Alpine and Porr to seek Serbian settlement

By Chris Sleight17 December 2008

A consortium including Austrian contractors Alpine Bau and Porr has pulled-out of Hergos-Pozega motorway in Serbia, having been awarded the € 1,5 billion concession last year. The group says it has been unable to reach agreement with the Serbian government following proposed changes to the contract in the summer.

The government and consortium will now go into a mediation process to settle the dispute. If this is not resolved after 60 days they will refer the matter to the International Chamber of Commerce (ICC) for arbitration.

A statement from Poor said, "We have made every endeavour to submit fair proposals to the Serbian government around the changed circumstances with which the Serbian government was confronted. We have showed continuous flexibility with regards to those considerable costs that resulted in the planning and preparation of the Horogos Pozega project.

"In July 2008 the National Council for Infrastructure made the decision not to go ahead with the Horogos Pozega construction project. Since then we have been in permanent informal discussions with the government. The consortium has had no clear decision regarding the numerous proposals submitted.... However, the Government has not dealt with out alternative proposals."

It concluded, "We will still endeavour to find a fair solution which creates a win-win situation for all involved. In this way, we hope to avoid a formal ICC hearing, which would be both time consuming and costly for all parties."

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