Termination of lease agreement: Kingho advised to choose the negotiating table

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While Kingho Railway and Port Company Limited has opted to enter into a legal battle with the government in relation to the termination of the lease agreement for the use and management of the port between Tonkolili and Pepel in the Port Loko District, Concord Times conducted interviews with some top lawyers, who advised that the company comes to the negotiating table and address the issue instead of taking legal action that will not augur well for the company. 

“It will be in the interest of the company to come to the negotiating table or else they will lose it at the end of the day. They are here to do business and they should not pick up a fight with the government, which has already acted within the ambit of the lease agreement,” they advised.

Based on the provision of the lease agreement, the Office of the Attorney General and Minister of Justice notified the company about the termination of the lease, after government has contracted a new company, Arise Integrated Industrial Platforms Limited, to take over management of the port.

The letter from the Office of the Attorney General reads, “I refer to the Railway and Port Lease agreement dated 8th January, 2021 between the Government of the Republic of Sierra Leone as Lesssor and Kingho Railway and Port Company Limited as lessee, among others, relating to the use, manage, maintenance and rehabilitate the Railway and Port (the Agreement).

According to the Attorney General, the notice was issued pursuant to Section 2-03 of the said agreement which provides that, “The lessor and the lessee hereby agree that the lessor reserves the right to engage another and port operator to independently operate the Railway and Port and the first two years of the term herein granted, subject to a six months’ notice to the lessee after the first two years (transition period)”. 

The first two years of the agreement having elapsed with the lessor having engaged another railway and port operator to independently operate the railway and port, according to the Attorney General, “I hereby serve you six months of notice of termination in accordance with section 2.03 and 11.01 of the Railway and Port Lease Agreement.

“At least the government has acted reasonably and accordingly, and that has nothing to do with the diplomatic relationship between Sierra Leone and China. The two countries have enjoyed diplomatic relations spanning over fifty years and a single agreement will not hamper that cordial relationship, which has existed for years. In diplomacy, we believe in negotiation and I believe the company should solicit the support of the Chinese Embassy in Sierra Leone to ensure that they engage the government and arrive at an amicable solution,” a seasoned diplomat told Concord Times.

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