UPDATE 1-Czech power firm CEZ starts arbitration in Albania row
* Long-running dispute over power imports, investment
* Albania revoked CEZ licence in January
* Dispute draws in Czech PM (Adds details, CEZ spokeswoman)
PRAGUE, Feb 7 (Reuters) - Czech power group CEZ has started international arbitration over its long-running dispute with Albania, where regulators stripped the utility of its licence last month.
Albania's power regulator revoked the distribution licence of CEZ's local unit, CEZ Shperndarje, on Jan. 21, holding central Europe's biggest utility liable for damages for importing insufficient electricity and not investing in the country's power grid.
The Balkan country's government has estimated the cost of CEZ Shperndarje's alleged failings at $1 billion.
"Today, CEZ has officially informed the Albanian Government about its intention to initiate international arbitration," CEZ said on Thursday.
CEZ, which is majority owned by the Czech state, did not say where the arbitration would take place, nor how much in damages it would seek, but has estimated it could record a 200-million-euro ($271 million) loss on its Albanian investment.
CEZ plans to detail what it stands to lose when it reports its 2012 financial results on Feb. 28, a spokeswoman said.
The company trimmed its 2012 net profit outlook to 40 billion crowns ($2.1 billion) from 41 billion in November due to its loss-making Albanian division.
CEZ's original investment was 102 million euros in 2009 for a 76 percent share in CEZ Shperndarje. Albania holds the rest.
CEZ said the Albanian acquisition accounted only for 3.6 percent of its foreign investments and 0.7 of total investments.
The dispute has drawn in Czech Prime Minister Petr Necas, who last month said the move to revoke CEZ's licence was a "very negative" signal for relations and raised questions about the Balkan country's commitment to EU entry.
($1 = 18.7309 Czech crowns)
($1 = 0.7387 euros) (Reporting by Jason Hovet; Editing by Michael Kahn and Mark Potter)
- U.S. man sues soccer star Cristiano Ronaldo over CR7 trademark
- Moscow fights back after sanctions; battle rages near Ukraine crash site |
- Wall St. tumbles; S&P below 50-day moving average
- Netanyahu vows to complete Gaza tunnels destruction |
- Argentina defaults but investors see eventual deal possible |