|“Doing business with Mongolia”, “UK Investors show” бизнес хөтөлбөр March 27-April 02. 2019 ЛОНДОН ХОТ, ИХ БРИТАНИ||Mongolian Business Database||London UK|
|SYMPOSIUM ON GLOBAL MARKETS Nationalism and Protectionism: The United States in the International Arena June 17-18, 2019 The Center for American and International Law Plano, Texas, USA||The Center for American and International Law (CAILAW)||Plano Texas June 17-18 2019|
|"Open to Export" ICC WTO International business award||ICC WTO||London|
COSCO Shipping Holdings Co Ltd (601919.SS) has offered to buy Orient Overseas International Ltd (OOIL) (0316.HK) for HK$49.23 billion ($6.30 billion), in a deal that will see the mainland China group become the world's third largest container liner.
The proposed deal is the latest in wave of mergers and acquisitions in global container shipping that has left the top six shipping lines controlling 63 percent of the market. OOIL's shipping subsidiary, OOCL, has a 2.7 percent slice of the market.
COSCO Shipping is offering HK$78.67 for each OOIL share, a premium of 37.8 percent over OOIL's closing price of HK$57.10 on its last trading date, the companies said in filings with the Hong Kong and Shanghai stock exchanges on Sunday.
OOIL's controlling shareholders had on Friday agreed to sell their 68.7 percent stake at that price to COSCO Shipping, which is making the offer with Shanghai Port International Group (SIPG) (600018.SS) that will take 9.9 percent, they said.
COSCO Shipping will have a fleet of more than 400 vessels and capacity exceeding 2.9 million TEUs (twenty-foot equivalent units) should the deal go through, it said.
This would make it the world's third largest container shipping line after Denmark's Maersk Line MAERSKb.Co and Switzerland's Mediterranean Shipping Company (MSC), according to Singapore-based transport research firm Crucial Perspective. It is currently the fourth-largest behind France's CMA CGM [CMACG.UL].
"COSCO Shipping Holdings believes this acquisition will enable both COSCO Shipping Lines and OOIL to realize synergies, enhance profitability and achieve sustainable growth in the long term," the Chinese group said in the statement.
OOCL was founded in 1969 by Hong Kong shipping magnate Tung Chao-yung, whose son, Tung Chee-chen is chairman, president and chief executive of the company, while several Tung children are in senior management roles.
The two companies in January dismissed merger rumors but analysts said that OOCL was still a likely bid target due to its long profitable history and relatively low leverage.
Both firms are also part of the "Ocean Alliance" partnership, which also includes CMA CGM and Evergreen Marine Corp (2603.TW), that was formed last year to take on the rival grouping of Maersk Line and MSC.
COSCO Shipping itself was created from the state-driven merger of former rivals China Ocean Shipping (Group) Company and China Shipping Group. Shares in the firm, which flagged a return to first-half profit last week, have been suspended since May 16.
The companies said that they plan to retain OOIL's listing status and maintain its global headquarters and presence in Hong Kong to support the city as a global maritime center.
Should the deal fall through, COSCO Shipping has also agreed to pay OOIL a reverse termination fee of $253 million, they said
UBS AG Hong Kong Branch (UBSG.S) is advising COSCO Shipping and SIPG, while J.P. Morgan Securities (Asia Pacific) Limited (JPM.N) is advising OOIL.
(Reporting By Brenda Goh in SHANGHAI and Matthew Miller in BEIJING; editing by John Stonestreet and Jane Merriman)...
ULAANBAATAR – A brash businessman with martial arts skills clinched Mongolia’s first-ever presidential runoff election Saturday after his opponent conceded defeat in the scandal-plagued race to take the helm of the resource-rich but debt-laden country.
Khaltmaa Battulga of the opposition Democratic Party (DP), a 54-year-old former world champion in the Soviet martial art Sambo, had 50.6 percent of the vote with 986 ballots outstanding, according to the General Election Commission.
