News | Sunday, 11 January 2009

PRINT THIS ARTICLE

MIDI trying to avoid €4.6 million bill

James Debono
The Malta Environment and Planning Authority has asked the developers of the Manoel Island and Tigné Point Development – MIDI plc – to pay a staggering bill of €4.6 million in fees for disposing over 1 million tonnes of construction waste into the sea.
But MIDI is refusing to pay, claiming the payment is time-barred – a term used when invoices to creditors are sent too late to be legally binding.
If MIDI’s claim that MEPA sent its invoices to the consortium is confirmed in court, the planning authority could end up losing a sum of money equivalent to the government’s entire financial allocation to the planning watchdog in 2008.
News that MEPA is asking MIDI to pay €4.6 million emerged in the consortium’s prospectus published for its issue of €30,000,000 in 7% bonds for public subscription.
Apart from claiming that the payment is time-barred, MIDI is arguing that any such payments should have been invoiced to the subcontractors responsible for the disposal of the excavated waste.
But when asked by MaltaToday, MIDI refused to reveal the names of the subcontractors who should have paid MEPA for the disposal of the construction waste.
MIDI also refused to divulge when MEPA issued the first invoice requesting payment from MIDI. “It is not appropriate for MIDI to add anything beyond what is stated in the prospectus which has been approved and issued to the public in terms of law,” MIDI chief executive Ben Muscat said.
MaltaToday also asked MEPA to reveal when it had issued the first invoice to MIDI but no reply was forthcoming from MEPA. A spokesperson for MEPA said the issue was “commercially sensitive”.
“Since the MIDI Consortium are currently disputing the amount, it is inappropriate to divulge any further information that may jeopardise the Authority’s position,” the spokesperson said.
The prospectus published by MIDI reveals that on 23 October 2008, MEPA’s legal advisor requested the payment of €4,557,206.40 and threatened legal action in the event of failure to pay.
A reply rebutting the claim was sent by MIDI’s legal advisors on 4 November 2008.
According to the prospectus, MIDI is contesting MEPA’s claim because the payments are “time-barred” and because “it was not the person who disposed of the material”, and any charges should “ultimately be paid by the contractors who were engaged to carry out the excavation works in terms of the relative contracts of works.”

1 million tonnes of waste
The €4.6 million fee imposed on MIDI indicates that more than a million tonnes of construction waste was disposed by MIDI in an offshore “spoil ground” located north-east of Valletta harbour.
According to a legal notice issued in 1997, anyone depositing rubble in public spaces must pay a fee of 70c on every metric tonne. Anyone depositing waste in to the sea must pay an additional fee of “at least Lm1” (approx €2.33) on every metric tonne of waste thrown in to the sea.
In 2007 MEPA had asked MIDI to pay €37,327 (Lm15,952) for the disposal of 7,976 tonnes of waste during 2006 and the first part of 2007.
MIDI were also asked to pay €2,981.60 for 800 tonnes of waste deposited between July and January 2007.
Effectively MEPA was imposing a fee ranging from €3.70 to €4.70 for every ton of waste disposed by MIDI.
A total bill of €4.6 million indicates that between 990,696 and 1.2 million tonnes of construction waste were dumped into the sea in the past decade of construction at Tigné.
This is roughly the equivalent of the annual amount of construction waste that was being deposited in Maghtab before 2003.
As a signatory of the London Convention, the Maltese government can only permit the dumping of inert waste under strict control and conditions.
The Malta Environment and Planning Authority has long recognised the risks involved in dumping of wastes at sea. A position paper issued in 2001, which was never approved by the government, lambastes the disposal of waste at sea as an activity that on one hand squanders resources and on the other carries significant environmental risks.
According to the document, the disposal of waste at sea should only be considered in the absence of an alternative disposal option, and only for inert waste. Moreover, it recommends that disposal sites at sea must be designated after proper environmental assessment.

jdebono@mediatoday.com.mt

The companies forming the MIDI consortium

Alf. Mizzi & Sons, Fortress Developments, Middlesea Valletta Life Assurance, Bank of Valletta, Investors Limited, Gee Five Limited, Gatt Investments, Polidano Brothers, Vassallo Builders Group, Pater Holding, Lombard Bank Malta

The Midi directors

Albert Mizzi (Chairman)

Non-Executive Directors
Paul Bonello
Tonio Depasquale
Arthur Galea Salomone
Joseph A. Gasan
John Mary Gatt
Mario C. Grech
Anthony Mamo
Alec A. Mizzi
Maurice F. Mizzi
Nazzareno Vassallo

Any comments?
If you wish your comments to be published in our Letters pages please click button below.
Please write a contact number and a postal address where you may be contacted.