Litigation on Nationalization of BISL Concludes in Supreme Court
Since taking over Belize International Services Limited, the parent company of IMMARBE and the IBC Registry, in June 2013, the Government of Belize has been embroiled in litigation with its previous owners. That protracted legal battle involving a battery of high profile attorneys from home and abroad concluded before Justice Michelle Arana this afternoon. During the trial, submissions were made on behalf of government, as well as BISL by senior counsels Denys Barrow and Eamon Courtenay, respectively. What is being sought by the former owners of the once privately held company is compensation to the tune of forty-five million U.S. dollars. Government, on the other hand, contends that it owes nothing for the nationalization of BISL. The matter which resumed on Wednesday wrapped up this afternoon and a decision has been reserved for a later date. According to Barrow, a privately held company had been given authority to administer public funds, contravening Section One-Fourteen of the Laws of Belize which deals with taxes being paid into the Consolidated Revenue Fund.
Denys Barrow
Denys Barrow, Attorney for Government of Belize
“The case concerns the takeover by government of the two registries, the ships registry and the International Business Companies Registry. That takeover occurred in June 2013 when the government decided that the contract which existed for BISL to manage the two registries had come to an end and that a purported extension of the contract from 2013 to 2020 was an unlawful and illegal extension, therefore government is not bound by it and they decided that they would take over the registry. The interesting thing is that that extension was signed in 2005 to take effect in 2013. The claim is for damages and they have quantified their claim as being forty-five million U.S. dollars. The position of the government is that we don’t owe you any money, we should not be ordered to pay you any damages because what we had is an illegal contract and therefore the contract should be held as not having properly existed, as having no existence and therefore there is not anything to damage and to break. Both sides filed pretrial submissions. In our submissions we contended that the contract is unlawful because: one, it allows a body which is not a government official, which is not a government department, which is not administered by any civil servant or any person in the employment of the Government of Belize to collect millions of dollars every year and every collection that is made of public money, these are taxes, fees and penalties payable by law. The contract allows the people who operated, managed the registries to put that into their own accounts called escrow accounts but, as emerged in the testimony, nobody from government could sign on those accounts, not the financial secretary, not the accountant general, not a single person from government could touch that money. So it means that taxes were not being paid into the Consolidated Revenue Fund as Section 114 of the Constitution mandates must take place. It was being paid to these private individuals and then they, when they were ready, and they did it quite regularly, pay out to the government what they calculate amounts to the government’s agreed percentage.”
A date in March 2016 is being considered for a decision to be handed down in the matter.
