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Fortis challenges nationalization of B.E.L.

Posted By: Marty

Fortis challenges nationalization of B.E.L. - 10/25/11 01:47 PM

The nationalization of Telemedia has led to the ninth amendment and just when the Government thought the litigation was dying down, another lawsuit has landed at its doorstep. On Friday, whilst the ninth was being debated in the House, Fortis filed a constitutional challenge against the nationalization of Belize Electricity Limited which took place on July twentieth 2011. In the Claim, Fortis alleges that the nationalization was unconstitutional because the Government’s basis for the nationalization was to ensure that “the country was not plunged into rolling blackouts” was false. According to Fortis, the Government knew that B.E.L. had enough money to take it to the end of July when the rains were expected and that there was no real threat that there would be widespread blackouts.

As to the timing of the filing, some three months after the nationalization, we understand from a legal expert not related to the case that the reason may be that Fortis will likely argue that the Ninth amendment has taken away its right to challenge the nationalization that’s is guaranteed by section seventeen of the Constitution. In other words, when the claim was filed Fortis could challenge the nationalization as not being for a public purpose and not in accordance with the procedures set out in section seventeen of the Constitution. With the passing of the Ninth Amendment, this right has been taken away from Fortis. Whilst these complex legal issues are resolved in the Courts, we understand from a Fortis representative that negotiations have not yet started with the Government over compensation. Fortis expects to present a claim before the end of the year. Local experts estimate that B.E.L. is worth more than one hundred million dollars. Aside from agreeing a value for the shares that were acquired, the ability of the Government to pay Fortis will also be a major point of contention.

Channel 5

Posted By: Marty

Re: Fortis challenges nationalization of B.E.L. - 10/30/11 01:39 PM

Fortis files claim against GOB

Canada-based multinational energy conglomerate, Fortis Inc., former owners of Belize Electricity Limited, filed a claim in the Belize Supreme Court last Friday, October 21, challenging the constitutionality of the Government of Belize’s June 20 acquisition of BEL.

The claim is against the Minister of Public Utilities and the Attorney General, and the law firm, Courtenay and Company, is representing Fortis.

Fortis’ claim says the nationalization of BEL was unconstitutional. It charges that government’s claim that it acquired the company to prevent the country from “plunging into rolling blackouts,” is untrue.

The company is also of the view that the government knew that BEL had enough money to remain operational up to the end of July, when the rains were expected to begin, and that there was no real threat of widespread blackouts.

Fortis’ claim comes some three months after BEL was nationalized and just days before the government’s 9th Amendment was signed into law.

It remains to be seen what impact, if any, the passage of the 9th Amendment will have on Fortis’ claim, which was filed before the amendment became law.

The Reporter
Posted By: Marty

Re: Fortis challenges nationalization of B.E.L. - 11/02/11 02:42 PM

New claims challenge GOB on 2011 nationalization of BTL

The Barrow administration has recently signed into law the Eighth Amendment to the Belize Constitution, which, it has said, would put the 2011 re-nationalization of Belize Telemedia Limited (BTL) beyond legal dispute.

However, Amandala has confirmed from Lois Young, SC, attorney for BTL who also does legal work for the government, that the former shareholders have challenged the 2011 reacquisition of BTL and the government was served last week, on Tuesday, October 25, the same day that the Government won its case over the 8th (formerly the 9th Amendment) Amendment.

The claims were filed by former chairman of BTL’s executive committee, Dean Boyce, as well BCB Holdings.

Additionally, indications to our newspaper are that the question of compensation for the Ashcroft group, the former majority shareholder of BTL would have to be settled in the courtroom.

As we reported last week, there is a substantial disagreement between the two parties over the value of the 95% shareholding which the Government of Belize had expropriated from the former shareholders in 2009, in a nationalization ruled unconstitutional by the court.

Earlier this year, immediately after the ruling of unconstitutionality, Ashcroft got back BTL for a few hours before the Government took control again, asserting that no order had been explicitly given by the court to hand back the company to them.

Government undertook a second nationalization move in 2011, in an attempt to correct what the court had deemed as missteps in the 2009 nationalization.

The Government has revealed that a share evaluation done by NERA Consulting has put the share value at the time of nationalization in August 2009 as low as BZ$1.44 a share; but the Ashcroft group, we were told, had asked a compensation of BZ$10 a share—that’s more than a sixfold difference.

Apart from the litigation that is very likely to ensue in this dispute over compensation, there is a pending case over the nationalization of 2009 before the Caribbean Court of Justice. Whereas the government still contends that the 2009 nationalization was legal, the former shareholders, who had won in the Court of Appeal, insist that the acquisition was unconstitutional.

No date has been set for either the CCJ hearing or the hearing of the new claims challenging the 2011 nationalization.

The case to settle compensation which had been filed pursuant to the 2009 acquisition has been discontinued, because of the second nationalization.

Young told us that two weeks ago, government responded to the claims made by the Ashcroft group; however, they had not written to say whether they would accept the NERA valuation or not.

As for arbitration pursued by Dunkeld, a member of the Ashcroft group, under the UK-Belize bilateral investment treaty, which began shortly after the 2009 nationalization, that has been frozen by the Court of Appeal and the parties are now awaiting a decision from that court on whether the interim injunction to stop the BCB from arbitrating the matter is binding on Dunkeld.

Amandala
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