Judge could take months to decide case of Castro-era Cuban debt

Can the Cuban authorities beryllium sued for unpaid debts from the aboriginal 1980s – debts truthful aged they are denominated successful a currency that nary longer exists?

That's the question earlier a justice astatine the UK High Court aft a seven-day trial marked by chaotic protests, a bribery accusation and distant grounds from an imprisoned Cuban banker.

The proceedings ended past week, but it could beryllium months earlier the judge, Sara Cockerill, renders judgement successful the lawsuit of CRF vs Banco Nacional de Cuba & Cuba. Her determination is cardinal to whether Cuba whitethorn yet beryllium forced to wage backmost billions of dollars successful unpaid debts.

The proceedings is seen arsenic a trial case. CRF1, formerly known arsenic the Cuba Recovery Fund, owns much than $1 cardinal successful look worth of European slope loans extended to Cuba successful the precocious 1970s and aboriginal 1980s, when Fidel Castro inactive ruled the island. Cuba defaulted connected the indebtedness successful 1986.

CRF1, which began accumulating the presumption successful 2009, is suing Cuba and its erstwhile cardinal slope implicit lone 2 of the loans they ain for more than $70 cardinal dollars. If CRF wins connected this tiny portion of Cuba's full outstanding commercialized debt, which is estimated astatine $7 billion, it could pb to further lawsuits from different indebtedness holders, with claims against Cuba rising into the billions.

While the astir melodramatic grounds has focused connected an accusation of bribery, overmuch of the proceedings has focused connected the arcana of Cuban and English law.

Were determination capable signatures from Cuban slope officials connected the paperwork erstwhile the loans successful question were "reassigned" oregon transferred to CRF?  Was the paperwork stamped with a dry-pressure seal oregon a wet-ink stamp and did they usage the close bluish information paper? At 1 constituent the barrister for CRF cited a British spot lawsuit regarding the lease of a fried food shop.

The question earlier the justice is of whether the money has the close to writer Cuba. Still, experts said she could contented a summary judgement successful which she rules not lone connected jurisdiction but besides connected substance, meaning not conscionable whether CRF tin sue, but besides whether Cuba indispensable pay.

Throughout the trial, representatives of the money person repeatedly stated that they did not privation to writer Cuba but did truthful lone arsenic a "last resort" aft the authorities ignored their requests to negociate for 10 years.

"Even astatine this precocious date, successful a lawsuit wherever we expect to prevail, CRF is consenting to settle," David Charters, president of CRF, said astatine the decision of the trial.

During testimony, CRF representatives said they made much than 1 connection to the Cuban authorities that would not drain the island's existent currency travel and would assistance amended its economy. They described offers of long-duration non-coupon bonds and indebtedness for equity swaps, neither of which would unit Cuba to travel up with currency successful the adjacent term, oregon adjacent the agelong term, depending connected the deal.

The Cubans person argued that it was ever CRF's volition to writer and has described them arsenic a vulture money taking vantage of an impoverished country.

No substance however the justice rules, the Cuban authorities volition inactive beryllium the money. And they volition not beryllium capable to get connected the planetary superior markets until they person settled each their past debts. Cuba hasn't been capable to get successful the markets since 1986, erstwhile the state defaulted. Since then, Cuba has survived connected the largesse of different countries specified arsenic the erstwhile Soviet Union and, much recently, Venezuela and China.

Cuba is not a subordinate of the IMF oregon the World Bank, institutions that would typically beryllium progressive successful helping an impoverished state restructure its debts and reemerge into the planetary fiscal system.

The Cuban authorities did not respond to requests for comment.