DSV and BBC sued for USD 97 million for using confiscated port in Cuba

American Sugar is suing Goldwind, DSV Panalpina and BBC Chartering under a controversial law for using its confiscated port in Cuba. The sugar trader demands USD 97 million in damages, the exact amount the port was estimated to be worth when it was seized by Fidel Castro more than 60 years ago.

The court case is based on a number of wind turbine deliveries for the 101 MW Herradura Wind Farm Project in the Cuban province Las Tunas, which is being developed by state-owned Cuban companies in cooperation with Chinese wind turbine manufacturers Goldwind and Dongfang.

In 2018 and 2019, DSV and BBC Chartering carried out two deliveries for the project which will feature a total of 54 wind turbine generators. While doing so, the companies used the port Puerto Carupano that was owned by American Sugar but confiscated by the Cuban government when Fidel Castro took over power during the Cuban Revolution in 1959.

For more than 50 years, American Sugar owned large sugar plantations in Cuba and Puerto Carupano was one of the company’s commercial ports used for the export of its product. However, shortly after Castro’s victory all of American Sugar’s local assets were seized and nationalised. “Within a year, from 1959 to 1960, the Cuban government destroyed American Sugar’s operations and the assets were confiscated without paying a single cent in compensation,” the sugar producer states in its indictment.

Cuba has since used the ports for its own economic activities, including the construction of the Herradura Wind Farm Project. On behalf of Goldwind, DSV Panalpina and BBC Chartering carried out two transports for this project delivering windmill parts to Puerto Carupano, which is located just 15 kilometres away from the wind farm.

American Sugar now states that the companies owe money for using the port and is demanding USD 97,373,414.72 under the controversial Helms-Burton Act. The amount is exactly equal to the damage claim that American Sugar filed against the Cuban government 60 years ago.

A traditional sugar cane plantation in Cuba. (Source: Wikipedia)

Helms-Burton Act

The Helms-Burton Act is an extension of the trade embargo that the US imposed against Cuba in 1962 and was signed in 1996 by then-President Bill Clinton. An important part of the law is Title III, which allows Americans to sue non-US companies that trade in or via property that was confiscated from US civilians by Cuba without compensation.

Up until May 2019, that had never happened because the entry into force of Title III was systematically suspended every six months. But that changed last year when President Donald Trump decided to let the law go into effect. Since then, 26 claims have been filed under Title III of the Helms-Burton Act, according to US media.

The Helms-Burton Act is condemned by many countries including the members of the European Union and Canada, which feel the law interferes with free international trade.

American Sugar’s indictment concerns two shipments which were carried out by the BBC-operated vessels BBC Jade and BBC Moonstone. (Photo: Wikimedia)

False statements

While American Sugar’s allegation specifically revolves around deliveries that took place from late 2018 to early 2019, when the law was still suspended, the sugar trader states that Goldwind, DSV, and BBC knew that since 1996 trading with Cuba and using confiscated assets brought with it the risk of large damage claims. The sugar trader also claims that for that exact reason, the three companies tried to conceal the real destination of their cargo.

“Certain defendants knowingly made false representations in legal documents that the final destination of the wind farm equipment ordered by the Cuban government was Miami—which was merely a refuelling stop en route to delivery in Cuba—in an apparent attempt to circumvent being found liable under the Helms-Burton Act and/or US sanctions on Cuba, and in violation of US law prohibiting the falsification of such information”, American Sugar states in its indictment.

Contrary to the documents, none of the wind farm equipment was unloaded in Miami.

The case concerns two shipments which were carried out in 2018 and 2019 by the BBC Chartering-operated vessels BBC Moonstone and BBC Jade, with DSV acting as NVOCC.

Both ships collected windmill parts in Tianjin in China at the end of 2018 and then set course for Miami in Florida, where they would deliver the parts in early 2019, American Sugar says, claiming it has based its allegation on the information on the bill of lading.

“Contrary to the Goldwind and Moonstone documents, none of the wind farm equipment was unloaded in Miami. In fact, while in Miami, no cargo on the BBC Moonstone was unloaded whatsoever. Instead, the BBC Moonstone bunkered at the Miami Seaport. Later that same day, on January 30, 2019, the BBC Moonstone departed the Port of Miami but falsely reported to Miami Seaport officials that the BBC Moonstone’s next destination would be the Dominican Republic. The BBC Moonstone’s true next destination was the confiscated port”, the indictment states. According to American Sugar, the BBC Jade’s voyage followed a similar pattern.

We strongly refute the claim that DSV has attempted to circumvent the law.

DSV denies falsifying documents

In an e-mailed statement to PCJ, DSV denies the company has falsified information. “Together with our customer we have made great efforts to ensure compliance with US regulations, and we strongly refute the claim that DSV has attempted to circumvent the law when planning and carrying out the project”, the freight forwarder states.

“The transport documents have been prepared in accordance with applicable rules, and information about the final destination – Puerto Carupanu, Cuba – is clearly stated in the documents. DSV is aware of the existing sanctions against Cuba, and we operate a strict compliance policy to ensure legal compliance”, DSV adds. BBC Chartering said it does not comment on pending litigation.

Author: Tobias Pieffers

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