On Wednesday, the Caribbean Court of Justice (CCJ) dismissed the majority of the claims brought by policyholders of British American Insurance Company Limited who accused Trinidad and Tobago of breaching several articles in the revised treaty of Chaguaramas, following the collapse of CL Financial.
The claimants argued that “the measures taken by Trinidad to assist CL Financial and its subsidiaries, CLICO investment bank limited, colonial life insurance company (Trinidad) Limited and British American insurance company (Trinidad) Limited were discriminatory and breached articles 7, 36, 37 and 38 of the revised treaty”
They said in addition that the bailout measures were taken to rescue CLF and CLICO, CIB and BAT, all subsidiaries registered in Trinidad and Tobago.
And, that this same protection was not offered to them as policyholders of British American insurance company limited.
They also argued that “the measures-imposed restrictions on the provision of cross-border insurance services in contravention of articles 36, 37 and 38 of the revised treaty”.
However Trinidad and Tobago, in its defense said that the actions complained about by the claimants “fell outside the scope of the revised treaty, saying that the actions were “activities in a member state involving the exercise of governmental authority’ under articles 30(2) and (3) and such activities were excluded from the scope of operation of chapter three of the revised treaty,”.
Prime Minister Gaston Browne, who is chairman of the Eastern Caribbean Currency Union (ECCU) sub-committee on insurance, had said that a decision was taken to take the Keith Rowley administration before the CCJ
Browne said at the time that he had written to the Rowely government after an ECCU meeting had agreed “unanimously to take Trinidad and Tobago to court after three failed attempts to get them to pay the outstanding funds”.
Trinidad and Tobago had reportedly pledged US$100 million to deal with the fallout of the failed BAICO, but Browne said only $40 million was paid.
BAICO was among the companies owned by the Trinidad-based CL Financial Group also including the Colonial Life Insurance Company (CLICO) but the company collapsed in 2009 resulting in successive governments in Port of Spain pumping in billions of dollars in a bailout plan.