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February 28, 2021

Broadsheet issue: Court issues new freezing order on Pakistan assets in UK

Top Story

February 28, 2021

LONDON: The UK High Court of Justice has issued a new freezing order in favour of Broadsheet LLC and against the National Accountability Bureau (NAB) ordering that no payments shall be released to the Government of Pakistan by the United Bank Limited (UBL) to any other party from the accounts held by the Pakistan government unless the judgment debt and interest of around £1 million is settled.

The latest interim third party debt order has been issued by Master Davison at the London High Court after a hearing and the same has been communicated to the chief compliance officer at the UBL branch near Oxford Street. Sources at both the UBL and Broadsheet LLC have confirmed the development to The News.

The court sources confirmed that the order was made on February 15, 2021 on the application of Broadsheet LLC after Pakistani government failed to respond to Braodsheet’s communication for the payment in the remaining judgment debt – after Pakistan paid around $28 million to Broadsheet at the end December 2020 after Pakistan’s accounts were frozen.

According to a copy of the order issued by Master Davison of the High Court of Justice’s Business and Property Courts of England and Wales Commercial Court, Broadsheet’s application against Pakistan will be heard on July 30, 2021 when a judge will decide whether a final third party debt order should be made.

By paragraph 2 of the order, until that hearing, the UBL must not pay to the judgment debtor, or to any other person, any sum of money due or accruing due to the judgment debtor, except for any part of that sum which exceeds the total of £89,252,150.

The UBL now has to once again carry out a search to identify all accounts held with it by the judgment debtor directly or indirectly and provide latest information on the health of these accounts, failing which the bank will be sanctioned and may lose licence. It’s pertinent to mention that the Pakistan government had indicated around six weeks ago that it will act against UBL for making payments to the Broadsheet LLC but no action has yet been taken.

The latest order says that the UBL operates accounts for Pakistan/NAB. The order sets out the amounts owed by Pakistan to Broadsheet LLC. It says that on October 24, 2019 and 29 November 2019, Justice Teare made two orders requiring Pakistan to pay money to the applicant (Broadsheet LLC) but a portion of the amount owed under that order is as follows: sums remaining due for payment under the order: $40,888.80; interests to the date of the order: $1,181,149.10; sub-total: $1,222,037.90 alongwith £110 in court fees. In total, the freezing order is for £892,521.50.

This correspondent understands that a hearing before a Master of the High Court of Justice, Business and Property Courts of England and Wales, Commercial Court (Queen’s Bench Division), will be held on July 30, 2021 when the master will decide whether a final third party debt order should be made.

The News had reported two weeks ago that the Broadsheet LLC has instructed its lawyers at Crowell & Moring LLP to initiate proceedings to seize further Pakistan assets after failing to get a reply from the Pakistan government’s lawyers at Allen & Overy for the recovery of nearly $2.2 million (Rs485 million) outstanding amount.

Kaveh Mousavi, Broadsheet’s CEO, had instructed his lawyers to initiate the assets seizure operation. Broadsheet’s lawyers told that the decision has been taken after Allen & Overy failed to engage with Broadsheet in 10 days after assuring on February 01, 2021 that Pakistan desires “to resolve the matter without the need for further enforcement action” but failing to confirm to Crowell & Moring that it has new instructions from Pakistan about the outstanding issues.