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Donaco’s US$190 million Singapore court case against Thai vendors delayed

Newsdesk by Newsdesk
Thu 15 Aug 2019 at 06:06
Deconstructing  Donaco

Star Vegas in Poipet, Cambodia

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A Singapore court case brought by Donaco International Limited against the Thai vendors of its Cambodian casino, Star Vegas, in pursuit of US$190 million in damages has been delayed by four months, the company revealed on Wednesday.

The arbitration claim will now recommence on 25 November 2019 after an initial oral evidentiary hearing was held over a two-week period starting in late July.

Donaco noted that, because the Singapore arbitration proceedings are confidential, it is unable to provide further details about the cause of the delay but plans to press ahead with its claim “with maximum efficiency and diligence.”

The company also observed that the length of the proceedings are not in keeping with standard practice, referencing a 2016 study by the Singapore International Arbitration Centre which revealed that the mean duration for an arbitration claim before a single arbitrator is 13 months, with a median duration of 11.3 months from filing of an arbitration claim to the making of an award. Donaco’s claim has already lasted 18 months.

Donaco is seeking US$190 million in damages after the Thai vendors continued to run gaming operations at Star Paradise, located adjacent to Star Vegas in Poipet, in defiance of non-compete provisions.

The vendors, Lee Bug Leng, Lee Bug Huy and Lee Bug Tong, had previously been granted permission to host gaming facilities under the management of Donaco in a deal that saw the latter paid a monthly management fee of THB5 million (US$151,000), but that agreement expired in 2017 with no new management arrangements put in place.

After they continued to run gaming operations in defiance of non-compete provisions, the vendors – who also own the land upon which Star Vegas sits – threatened in June to terminate Donaco’s 50-year land lease.

Cambodia’s Banteay Meanchey Court of First Instance subsequently granted an injunction against the vendors preventing such termination pending further legal hearings. Donaco is also in the midst of legal proceedings against the vendors in Australia where the NSW Supreme Court has issued a freezing order preventing the vendors from selling any of their 17.9% stake in the company.

 

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