Godfred Yeboah Dame, the Attorney General and Minister of Justice has clarified that the Trafigura judgment debt is not a new issue and that no US court has awarded a new judgment against Ghana.
This clarification comes in response to reports suggesting that a District of Columbia Court in the United States had ordered the Ghanaian government to pay over $111 million, along with obligatory post-judgment interest, following a Motion of Judgement in favour of the Ghana Power Generation Company (GPGC).
In an interview with Selorm Adonoo on Eyewitness News on Citi FM on Wednesday, Mr. Dame explained that the Trafigura judgment debt was actually decided back in January 2021.
He further clarified that the recent court action was merely an enforcement order, noting that while the government had taken steps to make payments, it had not yet completed the full payment.
“This award was given way back in 2021 and the government since then has had the obligation to pay and indeed they have been making efforts to pay. It is the failure to exhaust payment which has led to the company seeking enforcement orders in other jurisdictions. It is not the case where there has been a new judgement or a fresh award given by any court or any tribunal anywhere.”
“…The impression that is sought to be created by the publication that I have seen today- another judgment debt, a new judgment debt, US Court awards, there is no US Court which is awarding judgment against the government of Ghana. It is only an enforcement order and that enforcement order is on account of a failure to pay a judgment debt which accrued way back in January 2021 as a result of an award that was given that time,” he stated.
Meanwhile, a US District Court document has brought to light a series of mistakes made by Ghana’s legal team that culminated in its failure to challenge the substantial $134 million judgment awarded to British energy firm Trafigura.
The judgment, originally handed down by English courts, stemmed from the complex and highly consequential legal battle rooted in a power purchase agreement between Trafigura’s subsidiary, the Ghana Power Generation Company (GPGC), and the government of Ghana.
The origins of this legal dispute trace back to a decision made on January 26, 2021, by a UK tribunal. The tribunal issued a decisive final award, concluding that the Ghanaian government had breached its contractual obligations under the power purchase agreement with GPGC.
This breach occurred when Ghana unilaterally terminated the agreement on February 18, 2018. The tribunal’s findings were damning, ruling that Ghana was liable to pay GPGC a staggering $134,348,661 as an early termination payment.
This significant judgment not only involved the early termination payment but also included an additional financial burden on Ghana. The tribunal ordered that the Ghanaian government reimburse GPGC’s arbitration fees and expenses, which totalled $3,309,877.74. The interest on this sum was set at a three-month USD LIBOR rate, compounded quarterly, adding another layer of financial strain on the country.
Despite the clear and binding nature of the tribunal’s ruling, Ghana’s response was inadequate. Rather than settling the debt in full, the Ghanaian government made only partial payments, totalling $1,897,692.40. This left a considerable balance of $111,493,828.92 in arrears, with interest continuing to accumulate on the unpaid amount.
The situation took a more complex turn when Ghana sought to challenge the UK judgment, but only after failing to do so within the appropriate legal timelines in the UK courts.
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