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Nationalization Acts Ruled Constitutional Print E-mail
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Written by By Shane D. Williams   
Thursday, 22 May 2014 00:00

On Thursday, May 15th, President Manuel Sosa of the Belize Court of Appeals delivered the Court’s judgment on challenges to the nationalizations of Belize Telemedia Limited (BTL) and the Belize Electricity Limited (BEL). In a two to one split decision the Court of Appeals ruled that the nationalization of both BTL and BEL were lawfully done and the Eight Amendment Bill is constitutionally in order. The Court also ruled that compensation for the companies will be set at market value at the time of nationalization. Attorney General, Hon. Wilfred Elrington, says the decision is “a blowout for Government and at this point in time the people of Belize has every right to feel good about this decision.” Eamon Courtenay who argued that the nationalizations were unconstitutional took solace in the fact that one judge ruled in their favour and says the Caribbean Court of Justice will have the final say in the matter.

Courtenay’s commitment to take the case before the CCJ means there will be another round of litigation in a dispute that is almost five years old. The National Assembly of Belize passed an amendment to the Belize Telecommunications Act on August 25, 2009 to assume control over the utility company in the best interest of the public. Then on June 20th, 2011 the National Assembly passed an amendment to the Belize Electricity Act to assume control over electricity supply in the best interest of the people of Belize. Both Acts grant authority to the Minister with responsibility for Public Utilities to make an Order declaring that control of the utility will be assumed by Government for a public purpose. On Friday, June 24th, 2011 the Court of Appeals ruled that the nationalization of BTL was unconstitutional because it was inconsistent in respect to section 17 of the Constitution relating to protection of property.

Though Government appealed the decision of the Court, Prime Minister Barrow returned to the House of Representatives on July 4th, 2011 to introduce a new Act to amend the Belize Telecommunications Act. Prime Minister Barrow explained that it was in an effort to address the unsatisfactory portions of the bill pointed out by the Court to the extent in which they were inconsistent with the Constitution. Of particular note was the addition of a section 71, which deals with the payment of compensation. The Bill clarifies the scheme for satisfying compensation awards, and reinforces the right to enforcement. A new section 63 provides access to court for claimants with shares in the company. Another edition made was to the Statutory Instrument issued by the Minister to order the acquisition. While the public purpose given for the acquisition was justifiable, the Court wasn’t convinced that sufficient evidence was provided by the Minister for the stated purpose. Prime Minister Barrow’s response was, “Even if the Court was right, there was always an overwhelming number of reasons in existence that could prove the public purposes... I am certain that, in making his new Order, the public purpose choices of the Minister now will be rooted in circumstances and references of a nature that will still the doubts of even the most censorious of courts.” The reacquisition Act was passed with retrospective effective.

The Ashcroft Alliance challenged the second nationalization. Even with all the amendments to the acquisition Act, on June 11th, 2012 Justice Oswel Legall ruled that the second nationalization was unlawful. However, he did not grant an order for the company to be handed back to the Ashcroft Alliance. Instead, he ruled that Government should maintain control of the company and both parties should commence negotiations on compensation by August 1st, 2012. Both parties claimed victory while appealing the judgment. The appeal was heard in October of 2012. The BEL acquisition was attached to the case as well as the constitutionality of the Eight Amendment. There was a bump in the proceedings as the Ashcroft Alliance sought to have Justice of Appeal Samuel Awich recuse himself from the case. Lord Ashcroft and Dean Boyce had earlier written a letter questioning the validity of Awich’s appointment to the Court of Appeal. This was seen as a preemptive strike so the Alliance could always use the conflict of interest argument to prevent Awich from presiding over their cases. The request to have Justice of Appeal Awich recuse himself was refused.

The written judgment was over 320 pages long. Justice of Appeal Mendez ruled that the acquisitions of both companies were null and void, the Eighth Amendment is unconstitutional and the claimants are entitled to payment for damages. Justice of Appeal Awich, in over 180 pages, ruled that the acquisitions were lawful and the Eighth Amendment is constitutional. Justice of Appeal Sosa affirmed Awich’s ruling to reach a two to one decision. Compensation for the companies will be set at their market price at the time of nationalization. However, compensation negotiations are apparently not high on the list of priorities for the Alliance as they have already committed to an appeal to the Caribbean Court of Justice.