3 years and 4 months ago, the Government of Belize took over the IMMARBE AND IBC Registries. IMMARBE is short for the International Merchant Marine Registry of Belize, which sells the Belize flag as a Flag of convenience to ships. The other, ICB, is short for International Business Companies Registry, and that's the entity which registers offshore companies so that they can operate on Belizean soil, giving them tax-free status, and an assurance of secrecy in their corporate affairs.
These two entities were managed and controlled by a company named Belize International Services Limited, linked to the Ashcroft Alliance. On June 11, 2013, the Barrow Administration acquired them for a public purpose. You may remember that this was a time when Belize's fisheries products were facing sanctions because international vessels flying Belizean flags were engaging in illegal and unregulated activities on the high seas.
The premise of the Barrow Administration's takeover was that on that date the contract with BISL should have ended, but in 2005, the Musa Government extended it to 2020, in an arrangement which was secret, illegal, and unlawful.
So after the takeover, the former owners, BISL, filed a lawsuit in the Supreme Court claiming 45 million US dollars in compensation. That case remained unresolved while it went through its process. That's until today when Justice Michelle Arana ruled on it. After hearing both sides, and considering their arguments, she ruled that the takeover was valid, and she dismissed the claim brought by BISL. It's a big win for the Barrow Government right now, which is definitely in need of one. More importantly, Belize's foreign reserves will not be taxed with yet another 45 million US dollar payout this year.
We spoke to Government attorney Denys Barrow about the win, and he shared the specifics of the two side's positions:
Denys Barrow, SC - Attorney for Government
"The judge, the Honorable Madam Justice Arana, dismissed the claim against the Government of Belize, and ordered costs in the favor of the Government. Therefore, it was a clear and unqualified victory for the Government. The claim was by Belize International Services Company Limited, a supposedly Lord Ashcroft related company, for the decision by the Government that the contract to operate two registries, the Ships registry, and the International Business Companies Registry, that that contract had expired, and that a purported renewal or extension of the contract was invalid, ineffective, and and void. So, that was the Government's decision. The BISL contented that the contract was valid and subsisting, and that therefore, there was a breach of contract when the Government purported to not renew it, or to say that it was not renewable. And I think they were claiming something like 63 million or some major figure. So, I think the biggest victory for Government right now, is to not have to pay that kind of money because I think the coffers of the nation, the taxpayers money, have been drawn on quite a lot in recent times. So, I think we the taxpayers should be very happy about this outcome. I just skimmed the last 3 pages, essentially, it was on the basis that a contract of this value was required by financial regulations, which are a matter of law, to go through the tender process. And this contract was for tens of millions of dollars, and it was awarded without any tender, without any opportunity for anybody else to offer their services, to offer to perform the work at a lower price, etc. So, the court decided that the violation of the tender procedure was sufficient to make the contract not valid."
Daniel Ortiz, 7News
"In your mind, is this possibly a vindication of the Government's purposes for the registries in the first place?"
Denys Barrow, SC
"It's a curious thing, Daniel, because people are looking at a situation where the Government has to pay compensation, which is not the case here. But, they look at the situation where Government has to pay compensation as indicating that there was a bad move on the part of the Government, overlooking entirely the fact that when Government does acquire a property - does compulsorily acquire a property - it is doing something which government's legitimately are permitted to do. Section 17 of the Constitution permits it. Governments may legitimately be required, acting in the public interest, to acquire a property, so that when the property is acquired, the obligation to pay compensation is there. So, it is not that Government loses when it is ordered to pay compensation. You take away - the Government takes away people's property, and they must pay compensation, and when Government is ordered - when the taxpayer is ordered to pay compensation, we must remember that we have gotten the benefit of the property which was taken away."
Shortly after the ruling was handed down, the Government issued a release which says, quote, "The court's decision, rejecting the Ashcroft alliance's claim for $90 million for GOB's take back of the registries, is a vindication of GOB's position and a triumph for the rule of law and the constitution of the country." End Quote.
It then concludes with a harsh putdown of the Musa Government, saying, quote, "As this current administration has always maintained, it is politically, morally and legally repugnant for the PUP to have handed over control of Belizean assets and revenue to the Ashcroft enterprise. It amounted to a scandalous diversion of monies that could only properly have gone into the Consolidated Revenue Fund, and is yet another instance of the corruption that accompanied all the PUP secret deals." End Quote.
Of course with the Alliance and court, it's never over, and BISL is free to take this to the Court of Appeal, and Government attorney, Denys Barrow told us that he is expecting that they will waste no time to do so. BISL was represented by Eamon Courtenay, who is currently abroad.
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