Since 2004, the Government of Belize has had major legal trouble with some of the largest investments in the country involving foreign investors, and in most cases the settlement of the disputes has been taken outside national borders through a process of international arbitration. Most of these disputes involve allegations of fraud in multi-million-dollar transactions with the Government in power.
Over the past three years, five major foreign arbitration proceedings have been initiated against the Government. First, there was the dispute with CASCAL over Belize Water Services, which was to be settled in London. Then there were the string of legal disputes revolving around the sale and resale of shares in Belize Telecommunications Limited (now Belize Telemedia) – separate arbitration proceedings were lodged by Jeff Prosser’s Innovative Communications Corporation in Toronto, Canada, and by Carlisle Holdings in London. Thirdly, there was the dispute with Lufthansa Consulting over the Philip Goldson International Airport. Most recently, there is the London arbitration initiated by Carlisle (now BB Holdings) subsidiary, the Belize Bank, over the settlement of the debt for Universal Health Services.
To date, there has yet to be an arbitration award against the Government of Belize. Government has so far managed to settle the disputes it had with Cascal over BWS and Carlisle Holdings over BTL, and thus the arbitration proceedings were dropped.
As we had noted earlier, the enforcement of any arbitration award granted outside our borders is effected through the local courts. The governing legislation is not only rooted in colonial and pre-Independence law, but also stems from similar legislation in the United Kingdom.
The basis of enforcing these awards comes from Belize’s participation in the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards (New York, 10 June 1958).
Belize’s arbitration laws date back to 1926—well before Independence. At that time, Belize (then British Honduras) was a signatory to the Protocol on Arbitration Clauses (UN in Geneva). On May 26, 1931, the Convention on the Execution of Foreign Arbitral Awards (1927 – UN/League of Nations) became applicable to our territory.
Belize agreed to apply the UN Convention to its territory in 1980, and on February 24, 1981, it incorporated the convention into the Arbitration Act.
International arbitration is, evidently, the favored dispute settlement mechanism for investors operating in a global or international marketplace, and in fact, globalization is said to be the driving force behind the rise in international arbitration.
The question is: how many other undisclosed agreements has GOB signed wherein it has agreed to international arbitration for dispute settlement rather than having matters settled in local courts?
The Government does have a choice in the matter. For example, in the draft agreement to sell 8,255 acres of land in San Pedro to an American investor, the jurisdiction for the settlement of disputes is said to be the courts of Belize. Read More

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