Govt bids to set aside Clico Energy sale to Proman

Newsday understands that an application to have the sale set aside, which may involve moves by the State to have the CL Financial assets traced and recouped, is carded to come up for case management hearing in the Port-of-Spain High Court on July 20.

The action to set aside the controversial sale of shares in Clico Energy Company to Proman AG was said to have triggered the court action which saw an injunction issued to preserve the status quo of the CL Financial assets portfolio.

Proman AG is a Swiss company involved in the construction of the largest single methanol facility in the world in Trinidad. The company is currently constructing the methanol plant for the Oman Methanol Company in Sohar, Sultanate of Oman.

The Central Bank first approached the court under the terms of the recently amended Insurance Act to seek an order to stop CL Financial from disposing of Clico assets. The move was only made possible by the amendments to the Insurance Act which were assented to in February, shortly after the signing of a memorandum of understanding which gave the Government management control over Clico and other CL Financial subsidiaries.

On Tuesday, High Court judge Justice Judith Jones amended the terms of a three-part injunction issued against CL Financial in order to tighten the State’s hold on Clico assets which may be subject to the control of CL Financial and its subsidiaries.

The key changes to the injunction were the expansion of its second and third parts allowing for subsidiaries and affiliates of the CL Financial group to be better caught under the order’s net. Subsidiaries and affiliates of CL Financial which have interests in or powers to deal over Clico assets are now barred from disposing of them. Jones also ordered that the parties to the court proceedings limit the use to which they put information disclosed by CL Financial on the breadth of its assets to the court proceedings only.

Lawyers for the Central Bank are considering whether to appeal this order. On February 22, High Court judge Justice Gregory Delzin ordered that CL Financial, its directors, senior management, subsidiaries or affiliated companies be restrained from “doing or causing to be done the following acts without prior notice to and the prior approval of the Central Bank of Trinidad and Tobago.”

Under the restraining order CL Financial must also “disclose to the Inspector of Financial Institutions, or his designated officer, the identity, and location of all or any assets of Clico in or out of the jurisdiction.”

CL Financial was further mandated to make “full disclosure to the claimants of all or any information relevant to the existence of any interest held in any of the said assets in Clico.”