Godfred Yeboah Dame, the Attorney General and Minister of Justice, has refuted media reports that a US court has awarded a new judgement against Ghana.
The minister also clarified that the Trafigura judgement debt is not a new issue.
He was reacting to media reports that a District of Columbia Court in the United States had ordered the Ghanaian government to pay over $111 million, along with obligatory post-judgement interest, following a Motion of Judgement in favour of the Ghana Power Generation Company (GPGC).
Mr. Dame, in an interview with Citi FM, explained that the Trafigura judgement debt was actually decided back in January 2021.
He also announced that the court action was an enforcement order.
He indicated that the government of Ghana had taken steps to make payments but had yet to complete the full payment.
“This award was given way back in 2021 and the government since then has had the obligation to pay and indeed they have been making efforts to pay. It is the failure to exhaust payment which has led to the company seeking enforcement orders in other jurisdictions. It is not the case where there has been a new judgement or a fresh award given by any court or any tribunal anywhere.”
“…The impression that is sought to be created by the publication that I have seen today- another judgment debt, a new judgment debt, US Court awards, there is no US Court which is awarding judgment against the government of Ghana. It is only an enforcement order and that enforcement order is on account of a failure to pay a judgment debt which accrued way back in January 2021 as a result of an award that was given that time,” he added.
Background
A District of Columbia Court in the United States has granted a Motion for Default Judgement in favour of the Ghana Power Generation Company (GPGC) against Ghana.
Per the directive of the court, the Ghanaian government is to pay $111,493,828.92 plus mandatory post-judgement interest.
The court directive comes after Ghana failed to fully comply with an earlier tribunal decision from the United Kingdom.
A UK tribunal on January 26, 2021, issued a final award finding that Ghana breached its contractual obligations by terminating a power purchase agreement with GPGC on February 18, 2018.
Ghana’s defence argued that the foreign power company failed to meet certain contractual conditions, leading to the contract’s termination.
But the tribunal ruled in favour of the company awarding GPGC $134,348,661 in damages, calculated based on an Early Termination Payment formula in the purchase agreement.
The award included an interest rate of six-month USD LIBOR plus 6% and reimbursement of GPGC’s arbitration fees and expenses totalling $3,309,877.74, with interest at three-month USD LIBOR compounded quarterly.
Ghana, after the ruling, made partial payments totalling $1,897,692.40.
GPGC filed a case in the U.S. District Court on January 19, 2024, under the New York Convention and Chapter 2 of the Federal Arbitration Act, after efforts to recover the outstanding balance failed.
Ghana was served with the petition on January 23, 2024, through Shirley Ayorkor Botchwey, Ghana’s Minister for Foreign Affairs and Regional Integration.
The court documents were delivered in Ghana on January 29, 2024, with a signed confirmation of receipt.
However, Ghana failed to respond by the March 29, 2024, deadline and did not appear in the court proceedings.
The court determined that it had jurisdiction over the case, citing the New York Convention, which the U.S. has ratified, recognising UK arbitral awards.
It also emerged that Ghana had expressly waived its sovereign immunity and committed to international arbitration under the power purchase agreement.
In his August 6, 2024, memorandum opinion, Chief Judge James E. Boasberg emphasised that the arbitral award between the non-U.S. parties arose out of a commercial relationship, which falls under the New York Convention.
The Convention requires that member states recognise and enforce such awards, regardless of the parties’ citizenship or domicile.
GPGC pre-judgment interest was not granted, however, the court will award post-judgment interest at the rate stated in US regulations, which will increase Ghana’s financial burden.
By: Rainbowradioonline.com/Ghana
