Libyan bank challenges Burkina Faso over bank seizure

The Libyan Foreign Bank has challenged the Burkinabe government’s decision to nationalise its stake in commercial bank BCB.

A state-owned Libyan bank has filed for arbitration against the government of Burkina Faso over the 2024 nationalisation of joint venture bank Banque Commerciale du Burkina (BCB).

The Libyan Foreign Bank filed the claim on Monday 17 August at the World Bank’s International Centre for Settlement of Investment Disputes (ICSID), with legal representation from the Paris office of international law firm Eversheds Sutherland.

Established in 1997 as a 50-50 joint venture between the Libyan Foreign Bank and the government of Burkina Faso, BCB was nationalised in May 2024 by the West African state, which claimed that its Libyan partner had failed to meet its business obligations.

The Libyan Foreign Bank and Eversheds Sutherland have been contacted for comment.

Contested history

Since Burkinabe president Captain Ibrahim Traoré took power through a coup in 2022, his government has nationalised natural resources and key economic assets. In June 2025, the state seized two gold mines and three exploration licences, while the country is facing an ICSID arbitration claim by Australian gold mining company Sarama Resources which lost its exploration permit in 2023.

A report of a cabinet meeting published by the presidency in May 2024 said the state had nationalised the BCB “after fruitless exchanges” with Libyan Foreign Bank, explaining that  “difficulties have plagued the operation of the bank, because of the Libyan partner who did not provide the expected support for the smooth running of the bank”.

In its own May 2024 statement, the Libyan Foreign Bank insisted that it had complied with the original founding agreement between it and Burkina Faso, the laws of the Organization for the Harmonization of Business Law in Africa (OHADA) and decisions by the West African Monetary Union (WAMU).

The bank, which was established in 1972 and is owned by the Central Bank of Libya, reported that it had rejected proposals by the Burkinabe government (AI translation) “that can only be described as terms of submission”, asking instead for “a balance between the two parties” which would “fairly serve their interests” and expressed a hope for an amicable solution.

The statement continued: “The actions taken by the Burkinabe side constitute a clear violation of the provisions of the agreement concluded between the two parties, and also the instructions of the West African Banking Commission.”

Under President Traoré’s leadership, Burkina Faso has withdrawn from the Economic Community of West African States (ECOWAS), forged a closer relationship with Russia and formed the Alliance of Sahel States with Mali and Niger, which are both also led by military governments.

Despite the coup, according to a recent report Burkina Faso remains one of Africa’s strongest performers when it comes to tackling corruption and the country was removed from the ‘grey list’ of the Financial Action Task Force in 2025 after making improvements to its financial crime regime. The North African state’s sovereign wealth fund, the Libyan Investment Authority, is separately fighting an ICSID arbitration against Belgium over a failed 2008 project and the subsequent freezing of Libyan assets.