Allows the UBS Loan Board of Inquiry to conclude
Finally, the long-awaited Royal Commission on the Off-Shore Loan of the Union Bank of Switzerland began more than 12 months since its inception.
And we congratulate President Sir Salamo Injia and his team who have had to deal with a number of obstacles from various branches of government, including the COVID-19 pandemic, to finally get the investigation off the ground.
The investigation was established by the Marape government when it took office in 2019, following the filing of an investigation report by the ombudsman commission which had involved a number of key senior officials, including then Prime Minister Peter O’Neill and himself as Minister of Finance. time.
The Ombudsman’s Commission concluded that there had been a number of widespread illegalities and abusive behavior, including bypassing parliamentary approval to borrow, the NEC was misled when it approved the UBS loan and serious consultation with the relevant authorities and agencies, improper instructions and instructions were given to the President of IPBC and his leadership; and that the Central Procurement and Tendering Commission issued a “ certificate of inexperience ” for the engagement of financial, legal and technical consultants, without authorization from the state prosecutor and contrary to the law on public finances (management)
Prime Minister Marape acknowledged the findings against him of reprehensible and inappropriate conduct and reserved the right to seek a remedy, but he nevertheless created this commission of inquiry to verify and validate these allegations.
In his opening speech, Commission Chairman Sir Salamo said that while the mandate mainly relates to the government’s 2014 decision to get the UBS loan, it also includes questions relating to a loan obtained earlier. by the government in 2009 to the International. Petroleum Investment Company (IPIC) to finance its participation in the PNG LNG project by placing shares in Oil Search (PNG) Limited.
Both loans involve the government’s decision to invest directly in a private company.
With respect to the IPIC loan, the government obtained the loan to purchase shares in the PNG LNG project, using the issuance of exchangeable bonds in respect of the 196.6 million state shares in Oil. Search to secure the loan.
With respect to the UBS loan, the purpose of the loan was to purchase 149,390,244 shares or a 10.01% stake in Oil Search and to meet the associated expenses.
A common theme running through these two loans is government involvement in private business and an investor.
“It is this common theme that prompts the Commission to first understand government policies and strategies for investing in private companies.
While lead counsel assisting the Commission, Dr James Renwick, provided an overview of what the Commission will be investigating.
Some interesting questions and answers that will be presented during the hearing as raised by Dr Renwick are:
What is the possible link between the IPIC loan and UBS loans?
What was the value of the 14.64% state-owned Oil Search shares in 2009 and 2014 that IPIC chose to keep as exchangeable bonds?
What was the value of these shares in Oil Search at the time of the divestiture?
Who was the legal owner and beneficial owner of these shares at the time of their sale or transfer?
Was there a loss in the 14.6% state stock in Oil Search when IPIC exercised its option to hold Oil Search stock as exchangeable bonds?
What was Oil Search’s use of the proceeds from the sale of shares – some AU $ 900 million – and whether this sum was used to purchase the shares of Pacific LNG (PacLNG) in PNG LNG?
To whom did UBS sell the 149,390,244 Oil Search shares and at what price?
What were the repayments of loans from the Independent State to UBS between 2014 and October 2017 and what was the source of these funds.
Did they include PNG LNG revenue?
And was there any interest, direct or indirect, held personally by government officials involved in the IPIC and UBS loans in IPBC, Oil Search or any associated company, including PacLNG?
These questions will be answered during the investigation and we urge all who have signed up as witnesses and those who are not on the list but have evidence to assist the Commission in its conclusions.