RIYADH: Business conglomerate Al-Habtoor Group has issued a formal notice against Lebanon for violating its bilateral investment treaty with the UAE.
Under the treaty, signed in 1999, Beirut committed to protect Emirati investments on its soil. The dispute revolves around the UAE conglomerate’s extensive investments in Lebanon totaling nearly $1 billion.
In December last year, the group’s chairman, Khalaf Al-Habtoor, told Arab News that the initial value of the group’s direct investment in Lebanon was over $1 billion with an additional $500 million in indirect investments.
This includes investments in the Lebanese banking system, luxury hotels affiliated with Hilton Hotels & Resorts, a shopping mall, the Habtoor Land entertainment and leisure destination, and various other real estate ventures across the country.
However, due to the economic downturn, the current value of these investments is almost zero, impacting around 500 employees in Lebanon.
The UAE-based group asserts that “Lebanon and its central bank have violated the bilateral treaty by imposing restrictions, preventing the group from freely transferring funds amounting to over $44 million from Lebanese banks.”
A statement issued by the group said: “Lebanon has also failed to secure a safe and sound environment for Al-Habtoor Group’s businesses and investments. As a result of Lebanon’s actions, Al-Habtoor Group has incurred and continues to incur significant losses and damages.”
The conglomerate, represented by the international law firm White & Case LLP, expressed its intent to pursue its rights both domestically and internationally.
In a formal notice issued to various Lebanese government bodies in early January 2024, the group triggered the six-month cooling-off period outlined in the UAE-Lebanon Treaty.
“Should the dispute remain unresolved within this timeframe and the group’s claims go unsettled, the company reserves the right to initiate legal proceedings against the Lebanese Republic at both local and international levels, as stipulated in the treaty,” the statement added.
In an earlier interview with Arab News, the group’s chairman had warned of a complete withdrawal from Lebanon if the government failed to safeguard the conglomerate’s investments.
Al-Habtoor highlighted the moral duty and legal obligation of the Lebanese government to compensate and protect foreign investments.
The business tycoon stated: “If I find a buyer now for everything I invested there with a negotiable price, I will sell it,” indicating the severity of the situation.
Founded in 1970, Al-Habtoor Group has been a significant player in Lebanon’s hospitality, automotive, real estate, education, and publishing sectors. Despite economic hardships, the group reopened the Grand and Metropolitan hotels, reflecting a commitment to supporting local communities and providing employment opportunities.
Lebanon faces deep political instability, financial crises, and external threats, leading foreign investors, particularly from the Gulf Cooperation Council states, to express concerns about protecting their business interests. Al-Habtoor called for the urgent dismantling of armed groups controlling state resources for Lebanon’s survival and economic revival.
