Cases 23-1647, 23-1648, 23-1649, 23-1650, 23-1651, 23-1652, and 23-1781 are suspended; all filed by foreign companies against the Bolivarian Republic of Venezuela to, through Citgo, claim debts that courts determined for compensation for expropriation of assets in Venezuela of those companies during the administration of Hugo Chávez
The subsidiary of Petróleos de Venezuela (PDVSA) in the United States, Citgo, manages to extend its life as a Venezuelan asset against the risk of being auctioned and sold so that creditors of the Venezuelan government can collect their billion-dollar debts.
This new round of survival by the oil company is possible thanks to the decision of federal judge Paul B. Matey, of the Third Circuit Court of Appeals, who favorably accepted a motion filed by PDVSA’s Ad-Hoc Administrative Board, designated by the interim government of Juan Guaidó and which is still recognized as legitimate by the United States.
The ruling, to which he had access the stimulusspecifies that both this and six other processes that require the collection of the debt through Citgo will be temporarily suspended, at least until the court issues a new order.
Thus, cases 23-1647, 23-1648, 23-1649, 23-1650, 23-1651, 23-1652, and 23-1781 are suspended; all filed by foreign companies against the Bolivarian Republic of Venezuela to claim debts that courts determined for compensation for expropriation of assets in Venezuela of those companies during the administration of Hugo Chávez.
Despite the fact that the debt is attributed to the Bolivarian Republic of Venezuela, and not directly to Citgo, since 2018 the argument of “alter ego” was used in courts to qualify Citgo as a representation of the Venezuelan government.
The PDVSA Ad-Hoc Administrative Board and the Special Prosecutor’s Office appointed by the interim government of Guaidó tried, since 2019, to appeal these decisions and defend the assets that were already at risk in US territory, but the processes were already advanced and in many cases it was a losing battle.
Despite the fact that some rulings definitively sentenced Citgo, the Office of Foreign Assets Control (OFAC) of the United States Department of the Treasury issued a license that protected Citgo from any transaction of its assets, but in recent days OFAC authorized the sale of the company.
In this context, the PDVSA Administrative Board requested an emergency suspension on the grounds that an appeal will be filed on May 19.
“That is the reason why we decided to request this emergency suspension that has served in an important way after the absolutely inconvenient and contradictory ruling from the Treasury Department that induces, allows or tells Judge Stark that he can go to the auction process, when We are saying from the beginning that we are going to exercise the right of appeal on May 19,” Horacio Medina reasoned in statements to the stimulus.
*Read also: AN-2015 urges the PDVSA Ad-Hoc Board to negotiate with creditors to protect Citgo
The peremptory calendar establishes that the appellants must present their briefs on or before May 19, 2023; the response briefs of the appellees must be submitted before June 2, 2023 and the reply briefs must be submitted before June 9, 2023.
This decision gives PDVSA’s Ad-Hoc Administrative Board more time to try to negotiate with creditors in search of an agreement that does not imply losing Citgo as a Venezuelan asset.
*With information from the stimulus
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