Mozambique can sue Middle East shipbuilder Privinvest over a $2bn corruption scandal in the English courts, Britain’s highest court has ruled.
The African nation is suing the Abu Dhabi-based company, its Lebanese-born owner Iskandar Safa, the Credit Suisse bank and others over the alleged payment of bribes of more than $136m to corrupt Mozambique officials.
The payments were allegedly made to secure three decade-old deals between state-owned Mozambique companies and Privinvest to develop the country’s tuna fishing industry, a shipyard and a coastal defence system.
The plans were backed by nearly $2bn in loans from Credit Suisse and Russian lender VTB based on a guarantee from the Mozambique government. But the investment failed and Mozambique is taking legal action over the missing millions as it faces being exposure to a $2bn liability.
Privinvest had claimed that any dispute over the deals should be settled through arbitration in Switzerland and won a court ruling in 2021 that backed their argument.
But England’s highest court overturned the ruling on Wednesday clearing the way for a trial that is due to start in October and run for months. Mozambique wants to revoke the guarantee on a loan that it says was procured corruptly.
Privinvest claims that it provided valuable goods and services but they were squandered by the government, which sabotaged the project for internal political reasons.
The legal battle in London is just the latest in a long saga that has seen three Credit Suisse bankers pleaded guilty in the United States to offences including wire fraud and money laundering.
Prosecutors allege Mozambican government officials, corporate executives and investment bankers stole about $200m. While Privinvest did deliver ships and equipment to Mozambique, their value was grossly inflated, prosecutors had alleged.
Some of the bankers gave evidence against Privinvest lead salesman Jean Boustani, 41, but he was acquitted in 2019 of helping to defraud US investors after a trial in Brooklyn, New York.
Credit Suisse in 2021 agreed to pay about $475 million to authorities in the US and UK for defrauding investors over the deal.
