27.8 C
Belize City
Monday, March 18, 2024

Belize places Top 40 at Miss World 2023

Photo: Elise-Gayonne Vernon, Belizean contestant by Kristen Ku BELIZE...

PM presents 2024/2025 Budget

Photo: Prime Minister, Hon. John Briceño  The national...

Women in Art

by Charles Gladden BELIZE CITY, Thurs. Mar. 14,...

US asked to seize $130 mil of GOB’s money

HeadlineUS asked to seize $130 mil of GOB’s money

BELIZE CITY, Thurs. June 2, 2016–Although Belizean courts, including the country’s highest appellate court – the Caribbean Court of Justice (CCJ) – have said that arbitration awards handed down by the London Court of International Arbitration (LCIA) in favor of the Ashcroft group of companies could not be enforced against the Government of Belize, the parties are winning their appeals in US courts, which have been asked to “confirm and enforce” the arbitration awards.

In a painful end to a string of litigation dating back a decade, a US federal court in Columbia this month upheld two rulings against the Government of Belize. Last week, we reported on the ruling against the Government, whose appeal against the enforcement of a US$4.26 arbitration award in favor of Newco, a company set up in Belize by US investors in a botched airport concession deal, had been struck down. Newco had won foreign arbitration held in Miami. That was “peanuts” compared to another ruling handed down the same day.

Belize losing costly arbitration battles in the US, despite victories in domestic courts

The US federal court had also struck down the Government’s appeal against a US$22 million award handed down by the LCIA in 2009 over a series of settlement agreements which the then administration had penned with the Ashcroft alliance to settle litigation over the trading of shares in Belize Telemedia Limited, formerly Belize Telecommunications Limited (BTL). Of note is that the CCJ had denied a request by the litigants to enforce this arbitration award in Belize.

The legal dispute was over the set of accommodation agreements spanning 2005-2008, under which the former owners of BTL had been claiming guaranteed profits and special exemptions. They had been penned, according to then Prime Minister Said Musa, “to get out of this quagmire of lawsuits which were detrimental to the public interest.”

In its ruling on the matter, the CCJ had said that “…the deed was illegal, void and contrary to public policy and Caribbean courts have an obligation to strike down executive action that undermines the authority of the legislature. For these reasons, the Court found that the enforcement of the Award should be refused…”

The agreements in question had never been approved by Belize’s Parliament, as was required; neither were these secret deals disclosed to other key members of the then executive, who were also sitting in Parliament at the time.

However, in its May 13, ruling, the US District Court of Columbia in Washington, DC, rejected Belize’s bid to quash the order of the US Supreme Court, which agreed that the award should be confirmed and enforced against Belize.

Arbitration Awards copy

The US appeal court said that it rejected Belize’s arguments that it should refuse to enforce the award on public policy grounds, because it was the result of a “corrupt bargain” between the Ashcroft companies and Musa. The US court said that the CCJ did not refuse to enforce the award on the grounds of corruption.

The US Supreme Court is now considering whether to grant the state leave to appeal enforcement of an award in a third case, also involving the dispute over Belize Telemedia Limited (BTL).

As Amandala reported last month, the United States Supreme Court had invited US Solicitor General Donald Verrilli to file a brief expressing the federal government’s point of view in a rare case asking the US authorities to move against the assets of a foreign government in fulfillment of an international arbitration award. Belize Social Development Limited, an Ashcroft affiliate registered in the British Virgin Islands, had been formed specifically to seek collection of the arbitration award against the Government of Belize.

Months after the arbitration ruling against the Government, following a change in administration, another wave of legal battles ensued, leading to the 2009 nationalization of BTL, purportedly to put an end to the legal wrangling with the Ashcroft group.

In a less publicized case involving the group, the Belize Bank is pursuing yet another award against the Government—this one totaling BZ$36.9 million over the government guarantee penned under the Musa administration for a BZ$33 million loan for Universal Health Services (UHS). Our sources indicate that a decision by US courts on the UHS matter is also imminent.

The developments in the US courts come weeks after reports that a foreign arbitration panel which has been hearing the parties on the question of compensation to the Ashcroft group for the nationalization of Belize Telemedia Limited is finalizing its ruling.

Estimates say the panel’s decision would bring the total compensation value to roughly $250 million, with a payout of roughly $90 million required immediately and the remainder required in 12 months to settle the balance of the award.

Last year, the Government of Belize paid a partial settlement to the Ashcroft group based on its share value estimate.

Check out our other content

Belize places Top 40 at Miss World 2023

PM presents 2024/2025 Budget

Women in Art

Check out other tags:

International