Kuwait fund claims immunity against legal challenge from former staff

A lawyer representing the Kuwait Investment Authority’s London office has told an employment tribunal that the fund should be covered by diplomatic immunity in a legal wrangle involving former staff who accuse it of victimisation, Reuters reports.

Former fixed income head Simon Hard and another former staff member are pursuing an employment tribunal case against the Kuwait Investment Office (KIO), part of one of the world’s largest sovereign wealth funds, for alleged victimisation, discrimination and so-called whistleblowing detriment.

The former employees are themselves being sued by the fund over an alleged conspiracy to award unlawful pay rises, which they deny, but the High Court in July granted them a stay of application in that case in order to allow them to go ahead with their employment tribunal.

“HMG’s (British government) recognition, we say, that the KIO is part of Kuwait’s mission is an irrebuttable fact of state,” Dan Sarooshi, leading counsel for the Kuwait Investment Office, told the Employment Appeal Tribunal in London on Wednesday.

“Once HMG has granted such recognition, then UK courts and tribunals are bound by such facts of state and they cannot take a different approach.”

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A successful assertion of immunity would confirm that the KIO is outside the jurisdiction of the employment tribunal.

Sarooshi said that, since KIO was part of Kuwait’s diplomatic mission, its archives and documents enjoyed diplomatic inviolability under Article 24 of the Vienna Convention.

The sovereign wealth fund has assets of $534 billion, according to the Sovereign Wealth Fund Institute.

James Laddie, the lawyer representing Hard, argued that KIO was not part of Kuwait’s diplomatic mission.

“When it suits the Kuwait Investment Office, it will attempt to rely on diplomatic and state immunity, but also when it suits it will act as the aggressor,” he said.

Kuwait’s government in 1953 established an investment office headquartered in London, with a mandate to invest surplus oil revenue. The office was later named Kuwait Investment Office.