Unheard of clauses of NAB-Broadsheet agreement

ISLAMABAD: The National Accountability Bureau (NAB), while signing the agreement with the Broadsheet LLC in June 2000, had foregone the right of appeal in case of an adverse decision in arbitration.

Importantly, the arbitrator, who handed the judgment, was appointed with Pakistan’s consent and this is what the agreement had provided.

Clause 7.1 says any dispute, arising out of this agreement, shall be finally resolved by arbitration with the right of appeal hereby agreed to be excluded and waived by the parties. It further says this arbitration shall be conducted under the provisions and in accordance with the rules of the Chartered Institute of Arbitrators London mutually before a single arbitrator agreed by the parties.

Notably, although the agreement was signed in Pakistan, its clause 6.1 says it shall be governed by the laws of the Isle of Man and in case there being no conflict in accordance with the laws of Pakistan, provided that in respect of the provisions for “compensation” (para 4), the laws of the State of Colorado and the United States of America shall apply.

Para 4 says NAB and Broadsheet agree that any assets recovered as a result of the efforts of the Broadsheet or as a result of a settlement between NAB and any person or entity registered in accordance with the provisions of clause 1.2 shall be jointly shared as set out in it. For the removal of any doubt, the share of assets recovered as set out in this clause shall also apply to any settlement reached by NAB and any registered person or entity with or without the involvement of Broadsheet, provided that such persons or entity had been registered before the settlement.

Clause 4.2 says Broadsheet shall receive 20pc of the amount available to be transferred plus bonus if any as may be allowed by the NAB chairman and the NAB shall receive balance 80 percent of such amount thus recovered less bonus, if any, should the case to be.

A financial expert commented that such leeway and benefits are given to foreigners if they are bringing investment into Pakistan. In the instant case, unheard of favours were extended to a company, which is seeking business.

Another clause (18.7), which was very stringent for Pakistan, provided that the power of attorney given to the Broadsheet was irrevocable.

It said NAB and Broadsheet agree that both this agreement and the power of attorney shall remain in full force and effect and not be in any way amended, revoked or modified with respect to all “registered claims” until either the last of such claim has been settled or litigated and reduced to a final non-appealable judgment; and the last of such claims has been either fully collected, paid, settled or abandoned in respect of the concerned party.

The agreement prohibited Pakistan from unilaterally terminating the agreement. Clause 18.1 says NAB and Broadsheet agree that this agreement may be terminated by either or both parties only in accordance with the provisions set out in this clause: That is and with the mutual consent of both parties upon such terms and conditions as may be agreed; or by Broadsheet or NAB upon the provision of a written notice of them, as the case may be, effective thirty days after its receipt.

No notice of termination shall be applied to persons or entities registered by Broadsheet in accordance with the terms, listed in the agreement, in respect of which Broadsheet shall be allowed to continue its efforts to recover assets and no termination shall be effected in respect thereof and in respect of such registered persons or entities the provisions of this agreement shall be deemed to continue to apply and be operative.

No termination notice shall affect in any way any ongoing arbitration or any arbitration resulting from the possessing of a registered case and settlement or any registered case, ongoing or completed. Nothing is known about the second signatory as witness to the agreement, Tariq Fawad Malik, except that he is a resident of Defence, Lahore.