Parliament Speaker Mieygombo Enkhbold of the Mongolian People’s Party (MPP), which holds the majority in the legislature, had lagged well behind the wrestler since early Saturday morning.
Recognizing he was down for the count, he thanked his supporters in a concession speech broadcast on Facebook, saying that he would “respect and accept the presidential results.”
“Although the MPP couldn’t succeed in this election, the Cabinet will keep working to complete our agenda of overcoming the financial crisis for the well being of our people,” he said, adding that he had spoken to the sitting president about “transferring power as well as presidential stamp in the parliament house which also ends the election.”
“We did this thanks to power of people,” Battulga told supporters in Ulaanbaatar’s Independence Square, promising that he will “push the government in order to complete all their work.”
The new president will inherit a $5.5 billion International Monetary Fund-led bailout designed to stabilize its economy and lessen its dependence on China, which purchases 80 percent of Mongolian exports.
The former Soviet satellite’s economy grew by a measly 1 percent last year, a stark contrast from an impressive 17 percent in 2011.
It has been hit hard by a more than a 50 percent fall in the price of copper, its main export, over the past five years, while slowing growth in China, its biggest customer, has hobbled the economy.
Earlier in the day, Battulga, who ran on a populist, anti-China platform, told a press conference “Mongolia has won.”
“I will start work straight away to resolve the economic difficulties and make Mongolians debt free as I promised,” he said.
The real estate tycoon whose company funded a massive $4.1 million statue of Emperor Genghis Khan, has pledged to tap the country’s mining wealth to get Mongolians out of debt.
Both Battulga and Enkhbold were linked to scandals ahead of the first-round vote.
A video showed Enkhbold and two MPP officials allegedly discussing a 60 billion tugrik ($25 million) plan for selling government positions.
Battulga was haunted by reports of offshore accounts attached to his name, as well as the arrests of several of his associates by Mongolia’s anti-corruption body last spring.
But in the nearly two weeks between the first round and the runoff, public opinion appeared to turn in favor of him.
General Election Commission presented the results of Presidential election’s second round at 9.40AM. The Head of General Election Commission Ch.Sodnomtseren informed that the GEC discussed the second polling of Presidential election and prepared two resolutions. The first resolution states MPP’s candidate M.Enkhbold received 497,067 votes, which is 41.16 percent of the total votes, while DP’s candidate Kh.Battulga received 50.61 percent with 611,226 votes in the second polling of 2017 Presidential election of Mongolia.
Also, a Resolution on Approving the Authorities of the President of Mongolia was prepared to present to the Parliament for approval. A total of 1,990,797 people registered for the second polling of Presidential election and the voter turnout reached 60.67 percent with some 1,207,787 voters participating in the polling.
BEIJING, July 6 (Reuters) - The People's Bank of China (PBOC) and the Bank of Mongolia have extended their currency swap arrangement for another three years, China's central bank said on Thursday.
The deal aims to facilitate bilateral trade and investment and promote the economic development of both countries, according to the statement on the website of PBOC.
The swap arrangement will continue to have a size of 15 billion yuan ($2.20 billion) and 5.4 trillion Mongolian tugrik. ($1 = 6.8037 Chinese yuan) (Reporting by Beijing Monitoring Desk; Editing by Sam Holmes)
The European Union and Japan have formally agreed an outline free-trade deal.
The agreement paves the way for trading in goods without tariff barriers between two of the world's biggest economic areas.
However, few specific details are known and a full, workable agreement may take some time.
Two of the most important sectors are Japanese cars and, for Europe, EU farming goods into Japan.
The outline plan was signed in Brussels after a meeting between the Japanese Prime Minister, Shinzo Abe, and the European Commission president, Jean-Claude Juncker, on the eve of a meeting of the G20 group of leading economies in Hamburg.
It comes hard on the heels of the collapse of a long-awaited trade agreement between Japan, the US and other Pacific ring countries, the Trans-Pacific Partnership (TPP), which was scrapped in January by US President Donald Trump.
