The Costly Feud against Becchetti, 4M Euro and Counting

Several payments have been made on account of the international law firm Wragge Lawrence Graham & Co, Albania’s legal representative in two arbitration cases that are currently under review at the International Centre for Settlement of Investment Disputes (ICSID) of the World Bank in Washtington, DC, between businessman Becchetti and the Albanian government.

In November 2014, Becchetti and his partners at Albaniabeg Ambient shpk filed a complaint at the ICSID related to the breach of contract of their concession for the construction of a waste recycling and electric power plant by the Albanian state.

In November 2015, Becchetti and his company Hydro Srl, filed another complaint at the ICSID related to the financial damage caused by the government’s decision to freeze all assets of Becchetti and his Albanian companies.

For their defense in arbitration court, the Albanian government then hired the international law firm Wragge Lawrence Graham and Co.

Until now, this firm has filed, in both cases pending at the ICSID, a total of three lengthy observations and have given two replies to the claims of the other parties.

For this work the Albanian government has paid at least 4 million euro through special decisions of the Council of Ministers (KM), outside the control of Parliament.

  • On September 22, 2015, the KM decided on a payment of 220,000 US dollars for administrative costs of the arbitration; 200,000 euro for the defense lawyers.
  • On the same date, the KM decided on a payment of 39,050,000 lekë (about 280,000 euro) for the lawyers dealing with the case of the recycling plant.
  • On December 9, 2015, the KM decided on an additional payment of 1.95 million euro for the lawyers dealing with the case of the hydropower plant of Kalivaç.
  • And recently, on November 2, 2016, the KM decided on another additional payment of 1.18 million euro and 125,000 US dollars for the lawyers in the Kalivaç case.

Origins of the conflict

The conflict between the government and Becchetti started after the 2013 parliamentary elections.

After he came to power, Rama canceled two concessions of Becchetti from the period of Prime Minister Fatos Nano, which had been renegotiated during the Berisha government: one for the construction and operation of the hydropower plant in Kalivaç, and one for the construction and operation of a recycling plant.

Meanwhile, in 2015 the Office of the General Prosecutor investigated Becchetti for tax evasion. Initally, the accusations related to money laundering and the fraudulent investment schemes, but these were later reduced to tax evasion.

An international arrest warrant was issued for Becchetti and all his possessions were confiscated, leading the closure of his television project Agon Channel in the summer of 2015, and the dismissal of about 500 employees.

Becchetti, as well as a number of political commentators, qualified the investigation as an intentional attack of the Rama government, because of Agon Channel’s critical stance toward the government.

The declarations of Prime Minister Rama a few minutes after the confiscation orders of the Prosecutor’s Office confirm this interpretation: “The blocking of the source of black money that fed Agon Channel has been a success!”

Failed extradition request

In November 2015, Becchetti was arrested in London, and the Albanian government sought his extradition.

In July 2016, however, the Westminster Magistrates Court decided against the extradition, calling the government’s evidence “totally misleading.”

The court had found that the Albanian government had made, on purpose, false statements in the extradition request, including misleading information regarding Albanian legislation. It qualified the attempts of the Albanian government to be a “manipulation and usurpation” of the juridical process. For these reasons it voted against the extradition.

Initially, the government announced that it would appeal the decision. But in the last days before the deadline, it informed the court that it would forgo an appeal.

Similarly, in the beginning of 2016, the International Court of Arbitration asked the Albanian government to suspend the criminal procedures and arrest and extradition warrant against Becchetti and his partner, Mauro de Renzis, until the entire case had been scrutinized.

In spite of the request of the arbitration court, Rama’s government continues to spend millions on the “feud” against Francesco Becchetti.