After the Polish company Control Process S.A. failed to meet its obligations regarding the construction of a waste processing plant in Lviv, the Polish bank ING Bank Śląski was forced to pay the municipal enterprise ‘Zelene Misto’ €3,664,000 as a bank guarantee. More details can be found on city-adm.lviv.ua. This move was a result of numerous violations by the contractor, including incomplete project design, non-delivery of some equipment, and blockage of power supply works.
On February 10, the municipal enterprise ‘Zelene Misto’ appealed to ING Bank Śląski to activate the bank guarantee, which was accompanied by numerous threats from the contractor. The company also attempted to appoint an emergency arbitrator, but no grounds were found for this at the International Chamber of Commerce in Paris.
Oleksandr Yegorov, director of ‘Zelene Misto’, noted that the funds are already in the account and, with the support of the EBRD, there is a plan to use these funds wisely in the future. He emphasized that the effort to claim the guarantee and fulfill the contract will continue in accordance with the law.
According to Yegorov: “The bank took into account all our arguments. It was a three-week struggle for these funds, and they are already in our account.”
Fines for construction delays range from €1,901 per day for design delays to €27,394 per day for work execution delays.
In the ongoing arbitration process, ‘Zelene Misto’ is actively contradicting the decision in the International Commercial Arbitration Court in Ukraine. Over €29 million has already been paid to the contractor without debts.
Additionally, the Polish contractor explained the delays by the impact of air alarms, which they claim lasted 150 days. However, according to the official response from the emergency services, they lasted only two working days.