Prime Minister Briceno today signed a 76.5 million Belize dollar settlement deed with the Ashcroft Alliance. It's payment for the Belize International Services Ltd, which comprises the international ships and companies' registries which the Barrow Administration nationalized in June of 2013. The Ashcroft Alliance. and a Panamanian Law Firm had controlled the registry from its inception in 1993. That was under the Price Administration, and it then got a pair of extensions under the Musa Administration in 2003 and 2005. But, the Barrow administration believed the second extension was illegal so it acquired the registry.
As with all things Ashcroft - it ended up in court - and in June of 2020, the Caribbean Court of Justice found that the government had acted in breach of contract, and is liable to pay BISL damages. Another loss, and the only question is how many tens of millions this one would cost. It was sent back to the Belize Supreme Court for the assessment of damages.
And that's where the Briceno Administration came in seeking to work out a settlement rather than face another costly courtroom entanglement.
Months of negotiation ended up in a settlement price of 38.25 million US dollars BISL had sought compensation in excess of US$70 million. Like we said, a whole lot of money but government says it could have gone up as high as 90 million US dollars with accumulating daily interest in the thousands of dollars. That's why tonight it's being called a "deep discount" - and when we caught him at another event in Belmopan today, the Prime Minister explained why:
Hon. John Briceno, Prime Minister
"The point is that it has to be paid and it was sent back to the supreme court to be able to be dealt with expeditiously. We agreed to pay 38.25 million US dollars of which 11.5 million is going to be paid in Belize dollars. So I think approximately a little of 32 million dollars is going to be paid in US and the rest 11.5 million is going to be paid in Belize dollars."
"I know the question is why settle now? well if we don't settle now, we can look at the history with the previous government, we'd be paying a lot more. If we were to proceed going back to court and going all the way to the ICJ, we could see a potential settlement as high as a 180 plus million dollars. The interest rates is going to be around $17,000 per day and we cannot afford in good conscience as a country to continue to go down this road."
And while it was the most judicious course, the fact is the BISL registry is wholly owned and operated by the government and generates tens of millions of dollars in revenue annually. Today, the Prime Minister says that while the 38 million US may seem steep, BISL's earnings in the past 9 years have far surpassed that:
Hon. John Briceno, Prime Minister
"Since the acquisition in the past 7 years, we've collected as a government a little over 95 million US dollars in revenues over 7 years and of that it cost the government a little under 9 million dollars US to run those operations. So, in effect about 85-86 million dollars US profit. So when you subtract the payments and everything from those profits, we would have enough money to be able to pay. It was unfortunate that the previous government spent all the money. They did not save any money, they did not put anything in a sinking fund, knowing full well that it will have to be paid."
"We believe that it is in our interest to be able to settle it and settle now and move on."
Jules Vasquez
"The government always ends up paying through its nose for an entanglement with the Ashcroft Alliance. The broad contours of this as you have explained it, seem to somehow escape that inevitable trap that we often fall into with the Alliance. What is the difference in this case?"
Hon. John Briceno, Prime Minister
"I think it has to be with approach, that we were approaching it strictly business-like, accepting that we have a debt that has to be paid, accepting that if you continue fighting in court, you can't win. The CCJ have said that Belize was guilty and that they have to pay. So, we have to be realistic and to negotiate and we negotiated hard."
Government has 60 days to pay the former owners of BISL.
A Government Release says "the settlement represents a discount of some 58%". It will go to the House of Representatives for debate on Wednesday.
