NICARAGUA: 2008 EXPROPRIATION REPORT

UNCLAS MANAGUA 000753 STATE FOR WHA/CEN, EB/IFD/OIA, AND L/CID STATE ALSO FOR WHA/EPSC STATE PASS TO USTR TREASURY FOR INL AND OWH SIPDIS E.O. 12958: N/A TAGS: EINV ECON USTR KIDE OPIC CASC NU SUBJECT: NICARAGUA: 2008 EXPROPRIATION REPORT REF: STATE 43784 ¶1. (U) This cable provides proposed language for the Nicaragua chapter of the 2008 Report on Investment Disputes and Expropriation Claims. Embassy will e-mail a comprehensive annex with details of confiscated property claims by June 15 per reftel request. ¶2. (U) Property claims resolutions in Nicaragua continue to consume the time and energy of former owners and government officials. Since 1990, thousands of Nicaraguans and other nationals registered more than 28,000 claims with the Nicaraguan government for homes, farms, bank accounts, and other assets expropriated during the 1979-1990 Sandinista era. Although most were Nicaraguans at the time of expropriation, some were, or subsequently became, U.S. citizens. ¶3. (U) Between January 1995 and June 1, 2008, a total of 1,137 U.S. citizens registered 3,193 property claims with the Embassy. Of these, 2,535 have been resolved, primarily through compensation in the form of long-term, low-interest, government issued bonds. The estimated face value of these bonds is US$324,730,382. In isolated cases, claims have been resolved through the return of property, cash compensation or, in one instance, a land swap. Most claimants (i.e., 870 of the 1,137) who have registered their claims with the Embassy were not U.S. citizens at the time of expropriation. Another 2,020 U.S. citizen claims not registered at Embassy Managua have been resolved by government authorities without Embassy assistance. ¶4. (U) As of June 1, 2008, 305 U.S. citizens await the resolution of 647 Embassy-registered active claims. Sixty-three claimants, accounting for 113 of these outstanding claims, were U.S. citizens at the time of confiscation. Embassy Managua employs one American officer, one Nicaraguan attorney, and one Columbian-trained attorney who is an Eligible Family Member to assist U.S. citizen claimants. ¶5. (SBU) Between August 1, 2007, and June 1, 2008, the government resolved 21 U.S. citizen claims registered with the Embassy. Four U.S. citizen claimants withdrew a total of 11 claims registered with the Embassy between August 1, 2007, and June 1, 2008, because they did not have sufficient evidence to support their cases. ¶6. (SBU) During the course of the last 12 months, the Nicaraguan government's lack of full cooperation with the Embassy has stifled progress on U.S. claims. Between August 1, 2007, and June 1, 2008, the Nicaraguan government dismissed more than 130 U.S. claims in a nontransparent manner and without due process. The Ortega administration has limited communication between Embassy and Nicaraguan working-level officials to once-monthly meetings. All other communication is conducted through official correspondence between the Ambassador and the Attorney General. Until May 2008, the Nicaraguan government refused to allow Embassy officials to attend meetings between U.S. citizen claimants and the Attorney General, a practice that was common in the past. ¶7. (U) The Embassy will continue to press for swift and suitable resolution of outstanding U.S. citizen property claims in accordance with Section 584 (c) (i) of H.R. 4818, the Consolidated Appropriations Act, 2005. Section 584 specifically precludes adding claims registered after August 1, 2005, for inclusion in waiver determinations based on Section 527 of the Foreign Relations Authorization Act of FY 1994/1995. The Embassy also assists U.S. citizens seeking restitution for claims not registered under the aforementioned act. TRIVELLI