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Parliament approves cap on arbitration compensation

Mariyam Malsa
08 December 2019, MVT 21:29
Thulhaadhoo MP Hisaan Hussain. PHOTO: HUSSAIN WAHEED/ MIHAARU
Mariyam Malsa
08 December 2019, MVT 21:29

The parliament, on Saturday, approved a petition limiting the maximum amount the government can pay to settle arbitration cases.

Submitted by Thulhaadhoo MP Hisaan Hussain, the petition was unanimously passed by the votes of 62 parliamentarians after the public finance committee brought several amendments.

The report prepared by the public finance committee stated that the Ministry of Finance should amend the Public Finance Act to include an upper limit to the amount that all government institutions can pay as compensation in cases filed by both foreign and local companies.

The public finance committee also stated that the Attorney General's office must be notified of the limit on compensation so that the figure can be included in agreements. The AG office will also be mandated to draft amendments to the Civil Procedure Bill and Public Finance Act and forward it to the parliament as swiftly as possible.

MP Hisaan's petition also proposed that any government official found to be negligent or hold responsibility in matters that necessitate compensation must be charged and punished.

Many companies and firms have pressed charges against the state, seeking compensation for nullifying agreements, in some cases, unlawfully.

President Ibrahim Mohamed Solih's administration has paid an approximate MVR 1 billion in compensation for contracts that were nullified in violation of the agreements.

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