THE government has appealed a High Court order arising from its dispute with Austrian engineering company VAMID Engineering GmbH over contracts for the construction of hospitals at New Amsterdam and Ogle, Attorney General and Minister of Legal Affairs Anil Nandlall, SC, has disclosed.
Nandlall made the disclosure during his weekly programme, Issues in the News, while addressing the government’s decision to terminate the two contracts and the subsequent legal proceedings initiated by VAMID.
According to Nandlall, the government terminated both contracts on July 23, 2026, after what he described as breaches by the contractor and excessive delays in completing the works.
He said that despite repeated efforts by the government to have VAMID complete the projects and resolve the disputes amicably, the contractor failed to perform its obligations.
The Attorney General said, “At the date of termination, the works under the contracts were way behind where they were supposed to be by that time, and the government had no choice but to terminate the contract.”
Following the termination, he said, steps were taken to secure both hospital sites and the materials located there, as provided for under the contracts.
The government also moved to call in the performance bonds attached to the contracts.
Nandlall said each contract was secured by a performance bond valued at €15 million, bringing the combined value of the two bonds to €30 million.
“The government has taken the relevant steps to call in the outstanding sums in relation to each bond,” he said.
He explained that the bonds were provided by the Bank of Austria and that the relevant process had to be served on the institution.
Meanwhile, the dispute between the government and VAMID has proceeded to arbitration.
Nandlall said both contracts contain arbitration clauses requiring disputes to be referred to the Paris, France-based International Chamber of Commerce (ICC).
“Government of Guyana has initiated arbitration proceedings pursuant to that arbitration clause at the requisite tribunal, in this case the International Chamber of Commerce,” he said.
He said those proceedings will continue through the established arbitration process.
However, VAMID also initiated legal proceedings in Guyana, seeking damages for alleged breach of contract and a number of injunctions against the government.
According to Nandlall, the company sought orders restraining the government from invoking the performance bonds and from taking control of the hospital sites.
He said the company’s applications were dismissed by the High Court.
Nandlall explained that one of the government’s objections was that the dispute should proceed through arbitration rather than through the Guyana courts.
He said the government also argued that the particular orders sought against the state could not properly be granted.
“Those objections were made and they were upheld and both applications were refused,” Nandlall said.
However, he said that although the applications were refused, the judge, whom he declined to name, ordered both parties not to take control of the sites or materials until an arbitration tribunal is appointed.
Nandlall described that order as “manifestly wrong” and disclosed that the government has since appealed it.
“The learned hearing judge still injuncted both parties from taking control of the site and the materials until the arbitration tribunal is appointed,” he said.
“In my humble and respectful view, that is a manifestly wrong order,” he added.
Nandlall said the government’s position remains that the dispute should be resolved through arbitration, as stipulated in the contracts.
He also disclosed that the two arbitrations will be heard in Guyana, which he described as an important development for the country’s ambition to establish itself as an international arbitration destination. Nandlall said, “The seat of the arbitration is here in Guyana.”
He explained that the ICC will conduct the arbitration hearings in Guyana. Nandlall linked the development to the country’s recently enacted Arbitration Act 2024, which he said adopts a modern international framework for arbitration.
“Our intention is to make Guyana an arbitration destination,” he said.
He said the VAMID proceedings therefore represent not only a significant contractual dispute, but also an opportunity for Guyana to demonstrate its capacity to host international arbitration proceedings. The arbitration proceedings and the government’s appeal are ongoing.
The two projects are major healthcare investments. The US$161 million New Amsterdam Regional Hospital in Region Six is designed as a 230-bed, level-five facility with advanced diagnostic services, specialised care and five operating theatres.
The €149 million Paediatric and Maternal Hospital at Ogle is a 256-bed specialised facility for maternal and child healthcare, including surgery, intensive care unit (ICU), imaging and oncology services.
