Hussain Muhammad Imam
A power firm wants Finance Adviser Salehuddin Ahmed and Central Bank Governor Ahsan H Mansur to testify, so a US court issued “bench warrants for the arrest” of both on Thursday. The business is suing Bangladesh in an effort to collect on three separate arbitration judgements totalling $31.9 million.
The Bangladeshi government reportedly issued an urgent appeal in response to the move, according to Law360, a provider of legal news based in New York.
In response to a motion by Smith Cogeneration (Bangladesh), US District Judge Carl J. Nichols ordered the US Marshals Service “to detain and bring to court” Ahmed and Mansur.
In its decades-long quest to satisfy the arbitration awards, the corporation contends that it requires the depositions of Ahmed and Mansur, whom it has characterised as “two of the most senior leaders” of Bangladesh’s finances.
Judge Nichols’ authority to order the arrests of Ahmed and Mansur was challenged by Bangladesh in a swift appeal to the DC Circuit on Thursday afternoon. This was the first appearance of Bangladesh on the docket since the case was launched in 2006.
“In addition, the two individuals to whom the bench warrants are directed, both of whom are high-level Bangladeshi diplomats and officers of the International Monetary Fund and the World Bank, are immune from the criminal and civil process in the United States,” the government of Bangladesh claimed.
Bangladesh argued that the bench warrants are null and void and that Judge Nichols’ court loses jurisdiction due to the instant appeal.
According to the Daily Star report, neither Ahmed nor Mansur responded after the publication of news in the Law360 legal news and analysis. No government official could agree to comment on this issue. But the Power Development Board claimed ignorance of the matter.
In its Wednesday application for contempt sanctions, Smith Cogeneration stated that a court order directed Ahmed and Mansur to present for the depositions on Wednesday. However, they failed to do so. However, the motion states that the two did not appear.
“Without an order from this court holding the [government of Bangladesh] in contempt, the [government] will continue to ignore the authority of this court and will not comply or respond to the notices of deposition,” the request for Smith Cogeneration stated.
This week, Ahmed and Mansur were both in Washington, DC, for the annual meetings of the World Bank Group and the International Monetary Fund.
In its pursuit of assets in Bangladesh, Smith Cogeneration has stated that this visit may be its sole opportunity to take the depositions.
After a London-based tribunal for the International Chamber of Commerce handed down the arbitral rulings in 2002 and 2003, Smith Cogeneration claimed it had been battling to get them enforced for years.
The issue started in 1997 when Smith Cogeneration and the government of Bangladesh and its Power Development Board signed a power purchase agreement. The deal allowed for the building of a barge-mounted power plant in northern Bangladesh.
According to Law360’s reporting, in 2006, Smith Cogeneration informed the DC court in its enforcement petition that the government had agreed to grant the firm all the necessary permits to finish the project.
But Smith Cogeneration said the government scrapped the plan in 1999 and never gave them the permissions they needed. After that, it used money from a $1.5 million performance bond guarantee that Smith Cogeneration had paid for.
That same year, the business took the electricity board to the International Chamber of Commerce (ICC) for arbitration, which resulted in a $13.5 million payout. Additional payments of $222,000 were due from the PDB and the government of Bangladesh, while an additional $39,000 was due from the Power Development Board, as stated in court documents.
In 2007, the awards were upheld by a federal judge in Washington, DC. In May, at Smith Cogeneration’s request, the court changed its final judgement. After adding interest and other expenses, the amount that Bangladesh owes Smith Cogeneration exceeds $31 million, according to Law360’s interview with Smith Cogeneration’s legal counsel.