Telefonica Wins Arbitration Against Colombian Government

MADRID (Reuters) – Spanish telecoms company Telefonica (NYSE:TEF) announced that the World Bank's International Centre for Settlement of Investment Disputes (ICSID) has ordered the Colombian government to pay $380 million as part of an arbitration process.

Colombia is also required to pay Telefonica's legal fees and 5% compound interest as compensation for damages incurred, according to a statement from Telefonica.

This dispute began in February 2018 and arose from measures enacted by the Colombian government that led Telefonica to incur costs in 2017. Telefonica claimed these measures violated a bilateral treaty safeguarding foreign investments between Spain and Colombia.

While the ICSID has not commented, its website indicated the case was closed on October 2 following arbitration rules. A spokesperson from the Colombian finance ministry verified the arbitration's existence.

In July, Telefonica announced negotiations with Millicom, a New York-listed company, to sell its stake in its Colombian unit for $400 million after divesting from multiple Latin American markets.