BUREN secures decisive win for Tanzania National Roads Agency in Dutch set-aside proceedings

The Hague Court of Appeal has declared Progressive Constructions Ltd, Higleig Petroleum Services and Investment Company and their three joint ventures inadmissible in their claim to set aside a US$5.6 million UNCITRAL award in favour of the Tanzania National Roads Agency (Tanroads), and ordered the claimants to pay Tanroads’ costs of the proceedings, in a judgment handed down on 4 August 2026.

Background
The dispute traces back to road construction contracts signed in December 2010 between Tanroads and joint ventures formed by Progressive (India) and Higleig (Sudan) for works on three roads in Tanzania. The contracts were governed by Tanzanian law and provided for UNCITRAL arbitration seated in The Hague. After Tanroads expelled the joint ventures from the worksites in December 2012 and called on bank guarantees issued in connection with the project, the joint ventures obtained an interim injunction from the Indian courts against enforcement of those guarantees.

Arbitration followed in 2016, and on 28 September 2022 a Hague-seated tribunal issued a final award ordering the Progressive/Higleig parties to pay Tanroads approximately US$5.6 million in damages plus around US$2.9 million in costs, later corrected by an addendum of 5 December 2022.

The set-aside challenge
Progressive and Higleig sought to set aside the award on three grounds: that the tribunal had failed to rule on their claim for release of the bank guarantees, thereby exceeding its mandate; that the tribunal lacked independence and impartiality by adopting Tanroads’ expert’s figures without proper scrutiny; and that the tribunal’s findings on contractual time limits conflicted with mandatory Tanzanian law, rendering the award contrary to public policy.

Acting for Tanroads, BUREN argued that the claim was both procedurally barred and inadmissible on each ground. The Court of Appeal agreed, holding that the challenge based on the tribunal’s alleged failure to decide the bank guarantee claim could only be brought if a supplementary award had first been sought and issued or refused, which had not happened, and that the other two grounds were time-barred, since the three-month statutory period for set-aside proceedings ran from the original award and was not reset by the later addendum, which had corrected only limited calculation errors.

The court also rejected the claimants’ argument that their lack of legal representation and unfamiliarity with Dutch arbitration law justified an extension, noting that they had in fact managed to file a timely correction request.

Outcome
The result: Progressive, Higleig and the joint ventures were declared inadmissible on all grounds, without the court reaching the merits, and were ordered jointly and severally to pay Tanroads’ costs of over €31,000.

This follows an earlier ruling by the same court refusing to stay enforcement of the award, on the basis that the set-aside application had a low chance of success, a view now vindicated by the final outcome.

Why it matters
The judgment is a useful reminder of the strict, non-extendable time limits that apply to set-aside applications under Dutch arbitration law, and of the narrow circumstances in which a post-award correction request can reset that clock. It also underscores the importance of timely, well-advised procedural strategy in cross-border arbitration involving state agencies and international contractors.

BUREN’s Philip ter Burg led the representation of the Tanzania National Roads Agency throughout these proceedings, securing a clean and cost-effective result before The Hague Court of Appeal.