International Arbitration Rules Against Tullow in Tax Dispute with Ghana

An arbitration tribunal under the International Chamber of Commerce (ICC) ruled against Tullow in a dispute relating to corporate income tax with Ghana, as reported by the "Kalkine Media" platform.

The dispute relates to business interruption insurance proceeds, and the tribunal concluded that the tax assessment adopted by Ghana is consistent with the petroleum agreements concluded with the company.

The tribunal also determined that the imposed penalties were not covered by contractual protection, according to the same source. No monetary amount associated with the decision was disclosed.

Tullow stated that it is disappointed with the ruling and that it will evaluate its options with the government of Ghana. Petroleum agreements constitute the contractual basis that defines the company's tax obligations in the country.

What do these terms mean?

Arbitration: A method for settling disputes outside of courts, resolved by a neutral party or tribunal agreed upon by both parties, and its decision is usually binding.

International Chamber of Commerce (ICC): An international organization that administers commercial arbitration proceedings between companies and governments according to agreed rules.

Corporate Income Tax: A tax imposed by the state on the net profits of companies operating in its territory.

Business Interruption Insurance Proceeds: Amounts paid by an insurance company to a business when its activity stops, and their tax treatment varies from one country to another.