Business 4 May 2026 Daily Monitor (Uganda)
Uganda Ordered to Pay Shs522 Billion in Railway Concession Arbitration
An international tribunal in London has ruled that Uganda must pay Rift Valley Railways Uganda Limited (RVRU) approximately Shs522 billion ($138.93 million) for wrongfully terminating a 25-year railway concession agreement in 2017. RVRU was also ordered to pay Uganda $102,804.99 in historical damages. Source: https://www.monitor.co.ug/uganda/news/national/uganda-to-pay-shs522b-over-railway-concession-deal-5445998
Uganda faces a hefty payout of about Shs522 billion ($138.93 million) to Rift Valley Railways Uganda Limited (RVRU) following a ruling by a three-member international arbitration tribunal in London. The decision, issued on April 6, 2026, under UNCITRAL rules, determined that the government breached the concession by terminating it in 2017.
The tribunal, led by Klaus Reichert SC with Barton Legum and Muna Ndulo, rejected claims of unlawful expropriation but upheld the breach of contract claim. Uganda must cover the damages plus $1.27 million in RVRU’s legal and arbitration costs. RVRU, however, owes Uganda $102,804.99 plus interest for prior issues.
The dispute originated in 2004 when Uganda and Kenya privatized railway operations to a South African-led consortium, granting RVRU a 25-year concession for metre-gauge freight services. Tensions arose over unmet freight targets, unpaid fees, and poor maintenance, leading to a 2016 default notice and 2017 termination.
RVRU contested the move with court injunctions before pursuing arbitration. The tribunal denied future profit claims due to insufficient evidence, calling them speculative.
This outcome stems from recommendations by the Joint Railway Commission and a JICA report citing inefficiencies. It may influence Uganda’s approach to future infrastructure deals balancing public needs and investor rights.
Source: Daily Monitor