In light of a Cabinet decision made last week to put the Belize Cruise Terminal and Stake Bank projects on equal footing, the Port of Belize has secured an injunction from the Supreme Court, effective Monday, September 17, barring the Government of Belize from issuing a port license to Michael Feinstein’s Stake Bank project.
The hearing for the injunction was heard ex parte, with only the attorney for Luke Espat’s Port of Belize, Eamon Courtenay of Courtenay and Coye, present for the session. Justice Minnet Hafiz ordered that the Government could not issue a port license to the Stake Bank developers. However, that injunction only holds until October 8, when the Government can exercise one of two options: they could choose not to object to the injunction and have it remain in force, or they can apply to have it set aside, Courtenay told us.
On the same day that the court granted the injunction, Prime Minister Said Musa, who endorsed the Belize Cruise Terminal Project in April 2004, delivered his State of the Nation Address, in which he declared that, “If we don’t have a docking facility by 2009, cruise ships will bypass Belize.That must not happen. So long as we are the government, it will not happen. One or the other of those two cruise ship projects is going to be built.”
In interviews with the television media on Monday, following his annual State of the Nation Address, Musa claimed that the Port of Belize has exclusivity for a commercial trade port in the Belize District. Even though there is a live dispute with Port of Belize, he said, “…cooler heads will prevail.”
Tourism Minister Godfrey Smith told the television media on Monday that the developers on both sides of the fence have been negotiating since earlier this year, but evidently, those negotiations have reached a gridlock. He conceded that the situation is likely to get messy, but he told the press that Government could not just sit by and watch while nothing happens.
Courtenay confirmed Smith’s claims that the parties, Port of Belize and Stake Bank, have been in negotiations, but notes that there has been no move by the Government to have their recently filed suit settled out of court.
The Port of Belize has to act to protect its interests, Courtenay said, indicating that negotiations with Stake Bank have likely been intensified since Port of Belize began litigation last week.
The Port of Belize has never claimed exclusivity, Courtenay added. He pointed to Clause 8 of the Belize Cruise Terminal Agreement, which Port of Belize’s majority shareholder, Belize Ports Limited, Carnival Corporation and their joint venture company, Belize Cruise Terminal Limited, signed with the Government in April 2004 and under which Port of Belize agreed to offer no objection to the Stake Bank project as long as the Port of Belize’s revenues, such as port, cargo and docking dues, collected at Stake Bank go to the Port of Belize.
The Port of Belize learned, however, that some months ago the Government sent a letter to Stake Bank indicating that it would allow Stake Bank to keep the revenues – which the Port of Belize says is in violation of the Belize Cruise Terminal agreement Government had made with its group.
Gian Ghandi, legal advisor in the Ministry of Finance, confirmed to us that in April he did write Feinstein a letter, replying to a letter Feinstein had written to Government asking for assurances for his project. Ghandi indicated that the Feinstein port would be entitled to keep “applicable dues and charges,” such as cargo and port fees, and there was no indication that this would be limited to cruise ships.
Courtenay told us that this was the basis for Port of Belize’s move to get an injunction against the Stake Bank development.
Ghandi said, however, that Carnival Corporation was fully aware of Government’s agreements with Royal Caribbean, and the intent that both projects would get Government’s support. He said that on January 21, 2005, two agreements were laid before the House of Representatives: Government’s amended agreement dated September 14, 2004, with Royal Caribbean, which entailed the Stake Bank development, and a November 2004 clarification agreement to the April 2004 Belize Cruise Terminal Agreement. Carnival raised no objection, Ghandi said, adding that the Carnival project was dubbed “second cruise ship port” on the document.
When we asked exactly how much money in damages Port of Belize is seeking against the Government of Belize, he told us that the accountants are still working on the figures, but that the amount would be “substantial.”
We’ve been informed that at least two of the agreements that the Government has with the Port of Belize – the Share Purchase Agreement and the Belize Cruise Terminal Agreement – call for arbitration outside the court, the latter of the two naming Miami as the jurisdiction. However, Port of Belize intends to have its claims ventilated in the local courts, Courtenay said.
To date Government has not responded to Port of Belize’s court filing made last Tuesday, but they have a window of 21 days to do so.
Royal Caribbean had previously indicated its willingness to invest as much as US$50 million to finance the development of onshore facilities for Stake Bank, but that was well before the contention came to a head between GOB and the Port of Belize. Similarly, Carnival had pledged to finance half of the US$50 million Belize Cruise Terminal project.