Closing the book on its long-running dispute with Kuwait over the failed joint venture K-Dow, US chemical giant Dow Chemical (Midland, Michigan / USA; www.dow.com) has accepted a cash settlement of USD 2.19 bn from its erstwhile partner, state-owned Petrochemical Industries Company of Kuwait (PIC, Sabahiya; www.pic.com.kw).

The damage award is slightly less than the USD 2.48 bn imposed by the International Chamber of Commerce's (ICC) international court of arbitration – see Plasteurope.com of 08.03.2013. Industry experts say it reflects a 6 May agreement between the two chemical producers that sees Dow foregoing interest for the four-year period in exchange for the promise that PIC will not take “retaliatory or punitive actions” as a result of the payment, one of the largest ever from a corporate arbitration.

The planned joint venture was cancelled by Kuwaiti authorities three days before its scheduled start on 1 January 2009. Dow pressed charges, saying it was deprived of revenue needed to fund its acquisition of Rohm & Haas, and was thus required to divest assets – the original JV agreement foresaw PIC contributing USD 7.5 bn to the project. According to news reports, the penalty award to Dow has raised the ire of many in Kuwait, with members of parliament in particular demanding that the individuals responsible for the pull-out be held accountable.