After Becchetti, another arbitration? What does Albania risk from the clash over Vlora Airport?

Businessman Behgjet Pacolli's warning that the company MABCO Constructions SA will resort to international arbitration if the Albanian government formalizes the termination of the Vlora International Airport concession contract, brings to mind one of the most costly scenarios for the Albanian state, confronting investors in international courts.

Although a lawsuit has not yet been filed and it is not known how much MABCO may seek in damages, Pacolli's statement suggests that the company is preparing for a legal battle with potentially significant financial consequences.

What did Pacolli state?
In his public reaction, Pacolli emphasizes that the company has not been officially notified by the Ministry of Infrastructure and Energy about the initiation of the contract termination procedure and that he learned the news through the media.

He warns that, if the procedure is confirmed, MABCO will resort to international commercial arbitration, arguing that the company has been unfairly prevented from completing the project.

Among other things, on social networks he writes that " MABCO has been financially exposed to over 320 million euros, not including loss of profit and legal costs. The company had completed almost all contractual obligations and was only just before the airport certification phase."
Pacolli has not made public what value the company will seek if the case goes to an international tribunal, but he speaks first of MABCO's financial exposure, specifying that loss of profit and legal costs have not yet been added to this figure.

He also claims that, following a Supreme Court decision, the company was prevented from entering the site to complete the works, while valuable equipment was damaged or stolen. According to him, institutions cannot use as an argument for terminating the contract a situation that, according to MABCO's claims, was created by the state's own actions or inactions.

"The bill could reach 500 million euros"
The leader of the Democratic Party, Sali Berisha, has also reacted to the issue, stating that the termination of the contract could cost Albanian taxpayers up to 500 million euros.

However, so far no official arbitration claim of this value has been made public, nor has it been explained on what basis this figure was calculated.

The Becchetti precedent
If the clash between the Albanian state and MABCO ends in arbitration, this would not be the first time Albania has faced such a process.

The most well-known precedent remains that of Italian businessman Francesco Becchetti, who sued Albania before the tribunal of the International Centre for Settlement of Investment Disputes, claiming that the state had violated the investment protection agreement.

In 2024, the arbitral tribunal ruled that Albania must compensate Becchetti and his related parties with approximately 110 million euros, including damages, interest and a portion of the costs of the proceedings. The decision was considered one of the largest financial losses for the Albanian state in an international arbitration.

What is expected to happen?
There is currently no registered arbitration proceeding nor a formal claim for damages from MABCO.

However, if the Ministry of Infrastructure finalizes the contract termination and the parties do not reach an agreement, the dispute may proceed to international arbitration.

In this case, the tribunal will have to examine the contract documentation, the investor's claims and the Albanian state's defense to decide whether there was a breach of contract and whether the right to compensation arises. Only after this process could it be determined whether Albania will face another heavy bill, following the precedent of the Becchetti case. /Politiko.al/