Jamaica’s richest man Michael Lee-Chin awarded over $43 million in a dispute with the Dominican Republic

BY Ben Ebuka Oji January 8, 2024 6:05 PM EDT
Michael Lee-Chin
Michael Lee-Chin. Credit: The Edge

Jamaican billionaire Michael Lee-Chin, has received the final award from the UNCITRAL Arbitral Tribunal pertaining to the Caricom-DR Free Trade Agreement. The tribunal recently reached a decision in the treaty dispute between the Dominican Republic and Lee-Chin regarding a waste management concession.

While the ruling rejected a significant portion of Lee-Chin’s claim for damages amounting to US$676 million, they did award him over US$43 million in the investment dispute.

This verdict aligns with a previous Partial Award on Jurisdiction issued in July 2020 in favor of the businessman. The core of the dispute revolves around Lee-Chin’s involvement with Lajun Corporation SA, a Dominican company that held a long-term concession contract for managing a landfill in Santo Domingo. Lee-Chin’s son, Adrian Christopher Lee-Chin, was the general manager responsible for overseeing the operations of the concession.

In 2017, the Dominican Republic assumed military control of the landfill and initiated local measures to invalidate and terminate the concession, citing alleged environmental concerns.

However, Lee-Chin initiated an investment arbitration against the Dominican Republic, claiming that the state had violated multiple provisions of the treaty. These violations included arbitrary actions that compelled him to operate the landfill without receiving adequate returns.

After a lengthy legal process that lasted for more than five years, the tribunal ultimately resolved the dispute in favor of Michael Lee-Chin.

The Tribunal determined that the Dominican Republic had indeed breached its obligations in the Treaty, specifically regarding expropriation and just and equitable actions. Consequently, the Arbitral Tribunal mandated the Dominican Republic to compensate Michael Lee-Chin with a sum exceeding US$43.59 million, in addition to interest.

Siding with the arguments raised by Lee-Chin’s laywers, the tribunal dismissed all jurisdictional objections put forward by the Dominican Republic and resolved that “the termination of the Concession Agreement was part of a larger effort by the State to actually eject Claimant from the operation of the investment.”

The tribunal further held that “no pattern of reasonableness or plausible justifications may be discerned in [the Dominican Republic’s] changing attitudes throughout the investment.”

The tribunal was of the view that there is a lack of consistency or logical explanations in the Dominican Republic’s shifting perspectives regarding the investment. It specifically said that “no pattern of reasonableness or plausible justifications may be discerned in [the Dominican Republic’s] changing attitudes throughout the investment.”

As a result of breaching its obligations under the terms of the treaty, the tribunal has also determined that the Dominican Republic “must compensate Claimant for the damages it actually caused as a result of violating its obligations under the terms of the Treaty.”

The wealthiest man in Jamaica, Lee-Chin’s net worth is around $1.3 billion, amassed through strategic investments in profitable institutions such as National Commercial Bank Jamaica and AIC Limited. In 1987, he acquired AIC when the company’s assets under management were below $1 million. By 2022, under Lee-Chin’s expert guidance, the wealth management and mutual fund business, based in Canada, managed more than $10 billion in assets. However, the firm’s fortunes plummeted during the 2008 recession, leading Lee-Chin to sell AIC for an undisclosed amount in 2009 to Manulife, a Canadian financial services group. Nevertheless, Michael Lee-Chin retains a 60% stake in National Commercial Bank Jamaica, which accounts for a significant portion of his wealth.