Splash247: London tribunal confirms Djibouti acted illegally in DP World terminal seizure

The London Court of International Arbitration (LCIA) has ruled that Djibouti’s 2018 seizure of the Doraleh Container Terminal (DCT) from DP World was unlawful, confirming the validity of the Dubai operator’s 50-year concession agreement.

The decision closes the arbitration case between DP World and Port de Djibouti SA (PDSA), but wider disputes with the Djibouti government and China Merchants Port Holdings remain unresolved. The tribunal found that liability lay with the state rather than PDSA, leaving DP World’s $1bn claims against Djibouti and China Merchants still active.

DP World is also owed $685m in earlier arbitration awards against the government, which remain unpaid. “Djibouti’s claims are at odds with reality, proven time and again in independent international tribunals,” a DP World spokesperson said, adding: “This case is bigger than DP World — it is about whether governments can tear up binding contracts and ignore international law without consequence.”

The Doraleh Container Terminal, which handles 1.2m teu a year, is often described as the largest and most modern container facility in East Africa. DP World said that under its management, it accounted for about 12% of Djibouti’s GDP and provided thousands of jobs.

Djibouti maintained the seizure was lawful, a position rejected by multiple rulings. President Ismail Omar Guelleh recently defended the government’s actions in a video statement, but DP World insisted the narrative misrepresents the facts.

The conflict dates back to 2018, when Djibouti terminated DP World’s concession secured in 2006 and partnered with China Merchants. DP World has since pursued legal remedies through international tribunals.