Tashkent, Uzbekistan (UzDaily.com) -- Uzkimyosanoat and the State Assets Management Agency were very surprised and disappointed to receive notifications of the initiation of arbitration proceedings without preconditions, despite negotiations between the parties. This is stated in the statement of the organizations.

Earlier media reported that the Spanish company filed a lawsuit in London in March this year. The disagreements concern Maxam’s share in Maxam-Chirchiq, one of the largest enterprises in Uzbekistan for the production of mineral fertilizers and chemical products. The partner is the state company Uzkimyosanoat.

The statement says that in 2007 Maxamcorp International S. L., together with Uzkimyosanoat JSC, created two joint ventures - Maxam-Chirchik JSC and Ammophos-Maxam JSC.

Despite the commitments made, the Spanish company has not fulfilled its obligations to attract investments and is currently refusing to fulfill them, the statement says.

Uzkimyosanoat and the State Assets Management Agency denied Maxam’s accusations of violating contractual relations.

The Uzbek side noted that joint ventures have been successfully operating for almost 15 years. "Maxam’s claims are nothing more than an attempt to hide its violations of contractual obligations and avoid responsibility for poor management, failure to invest and non-compliance with Uzbek legislation," the Uzbek organizations said in a statement.

The statement notes that Maxam’s failure to fulfill investment obligations will significantly complicate the operation, modernization and expansion of the enterprise.

Uzkimyosanoat and the State Assets Management Agency expressed surprise that Maxam disclosed its claims when the parties’ questions and positions are in fact confidential.

The Uzbek side stated that it did not violate any contractual or other obligations and acted within the framework of the law. Uzkimyosanoat and the State Assets Management Agency remain committed to amicably and in good faith resolving the dispute with Maxam.

At the same time, Uzkimyosanoat and the State Assets Management Agency voiced a number of claims against the Spanish company. In particular, they noted that Maxam was aimed only at receiving dividends during the entire period of its work and did not aim to improve the performance of joint ventures.

Maxam’s commitments included modernizing the two JVs, providing state-of-the-art technology, upgrading production equipment and technical support.

The statement emphasizes that Maxam has not fulfilled its obligations. This is also confirmed by the accident of outdated equipment that occurred in October 2022 at the plant of Maksam-Chirchik JSC, the Uzbek side noted.

Uzkimyosanoat and the State Assets Management Agency noted that the profit of the joint venture has increased significantly in recent years. The existing facilities have been upgraded and performance is improving.

"This was achieved solely through the efforts of the Uzbek side without the participation of the investor and its representatives," the statement said.

Uzkimyosanoat and the State Assets Management Agency cut out the hope for a legal resolution of all existing contentious issues.

The Uzbek side stated that it is preparing a legal position on the claims of Maxam, which will be presented in due course.