The president of the European Council, Donald Tusk, said the agreement showed the EU's commitment to world trade: "We did it. We concluded EU-Japan political and trade talks. EU is more and more engaged globally."
Mr Tusk also said the deal countered the argument put forward by some of those in favour of Brexit that the EU was unable to promote free trade: "Although some are saying that the time of isolationism and disintegration is coming again, we are demonstrating that this is not the case."
He added that the deal was not just about common trade interests, but reflected "the shared values that underpin our societies, by which I mean liberal democracy, human rights and the rule of law".
Japan is the world's third-largest economy, with a population of about 127 million.
As it stands, the country is Europe's seventh biggest export market.
One of the most important trade categories for the EU is dairy goods.
Japan's appetite for milk and milk-based products has been growing steadily in recent years.
The EU's dairy farmers are struggling with falling demand in its home nations and an ultra-competitive buying climate, which farmers say means they are paid less than the cost of production.
Even once the agreement is fully signed, the deal is likely to have in place long transition clauses of up to 15 years to allow sectors in both countries time to adjust to the new outside competition.
The voice-controlled Tmall Genie can be used to play music, run third-party apps and buy goods from the Chinese retail giant's online stores. Like many such devices, it lacks a display.
At launch, it will understand only Mandarin and be sold in the company's domestic market.
It will compete in China against devices already launched by Baidu and JD.com.
Tencent - China's biggest technology company by market capitalisation - has announced it has a similar product in development.
In the West, Amazon's Echo range of smart speakers compete against Google Home. Apple and Microsoft have similar products scheduled for release soon. And Samsung is readying a speaker of its own, powered by its new Bixby virtual assistant, according to a report by the Wall Street Journal on Tuesday.
Alibaba's new product derives its name from the company's e-commerce platform - Tmall - and during a demonstration in Beijing was used to order a delivery of Coca-Cola and buy credit for a phone.
Tmall allows local and international retailers to run their own virtual storefronts on its platform and says it is China's third most visited shopping site.
"It clearly is an advantage if - like Amazon - you can pull consumers into your retail ecosystem with a smart speaker," said Eden Zoller from the technology consultancy Ovum.
"But one thing we need to remember is it's early days for this category, and there remain questions of consumer trust in using the digital assistants to buy goods, on a smartphone or smart home speaker device.
"By that, I mean both the security of the transaction and privacy concerns about how personal data is leveraged and shared."
Alibaba has addressed these concerns in part by using voiceprint-technology to try to restrict purchases to recognised users.
In addition, it has built in support for Alipay, the company's popular online payment system, which is similar to PayPal.
However, to begin with, the company is marketing the device as a "limited beta" release that will help provide feedback before it is ready to mass produce the item.
It will charge 499 yuan ($73; £57) for the product, making it one of the cheapest on the market.
Japan's SoftBank Group Corp (9984.T) is targetting raising between $3 billion and $5 billion through an offering of U.S. dollar bonds, according to a person familiar with the plans.
The group has named Morgan Stanley, Bank of America Merrill Lynch and Deutsche Bank as joint global coordinators for a bond offering, it said in an announcement on Thursday, without disclosing the amount it plans to raise.
A SoftBank spokesman said an issuance of hybrid bonds is under preparation, but declined to comment on details.
The bond offering comes after the telecoms-to-investment conglomerate announced raising the world's largest private equity fund – the nearly $100 billion Vision Fund backed also by Saudi Arabia's main sovereign wealth fund - in May.
It bought British semiconductor designer ARM Holdings last year for $32 billion and has been involved in a number of deals across the globe this year including acquisitions of two robotics business from Google's parent company Alphabet Inc.
Shortly after it announced the ARM deal, SoftBank said it was considering selling around $9.8 billion worth of hybrid bonds in the financial year that ended in March to bolster its capital base and secure funds for future growth.
Hybrid bonds are often treated as quasi-equity by credit-rating firms, allowing companies to raise capital without hurting their ratings.
SoftBank did not specify the purpose of the proceeds in the announcement on Thursday. It will meet fixed-income investors in Hong Kong, Singapore and London from tomorrow. The group is rated Ba1 by Moody's and BB+ by S&P.
