11 Jul 2013
The Caribbean Court of Justice (CCJ) has ruled that the British Caribbean Bank (BCB), formerly the Belize Bank of the Turks and Caicos Islands, can commence foreign arbitration proceedings against the government of Belize in its dispute over USD22.5 million loan owed to BCB by Belize Telemedia Limited (BTL), even though the matter is still under litigation in Belizean courts, local news vendor Amandala reports. According to the article, the foreign arbitration proceedings are reportedly to be held in the London Court of International Arbitration (LCIA).
According to TeleGeography’s GlobalComms Database, in December 2009 BCB was seeking to close down BTL on the basis that it neglected to pay back the debt of USD22.5 million plus charges it had inherited via the state takeover. BTL responded by saying that it considers the loan taken out in 2007 by the previous board of directors under private ownership (of companies associated with British businessman and politician Lord Michael Ashcroft) to be unlawful and void, claiming that the loan was ‘illegally’ used to buy up BTL shares and redistribute them to companies controlled by Ashcroft. On 4 June 2011, BTL and the government filed a claim in the Supreme Court of Belize against BCB seeking declarations that the loan was unlawful and that the company had no legal obligation to pay. Complimentary to the domestic court proceedings, BCB looked to international arbitration as a resolution to the dispute with the government of Belize; though in 2010 Belize was granted an injunction to halt the arbitration proceedings. Consequently, BCB appealed the matter to the CCJ on the grounds that BCB and the government of Belize were both party to a clause that specifically provides for arbitration in the event of a dispute.