Case against government on ‘vitiated’ casino licence to go ahead

The licence was granted two months after the election

The controversy surrounding Casino Malta goes back to May 2013. Photo: Matthew Mirabelli

The controversy surrounding Casino Malta goes back to May 2013. Photo: Matthew Mirabelli

A court has decided that a high-profile case against the government on the process concerning the granting of a casino licence to Eden Leisure Group soon after Labour was returned to power should go ahead despite attempts by the government’s lawyers to stop proceedings.

In his decision, Mr Justice Wenzu Mintoff threw out the government’s submissions that the case should not continue to be heard as it was time-barred and ordered the case to continue.

Mr Justice Mintoff also said that as from the next hearing, scheduled for November, Dragonara Casino Ltd, which filed the case, could start presenting its evidence.

Witnesses summoned to answer questions on the processing of the licence, which according to Dragonara was ‘vitiated’, include the Prime Minister, his chief of staff Keith Schembri and ministers Edward Zammit Lewis and Chris Cardona.

Witnesses include the Prime Minister and his chief of staff Keith Schembri

The controversy goes back to May 2013, when just two months after the election, the government issued an expression of interest for a new casino licence.

Two bids were shortlisted for the 10-year concession, one from Eden Leisure to open a casino at the InterContinental Hotel in St Julian’s and the other from Dragonara Ltd, operators of the Dragonara casino, to open a new one in Buġibba.

However, despite the fact that the bid from the Dragonara operators – valued at €4.3 million – was three times the value of the one submitted by the Eden Leisure Group, the government still decided to grant the concession to the latter.

At the time it announced its selection, the government had said it would also enter into negotiations with the Dragonara bidders to grant them a licence as well, even though this had not been envisaged in the original bidding process. However, Dragonara did not manage to get a licence.

In a strongly worded submission, Dragonara alleged that the government’s selection process – which was obligatory when concessions of this nature were granted – was “rigged” and that the government had acted “in bad faith”.

Dragonara is claiming that the government sidelined the original criteria and opted to grant the concession to Eden Leisure merely on the potential of projected tax revenues – something that had never happened in similar concessions.

They are asking the court to annul the whole process and re-open it. In case this cannot happen, Dragonara is asking the court to order the government to pay compensation, which could run into millions.

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