April 25, 2024

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[THE INVESTOR] Lotte Duty Free might lose its right to run its duty-free business at Guam International Airport after global leading duty-free store operator DFS won a lawsuit against the Guam International Airport Authority on Feb. 2.

The lawsuit was filed against the Guam airport authority for applying incorrect procurement procedures for selecting a duty-free operator in 2013. The Superior Court of Guam ruled the duty-free concession awarded to Lotte Duty Free Guam in 2013 as void.

The situation is expected to drag on, as the Guam airport authority has decided to appeal the decision, saying that it “strongly disagrees with Judge Barcinas’ decision.” It had used the same procedures to award three other previous contracts,

DFS also appears unlikely to step back. “Although this is a significant step in the right direction, DFS looks forward to continuing to press its claims against both the Guam International Airport Authority and Lotte to seek redress for its misconduct and the considerable damage done to both DFS and Guam,” DFS attorney Maurice M. Suh said in a statement.

If the court maintains its ruling against Lotte Duty Free, the Korean company will be able to operate only until the new operator is chosen.

“We will have to stand back and watch for the time being,” a Lotte spokesperson told The Investor. “When the court makes its final decision then we will decide what we will do.”

According to the contract signed in 2013, Lotte has the right to operate a duty-free entity in the Guam airport until 2022. Lotte’s duty-free store at the facility spans around 2,250 square meters and sells various products including perfume, cosmetics and alcoholic beverages.

By Song Seung-hyun (ssh@heraldcorp.com)