Ulaanbaatar /MONTSAME/ The Government of Mongolia won in the arbitration dispute with three Chinese investors to Tumurtein Khuder Company. The investors appealed to the permanent court of Arbitration at the Hague in February 2010, concerning the Government agency’s decision on cancellation of Tumurtei khuder company’s license of Tumurtei iron ore mine. On June 30, the arbitral tribunal made decision to dismiss the claimants’ requests in full.
Tumurtei mine located in Khuder soum of Selenge aimag has a reserve of 250 million tons of iron ore. The mine license was cancelled in 2006 as license holder ‘Tumurtein Khuder’ company had breached relevant laws and regulations by not repaying costs for the exploration of the deposit conducted with the state budget finance, having failed to develop plans on environmental protection and rehabilitation and take measures, making explosion on a field of ‘Khustain Yeroo” company or unauthorized field and by having exported iron ore instead of concentrating it as stated in its Environmental Impact Assessment.
The Chinese investors, including China Heilongjiang International Economic and Techinical Cooperative Corporation claimed investment of USD60 million, plus potential profits since the license revocation as well as all costs incurred arbitration dispute.
Mining accounts for over 80% of Mongolian exports
The mining sector accounts for approximately 25% of Mongolia’s GDP and more than 80% of all exports. The resource-rich economy has had its double–digit growth glory days back when commodities demand from China was robust. However, since the commodity price slide in mid-2014, the economy has been struggling to cross the 5% growth rate mark. Mongolia has been attempting to immune itself from such commodity shocks by diversifying into other export oriented industries such as meat, dairy, and cashmere. Regardless, nothing diminishes the importance of metals and mining in generating revenue for the economy, and particularly funds coming from major mining giants operating in the country including such as Rio Tinto or Xanadu Mines.
2 reforms to attract more foreign investment
Although commodity prices are recovering, this will still not put the metals and mining industry in Mongolia back to where it was during the boom period. To plug the gap, local authorities are undertaking new reform measures to attract foreign investment into the area.
In May, the country decided to open up a wider mining exploration area, now covering over a fifth of its territory.
The country has also revoked a banking law that required foreign companies to channel all their sales revenues from investment projects through local banks.
Rio Tinto and others stand to benefit
Consequently, companies such as Rio Tinto and Turquoise Hill have launched new exploration projects in the Asian nation for metals and mineral resources, beyond the pre-existing Oyu Tolgoi mine. OT is a copper-gold mine in the South Gobi region of Mongolia. Turquoise Hill currently holds a 66% stake in OT, with the other 34% being with the Government of Mongolia. Rio Tinto indirectly owns a 50.8% interest in Turquoise Hill Resources.
In October, a new gold zone was discovered at the Bayan Khundii gold project in Mongolia by Canada’s Erdene Resource Development. The project, now Erdene’s flagship venture, has grown to prominence in the past 18 months.
Australia’s Xanadu Mines is another established explorer and metal miner in Mongolia. Its flagship Kharmagtai copper-gold exploration project has been delivering beyond initial expectations thus far.
The Coal Mongolia 2017 international conference and exhibition to be held from September 7-9 this year in the capital, Ulaanbaatar, is expected to help the economy attract international investment into the coal sector of Mongolia. Currently, Mongolian coal export capacity has reached about 50 million tonnes but actual export is around half of the full capacity.
Milbank Secures Significant Victory for Mongolia over Chinese SOEs in Treaty-Based Arbitration www.milbank.com
NEW YORK, July 5, 2017 – Mongolia, represented by Milbank, Tweed, Hadley & McCloy LLP, has prevailed in an arbitration brought by Chinese State-Operated Entities’ (SOEs) pursuant to the investment-protection treaty between the two countries following Mongolia’s revocation of a license for the Chinese entities to mine the vast Tumurtei iron ore deposit. The Tribunal’s award of June 30 dismissing all claims has potentially significant implications for Chinese foreign investment worldwide because the identical treaty language appears in the majority of China’s 110 bilateral investment protection treaties with other countries.
