Malta will have to wait “at least a few more weeks” before it can unfreeze the €377 million of Libyan assets that were withheld following UN and EU sanctions.
An EU official in Brussels said yesterday Malta could not decide unilaterally to unfreeze some of its Libyan assets as these were being held under EU-regulated sanctions. “This means that Malta will have to wait for a formal EU decision – in which the island is also involved – before it can proceed to pass on (Muammar) Gaddafi’s money to the rebels,” he said.
Asked when such a decision was expected, the official said Brussels had already started the ball rolling through its Political and Security Committee to prepare the ground. However, the decision also depended on the UN’s Security Council, which had to make a separate decision.
“We are doing our utmost to unfreeze these funds as soon as possible,” the official said. “However, it is more likely that the process will take a few more weeks.”
The EU’s procedural machinery was kick-started last Tuesday when the PSC commissioned a work group to study various options and prepare the unfreezing of Libyan assets. Brussels-based sources explained that this only affected the assets frozen in accordance with the EU’s autonomous restrictive measures and once the work group’s work was done, the EU Council, representing member states, would have to adopt a decision by written procedure so that each member state government could then proceed with unfreezing the assets.
As for assets frozen by the EU in accordance with the decisions of the UN Security Council, the sources said the EU Council would have to wait for the former to decide to unfreeze the assets before it can, in turn, adopt a decision on the matter.
This issue is expected to be discussed during a Contact Group summit on Libya to be held today in Paris, which Prime Minister Lawrence Gonzi is due to attend.
Malta announced last week it was holding €377 million in Libyan assets. A total of €86 million of these assets belong directly to the Gaddafi family. The government gave no details about the rest.
Malta adopted the EU and UN sanctions in different sets in February and March. These involved the freezing of assets of about 50 Libyan entities, particularly those involving state companies and investment arms related to Col Gaddafi and his family.
Before the implementation of the second batch of sanctions, in March, which also affected the Libyan Arab Foreign Investment Company (Lafico), Malta had raised its reservations at EU level as it was worried with the repercussions such an asset freeze could have on hundreds of Maltese jobs. Lafico, which also operates an administration office in Sliema, has numerous investments on the island. These include a shareholding in the Corinthia Group and its satellite companies that invest in and control the group’s hotel investments around the world, other hotels such as Milano Due and Vivaldi, aviation services company Medavia and manufacturing plants such as Medelec.
Following tough negotiations with its EU counterparts in Brussels, Malta dropped its reservations and supported the sanctions against Lafico after being assured by the other member states that the Maltese companies having Libyan shareholding would still be able to carry on with their business on condition that any dividends to their Libyan associates would be withheld until the sanctions remained in place.
Last week, the UN Security Council’s Libya Sanctions Committee approved a US proposal to unfreeze $1.5 billion of Libyan assets to be used to provide critical humanitarian assistance to the Libyan people.