WALVIS BAY – A partnership between Erongo Marine Enterprises and Erongo Sea Products has caused a ruckus among fishing right holders, who are now questioning the decades-old arrangement and claim being cheated on.
Erongo Marine is owned by global fishing giant, Oceana Group. Now, local right holders and stakeholders in the fishing industry claim that Namibian right holders have been cheated on by their monied foreign partners and are demanding a fair share of the pie.
Philip Munenguni, yesterday expressed concern over the relationship with EME, claiming that the Namibian right holders have indeed been deceived.
“Yes, they have been cheating Namibian right holders. They diverted from the charter fee agreement and quota usage fee without an agreement for many years. Namibian rights and quota holders were never given audited financial reports,” Munenguni said.
He also questioned some of the decisions made by the company despite there being no board meetings or annual general meetings (AGM) for over two decades now.
“Namibians didn’t know what their companies returns were. They have never been paid as per the real agreement. The Ocean Group should come to their senses and honour the Namibian right holders as we are rightfully demanding our seat to the table,” he said.
Munenguni represents Erongo Seafood – the joint venture is also part of ESP.
Titus Imbili, another member of Erongo Seafood, refused to be drawn into the fishy brouhaha.
“I don’t want to talk about those things,” Imbili said before hanging up the phone call.
Meanwhile, Maria Dax from Arechanab on Sunday said she is yet to receive the second follow-up document on the agreement.
Asked whether they are happy with the business operations and relationship with Oceana Group, she told New Era that: “There is a meeting expected to take place very soon and all these matters will be addressed, and we will have to come up with a way forward for all of us.”
Namibian fishing rights and quota holders have been in complete darkness about what their companies were supposed to receive from the agreement and assert that the fees were never paid in line with the original agreement.
Probe
Allegations of financial discrepancies and exclusion from decisions prompted an investigation and negotiations for a potential win-win solution.
Despite Oceana’s reassurances, discrepancies and disagreements still persist, it is said.
The partnership between EME and Erongo Sea Products is currently under scrutiny as right holders are questioning the over 20-year-old partnership that raked in millions of dollars at the alleged expense of right holders.
Erongo Sea Products (ESP) owned two fishing vessels, while EME owned one vessel.
One of ESP’s vessels was allegedly sold due to a lack of quota. But this was done without the knowledge or consultation of the right holders, it further claimed.
EME manages and controls the vessels and contracts quotas from right holders to keep vessels operational.
The right holders, in partnership with EME is Arechanab, Cerocic, Erongo Seafood, and ESP itself.
They all claim to have been sideline from decision-making within ESP for years and that they are not receiving a fair share from the millions made.
Instead, most of the profits go to Oceana, according to documents seen by New Era.
Win-win
Questions posed by right holders in a win-win proposal suggest that the Oceana Group deviated from the catch agreements and sold the vessel owned by ESP without their input or knowledge. The details of the charter agreements between ESP and EME are also under scrutiny.
New Era is reliably informed that documents on which the contested partnership is based have since vanished into thin air, with little trace.
“Our quota contributions entitle us to a larger slice of the pie. Additionally, we have raised questions about the transparency of financial dealings and the authorisation of a loan from Erongo Marine Enterprises, a company within the Oceana Group,” one of the right holders said over the weekend.
Propossal
Additionally, a report by Cronje Inc Law Practice looks at a “win-win solution that would benefit both parties”.
Negotiations to that effect are currently underway.
The proposal clarifies historical financial matters and potentially establishes a joint venture between ESP and EME.
“This joint venture could offer right holders greater involvement in operations and a market-related return on their quotas,” the report states.
In the dossier, right holders also want to know why the initial agreements were deviated from.
“According to Cronje’s first independent legal report, agreements were significantly deviated from. From the external auditors, agreements are missing despite right holders being paid as per these agreements more than 20 years. What agreement was applied then?” they ask in the document.
According to the ESP partners, they did not benefit from the deviated agreements and if the agreements were correctly applied, the ESP partners would have benefited.
“EME was built by and through our quotas. In the past, the quota quantities were over and above enough meeting capacity of vessels. As right holding entities, we gave EME access to our quotas by giving EME shareholding in the right holding companies in exchange for a partnership in the vessels and operations,” the right holders said. According to a right holder, Namibian right holders were not privy to ESP and any operations.
The first-ever AGM of ESP was in 2021. This meeting, according to the right holders, never took place.
According to them, any decisions that were taken could not have met the quorum.
They are also demanding meeting minutes or resolutions for decisions made as ESP shareholders.
“We were excluded and had no access to ESP information until 2021/22 and when information became apparent, they questioned why ESP or EME did not apply the charter agreement correctly as per the original intention of the parties,” reads another section.
Response
In its reply, Oceana Group says all their operations were above board.
“The charter agreements and fees have been consistently applied, with ESP benefiting from the arrangement,” Oceana stated on behalf of EME.
This is contrary to the documentation in our possession.
According to them, the relationship and agreements between EME and ESP worked successfully for 20 years.
“During 2022, both parties selected Cronje Inc as an independent party to review the mutual deviation from the original written agreement and propose an acceptable solution. EME, as with all group companies, is independently audited and abides by all laws and regulations in the territories in which it operates, including tax laws,” Oceana said on Sunday.
-edeklerk@nepc.com.na