Notas de Prensa

THE NATIONAL CONGRESS IS ORDERED TO REJECT LAND LEASE CONTRACT WHERE PUNTA CATALINA COAL PLANTS ARE BEING BUILT

Public Statement,
Tuesday, April 4, 2017,
Santo Domingo, D.N.

 

The National Committee to Combat Climate Change, CNLCC, has called on the National Congress to reject immediately the lease agreement signed between the Dominican Corporation of State Electric Companies (CDEEE) and the Explotaciones Industriales, SA, owned by the Vicini family, on the land on which the Punta Catalina coal plants are being built.

 

It stated that under this contract, the State is abandoning its prerogative set forth in Article 51.1 of the Constitution of the Republic to declare these lands to be of public or social interest, for the exclusive purpose of favoring the owners of these lands in a damaging manner against the public interest of the Nation.

 

The group reported that on March 15, the first executive vice president of the CDEEE, Rubén Jiménez Bichara gave it a copy of this contract and its annexes, responding to the request made by the group on 21 February.

 

It pointed out that with the delivery of these documents, the struggle for the society to gain access to them was successfully culminated on November 14, 2014 with the deposit of an injunction petition for the fulfillment of the right to free access to public information, Of the Superior Administrative Court.

 

On 15 February this year, the Constitutional Court overturned the judgment of the High Administrative Court that rejected the appeal initiated by the National Committee to Combat Climate Change (CNLCC) and other organizations, recognizing the right of these entities to obtain these documents As soon as they existed.

 

“We are distributing this contract and its annexes to the media and to interested entities and organizations to study them, draw their own conclusions and make their pronouncements,” it said.
It explained that the logical and normal thing is for a public work or an investment of social interest be carried out on public lands, especially if the amounts involved, as in the case of this construction, exceed two billion dollars, which represents a considerable part of public revenues.

 

“Instead of a purchase of land, the government opted for a long-term lease of the land, which is a much less stable legal solution and much more dangerous for the security of the huge public investment made in this project,” it said.

 

It was affirmed that “given the excessive economic importance of public investment that will be sown in these areas, whose security will depend directly on the terms of the contract, and this contract is an act that compromises public revenues, and is also an instrument that provides for and compromises In the future, the possibility of transferring ownership of power generation plants to the owner of the land, if they so wish, is clearly a contractual instrument that must be submitted to the approval of the National Congress for its validity, and it has not been. “

 

Abusive clauses

 

It stated that in addition to subordinating public interests to the property rights of an individual that would suffice to desist from contractual means, this contract contains abusive clauses against the State that threaten the public character of the project being built in those areas.

 

It observed that the contract is practically in perpetuity, because it establishes a duration of 50 years, extendable by periods of 20 years, without fixing a clear and definitive term.

 

It stated that under this contract, the State will pay a lease for 8 million 676 thousand 464 square meters when it will only occupy one million 356 thousand 645 square meters, in the event that the lease value of the leftover portion be deducted in contract addendum after other occupants in favor the interests of the owner of the land would enter to occupy unused part of the land.

 

It pointed out that the lease contract is carried out even though a conventional mortgage in the first range of $ 7 million exists in favor of Banco del Progreso, also owned by the Vicini family, without any commitment in the contract to liquidate this mortgage of the owners of the land. “The logical thing is that prior to the signing of the contract this mortgage would be liquidated .”

 

It explained that the contract establishes a dark and complicated levys for the payment of the lease that will amount to several times the value of the land over the course of the 50 years of the contract.

 

It indicated that the payment of this levy is in dollars that can be settled in pesos but at the rate of the day, just as the annual adjustment for inflation will be made in relation to the US inflation rate.

 

“These clauses clash with the Monetary and Financial Law that establishes in its article 24 that the peso is the currency of legal course and more so being that this contracting realized between the Dominican State and a local company in the national territory,” It said.

 

The collective also denounced that this contract imposes the capitalization of arrears, which is manifestly contrary to the law.
Compensation for damages form the coal is established for the sugarcane cultures of the Vicini’s.

 

It revealed that the contract imposes an indemnity to be paid by the State in the event that the waste from the coal plants causes damages to the organic sugarcane in the Vicini’s property, consisting of US $36,375 per hectare that will be payable in a term of 60 days or less.

 

“This clause is a strong admission that coal plants will damage agriculture and people in neighboring communities, but at the same time it is an outrage to provide compensation exclusively for the goods of the Vicini’s and not for the goods of others, especially in terms of damage to the health of people who are worth much more than cane, “it said.

 

It alleged that the contract has three clauses that threaten the public interests of the Punta Catalina project:
The first of these clauses is that it grants the owner of the land unilateral power to terminate the contract after three years in case of breach of payment of the lease.

 

“The second clause that undermines the public nature of the project is that the owner of the land will have the possibility to participate, if he wishes or agrees, in the reactivation of the work and the development of the project, in case the works be paralyzed for more than five years. The design already adopted, the intention converted into an obligation, to assure the owner of the land the faculty and vocation to become the owner of the plants, is evident. Two plants are being built for free, for the Vicini’s “it added.

 

It also stated that at the end of the contract the owner of the land is entitled to the improvements and / or construction made, although this right will not operate automatically, but through a negotiation mechanism, but in any case the owner will be have the first option in the acquisition of the land improvements.

 

Contract proves the illegality of the Punta Catalina environmental license

 

It argued that with the publication of this contract, the illegality of the environmental license granted to this project is confirmed, because the lease of the land was signed on August 31, 2015, while the environmental license was granted on August 26 2014, a year earlier.

 

“Article 5, paragraph 1. of the regulation governing the granting of environmental permits and licenses provides that incomplete files will not be received from the applicants for these permits and licenses, so it was not possible to grant an environmental license to Punta Catalina without the project not previously having the documents which justified the relationship of the applicant for the license with the land where the project is to be built, “it said.

 

It clarified that still today this file is incomplete and therefore the environmental license of Punta Catalina is illegal, although this contract exists, because even this one is not definitive until the National Congress ratifies it.

 

“Unfortunately, a project called to provide the country with much needed electricity is plagued with scandalous obscurity everywhere,” It said.

 

NATIONAL COMMITTEE ON COMBATING CLIMATE CHANGE, CNLCC

 

– Enfiteusis Contract in Plots No. 136 and 137, of Cadastral District No. 2, Baní, Provincia Peravia, Dominican Republic, No. 108/15, dated August 31, 2015 and its annexes.
Spanish

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– Letter from Executive Vice President of the Dominican Corporation of State Electric Companies (CDEEE), Rubén Jiménez Bichara, to the National Committee to Combat Climate Change (CNLCC), dated March 15, 2017.
Spanish

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Familia Vicini[5927]

Photo of the Vicini Family.

 casas-historicas-Casa-Vicini-4[5928]

Photo of the traditional headquarters of the Vicini Family, in the Colonial City of Santo Domingo, D.N.

 

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