Eritrea: 2006 Report on Investment Disputes and

UNCLAS ASMARA 000580 SIPDIS SIPDIS E.O. 12958: N/A TAGS: ENIV CASC KIDE OPIC PGOV ER SUBJECT: Eritrea: 2006 Report on Investment Disputes and Expropriation Claims (527) Ref: State 60294 ¶1. The United States Government is aware of four claims by American citizens that may be outstanding against the Government of the State of Eritrea (GSE). Three of these claims were reported in previous reports and there is one new claim for 2006. ¶2. a) Claimant A b) 1998 c) On July 20, 1998 Claimant A notified the Embassy that eight machines and six lots of parts were stranded in the port of Assab following the outbreak of hostilities between Eritrea and Ethiopia. Following the Claimant's request for assistance, the Embassy raised the issue with GSE officials, however, the Embassy's intervention did not succeed in securing the release of the equipment. Over a period of several years the Embassy raised the issue repeatedly with GSE officials. There has been contact between the two parties in an attempt to resolve the case yet since the submission of the 2003 report, the Embassy has not been contacted by the claimant nor is the Embassy aware of any recent activity on the case. ¶3. a) Claimant B b) The two properties in question were nationalized in 1975 by the Derg government of Ethiopia. Eritrea was then a province of Ethiopia. c) The expropriated properties are commercial and located at Martyrs' Avenue No. 273-281 and at Zibel Street No. 2- 10, both in Asmara. After Eritrea won its independence from Ethiopia in 1991, it issued a decree dealing with properties expropriated by the Derg government. Article 9 of this decree stated that the question of property expropriated from foreigners would be addressed at "a later date." In 1993, Claimant B reported that, after seeing a newspaper announcement stating that properties would be returned, it paid the GSE a rehabilitation tax for the properties. Claimant B also continued to pay taxes on the properties and reported that the GSE collected rents on the properties. In 2001, the Housing Commissioner of Eritrea told Claimant B that the two properties would never be return nor would compensation be paid. Later in 2001, the Housing Commissioner reportedly told an Embassy officer the same thing. An Embassy officer met with the GSE Minister of Land twice on this issue and in June 2002 the Minister denied the statement that the properties would not be returned. He did add, however, that the GSE had not made any decisions about expropriated properties and had no idea when this would happen. Claimant has not pursued legal action. Claimant estimated total property value at 140,000 in 2004. There is a local representative on the case and to the Embassy's knowledge no further action on the claim. ¶4. a) Claimant C b) The two properties in question were nationalized in 1975 by the Derg government of Ethiopia. Eritrea was then a province of Ethiopia. c) The expropriated properties are commercial and located at Herent #212 and #214 in Asmara. After Eritrea won its independence from Ethiopia in 1991, it issued a decree dealing with properties expropriated by the Derg government. Article 9 of this decree stated that the question of property expropriated from foreigners would be addressed at "a later date." In 1993, Claimant C reported that all applications and documents needed for processing the properties' return had been submitted. The GSE had been collecting rent since 1991 and income taxes prior to 1973 (when the Derg seized power) had been paid. Land taxes were paid. Claimant C has not been able to obtain a new certificate of ownership from the GSE, although claimant does have all prior title documents. Claimant C has not pursued legal action and estimated the total property value at $290,000 in 2004. There is a local representative on the claim and to the Embassy's knowledge no further action taken. ¶5. a) Claimant D b) 2006 c) In May 2006, Claimant D contacted Embassy to discuss the expropriation of a private vehicle. Claimant D had imported the vehicle in 1999 upon arrival in Eritrea to work as a religious missionary and had paid all required taxes and duties. In 2002, Claimant D was unexpectedly asked to depart Eritrea and left care of the vehicle, with a power of attorney, with an Eritrean national who is a member of an unregistered religious institution. In June 2005 Claimant D returned to Eritrea for several months. Again he departed and left the vehicle. Several months later the GSE confiscated the vehicle allegedly for illegal activity. Police have taken possession of the vehicle. Claimant D did not place a value on the vehicle. Embassy last had contact on June 8, 2006 with Claimant D. ¶6. Claimants: Claimant A: Caterpillar Equipment. Status of Privacy Act Waiver unknown. Claimant B: Irene Shoa Kivitz, American Citizen, Privacy Act Waiver not signed. Claimant C: Susanne Shoa, American Citizen, Privacy Act Waiver not signed. Claimant D: D. Kevin Smith, American Citizen, Privacy Act Waiver not signed. DeLisi