BOV chairman John Cassar White has his office in the House of Four Winds.A legal exception invoked by the government in a deal with Bank of Valletta over the House of Four Winds “was never used for such a purpose before”, a senior civil servant has said.
The contract between the Land Department and BOV, which changed a 40-year lease into a temporary emphyteutical concession for 65 years, was based on an exception under the Disposal of Government Land Act.
This stipulates that a deal would not require a parliamentary resolution or the issue of a public tender “if it consists in land which is offered for an industrial project after applicant would have satisfied the government about the benefit which the project would render to the country’s economy and that it would create an adequate number of jobs”.
The contract lays down that the House of Four Winds in Valletta, which houses the bank chairman’s office, “shall be used for the carrying out of financial services”.
To a senior government official close to the Land Department, invoking the legal proviso “is highly abnormal and was never used for such a purpose before.” The senior civil servant, who did not wish to be identified, specified that this exception was never used in relation to offices.
“The Land Department has always interpreted the clause in terms of buildings related directly to industry, such as factories, Malta Shipbuilding and other manufacturing industries. Offices constitute, by nature, a commercial activity and the Land Department has never interpreted the law as has happened now for the House of Four Winds.
“This has never happened before,” the official insisted.
Asked to say why the government gave the interpretation it did to the law in question and to list instances where this particular exception was used to grant a concession for property serving as offices, a spokesman for Planning Parliamentary Secretary Michael Falzon had not yet replied by the time of writing.
The government was also asked whether the Attorney General’s advice was sought prior to the signing of the deal. Again, no reply was forthcoming.
The Sunday Times of Malta reported that Dr Falzon took part in negotiations with BOV on the deal over the House of Four Winds. At the same time, he had negotiated with the bank, where he worked in the legal office, an early retirement scheme amounting to €260,000, which included a special clause that he could return to the bank once he ceased occupying his political office. This special clause was only given to Dr Falzon.
Although Dr Falzon dismissed any accusations of conflict of interest in these dealings, the Office of the Prime Minister has not yet declared whether any guidance was sought prior to the negotiations on the House of Four Winds.
The ministerial code of ethics demands such guidance in cases of a potential conflict of interest.
Dr Falzon told a press conference last Friday that he had already received the early retirement scheme when the deal over the chairman’s office was signed.
Dr Falzon has so far failed to give the dates upon which his private agreement with BOV was signed.
Last December, bank chairman John Cassar White said the new deal was important for the bank to boost return on investment and stressed that “a lease did not give as many rights as an emphyteusis”.