The Tribunal’s award parted ways with determinations by two tribunals in prior arbitrations brought by Chinese investors, one confirmed by the Singapore Supreme Court, that found the critical treaty language to be a broad submission to the jurisdiction of international tribunals. In contrast, the Tumurtei Award relied upon evidence of historic Chinese state practices not considered in the prior cases and held that only national courts in the host country of foreign investment, not arbitral tribunals constituted pursuant to the China-Mongolia treaty, were empowered to determine whether the host State had committed an unlawful expropriation.
The final award handed down on June 30, which was unanimous, puts an end to seven years of arbitration. The arbitration was presided over by the former President and current Judge of the International Court of Justice Peter Tomka. A week-long hearing was held at the Peace Palace in The Hague in late 2015. The other members of the arbitration tribunal were Yas Banifatemi, a member of the Shearman & Sterling team that secured the $50 billion arbitration award for Yukos against Russia (by nomination of the Chinese Claimants) and Mark Clodfelter, the former US State Department’s Assistant Legal Adviser for International Claims and Investment Disputes (by nomination of Mongolia).
At a time when Chinese outbound foreign investment has become enormous and is growing, the decision of the arbitral Tribunal has potentially significant implications for Chinese foreign investments around the world. Out of 110 bilateral investment treaties entered into by China and still in force, 70 are treaties of the “1st generation” – that is, early treaties concluded in the 1980’s and 1990’s almost all of which contain the same sort of language restricting access to arbitration to disputes involving the amount of compensation for expropriation. These early treaties reflect China’s distrust of arbitration as a mechanism to resolve disputes with foreign investors at a time when China was predominantly a capital importer hosting foreign investments. It is only around the time that China adopted its so-called “going out” strategy in 2001, shifting its focus to becoming a significant exporter of capital, that a new wave of BITs were signed. In these ‘2nd’ and subsequent generations of Chinese BITs, the arbitration clause was extended to “any disputes concerning an investment” so as better to protect China's outbound investments.
The Tribunal's ruling on the Chinese Treaty departed from prior awards interpreting identical language in other Chinese treaties and similar language in communist-era treaties of Russia, Bulgaria and the Czech Republic. In support of its position, claimants had relied on arbitral awards in Tza Yap Shum v. Peru, EMV v. Czech Republic, Renta v. Russia and Sanum v. Laos. In Sanum, the Singapore Court of Appeal held, in September 2016, following extensive treaty-based arbitration proceedings, that a “narrow interpretation” of the dispute resolution clause of the China-Laos BIT (containing the same language) could “render illusory the availability of access to arbitration” and leave the clause without meaningful effect. In Tza Yap, the arbitral tribunal also agreed that the Chinese claimant’s “interpretation, the broader one, is the most appropriate.”
The Tumurtei arbitration was the first in which a respondent-State had put forward the argument that international arbitration would be available for the determination of quantum following an expropriation formally “proclaimed” by the State. In the arbitration, Mongolia submitted substantial of China's historic use of such proclaimed expropriations, whether through ordinances or decrees, when its 1st Generation treaties were entered. Thus, Mongolia argued that the critical treaty language had meaningful effect even if construed so as to exclude international review of its revocation of the Tumurtei license.
By unanimous decision, the Tribunal accepted Mongolia’s position and found that the China-Mongolia BIT “restrict[s] the jurisdiction of an ad hoc arbitral tribunal to encompass only disputes which involve the amount of compensation for expropriation.” The Tribunal disagreed with Claimants’ view that the arbitration provision of the BIT would be deprived of any effect in practice, because “[a]rbitration before an ad hoc arbitral tribunal would be available in cases where an expropriation has been formally proclaimed and what is disputed is the amount to be paid by the State to the investor for its expropriated investment. In other words, arbitration will be available where the dispute is indeed limited to the amount of compensation for a proclaimed expropriation.”...