8 February 2013

Namibia: Quota Holders Question Joint Venture Board Fees

FISHING rights holders in some of the shotgun marriages or joint ventures (JVs) facilitated by the Ministry of Fisheries are unhappy over the "exorbitant" monthly stipends and board fees paid to their representatives on the JVs.

The Namibian understands that some of the joint ventures pay up to N$15 000 a month to the directors serving on the holding company board.

While some see the monthly fee as justifiable, others say the few directors on the joint venture are robbing other shareholders of their income.

"This is happening across all JVs in the hake industry. The board members are drawing allowances/salaries of N$10 000 per month," said a board member of one of the hake joint ventures.

"This is despite the fact that they have very little to do, other than selling off the quotas annually to whatever company offers the most," said another source.

The minister of fisheries and marine resources, Bernard Esau, arranged various fishing companies into 'marriages' two years ago.

Each company in the joint venture appoints a director who serves on the board. The money the board member gets is his or hers and does not go to the parent company.

Some fear that the payment of monthly fees to directors will transform these boards into exclusive clubs that will not serve the interest of the quota holders.

They questioned the "excessive payments" to board members, saying it's corruption since in most cases the rest of the shareholders of companies either do not know, or if they know, they are unhappy but their hands are tied because it is a decision taken by the board, often without consultation with the individual companies forming the JV.

"The fact that most JVs operate at JV level, which the quotas are allocated to, makes it easy for the board to take such decisions."

The director of policy planning and economics at the Ministry of Fisheries, Anna Erastus, told The Namibian that the ministry does not have the power to interfere since those are operational issues.

She said the JVs need to consult each other before deciding on the fees.

The fishing rights are valid for seven years, and two years into the joint venture arrangements, a number of fishing rights holders have made allegations of unfair and disproportionate distribution of shares and dividends.

Some companies in joint ventures are even threatening to take each other to court because of disagreements over how the joint ventures are run. Others have threatened to pull out of the ventures.

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