Alcoa’s settlement of a landmark US lawsuit brought by Bahrain’s state-controlled aluminium company over alleged corruption is a deal that will reverberate around the Gulf – and far beyond the metals industry.
The agreement announced on Tuesday – under which Alcoa will pay Aluminium Bahrain (Alba) $85m – has thrown a fresh spotlight on the commission payments at the heart of a growing number of probes into western multinationals operating in the Middle East. It has also opened the way for other companies to come to The US courts with claims that they have been ripped off by western multinationals involved in bribery.
Alba had accused Alcoa of overcharging it by more $400m for raw materials over a 12 year period and of recycling some of the money to pay millions of dollars of bribes to officials in Bahrain. Alcoa, which denied liability, said the settlement was the “best possible outcome” of the dispute, avoiding the “time and expense of complex litigation”.
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