Belden Namah was reportedly the man behind the sale of controversial land by Telikom PNG

A MINISTERIAL directive issued in January 2012 by then acting Minister for Public Enterprises Belden Namah paved the way for the eventual sale of a piece of land owned by Telikom PNG Ltd at 5-Mile in Port Moresby.

Documents obtained by The National reveal that Gabaka land, previously called OTC grounds, was sold for K4.3 million to PNG Land Ltd, a Port Moresby-based company whose five shareholders, including managing director Henry Tse, are naturalised citizens of Chinese origin.

Investment Promotion Authority (IPA) records show that the company was incorporated on Nov 8, 1990, and its registered office is located at Deloitte Tower, in downtown Port Moresby.

The sale came under Parliament scrutiny last Tuesday with Prime Minister Peter O’Neill instructing the National Capital District Physical Planning Board to halt any development until allegations surrounding the transaction were fully investigated.

Namah, pictured, now Opposition leader, was not present in the chamber when East Sepik Governor Sir Michael Somare and Kerowagi MP Camillus Dangma queried Lands Minister Benny Allan and O’Neill on the sale.

Sir Michael, who was prime minister at the time of the initial sale agreement, had asked Allan to reveal the name of the person who allowed the sale of the land. But Allan said he was not aware and would investigate his department’s involvement.

O’Neill has since written to Task Force Sweep chairman Sam Koim to investigate the matter.

“Without pre-empting your investigation, I am very concerned with the manner in which this prime land was sold and therefore warrant your immediate investigation,” O’Neill said in his letter to Koim dated Nov 12.

Two valuations of Gabaka land were sought by the Independent Public Business Corporation (IPBC) in early 2012. LJ Hooker valued the land at K32 million and Rubeem Valuation assessed it at K75.6 million.

In his letter to O’Neill on Oct 22, IPBC managing director Wasantha Kumarasiri said that Gabaka land, which consisted of 101 sub-divided portions, was sold for K4.3 million in June 2012.

He confirmed the sale was completed in line with the ministerial directive from Namah, who was the Deputy Prime Minister and Minister for Forests and Climate Change.

“It is noted that Section 46 approval requirements under the IPBC Act appear to have been overlooked during the sale,” Kumarasiri said in his letter to O’Neill.

He may have referred to the Section 46 clause, which states that a state-owned enterprise must not sell or lease any land and must not sell or lease any plant under a contract for consideration exceeding K1 million without IPBC approval.

Namah had assumed the acting role in the absence of then Public Enterprises Minister Sir Mekere Morauta.

His ministerial directive dated Jan 23 was addressed to then IPBC managing director Thomas Abe and his Telikom counterpart Peter Loko.

The National understands that Loko’s refusal to adhere to Namah’s directive resulted in his removal as managing director.

IPBC chief legal officer Erastus Kamburi confirmed in a brief to Kumarasiri on Oct 19 that Telikom PNG Ltd and PNG Lands Ltd completed final settlement of the sale transaction on June 1, 2012.

Kamburi said a cheque of K4,341,153.20 was subsequently paid to IPBC to hold in trust pending determination on the apportionment of the funds between Telikom PNG Ltd, Post PNG Ltd and National Information and Communications Technology Authority (NICTA), which all had an historical interest in the land as they were part of the former Post and Telecommunications Corporation (PTC).

The Gabaka land was previously developed under a special purposes lease and was used by the then Overseas Telecommunication Corporation (OTC), hence it was called OTC grounds.

Following the departure of OTC, ownership of the land was transferred to the Department of Post and Telegraphs and later to the Department of Public Utilities, which was subsequently restructured and named Post and Telecommunications Corporation. PTC was the owner of the land until its corporatisation in 1996.

Telikom PNG assumed full ownership of the land in 1998 and proceeded with subdividing it into 101 allotments.

It was granted individual title deeds to the allotments by the Registrar of Titles in August, 2003.

Earlier on June 13, 2003, Telikom advertised the land by public tender and on Sep 17, 2003, accepted an offer by PNG Land Ltd to purchase the entire 101 allotments for K4.3 million. The contract of sale was signed on Nov 3, 2003.

“It is alleged that this was at a significant discount to the then market value,” Kamburi said in his brief.

“It is alleged that PNG Land Ltd was not the highest tender in the tender process conducted by Telikom PNG, and that the tender process may have been flawed.

“It is further alleged that the current value of the land could be in excess of K80 million.”

The National understands the initial contract of sale was signed by then Telikom acting managing director Martin Veisame, who later left the organisation to pursue private business interests.

Veisame returned to Telikom recently, again as acting managing director to replace Charles Litau, who had assumed the role after Peter Loko’s removal.

Telikom’s ownership of Gabaka land became a contentious issue with Post PNG, which claimed it had an “equitable interest” in the land.

The IPBC brief said Telkom’s continued ignorance of Post PNG’s requests led to the lodging of a caveat and commencement of legal proceedings against the telecommunications provider on Nov 14, 2003.

PNG Land Ltd instituted legal proceedings against Telikom in 2004 and obtained orders from the National Court compelling Telikom to settle the sale.

However, the court order could not be effected as long as the caveat lodged by Post PNG remained in place.

The IPBC directed Post PNG not to withdraw the caveat while it attempted to facilitate a resolution of the dispute.

The Post PNG caveat on the property expired on Mar 28, 2012, and was cancelled by the Registrar of Titles.

NICTA then lodged its own caveat, on the instructions of IPBC, to stop the sale proceeding.

But the Deputy Registrar of Titles refused to register it, stating that NICTA held only beneficial interest in relation to the proceeds of the sale and did not have equitable interest that could be protected by the caveat.

Namah said in the ministerial directive that he had come to the conclusion,after considering the positions of all parties, that Telikom must complete the settlement immediately.

He said IPBC was unlikely to succeed in any new negotiations with PNG Land Ltd to rescind the sale and re-sell the land for K80 million or any other increased price.

“This is a commercially unrealistic proposition,” he said.

The acting minister then issued the following directions:

Telikom PNG to complete the sale within 14 days;
IPBC and Post PNG to remove the caveats over the land;
sales proceeds (if any) to be paid and dealt with as ordered by the National Court decision of 2003,and,
A full report, including details of settlement, must be made to him within seven days after settlement.
“Failure to implement the above directions will result in the referral of this matter to the National Executive Council to consider an inquiry and sanctions,” Namah said.