African Selection Fishing Namibia (AFSN) Chairperson and Seaflower Pelagic Processing (SPP) majority shareholder, Adriaan (AJ) Louw, says N$ 600 million in quota fees alone, over the next 12 years, could be lost to Government, should it proceeds to approve the attempted termination of the joint venture between National Fishing Corporation of Namibia Limited (Fishcor) and AFSN.
The businessman confirmed that over and above the quota fees of N$ 48 million per year, Fishcor could also lose their 40 percent share in the investment made. Employment of 655 workers will also be in jeopardy, while another 450 workers already vetted for potential employment would not be employed due to the uncertainty.
‘The Quota Usage Agreement in favour of Fishcor is by far the highest in the industry and would entitle Fishcor to an 8 percent quota usage fee based on the 50 000mt Horse Mackerel allocation undertaken. Thus, over and above Fishcor’s 40 percentshareholding in profits or losses, they would earn N$48 000 million in quota usage fees per year.”
In terms of Designation and Co-operation Agreements promulgated in Government Gazettes, Government committed to allocate 50 000mt of Horse Mackerel per year to the Joint Venture project over a period of 15 years.
The AFSN Chairperson said his company had on numerous occasions tried to engage Government through the Minister of Fisheries and Marine Resources.
“We have repeatedly requested an audience with our Joint Venture partner as well as the Minister of Fisheries, without success. We have even out of sheer desperation to save the project and secure our workers jobs, addressed a letter to the President, requesting him to urgently intervene”, he said.
Louw maintained that the Fisheries Minister did not have the authority to cancel the agreement, which had been approved by Cabinet. The Minister in official correspondence first relied on the obiter (in passing) remarks of a High Court judge. Lately his new reasoning is that his decision to cancel was based on protecting public interest.
“The Designation and Co-operation agreements were approved by Cabinet and Government Gazetted, duly published and the public was informed of the terms and conditions. Transparency was adhered to. A single minister apparently does not have the authority to cancel these agreements. Any cancellation of a contractual agreement further can only be made on legal grounds. The legal grounds that the Minister of Fisheries relied on are invalid. We are not aware of any Government Gazettes withdrawing or cancelling these agreements,”” he said.
“We have rejected the attempted repudiation of the agreements, as well as the attempt by Fishcor to cancel the Shareholders Agreement based on these incorrect and unauthorised decisions of The Minister of Fisheries. The Fishcor Board members on the Board of SPP resigned in August 2020 and despite repeated requests, notices of demand and reminders to rectify, they remain in breach of our requests to appoint new SPP board members. We have referred this specific breach to arbitration. In terms of the Shareholders Agreement this leads to a trigger event. This trigger event leads to a forced buy out of the Fishcor shares by AFSN. The matter was first referred to mediation, but this opportunity was ignored by Fishcor.”
“AFSN and SPP will remain steadfast in its goal to arbitrate and will oppose any court applications to derail this process. The process of holding the Fishcor board members personally liable has also commenced.
The completed 14 000 square meter SPP factory in Walvis Bay is said to be the largest frozen pelagic fish processing plant in Sub-Saharan Africa. The plant in 2019 enjoyed Presidential visits by the President of Zimbabwe and the President of Kenya, Uhuru Kenyatta with their official delegations and hailed as a major success and example for the rest of Africa.