A Maltese civil court has declared that it is to continue hearing a case instituted by the Libyan state to recover funds held by the late Mutassim Gaddafi, fourth son of former leader Muammar Gaddafi, in a Maltese-registered company of which the son was sole shareholder.
This was the crux of a partial judgment delivered by the First Hall, Civil Court in the suit filed by lawyer Shaheryer Ghaznavi on behalf of the Libyan state against curators representing the unknown heirs of one of the sons of the deposed Libyan ruler and Capital Resources Ltd, the company of which Mutassim Gaddafi was sole shareholder, Director and company secretary.
Through Mutual Legal Assistance Treaties on Criminal Matters, the litigation department of the Libyan government was authorised to trace any such funds, even those held under foreign jurisdictions
The issue dated back to 2012 when, following the overthrow of Gaddafi’s regime, the Libyan state embarked upon an exercise to recover funds abusively held by individuals closely associated with the former ruler.
Through Mutual Legal Assistance Treaties on Criminal Matters, the litigation department of the Libyan government was authorised to trace any such funds, even those held under foreign jurisdictions.
Among these, the Libyan authorities laid their sights upon certain funds belonging to Mutassim Gaddafi, who had been an official in the Libyan army and who, up to 2011, had occupied the post of consultant on national security in his homeland.
Upon his death in Misurata on October 20, 201, at the height of the civil uprising against his father’s regime, various credit cards issued by BOV Ltd had been found in his possession.
According to Libyan law, as an army official he had been precluded from drawing benefits from any business interests. Moreover, he had failed to submit a full declaration of assets as prescribed by the laws of his country.
Consequently, the post-revolution Libyan state looked upon these funds, held by Mutassim Gaddafi under the veil of Maltese registered company Capital Resources Ltd, as illicit gains and authorised Dr Ghaznavi, as special mandatary of its Litigation Department, to file civil proceedings for restitution of said money.
A bank representative testifying in the case had informed the court that there were five accounts of Capital Resources Ltd which had since ceased operations. One was a sterling account with a balance exceeding £3 million, a second was a US dollar account with a balance of almost $39 million and the other three euro accounts totalled a balance exceeding €56 million.
A bank representative testifying in the case had informed the court that there were five accounts of Capital Resources Ltd which had since ceased operations.
In the course of these proceedings, the defendants claimed that the Maltese courts lacked jurisdiction to decide upon the dispute. However, this plea was rejected by the First Hall, Civil Court, presided over by Mr Justice Lawrence Mintoff, who declared that, irrespective of the merits, since the court was being asked to authorise the transfer of the Maltese company’s shares in favour of the Libyan state, these proceedings fell within its jurisdiction.
Shooting down two other preliminary pleas by the defendants, the court observed that the Litigation Department represented by Dr Ghaznavi acted on behalf of the Libyan state – which was acknowledged in international fora.
Moreover, Dr Ghaznavi’s appointment as special mandatary was evidenced by documents sent to the Minister of Foreign Affairs by the Permanent Representative of the Libyan state at the United Nations in New York. This state was recognised as the legitimate government of Libya not only by Malta but also by the United Nations.
The signature on these documents had also been authenticated by the Consul General at the Libyan Embassy in Malta in the presence of Dr Ghaznavi.
On the basis of evidence produced and after hearing submissions on these preliminary pleas raised by the respondents, the court rejected said pleas and declared that it would continue to hear the case.
Lawyer Simon Micallef Stafrace and legal procurator Peter Paul Sammut were appointed as legal curators of Mutassim Gaddafi’s unknown heirs in the suit.
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