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[Barbados, Fuellers] Sol ban stays

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[Barbados, Fuellers] Sol ban stays

Unread post by bimjim » Fri Mar 31, 2017

https://www.barbadostoday.bb/2017/03/31/sol-ban-stays/

[Barbados, Fuellers] Sol ban stays
Court extends injunction stopping BNTCL sale to oil giant
Colville Mounsey
March 31, 2017.

An injunction preventing Government from selling the Barbados National Terminal Company Limited (BNTCL) to regional petroleum products giant Sol has been extended until May 26.

A battery of high-profile lawyers went before High Court Judge Olson Alleyne this morning for what was expected to be a series of arguments for and against extending an interim injunction granted to Sol’s competitor, Rubis last Friday, halting the sale, on which the Freundel Stuart administration was counting on to help shore up the foreign currency reserves.

As it turned out, the attorneys for the defendants - the Attorney General, Barbados National Oil Company Limited (BNOCL) and Sol subsidiary BNTCL Holdings Limited - were not quite ready and requested more time to prepare their response, to which Rubis’ lawyers agreed.

"The injunction continues by consent of us all until May 26 when we come back and argue whether the injunction should continue or whether it should be discharged. The usual practice is to continue it until that hearing is had. So in the meantime we have to file affidavits, written submissions, and the timetable has been set by the court, which we have to comply with. So hopefully when we come back the hearing will take place," Barry Gale, QC, one of the attorneys for BNTCL Holdings Limited, later explained.

In addition to Gale, the oil terminal company is also represented by Sir Henry Forde, QC, Laura Harvey-Reid and Lisa Gollop-Corbin, while Donna Brathwaite, QC, appeared for the Attorney General and Roger Forde for the BNOCL.

"We were only served with court documents on the 27th of March and the injunction was acquired ex-parte [without notice] so all three defendants have to get instructions to prepare affidavits and to respond to their [Rubis] affidavits. Following that exercise all parties have been ordered to file written legal submissions," Gale added.

The High Court had last Friday granted Rubis an interim injunction until April 3, stopping the controversial multi-million dollar sale of the oil terminal in its tracks and throwing a spanner in the works of Government’s plan to beef up the dwindling foreign exchange reserves, which had fallen to a 14-year low of 10.3 weeks of import cover as of the end of last year.

Rubis had lodged an application for a judicial review, challenging the inclusion of a 15-year moratorium clause in the agreement between Government and the Sir Kyffin Simpson-led Sol for the US$100 million merger, which the Fair Trading Commission (FTC) is currently probing to determine whether or not it should be approved.

The clause prohibits the construction of another oil terminal in Barbados, as well as the granting of licences for the storage of fuel, aviation fuel and jet fuel for the commercial and industrial purposes.

Attorney-at-law Leslie Haynes, QC, who along with Sherica J Mohammed Cumberbatch and Nicholas Maynard comprised Rubis’ legal team, this morning explained it was important to take the legal route before the FTC had reached a decision.

"We explained to the court that the matter was of some urgency because the Fair Trading Commission could at any date make its decision. By the Fair Trade Commission Act, they are not obliged to give notice to Rubis because Rubis is not party to the application. So once the FTC gives its decision of which Sol and BNOCL would have notice, the transaction could be completed within the next ten minutes," Haynes argued.

The delay comes much to the frustration of Sol, which had been hoping for a speedy completion to the agreement it reached with the Stuart administration.

"Time is of the essence," Gale stressed. "The matter as you know is still before the Fair Trading Commission and that process is ongoing, there are still representations being made. The interim injunction, unless it is discharge, will prevent completion of the acquisition."

The attorney added that the 15-year moratorium was "in essence a fundamental condition of the acquisition, so the practical effect is that the injunction does prevent the completion of the transaction".

After the international ratings agency Standard & Poor’s had downgraded Barbados from B- to CCC+ last month, Minister of Finance Chris Sinckler had said he was confident the FTC would approve the sale which, when taken with a draw down which was expected from the Sam Lord’s Castle development project and a First Citizens bank loan, would return the reserves to "well above" the desired 12 weeks of imports.

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