AFRICA Selection Fishing Namibia (ASFN) and the Nationa Fishing Corporation of Namibia (Fishcor) is heading for the High Court after the state-owned enterprise opted out of an arbitration process.
After initially agreeing to go into the process to work out modalities on how the contractual agreement between the partners in the joint venture with Seaflower Pelagic Processing (SPP) would be honoured, Fishcor gave notice that it will instead approach the High Court of Namibia with an application to halt the arbitration process.
According to the contractual agreement and the calculations of the remaining board members of SPP, the fisheries ministry owes the joint venture a fishing quota of nearly 100 000 tonnes. The agreement stipulates that SPP would receive a fishing quota of 50 000 tons of horse mackerel quota per year for 15 years, but since 2018 the joint venture did not receive a full annual quota.
The two partners have been at loggerheads after the Minister of Fisheries and Marine Resources, Albert Kawana during September 2020 took an unilateral decision to cancel the Designation and Co-operation Agreements promulgated in two different Government Gazettes relating to the joint Venture project between AFSN and Fishcor.
According to a statement by Adriaan Louw, the SPP Board Chairman, the minister based his decision on passing remarks made by a High Court Judge in a ruling about an application to halt the sale of fish on public auction.
In the matter before court at the time, the Judge was not required to assess the legality of the underlying agreements or the Government promulgations.
‘The Judge was further not addressed or requested to assess the underlying Designation and Co-operation Agreements.
“As a legal expert, Minister Kawana, relying on an incorrect legal and factual basis, and entirely without mandate from Cabinet, caused irreparable harm and damages to the joint venture project and has prevented 655 workers from being permanently employed,” Louw said in a statement.
According to Louw, a set of events have been set into motion that led to arbitration and court proceedings because incorrect decisions were taken.
Due to the failed Public Auction proceedings instituted by the Minister of Fisheries in 2020, 100 0000 tonnes of the horse mackerel quota remained in the sea.
The harvesting of other fish species was similarly affected.
This decision cost the Namibian fiscus billions of dollars in both direct and indirect revenue.
“This could have been prevented,” he said.
The Horse Mackerel fishing season commenced on 1 January 2021 and no quota has been allocated to SPP to date.
“This is to the detriment of both joint venture partners. Fishcor is already under financial pressure and is at risk of losing their investment in the project. For the Minister of Fisheries to renegotiate on these agreed terms and conditions are tantamount to sabotage of the joint venture investment agreement,” Louw said.
He said the repeated refusal by the Minister of Fisheries to engage with the board of SPP, has left ASFN and SPP with no alternative but to refer the matter to arbitration.
Fishcor further ignored the opportunity to engage in mediation, which predates the arbitration process.
“Fishcor initially agreed to the arbitration process, but opted out about a week later and then informed us that they will approach the Namibian High Court with an application to have the process set aside. SPP and ASFN were left with no choice but to oppose the application,” he said.
Despite the looming High Court Challenge, Louw reiterated that ASFN and SPP remains committed to finding an amicable solution, not only to the benefit of all parties concerned, but also for their workers’ job security, the economy of Walvis Bay and to the benefit of Namibian citizens.
“SPP and ASFN are not on a war path with the Government,” he stated.