ECE is suing the state for 1.8 billion due to the construction of stores in Liberec.

Prague - Investment companies of the German real estate developer ECE Projektmanagement are suing the Czech Republic for damages amounting to approximately 1.8 billion crowns (70 million euros). The reason for the arbitration is the alleged unlawful actions of Czech authorities during the approval of the construction of the Galerie Liberec shopping center, which ECE planned to build. This was announced today by ECE's managing director Josef Tobek. The Ministry of Finance does not recognize the company's claims.
Tobek stated that the German developer group ECE Projektmanagement already sent its claims for damages to the Ministry of Finance last November. "In the following six months, the Ministry of Finance did not agree to any compensation during the mediation proceedings, and thus ECE was forced to initiate arbitration," the ECE company stated.
"The Ministry of Finance did not recognize and does not recognize these claims from the investor, although it acknowledges his right to conduct arbitration," said spokesperson Ondřej Jakob in response today. The Ministry has already announced a tender for legal representation of the state in amicable dispute resolutions and in arbitration proceedings with ECE. According to the spokesperson, the aim of the state in the dispute with the developer is that the Czech Republic should not have to pay even a crown at the end of the arbitration.
The construction of the Galerie Liberec shopping center was halted by ECE in February. From the beginning, the project was accompanied by competitive disputes with the Dutch company Multi Development, which is literally building the Forum shopping center across the street. The company appealed against the original zoning decision, and Czech authorities blocked the entire ECE construction.
According to earlier statements by Tobek, the main reason for halting the construction was the procedure of the building authority, which reportedly interrupted the building proceedings without legal reasons. Another reason was allegedly the unlawful action of the Ministry for Regional Development. In 2008, the Ministry reversed previous statements of the Liberec municipality and the regional office and recognized the competing Multi Development as a participant in the building proceedings.
The ECE group manages about a hundred shopping centers in 14 countries. In the Czech Republic, it has invested over 200 million euros (nearly five billion crowns) so far. In Brno, it built the Galerie Vaňkovka shopping center, and in Prague, it opened the Arkády Pankrác shopping center last year in collaboration with developer Unibail-Rodamco.