El Salvador Wins Arbitration Case Against Construction Firm MECO

The Inter-American Commercial Arbitration Commission rejected the arguments put forward by the Costa Rican construction company, which demanded payment of $13 million for alleged overcharges incurred in a road works project within the Fomilenio project.

Tuesday, April 18, 2017

From the statement issued by the Attorney General:

Panama. The Attorney General's Office reports that a new international arbitration case has been won by the State of El Salvador, for thirteen million dollars, in a lawsuit filed against the FOMILENIO project.

The commercial litigation was initiated by the construction company MECO S.A. through the Inter-American Commercial Arbitration Commission, CIAC, based in Panama, over the construction of Section 6, Cuidad Barrios Detour-Osicala and Concepción Cacaopera, of the Longitudinal Highway of the North. The notification of the sentence was received in the Attorney General's office last week.

More on this topic

El Salvador Wins International Arbitration Against Construction Company

July 2013

Meco of Costa Rica sued the Salvadoran government and Fomilenio for $1.3 million related to increased costs in the contract to build a road.

Elsalvador.com reports: "An international arbitration court has ruled in favor of the Salvadoran government and the Millennium Fund of El Salvador (Fomilenio) who the Costa Rican company MECO sued for $ 1.3 million alleging that El Salvador breached the "financial suitability" clause of the contract for construction of section II of the Northern Longitudinal Highway: Metapan-Santa Rosa Guachipilín. The 'financial suitability', that MECO refers to concerns the calculation of the cost increases of the work over time (known as polynomial formula). "The company explained that this formula did not cover the increases in material that might be seen during the course of the execution of the work.

$90 million Law Suit Against Costa Rican State

September 2012

The concessionaire of the route San Jose – Caldera, , Autopistas del Sol, has filed a lawsuit against the state demanding an update of the cost of road construction.

The company is seeking to "rebalance the contract based solely on an update of the amount of the original bid", said Luis Diego Flores, constitutional attorney.

Meco To Build Highway Stretch in El Salvador

January 2010

Company Meco was awarded a $23.04 million contract to build a stretch of the highway known as “Carretera Longitudinal del Norte” (CLN).

This stretch, 30.4 kilometers long, runs from Cuidad Barrios up to Osicala, in San Miguel, and from Delicias, Concepción to Cacaopera in Morazán.

Six Companies Bid Highway Construction Project in El Salvador

February 2009

The consortium of Constructora MECO, SBI International, Santa Fe-CODOCSA, Astaldi, Consorcio Vial Fomilenio y Corporación M&S presented the proposals for the North Longitudinal construction project.

Elsalvador.com reports: “The proposals included a range of $29 million to $40 million for asphalt concrete; meanwhile, in the case of hydraulic concrete, the proposals were from more than $35 million to a little more than $44 million, as was recorded in the meeting minutes signed by the representatives of Fomilenio and participating construction companies.

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