by Linda Straker
- Arbitration request made under a binding 1986 treaty between the US and Grenada
- Kimpton Kawana Bay hotel project halted due to legal action taken by developers
- Kawana Bay Hotel at Grand Anse beach is a Citizenship By Investment-approved project
The Kimpton Kawana Bay hotel project was halted because of legal action taken by the developers in the first quarter of 2022. Prime Minister Dickon Mitchell publicly expressed his Government’s intention to negotiate a settlement with them to see the completion of the project. However, the developers indicate this may not be a possibility.
“Unfortunately, the extensive damage to the project caused by the actions of the former government administration in Grenada has severely complicated and handicapped the efforts towards settlement. We welcome the Prime Minister’s statement and remain open to the possibility of an amicable settlement in the interest of all stakeholders,” said a 23 January 2023 statement published on the developers’ website.
The statement to investors of the project provided an update on the legal proceedings since the matter was filed with the International Centre for the Settlement of Investment Disputes (ICSID). The statement said, since filing, there has been increased momentum in the case against the Government of Grenada before the World Bank ICSID. “On 1 July, 2022, we filed our Memorial on the Merits, setting out the details of our claim with supporting expert reports. The Government of Grenada would have been required to file its response in the form of a Counter-Memorial by December 2022, but forestalled this on 1 November 2022 by making a preliminary application objecting to ICSID’s jurisdiction and seeking to bifurcate those jurisdictional objections into a separate phase.”
“On 28 December 2022, we filed a comprehensive response rebutting the Government’s objection. At this juncture, the tribunal may either make a ruling on the matter or conduct a hearing on whether to bifurcate the dispute. If a hearing is scheduled, we anticipate it will be held on or about April 2023; however, if the Tribunal elects to make a ruling, the Government’s preliminary application may be determined in the next few months (if not sooner).” The statement explained there was a change in Government on 23 June 2022.
“We continue to take prudent steps to move the arbitration proceedings forward as efficiently as the circumstances permit. We are cognisant that in the ordinary course, the international arbitration proceedings may span into 2024. However, we maintain a cautiously optimistic outlook that 2023 may bring a positive and final outcome,” said the statement which thanked purchasers and stakeholders of the projects.
Kawana Bay Hotel, an incomplete tourism project at Grand Anse beach, is a Citizenship By Investment (CBI) approved project. The developer or company behind the project is True Blue Development, whose major shareholder is former ambassador at large to Grenada, Warren Newfield. With 2 affiliated entities and US shareholders, the company has brought an arbitration before the ISCID against the Government of Grenada.
According to the developer, the arbitration was filed because the then Government imposed unilaterally a limitation on using CBI funds for the construction costs of the hotel. The arbitration request has been made under the binding 1986 Treaty between the United States and Grenada Concerning Reciprocal Encouragement and Protection of Investment, which was signed on 2 May 1986 and entered into force on 3 March 1989.
The 4 main objectives of the treaty provide for foreign investors to be accorded treatment in accordance with international law and are to be treated no less favourably than investors of the host country or no less favourably than investors of third countries, whichever is the most favourable treatment (“national” or “most-favoured-nation” treatment) subject to certain specified exceptions; International law standards shall apply to the expropriation of investments and to the payment of compensation for expropriation; Free transfers shall be afforded to funds associated with an investment into and out of the host country; and Procedures are to be established which allow an investor to take a dispute with a Party directly to binding third-party arbitration.
Loading...
Reload document 
Open in new tab 
Agreed.
NDC knows exactly what is going on and continue do nothing about it. The corrupt environment still exists.
Very succinctly put in typical WI style…
We are quite confident there are several other cases of wrong-doing by the former Doc Mitchell Regime against several foreign investors that need to be made public to expose the patterns of wrong doing that existed for way too long, with extreme tactics to keep it all covered up.
Silence is Complicity; even as same continues to all kept under wraps by the Dickon Mitchell Administration.
KIETH and NNP have cost Grenada $100s of millions over the years.
Grenadians must be mad to continue voting this reckless bunch into office.
Yes indeed and the cover up continues to take center stage under the NDC Administration.
Agreed. It’s for this reason I get myself to get involved in color politics.
NDC knows exactly what is going on and continue do nothing about it. The corrupt environment still exists.
Lawyer who offer his service to sell Grenada’s passport becomes PM.
How can one person cause Grenada to lose significant scarce resources and get away with it? Moneys that should gone towards the development of the people and country.
A usual the foreign vultures gather to attempt to feed on the local carcass… The government needs to allow the project to complete but with not one cent of grenadian money being given, and huge future duty and tax implications if the developers are less than compliant. If they ultimately want a business they must accept this, or others will complete the project and reap the rewards.