Agility decides to take FBR to ICJ: February 28 deadline for settlement

'Agility', the Kuwait based software supplier, has decided to proceed to the International Court of Justice (ICJ) against Federal Board of Revenue (FBR) for settlement of its dues. Having lost patience, Agility has warned FBR, in a letter, to either recommence negotiations by February 28, 2011, or face consequences, as it has decided to take FBR to ICJ to recover the amount.
The demand of Agility is that a firm commitment for re-commencing negotiations be communicated, otherwise the Pakistan Automated Customs Computerised System (PaCCS) would be closed down, without further notice. Needless to mention, initially, the PaCCS pilot project was designed for only one year, to the extent of Karachi International Container Terminal (KICT). Total cost to be paid to Agility was $200,000, out of which $70,000 has been paid so far, while the project has been going on for over six years now, and at three terminals.
Interestingly, Agility was invited for negotiations and further signing of contract for PaCCS project on public-private partnership basis in 2007. Agility offered to invest $103 million in Pakistan for the project and was invited to commence negotiations for further necessary action. The company is bearing the cost of the existing PaCCS project from which the government is earning billions of rupees every year.
Although all Agility deadlines given earlier were serious, but on each occasion it gave concessions, specifically at the request of the Ministry of Finance. In 2007, the FBR floated an international request for proposal inviting companies to bid for Pakistan automated commercial community system, which is an upgrade to PaCCS, and the rollout of PaCCS to the entire country. Multiple international firms responded, and FBR hired the services of independent evaluators to evaluate best company for the project. As a result, the services of A F Fergusons were obtained.
The concept of public-private partnership was to ensure that the Government of Pakistan did not have to make any investment but rather the qualified firm would invest in Pakistan, build the project, own it, and transfer it to the government after a specific period.
During this period, the company would recover its cost by levying a transactional charge based on a mutually agreed standard. By December 2007, the FBR stopped all negotiations, and nothing has happened since. The government of Pakistan has earned billions of rupees from this automated solution installed at three major terminals, but has paid nothing to Agility. It might have to pay thousands of billions of rupees to this company if the case is registered with ICJ.