Fraport seeks compensation following Manila withdrawal

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Following Fraport's dispute with the Philippine government over retail revenue control at Manila airport's new terminal three, the Frankfurt-based airport group has revealed that it will take legal action against the government, both on its own and as part of concession consortium Philippines International Air Terminal Co (PIATCO)

The statement was released after the Philippines supreme court's decision this week that all project and concession contracts regarding the new terminal are null and void.

The original deal gave the PIATCO partners exclusive rights to operate duty-free in the terminal, but Fraport ended its participation in the project last week after the building had remained empty since November. The losses incurred left the group with a $132m net loss in 2002.

A Fraport spokesperson said PIATCO should be able to claim compensation for its investment in the completed terminal, and added that the group would be seeking its own damages from the state under the provisions of the German-Philippine Investment Guarantee Treaty.

More details will appear in the next issue of the newsletter DFNI eXTRA, out tomorrow.