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Cablegate: Mozambique - 2005 Report On Investment Disputes

This record is a partial extract of the original cable. The full text of the original cable is not available.

UNCLAS MAPUTO 001062

SIPDIS
AF/S - TREGER, EB/IFD/OIA - PROSELI, L/CID - NICOL
E.O. 12958: N/A
TAGS: CASC EFIN EINV KIDE PGOV MZ OPIC
SUBJECT: MOZAMBIQUE - 2005 REPORT ON INVESTMENT DISPUTES
AND EXPROPRIATION CLAIMS

REF: STATE 70014
1. Claimant A purchased a 50 percent share in a luxury beach
lodge in Vilanculos, Mozambique, from a non-U.S. citizen in
August 2004, using USD 2.5 million in OPIC funds.? A
Zimbabwean claimant had for several years asserted a claim to
the land on which the lodge was constructed in late 2003.
Courts and government officials had previously denied the
claim, but in March 2004 a provincial judge ruled in favor of
the Zimbabwean's claim against the Mozambican body that had
issued the concession to Claimant A,s partner.? It is not
clear that Claimant A was fully aware of the status of this
claim at the time of his purchase.
2. In October 2004 the provincial judge issued an order
declaring that the Zimbabwean's corporation owned usage
rights to the land.? After attempts at negotiation and legal
maneuvering, provincial police evicted guests and managers
employed by Claimant A and his partner, with the eviction
starting on January 6, 2005, and being completed on January
10.? Subsequently the Mozambican Supreme Court ordered the
suspension of the eviction order and is now considering the
issue of the two competing claims.? The provincial judge,
however, so far has refused to enforce the higher court's
ruling on suspension of the eviction order.? As a result, the
property is now closed and occupied by security guards.
3. Over the past ten months the Embassy has contacted many
high-level Mozambican officials to encourage resolution of
the dispute, including Mozambique's President and several
ministers in two different governments.
4. Post last received information about the case in July 2005.
5. Claimant A: US citizen David Herbert.? Post does not have
any information indicating that Mr. Herbert has signed a
Privacy Act waiver.
La Lime

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