On December 16, Jingke Energy announced the latest progress in arbitration with the Sterling and WilsonInternational FZE (SW FZE "). According to
the content of the announcement, the arbitral tribunal decided on December 15, 2023 that the case was terminated by settlement. JinkoSolar and SW FZE and its Affiliates reached a comprehensive settlement of the disputes related to the Component Supply Contract and signed the Settlement Agreement. According to
the agreement, Jingke Energy will eventually have to pay $ 30.5408 million (equivalent to RMB 218 million , converted according to the US dollar exchange rate on December 17). Among them, USD 28.7379 million is the cost of construction or installation of 32 MW PV module products and the liquidated damages that SW FZE claims to pay to the owner; $ 1,802,900 is 50% of SW FZE's reasonable arbitration costs. On May 5,
2017, Jingke Energy signed the Component Supply Contract with SW FZE and its related parties, and signed the First Amendment Agreement and the Second Amendment Agreement on December 28, 2017 and January 30, 2019, respectively. It was agreed that the Company would provide 3,228,400 modules ( 1.18GW ) for the Sweihan PV Project in Abu Dhabi, United Arab Emirates ) with a contract value of USD 427 million. In July
2022, Jingke Energy received a notice from the ICC International Arbitration Court of the International Chamber of Commerce that the applicant SW FZE filed an arbitration request against the company for disputes related to the Component Supply Contract. SW FZE requires the company to bear the following compensation:
1. The liquidated damages claimed by the project owner to the applicant (including its related parties) are 4.2816 million US dollars ;
2. The cost incurred by the applicant (including its related parties) for the construction or installation of 32 MW PV module products to make up for the module difference is 14.1453 million US dollars ;
3. Liquidated damages for delay of US $ 307 million. The total amount of the above
three items is US $ 326 million.
Regarding the arbitration request of SW FZE, JinkoSolar said that SW FZE did not provide sufficient evidence to prove that JinkoSolar had violated the obligations under the Component Supply Contract and the quality assurance documents, nor did it specify the specific calculation method of the amount of compensation claimed by JinkoSolar, so its claim for compensation obviously lacked basis. Therefore, it believes that the possibility of supporting the arbitration request of SW FZE is very low. At the same time, he said that according to the lawyer's opinion, the arbitration procedure is expected to last for more than three years.
But in less than a year and a half, the two sides reached a settlement. JinkoSolar said that the implementation of the agreement is expected to reduce the company's net profit by $ 25.9597 million in 2023. This arbitration settlement will not have a significant impact on the company's financial position and operating results.
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