Cape Verdean investment

Question

Hundreds of UK citizens have invested in a complex named Vila Verde on the Cape Verdean Island of Sal. The developer, Tecnicil, was funded by the Portuguese bank Banco Espirito Santo (BES). There were strong safeguards in the contracts to protect the bank’s investment if the project was not completed. Tecnicil has now gone bankrupt; BES is looking to take up the development site and will not reimburse the other investors.

However, BES is now being bailed out with European taxpayer money. Could the Commission specify how this money will be spent, and whether it will be looking to reimburse the life savings of the EU taxpayers who invested in the project?

Answer

The Commission’s role is to assess the conditions for access to state aid and the requirements which need to be ensured to find such aid compatible with the internal market. The measures and commitments given by the Portuguese authorities to achieve compatibility are described in State Aid Decision SA.39250 on the Resolution of Banco Espírito Santo (BES); the non-confidential version has been published on the Commission website.

The conflict between the investors in the Vila Verde complex on the Cape Verdean Island of Sal and Tecnicil focuses on a private dispute between Tecnicil, the developer funded by BES, and the investors who worked with Tecnicil. The Commission appreciates the link that can be made with BES in this context. However, the conflict mentioned does not concern the received state aid, but the seniority of the various creditors in the insolvency proceedings of Tecnicil. The Commission cannot enter into such a private dispute, as only the national courts have jurisdiction.

Be the first to see my new articles

Subscribe to my mailing list and get updates when I post new content.

Thank you for subscribing.

Something went wrong.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.