Telefónica Drops Suit Against Argentina

Spanish firm Telefónica has said it is dropping the lawsuit against Argentina brought before the World Bank’s International Centre for Settlement of Investment Disputes (ICSID) for $2.8 billion. Telefónica was suing the Republic of Argentina for losses incurred as a result of the freeze in tariffs imposed by the government in 2002. In dropping the claim, Telefónica announced it had signed a memorandum of understanding with the Argentine government allowing it to renegotiate its pricing in the country in return for investment and maintaining most of its tariffs unchanged. It said it plans to invest $326 million in Argentina this year.