US embassy cable - 05MAPUTO1062

UNCLAS MAPUTO 001062 
 
SIPDIS 
AF/S - TREGER, EB/IFD/OIA - PROSELI, L/CID - NICOL 
E.O. 12958: N/A 
TAGS: CASC, EFIN, EINV, KIDE, PGOV, MZ, OPIC, Nyati 
SUBJECT: MOZAMBIQUE - 2005 REPORT ON INVESTMENT DISPUTES 
AND EXPROPRIATION CLAIMS 
 
REF: STATE 70014 
1. Claimant A purchased a 50 percent share in a luxury beach 
lodge in Vilanculos, Mozambique, from a non-U.S. citizen in 
August 2004, using USD 2.5 million in OPIC funds.? A 
Zimbabwean claimant had for several years asserted a claim to 
the land on which the lodge was constructed in late 2003. 
Courts and government officials had previously denied the 
claim, but in March 2004 a provincial judge ruled in favor of 
the Zimbabwean's claim against the Mozambican body that had 
issued the concession to Claimant A,s partner.? It is not 
clear that Claimant A was fully aware of the status of this 
claim at the time of his purchase. 
2. In October 2004 the provincial judge issued an order 
declaring that the Zimbabwean's corporation owned usage 
rights to the land.? After attempts at negotiation and legal 
maneuvering, provincial police evicted guests and managers 
employed by Claimant A and his partner, with the eviction 
starting on January 6, 2005, and being completed on January 
10.? Subsequently the Mozambican Supreme Court ordered the 
suspension of the eviction order and is now considering the 
issue of the two competing claims.? The provincial judge, 
however, so far has refused to enforce the higher court's 
ruling on suspension of the eviction order.? As a result, the 
property is now closed and occupied by security guards. 
3. Over the past ten months the Embassy has contacted many 
high-level Mozambican officials to encourage resolution of 
the dispute, including Mozambique's President and several 
ministers in two different governments. 
4. Post last received information about the case in July 2005. 
5. Claimant A: US citizen David Herbert.? Post does not have 
any information indicating that Mr. Herbert has signed a 
Privacy Act waiver. 
La Lime