DP World’s Egypt operations in late 2012 ‘a war zone’

DP World’s operations in Egypt in late 2012 were akin to “a war zone”, Mohammed Sharaf, its chief executive, said yesterday.

He made the comments regarding the port operator’s concession in Sokhna while giving evidence during a trial at the Dubai World Tribunal brought against DP World by Platinum Services, its former labour contractor.

Sokhna Port was hit by a series of strikes and industrial action in 2012 and 2013, amid a wider backdrop of political and industrial turmoil in the country.

“Egypt was going through ... turmoil at the time, we were facing quite a [number] of challenges on the ground at the time,” Mr Sharaf said in response to questions from Platinum’s legal team about his increasing involvement in Sokhna Port’s daily operations.

“On the ground the labour situation was not stable.”

Platinum filed a US$50 million lawsuit against DP World in December 2013, claiming that the company and its Egyptian subsidiary, DP World Sokhna (DPWS), conspired from late 2012 to terminate Platinum’s engagement as a labour subcontractor at the port.

Platinum also claims that DP World and DPWS conspired to lure its workers to another third-party labour supplier, with no compensation paid to Platinum for the loss of its workers, thus driving it out of business.

DP World argues that DPWS made a commercial decision in 2012 to split the services Platinum provided into smaller packages and put them out to tender for more favourable rates and to be less dependent on any single labour contractor.

“Whether it’s us, our suppliers or vendors, whatever we do we always make sure that all parties are winners,” said Mr Sharaf.

“We don’t want any parties – whether they are labourers, especially labourers – to be taken advantage of. That is our principle concern.”

DP World said that although DPWS had terminated Platinum’s services in 2013, Platinum was invited to participate in the tender process for new services.

DP World said that Platinum chose not to participate in the tender process, and subsequently “improperly incited its workers to strike in an effort to force DPWS to reverse course”.

The ports operator has denied instigating Platinum’s former workers to quit upon the expiration of the company’s contract with DP World.

The ports operator said it had urged “the contractors replacing Platinum to offer jobs to laid-off Platinum employees if they wanted to continue working at the port, and [published] notices during the strike in an effort to correct misinformation being spread by Platinum”.

The case continues until next week. A judgment is expected to be handed down early next year.

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