Brookfield initiates arbitration over illegal asset expropriation in Peru

This press release was published in English using an automatic translation system.

Brookfield, a leading global investment fund manager listed on the Toronto and New York Stock Exchanges and with operations in over 30 countries, yesterday (March 12, 2025) commenced international arbitration proceedings seeking restitution of over US$2.7 billion in the value of Rutas de Lima SAC ("Rutas"). The request was filed with the International Centre for Settlement of Investment Disputes under the Canada-Peru Free Trade Agreement (the "Agreement").  

Ben Vaughan, Global Operations Manager for Brookfield's Infrastructure Group, said: "For many years, Brookfield has enthusiastically invested in Peru, but unfortunately, our trust has been violated. We are frustrated that the Municipality of Lima and other Peruvian government entities have taken our investment in violation of the rule of law and legal certainty, and are attempting to mislead the public about our company and our investment in Rutas. This situation leaves us with no choice but to demand fair treatment under the terms of the Treaty. We are confident that this arbitration process will allow us to receive full compensation for Brookfield."

Today's announcement follows years of arbitrary actions by the Municipality of Lima and other Peruvian entities, such as the Constitutional Court, which have deprived Rutas of its ability to collect tolls on one of the concession sections. Furthermore, the Municipality and other entities have recently expropriated another of the concessioned sections through a series of municipal ordinances and state actions that violate the applicable legal framework. Furthermore, two international tribunals, as well as a federal court in the U.S., have already ordered the payment of more than US$200 million to Rutas as compensation for repeated breaches of the Rutas Concession Agreement by the Municipality of Lima. However, to date, the Municipality has not paid these amounts. The sum of these actions, as well as a number of additional actions by the State, have deprived Brookfield of the value of its investment in Rutas.

"As a long-term investor recognized as a trusted partner by multiple governments around the world, with a nearly 30-year history of investing in Peru and over 100 years of investing in South America, Brookfield considers Peru's actions to be unreasonable and counterproductive," Vaughan said. "Given Peru's stated goal of increasing scale of foreign investment in the country, we remain hopeful that we can find an acceptable solution with the Peruvian government."