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. Last Updated: 07/27/2016

Arms Exporter Wrestles Canadian Firm




Russia's powerful weaponry exporter Rosvooruzhenye is struggling to wrestle more than $2.5 million from Century International Arms Ltd., a Canadian company that has refused to pay for Russian-made small arms it has purchased, officials said Wednesday.


The arbitration court of the International Chamber of Commerce ruled earlier this year that the Canadian company should pay $2.4 million to Rosvooruzhenye for guns delivered from 1993 to 1994.


According to the ruling issued March 23 in Zurich, the Canadian arms dealer should also pay 15 percent annual interest for the period from May 27,1995, until the day on which payment is made.


The court's "award sentence" said Century International Arms must pay the entire sum to Rosvooruzhenye within 10 business days.


But more than a month later, no payment has been made and the Canadian company is refusing to honor the court's decision, said Ivan Skrylnik, a spokesman for Rosvooruzhenye, whichhandles some 95 percent of Russia's arms exports.


"We are not going to retreat and we will insist that the decision should be implemented," Skrylnik said.


Rosvooruzhenye officials said the company plans to "force" the Canadian company to pay the awarded sum with "legal measures" to be taken in Canada and United States. They would not elaborate.


Decisions of the ICC arbitration court cannot be appealed, but an official with the court's Paris-based Secretariat said verdicts "are binding, but sometimes difficult to implement."


The official, who refused to give her name, said the claimant usually takes the verdict to the country where the respondent is registered and appeals to local judicial bodies to enforce it.


Rosvooruzhenye filed a $2.26 million lawsuit with this international court in May 1996, claiming that Century Arms International had repeatedly refused to honor its contractual obligations.


The Canadian arms dealer signed a contract with Rosvooruzhenye's legal predecessor Oboronexport on May 27, 1993, to buy 20,000 Nagant revolvers, 1 million rounds for these guns, and 49,000 self-loading Simonov rifles by the end of 1994.


After signing the contract, Century International Arms requested that full delivery be made before its license to sell weaponry in the United States expired July 2, 1994, according to Rosvo-oruzhenye.


By then, only the 20,000 Nagants had been delivered, as the contract didn't oblige the Russian company to take into account that Century International Arms' U.S. license was expiring, Rosvooruzhenye said.


By December 1994, Rosvooruzhenye had shipped the 49,000 Simonov rifles to meet the contract's deadline.


However, Century International Arms paid only $925,000 for them, instead of the $3.18 million specified in the contract.


The Canadian company's managers said the rest of the sum was being withheld to compensate for losses incurred when the Russian partners failed to ship the rifles by July 2, 1994.


Contacted Wednesday, officials at Century International Arms in the United States and Canada declined to give any immediate comment.