KEY POINTS
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A US appeals court dismissed a $93 million enforcement case against Zimbabwe’s state mining company, citing lack of jurisdiction.
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The dispute stems from a cancelled joint venture with Mauritian firms and a 2014 arbitration award that remains unpaid.
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Zimbabwe celebrates the ruling as a win for national sovereignty, while legal experts warn it may deter foreign investment.
In a significant legal victory for Zimbabwe, the US Court of Appeals for the District of Columbia Circuit has dismissed a case brought by two Mauritian firms seeking to enforce a decade-old arbitration award against the Zimbabwe Mining Development Corporation (ZMDC), a state-owned mining enterprise.
The lawsuit, filed by Amaplat Mauritius Ltd. and Amari Nickel Ltd., was aimed at recovering an arbitration award dating back to 2014. The companies had been awarded a combined total of $46.8 million by the International Court of Arbitration in Zambia following the cancellation of a joint venture agreement with ZMDC for nickel and platinum mining operations in Zimbabwe.
The Zambian arbitration panel found ZMDC liable for breach of contract and awarded $42.9 million to Amaplat and $3.9 million to Amari, with an additional 5% annual interest. The accrued interest over the years brought the total sum claimed to approximately $93 million by 2025.
“Despite the clear outcome of the arbitration, ZMDC refused to comply with the award,” said a legal representative for the plaintiffs. “This left the companies with no choice but to pursue enforcement in other jurisdictions.”
However, the US appellate court ruled that it lacked jurisdiction over the matter, effectively ending the firms’ attempt to seize ZMDC assets located within the United States. The court emphasized that the Foreign Sovereign Immunities Act (FSIA), which outlines the circumstances under which foreign governments can be sued in US courts, did not provide adequate grounds to proceed with the enforcement case.
Zimbabwe hails ruling as a diplomatic and legal win
Zimbabwe’s Secretary for Mines and Mining Development, Pfungwa Kunaka, welcomed the ruling as a positive step in protecting the country’s sovereignty and its struggling public enterprises.
“This judgment validates our position and prevents the unlawful seizure of Zimbabwe’s assets abroad,” Kunaka stated. “We remain open to resolving legitimate business disputes, but we will not allow coercive tactics to undermine our national interests.”
Legal analysts have noted that while arbitration awards are internationally recognized, enforcement often becomes complex when it involves sovereign states. The case highlights a broader challenge many investors face when dealing with state entities in emerging markets — the difficulty of compelling compliance when governments decline to honor contractual or arbitration obligations.
The dispute between the Mauritian firms and ZMDC traces back to a joint venture agreement signed in the mid-2000s, intended to develop rich deposits of platinum and nickel in Zimbabwe’s Great Dyke region. When ZMDC unilaterally terminated the venture, citing regulatory and strategic concerns, the matter escalated into international arbitration.
In 2019, the Zambian High Court permitted the enforcement of the arbitration award, which could have paved the way for asset seizures had Zimbabwe held recoverable property in Zambia. With the US now rejecting jurisdiction, options for enforcement have further narrowed.
Observers say the ruling could embolden other state-run firms resisting arbitration outcomes, but it may also increase investor wariness toward Zimbabwe, especially in the critical mining sector.
Zimbabwe, which is grappling with over $18 billion in public debt, has been trying to revive investor confidence in its extractive industries. The country boasts vast reserves of gold, lithium, platinum, and chrome, yet ongoing legal and policy uncertainty has constrained investment inflows.
International financial institutions and development agencies have consistently urged Zimbabwe to improve transparency, uphold the rule of law, and honor contractual agreements if it hopes to attract sustainable foreign capital.
For the Mauritian companies, legal avenues for enforcement now appear limited, though their representatives have hinted at pursuing alternative jurisdictions or diplomatic pressure through their home government.
