LAND LAW CHANGES TO LEGALIZE CURRENT GOV ABUSES

C O N F I D E N T I A L CARACAS 001356 SIPDIS NSC FOR CBARTON HQSOUTHCOM ALSO FOR POLAD E.O. 12958: DECL: 05/04/2015 TAGS: PGOV EAGR SENV VE SUBJECT: LAND LAW CHANGES TO LEGALIZE CURRENT GOV ABUSES Classified By: POLITICAL COUNSELOR ABELARDO A. ARIAS FOR 1.4 (D) -------------- Summary -------------- ¶1. (C) The Venezuelan National Assembly amended the 2001 land law on April 14 to increase the types of land subject to expropriation, to grant squatters more rights, and to empower the National Land Institute (INTI). The modifications, however, do not provide INTI objective standards to use as it exercises its new authority. With or without such standards, the GOV probably will continue to apply the law in a discriminatory manner. Most changes to the law validate abuses that INTI has already committed. End summary. ¶2. (C) The Venezuelan National Assembly passed a "partial reform" of the 2001 land and agrarian development law on 14 April. The legislation now goes to President Hugo Chavez, who said he would have the reform published immediately in the official gazette, according to press reports. The modifications include: -- The "latifundio," lands targeted for GOV redistribution, is defined more loosely. The 2001 law defined the "latifundio" as idle, infertile land in estates larger than 5,000 hectares. The new law calls for the redistribution of any unproductive land in estates over 100 hectares. It expressly gives the National Land Institute (INTI) the authority to determine whether such land is being used appropriately. -- INTI will have authority to regulate the mining of "non-metallic minerals." (Note: several governors have stopped the activities of mines and quarries, asserting that their owners lack title. The Venezuelan construction industry is concerned about this provision.) -- "Occupants" will be able to remain on land as long as they make the land productive. Press reports have interpreted this rule as applying only to squatters. -- The law will apply to all types of land. Under the original law, only lands within the confines of "rural polygons" were subject to redistribution. Former Minister of Agriculture Hiram Gaviria explained to poloff that rural polygons were portions of Venezuelan territory the GOV was to classify in terms of agricultural productivity. -- The law incorporates two articles of the 2001 law ruled unconstitutional by the Supreme Court. One article allows the GOV to take back land without paying "illegal occupants" for improvements they have made. The other allows the INTI to "rescue" (the term used for taking over land deemed to belong to the state) land without court approval. ¶3. (C) The changes to the land law neither provide a framework for determining which lands are productive nor a means to equip INTI officers to exercise their new authority. Alejandro Arcai, the local lawyer for the British ranching company Vestey Group, told embassy officers April 20 there were no legal standards to measure the effective use of land. Arcai said Vestey's Hato El Charcote ranch produced more than the national average amount of meat per hectare of land, yet INTI had judged much of the ranch "uncultivated" and had granted "writs of permanence" allowing squatters to remain. A biologist for the 80,000-hectare wildlife reserve, cattle ranch, and biological research center Hato Pinero told emboffs April 21 that the INTI officers inspecting the property, which also had been declared public land, had no scientific background. -------------- Vestey's Legal Battle -------------- ¶4. (C) INTI declared the 13,000-hectare Hato El Charcote GOV property in March. Armed with title documents dating back to 1830, Arcai nonetheless appeared cautiously optimistic about his chances for successfully appealing the ruling before the deadline of May 15. He told emboffs that he would have a 90 percent chance of winning a case in a "normal court" and that ranchers had experience prevailing even in difficult political circumstances. Ranchers had survived the agrarian reforms under President Romulo Betancourt and the dictatorships of Juan Vicente Gomez and Marcos Perez Jimenez, he said. If all else failed, Arcai said, the British Government would invoke an "Anglo-American treaty" (presumably a reference to the UK-Venezuelan bilateral investment treaty) to try to protect Vestey's holdings. Vestey Group has asked the British Embassy to keep a low profile on the case so far, but Arcai said it may soon be getting more involved. The main obstacle Arcai described was that of squatters, who had been invading the land since late 2000. Now, he claimed, squatters occupied 90 percent of the ranch. Although its production had declined, Hato El Charcote made do by driving cattle to graze among the squatters' plots. ¶5. (U) INTI chief Eliecer Otaiza told the press in mid-March that the ranch's proof of title was "irregular," and the national archive only had Vestey's ownership registered back to 1850. (The law requires the titular chain to be established back to 1848, the date of the Venezuela's first land law.) Otaiza added in mid-April that INTI will withdraw from Hato El Charcote and from 99 other rural properties declared public land if the alleged owners show the courts title documents that they have not shown INTI. Otherwise, INTI will begin to establish agricultural cooperatives on the properties after their 60-day windows for appeals have closed, he said. -------------- Comment -------------- ¶6. (C) The changes to the land law add a veneer of legitimacy to current GOV practices. For example, the GOV already has mounted "invasions" and "rescues" without court orders, countenanced land invasions, refused to pay for land, and expropriated urban and other properties not covered under the 2001 law. Selective enforcement of the law will remain the norm. INTI has already begun to interpret the term "occupants" in the law as "ranchers" in cases where the law curtails rights and as "squatters" where it guarantees them. INTI also may be favoring GOV allies and those who can pay land inspectors to look the other way. INTI's new authority over mines represents a departure from current practice. The change will offer INTI personnel--whom Otaiza accused of corruption in a recent interview--another lucrative source for kickbacks. McFarland NNNN 2005CARACA01356 - CONFIDENTIAL