The Customs Commissioner of the Liberia Revenue Authority, Mr. Saah Saamoi, appears to be in blatant violation of a Supreme Court order, effectively diverting to an illegal company huge amounts of revenue that should otherwise be payable to the Liberian government and other parties under an existing Destination Inspection Agreement.
The order, issued by the Supreme Court of Liberia on August 26, 2024, mandates the reinstatement of Medtec Scientific Liberia Limited under an existing Destination Inspection (DI) Agreement, effectively halting the operations of MTS Inspection Service Ltd., the company that had been superimposed as the Special Purpose Vehicle (SPV) under the same agreement.
According to the DI Agreement, signed In 2021 by the Government of Liberia and Medtec Scientific Limited, a company registered in Abu Dabhi, the United Arab Emirates, Medtec Scientific Limited established a subsidiary registered in Liberia, named "Medtec Scientific Liberia Limited", for the implementation of the agreement. MTS Inspection Service is not recognized under the DI Agreement.
The DI Agreement sought to replace BIVAC, the pre-shipment inspection provider after it closed operations in Liberia. The administration of President George M. Weah, at the time, opted to replace pre-shipment inspection -- inspection of all goods at the port of embarkment -- with Destination Inspection, which would take place upon arrival of shipments in Liberia. Destination Inspection, for the purposes of the agreement, refers to "the intrusive and non-intrusive examination of goods imported to or exported from Liberia for the purpose of ensuring the correctness of quantity of goods declared to Customs; and the accuracy of goods valuation, HS classification, origin, and the quality of such goods as established by the Government of Liberia using risk management techniques."
Specific functions of Medtec Scientific Liberia Limited include, under the DI Agreement: "Price Verification, Customs Tariff for the purpose of revenue collection by the LRA, Determining the payable Import/Export Duties and any other Government levies, Non-Intrusive Inspection (Scanning), Intrusive Inspection (Discretionary to Customs: Stuffing/Unstuffing, Risk Management System of Importers and Exporters, Records safe keeping/storage, and Training."
But due to some disagreement between the partners in Medtec Scientific Liberia Limited, including Ms. Angela List and the UAE parent company's Chief Executive Officer, Mr. Ramzi Abou-Hassan, the latter decided to establish another subsidiary in Liberia, named "MTS Inspection Services LTD", to carry out the same function under the DI agreement, completely ignoring and sidelining Medtec Scientific Liberia Limited and diverting all revenues to MTS.
Medtec Scientific Liberia Limited then filed a petition to the Supreme Court stating that, being officially recognized under the DI agreement between the Government of Liberia and its parent company, Medtec Scientific Limited, the subsidiary had hired both foreign and local employees, and provided the customs inspections services stipulated under the terms and provisions of the Destination Inspection Agreement to the Liberia Revenue Authority under the DI agreement.
In Justice Yussif D. Kaba's ruling on August 26, the Court directed all parties involved in the legal dispute to revert to the status quo, restoring Medtec Scientific Liberia Limited to its original role. MTS Inspection Service Ltd. was ordered to immediately cease all activities under the DI Agreement.
Furthermore, the Court instructed Ecobank, Guaranty Trust Bank, and International Bank Liberia Limited to freeze all funds in the accounts associated with Medtech Scientific Ltd. and MTS Inspection Services Ltd.
To manage the financial aspects of the DI Agreement, the Government of Liberia has been ordered to establish an escrow account at Ecobank Liberia Limited. All fees collected under the DI Agreement will be deposited into this account, with 20% of the funds credited directly to the Liberia Revenue Authority (LRA). The remaining 80% is to be transferred into a joint escrow account managed by Medtech Scientific Ltd. and Medtec Scientific Liberia Ltd., which they are required to open immediately.
The LRA has been further instructed to direct all exporters and importers to deposit their fees into the newly established government escrow account. The respondents in the case have until September 4, 2024, to file their returns in compliance with the Court's order.
In response to the Supreme Court's decision, MTS Inspection Services Ltd. has announced the immediate suspension of all operations. The company, in a notice dated August 26, 2024, stated that this move is in compliance with the Court's order. All MTS offices have been closed until further notice.
The notice, signed by Mr. Ramzi Abou-Hassan, Chairman & CEO of Medtech Group, was addressed to the public, including the company's staff, customs brokers, importers, customs officers, and relevant government agencies including the LRA and the Ministry of Commerce and Industry. MTS assured that further updates will be provided as necessary.
Defying Court Ruling
However, Customs Commissioner Saamoi released a statement cleverly circumventing the Supreme Court's ruling, which clearly reinstates Medtec Scientific Liberia Limited to its original role under the DI Agreement.
"In the wake of the latest Supreme Court order, the Liberia Revenue Authority (LRA) informs the general public that all customs declarations will now be submitted directly to Customs under Customs Procedure Code IM4 (CPC-IM4) without the requirement for inspection certificates, pending resolution of the matter."
The Saamoi emphasized that while this change is in place, all other procedures, including the payment of government revenue, remain unchanged, suggesting that payments would still be made to the bank accounts of MTS, instead of Medtec Scientific Liberia Limited.
"Meanwhile, all other procedures, including payment of Government revenue,
remain unchanged until further notice," Saamoi added, offering assurances of LRA's commitment to providing "uninterrupted service delivery" during the ongoing court proceedings.
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Background on the DI Agreement
According to a board resolution of Notre Dame Investment Limited, whose sole Director is Angela List, her company entered into a joint venture agreement with Medtech Scientific Limited ('Medtech Dubai') on 4th July 2021 for the operation of the Destination Inspection Contract (DI Contract) in Liberia.
"A local company known as Medtech Scientific Lib Limited was established to undertake the inspection and other obligations under the DI Contract in line with the agreement executed with the Government of Liberia. The company is a 60% shareholder while Medtech Dubai maintains 40% of the issued shares."
The DI Agreement initially designated Medtech Scientific Liberia as the SPV (in other words, the legal entity registered under the laws of Liberia) responsible for inspection services.
However, this role was later transferred to MTS Inspection Services, as outlined in Part 2 of the Memorandum of Understanding (MOU).
"It has come to the attention of the board," List said, "that Medtech Dubai has hijacked the operations of Medtech Liberia in violation of the joint venture agreement and the DI Contract and has, under false representations opened bank accounts in the name of Medtech Dubai contrary to its obligations," prompting List to pursue legal remedies.
With the Supreme Court's recent order, the original designation of Medtech Scientific Liberia has been restored, effectively reversing the previous transfer of responsibilities.
