By KT Reporter
Uganda has escaped a 2.3 Billion Dollar suit filed by the Rift Valley Railways consortium over the contract termination in 2017.
This is after a London-based international arbitration tribunal issued a Final Award dated 22nd July 2025, dismissing all claims brought against Uganda by RVR Investments (Pty) Ltd (RVRI) and KU Railways Holdings Limited (KURH).
The Uganda government and it’s Kenya counterpart, had long accused RVR of failing on its obligations especially meeting freight targets and improving the Uganda Railways assets and general network.
A notice of termination was issued but withdrawn in 2017 after Uganda and RVR agreed that the investors withdraw court cases against it at that time.
However, in 2018, a frustrated Ministry of Finance, Planning and Economic Development ended the deal and ordered RVR out, barely halfway through the 25-year concession.
An arbitration was then commenced by the Investors (‘RVR’) on 2nd April 2020 as conducted under the UNCITRAL Arbitration Rules (2010) before a three-member tribunal seated in London.
The hearing was conducted in March 2024.
RVR, as investors and ultimate concession holders in the Kenya and Uganda railway concessions, commenced arbitration against both the Republic of Kenya and the Republic of Uganda, alleging breach of Agreements signed in connection with the concession of the Meter Gauge Railway (MGR) line.
RVR sought compensation in excess of 2.3 Billion US Dollars from Kenya and Uganda.
It alleged failure by the Governments to harmonize operational standards across the two countries, adverse impacts caused by the development of the Standard Gauge Railway (SGR), repudiation of Agreements due to SGR plans and deceit and inducement to continue investment despite an alleged hidden intention to retire the MGR.
After a lengthy hearing and a comprehensive review of the evidence brought by all the parties, the Tribunal rejected all claims.
While dismissing the claims, the Tribunal found that Uganda was not in breach f its harmonisation obligations as had been alleged.
The Tribunal noted that the Uganda Concession Agreement was terminated for a multitude of independent reasons based on RVR’s own shortcomings.
Uganda consistently maintained that it was not in breach of its contractual obligations, and that RVR’s own mismanagement, underperformance, and failure to meet agreed freight volume targets and maintenance commitments led to the termination of the concession.
In addition to dismissing all claims, the Tribunal ordered RVR to pay Uganda SD 3,668,519.25 in Legal Costs and GBP 200,369.11 in Arbitration Costs.
”This award underscores Uganda’s firm position that the termination of the
concession was lawful, justified, and necessary to protect a critical national infrastructure asset,” says a statement by the Ugandan judiciary.
It adds Uganda reaffirms its commitment to fair and transparent investment partnerships, and to the responsible stewardship of public assets.
Uganda was represented by the Attorney General’s Chambers, Curtis, Mallet-Prevost, Colt & Mosle LLP and K&K Advocates.
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