Tyco director's group in Belize dispute
By Andrew Parker in London
Published: August 21 2002 22:05 | Last Updated: August 21 2002 22:05
A decision by a telecommunications company controlled by Lord Ashcroft, a
director of Tyco, to increase call and internet charges has sparked a
dispute with the government of Belize.
The business activities of the British peer, who is a leading figure in
Belize's financial community, have caused controversy in the UK, where he is
a former treasurer of the opposition Conservative party.
The latest dispute has damaged Lord Ashcroft's relationship with the Belize
government, according to Maxwell Samuels, the country's minister for
communications and public utilities.
"He has behaved rather arrogantly, high handedly," Mr Samuels said of Lord
Ashcroft, formerly Belize's United Nations ambassador.
He is a shareholder and director Tyco, the troubled US conglomerate, whose
board on Wednesday discussed his proposal that he and eight other directors
should resign to restore investor confidence in the group. On Wednesday
evening the outcome of the meeting was unclear.
The profitability of Carlisle Holdings, Lord Ashcroft's company, has been
buttressed in the past two years by its operations in Belize, which include
Belize Telecommunications (BTL). In contrast, Carlisle has incurred
operating losses in its main US service business.
BTL announced the increased charges, including those for local calls, last
November. There were also rises for internet services, and some cuts in
long-distance calls. Ralph Fonseca, Belize's former telecoms minister, tried
to impose a freeze on BTL's tariff changes in January, but a judge decided
to allow them pending a judicial review.
Abdulai Conteh, the chief justice of Belize, is expected to rule next month
on whether BTL was entitled to introduce the changes. The Belize government
claims that BTL wrongly failed to consult ministers about the changes.
Clifford Slusher, director of telecoms, said Lord Ashcroft's charitable
giving in the country now risked being overshadowed by the dispute with BTL.
"He is not so popular," said Mr Slusher, who added that the increased BTL
tariffs would hit the less well-off hardest.
Carlisle has a 30-year exemption from taxes in Belize, and BTL has been
licensed as the sole telecoms provider for the past 15 years. However, the
agreement will end in December.
Carlisle owns 51 per cent stake of BTL and also owns Belize Bank, the
country's main commercial bank. Carlisle's financial services division
provided income of $18.8m in 2000-01. BTL generated income of $6.7m.
A person close to Lord Ashcroft said the changes had been necessary to
prepare Belize for competition within its telecoms sector. He said local
calls had been effectively subsidised in the past, and denied that the
dispute had damaged Lord Ashcroft's relationship with the Belize government.