC sent copies of the finalized loan agreement to DCGL to execute.589 The Respondent also rejected the Claimants' allegation that they were entitled to a set-off of the liability and their dispute about the quantum actually disbursed.590 No loan terms had set because DCGL without excuse had refused to settle them,591 and so the Respondent alleges that 'Standard commercial loan terms' apply.592 The Respondent says that because the Project Agreement was 'the only arguable mineral right DCGL held', a breach of the contractual obligation to repay constituted a breach of the term of the mineral right sufficient to engage section 67 of the Minerals and Mining Law 1986.593 It says that DCGL had notice of the issue in May 2003 and at the 4 May 2005 meeting.594
(f) Quarterly reports : The Respondent points out that the failure to submit quarterly reports was identified in the Minerals Commission's letter in May 2003, and the Claimants' response that it was already filing monthly reports was not given then.595 Mr Aryee's evidence is that the quarterly reports that were required in divested projects were required to be more detailed than ordinary monthly production reports.596
(1) What rights, including mining rights, did the Claimants acquire over the Dunkwa Concession by virtue of the Project Agreement and what legal regime governed the exercise and enjoyment of those rights?
(2) Was the Government entitled to terminate the Claimants' rights upon notice for failure to mine the concession and, if so, did the Minister validly exercise such right of termination under the applicable legal regime?
All claims, differences and disputes arising between the parties as to any matter arising, whether directly or indirectly out of, or in connection with this Agreement shall be referred for determination by International Arbitration under the rules and regulations of the International Chamber of Commerce ("'CC") by a board of three (3) arbitrators which shall be appointed and will carry out the arbitration in accordance with the ICC rules.
7.5 The Tribunal shall apply the substantive law of Ghana to the Agreement, and may also have regard to relevant principles of international law in the determination of the dispute as agreed by the parties (Request for Arbitration, , Respondent's letter of 3 February 2012, Answer, ).
7.6 The Tribunal shall be entitled to determine any issue as to Ghanaian law on the basis of:
(a) the parties' written and/or oral submissions, including any legal authorities relied upon; and/or,
(b) expert evidence, if the Tribunal calls for expert evidence as to Ghanaian law or the parties, with the leave of the Tribunal, submit such expert evidence.
(1) Standing. First the Respondent challenges the Claimants' standing. This issue turns upon the extent and effect under Ghanaian law of CCML's oral assignment of its rights under the Project Agreement to DCGL or the extent to which DCGL may validly take the benefit of rights (including the right to invoke the arbitration agreement) under the Project Agreement.
(2) Limitation. Next, the Respondent questions whether the present claim was brought in a timely fashion in accordance with the applicable limitation period. It is common ground between the Parties that, as regards the contractual claims, the limitation period is six years from the date of the alleged breach. In addressing this issue, the Tribunal must first determine the relevant date of breach for this purpose. It must then decide whether Claimants' Request for Arbitration issued on 4 November 2011 was valid and effective to toll the limitation period and, if not, when the limitation period was tolled.
(3) International law claims. Third, the Respondent challenges the jurisdiction of this Tribunal in respect of those of the Claimants' claims that are grounded in public international law. In order to address this objection, the Tribunal will have to consider the conditions applicable to the admissibility of these claims under international law.
(4) Constitutional law claims. Finally, the Respondent challenges the jurisdiction of the present Tribunal over claims under the Constitution of Ghana.
CCML shall be entitled at any time from the date of signing this Agreement to assign part or all of its rights and obligations under this Agreement in whatever form such rights and obligations then existed, to a company which is its affiliate or subsidiary provided that such company undertakes to be bound by the provisions of this Agreement or any other agreement which may replace it.
In the event of any assignment by CCML to another company, CCML shall continue to be liable with the assignee for the performance of its obligations.