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January 2, 2021

After getting Rs4.6 bn, Broadsheet seeks Rs483m more

Top Story

January 2, 2021

LONDON: The Government of Pakistan has made a payment of nearly $29 million under a London High Court order to the Broadsheet LLC but the litigation is far from over as liquidating agents of the assets recovery firm are seeking several million more from the National Accountability Bureau (NAB), $3 million (approx Rs483 million) in interests and costs at the rate of $5,000 per day.

An agent of the Broadsheet LLC has told this reporter that the NAB still owes the Broadsheet $3 million and interest rate of $5,000 per day on the overall award amount. “I can confirm that US$28,706,533.34 (4.6 billion) has been paid into the Broadsheet LLC Liquidator’s account as per the court Order on account of $22 million judgment and $6 million in initial legal costs. The cost of around $3 million legal costs is still owed and it is costing the Pakistan Govt $150,000 per month at the rate of $5,000 per day and growing. We have an enforcement cost Order from the court. The $5,000 per day interest is statutory interest, and not punitive. The NAB is dragging its feet to pay this amount but the interest amount is accumulating every day.”

Kaveh Mousavi, the former Oxford University academic, was not available to comment but an agent of the Broadsheet, which is in liquidation, told this correspondent that both the NAB and its legal team in London were responsible for the loss of millions of dollars to Pakistani taxpayers.

The agent said: “The NAB’s lawyers at Allen & Overy didn’t respond to our 18 letters in 14 months until the point where we had to threaten to go to the Solicitors Regulatory Authority at their behavior. They were on the record and they had an obligation to reply.” The Broadsheet agent claimed that Pakistan has incurred accumulative legal costs of around $20 million for its legal team, first Kendal Freeman, then leading counsel from Essex Court and finally Allen & Overy, from Nov 2015.

The Broadsheet agent said that Pervez Musharraf’s government approached Kaveh Mousavi in 1999 soon after coming into the government and signed a deal, abruptly cancelling it in 2003. The agent said: “Mousavi’s meeting was with General (retired) Hafeez in 2003 and he resolved he will pursue the case over violation of the contract if not settled. Mousavi didn’t want to bring a bad name to Pakistan but no one listened to him. The Broadsheet went to the court in 2003. We issued arbitration proceedings in 2009.”

The Broadsheet’s former owner Mousavi held two meetings in London with PM Imran Khan’s advisor Shahzad Akbar last year and offered a settlement but Akbar couldn’t do anything. Shahzad Akbar was not available to comment but Pakistan had already lost the case long before Shahzad Akbar came into the government.

The Broadsheet agent said: “Pakistan could have saved a lot of money by settling the case years ago but they were wrongly advised to fight in the hope that there will be no recoveries. Non-compliance over the payment will be noted at the international financial institutions. Pakistani people don’t deserve this.”

The News has obtained a copy of the judgment which shows that Pakistan govt accounts in London were frozen through an interim Order and the amount to Broadsheet was paid from the frozen accounts.

In London High Court’s Commercial Division, the District Judge Master Kay QC made the final judgment between the claimant Broadsheet LLC and Defendants The Islamic Republic of Pakistan (on behalf of NAB) and United National Bank Limited as the Third Party. The judge finalised the 23 June 2020 Interim Third Party Order giving Pakistan until 4.30pm on Wednesday 23 December 2020 to appeal but Pakistan chose not to appeal.

The court ordered that the claimant should be paid “USD 28,706,533.34 on or before 31 December 2020". The court Order confirmed that Pakistan government accounts were frozen. “If the Defendant does appeal in accordance with paragraph 2 above, then the funds held by the Third Party subject to the Interim Order shall be paid into court, to be held pending determination of the appeal.”

The Pakistan government had attempted to claim Sovereign Immunity under the Vienna Convention but the court ruled that the Pakistan government account at the United Bank didn’t enjoy Sovereign Immunity as it had been used for commercial purposes, which does not draw immunity.

Pakistan is now out of time and can no longer appeal. The NAB has said that its current leadership had nothing to do with the original case as the major decision against NAB was made in 2016, long before the current chairman took over. A source at Pakistan High Commission said that the NAB will make the decision about the further monies owed to the Broadsheet.