Saturday, March 26, 2011

Government to freeze Libya assets in Zambia

COMMENT - If 75% of shares are frozen, who is going to vote at board meetings? How is this going to effect the operation of the board?

Government to freeze Libya assets in Zambia
By Mwala Kalaluka
Fri 25 Mar. 2011, 16:50 CAT

THE government will freeze LAP Green's 75 per cent stake in Zamtel once the UN Security Council confirms that the company’s assets were part of its resolutions on Libya.

Finance minister Dr Situmbeko Musokotwane told Parliament that Libya’s LAP Green Network's shares in Zamtel were covered under UN Security Council Resolution 1973, which, among other things, calls for the freezing of assets linked to the Muammar Gaddafi regime.

Dr Musokotwane said in a ministerial statement on Tuesday that Zambia, being a UN member since 1964, it would take any and all action required to ensure the successful implementation of the above Resolutions.

“There has been a considerable degree of speculation in the past few days as to the future of Zambia Telecommunications Company Limited (“Zamtel”) in connection with the recent events in Libya,” Dr Musokotwane said. “Seventy-five per cent (75%) of the equity in Zamtel is owned by LAP Green N, a Mauritian company headquartered in Uganda which is 100 per cent owned by the Libya Africa Investment Portfolio, known as LAP…”

LAP is in turn wholly owned by the Libya Investment Authority.

“As government we understand that there is high likelihood that the shares in Zamtel which are held by LAP Green N are covered by United Nations Security Council Resolution 1973 and therefore those shares shall be frozen,” Dr Musokotwane said.

“As a consequence, certain actions such as payment of dividends or registration of transfer of such shares, for which as government we already have protection in the transaction documents, shall be temporarily suspended, pending resolution of current issues in Libya.”

Under resolution 1973, the UN Security Council resolved, amongst other things, to extend its earlier resolution on asset freezing applicable to key individuals in the government of Libya as stipulated in resolution 1970 (2011), to apply to the assets under the control of the authorities of Libya.

Dr Musokotwane said freezing of assets, as it pertains to Zamtel, relates to the
shareholder LAP Green Network and its holding of shares in Zamtel.

He said as a cautionary measure, the government would seek clarification from he Sanctions Committee established under clause 24 of the UN Security
Council Resolutions number 1970, on the issue.

Dr Musokotwane said he was unable to give the exact time frame but that the Ministry of Foreign Affairs had already contacted the UN.

He also said should the UN Security Council confirm that the assets of LAP Green Network were part of its Resolutions on Libya, the assets would be frozen.
Dr Musokotwane said the Bank of Zambia would be involved to ensure Zamtel funds were not externalised to finance activities of the Gaddafi regime.

Kafulafuta MMD parliamentarian George Mpombo said Dr Musokotwane's ministerial
statement was an exercise in snoopy because there was incontrovertible evidence that Col Gaddafi's son, Islam, was the founder of the Libyan parastatal, LAP Green.

But Dr Musokotwane said Mpombo's question was incomprehensible.
“We all know that LAP Green is owned by the Libyan government and could be owned by Gaddafi,” said Dr Musokotwane. “If it is, the answer is very clear, it is subject to sanctions. So what is the excitement about?”/JC

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