Aug 2009 Financial News

CCJ rules for Caricom in TCL challenge

Aug 12, 2009

Although the decision by the Caribbean Community (Caricom) to suspend the common external tariff (CET) was procedurally wrong, the Caribbean Court of Justice (CCJ) has ruled in favour of Caricom. The CCJ ordered Caricom to pay half of TCL’s legal costs. The ruling dealt with Trinidad Cement Ltd (TCL) having challenged two Caricom decisions which resulted in authorisation being granted to suspend for one year the common external tariff (CET) on imports of grey cement to certain Caricom member states.

The first of the two decisions was made by the Secretary-General of Caricom on or about September 23, 2008, authorising suspension by Jamaica from September 10, 2008. The second decision challenged was made by the Council for Trade and Economic Development (Coted) on November 24, 2008, which authorised suspension of the CET on cement for one year for seven Caricom members. The CCJ ruled there were procedural flaws in Secretary-General Edwin Carrington’s authorisation of Jamaica’s request to suspend CET on grey cement.

The suspension meant that member states could have gone outside of the Caribbean and import cement due to a shortage. TCL claimed each of the two decisions was ultra vires and should be quashed by the court. Carrington testified that as a result of the request by Jamaica to suspend the CET, he sent out inquiries to member states to determine if they could supply cement. The court heard that the first response came from T&T, which stated that it had no objection to the suspension. TCL said it was able to satisfy 75 per cent of regional demand and there was no basis for either the Secretary-General or Coted to authorise a suspension of CET.

The CCJ ruled that Carrington was wrong to accept a “no objection” reply from T&T as a sufficient answer, but it rejected TCL’s claim to have the Secretary-General’s decision quashed on this basis. “While his procedural flaw attracted an appropriate declaration, it was not of a sufficiently serious nature to warrant the annulment of his decision,” the CCJ ruled. The CCJ said it could find no basis for regarding Coted’s their decision as being ultra vires. TCL’s lead attorney was Dr Claude Denbow and while Dr Kenny Anthony, former St Lucia prime minister, represented Caricom.

Kenny Anthony, former St Lucia PM

Anthony, who represented Caricom, said: “It benefits the decision-makers in Caricom as this is the first time they would be given some kind of guidance in exercising their powers on the Treaty (of Chaguaramas),” he said. He said the judgement was a partial victory for both sides. The Treaty of Chaguaramas established the Caribbean Community and Common Market.

TCL RESPONDS

Alan Nobie, manager, investor relations and corporate communications for the TCL Group, said in a statement that TCL was heartened the judgment provided procedural clarity with regards to the decision-making process of waivers of the CET. “From the onset, TCL sought to clarify the procedures and principles that guide the suspensions of CET, and we are of the view that this judgment brings greater clarity to the process going forward. Nobie said TCL is able to fully supply this year’s regional demand for cement.

Source: Trinidad Guardian
http://guardian.co.tt/business/business/2009/08/11/ccj-rules-caricom-tcl-challenge
Date published: 11-Aug-2009