Issue link: https://maltatoday.uberflip.com/i/929711
maltatoday SUNDAY 21 JANUARY 2018 2 News CONTINUED FROM PAGE 1 The only condition is that the government can take back the title over Karin Grech and Gozo hospitals after the 30 years are up. To do so, the government would have to pay Vitals €80 million. Tourism Minister Konrad Miz- zi, who masterminded the con- cession agreement, admitted in Parliament last Wednesday that the 30-year concession could be extended to 99 years, describing this as "normal practice". Until then, everybody believed the three State hospitals were handed over to the private com- pany on a 30-year lease. However, Mizzi did not point out that government has abso- lutely no say in the matter if Vi- tals opt to extend the lease. Although the temporary em- phyteutical concession is for a period of 30 years, Vitals can, of its own accord, decide to extend the period for a "single addition- al term of 69 years". This applies to all three hospi- tals unless the government de- cides to take back two of them. The deed governing the emphy- teutical grant was signed on 22 March 2016, four months after the government and Vitals final- ised the concession agreement on the three hospitals. A heav- ily redacted copy of the 30-year concession agreement, dated 30 November 2015, was only tabled in Parliament in October 2016. Selling out Vitals are currently in talks to sell the concession to American company Steward Healthcare af- ter finding it difficult to raise the necessary finance for the €220 million project. Vitals had to build a new gener- al hospital in Gozo and refurbish St Luke's and Karin Grech, how- ever, works have fallen behind schedule. Meanwhile, MaltaToday has learnt that last December, Vitals secured a loan of €908,000 from Agribank plc, using the hospitals buildings as hypothec. The loan pales into insignifi- cance when compared to the multi-million-euro investment the company was expected to make and is very likely to have been a form of bridge financing. Vitals had been facing prob- lems to pay off certain suppliers. ksansone@mediatoday.com.mt What was transferred to Vitals St Luke's hospital - building and grounds, with free overlying airspace and sub-terrain covering a superficial area of approximately 54,728 square metres Karin Grech rehabilitation hospital - building and grounds with its free airspace and sub-terrain covering a superficial area of approximately 7,683 square metres Gozo general hospital -building and grounds covering a superficial area of approximately 72,881 square metres What Vitals will pay The company will pay a global annual temporary ground rent of €525,000 sub-divided as follows: St Luke's hospital: €309,188 Karin Grech hospital: €59,062 Gozo general hospital: €156,750 If VGH opts to extend the lease to 99 years, the ground rent will increase by 30% and be revised upwards by 5% every 5 years. What the deed says The lease is for 30 years and lapses on 21 March 2046. However, "upon expiration of the 30 years, this emphyteutical grant may be extended at the sole discretion of the grantee [Vitals] for a single and additional term of 69 years". The deed continues: "Such extension may only be made by the grantee [Vitals] with respect to all the sites in their entirety not in part and under the same terms and conditions." Government never revealed that Vitals could extend 30-year concession to 99 years CONTINUED FROM PAGE 1 A source close to the inquiry said IT investi- gators in the United Kingdom now are being requested to find any evidence that can sup- port this allegation, by revisiting keywords from a database extracted from Pilatus Bank. The allegation was one of several posted by the slain journalist Daphne Caruana Galizia in April 2017, who said Pilatus Bank had re- ceived instructions in March 2016 to open an account for Negarin Sadr, and credit it with a $1 million loan for her fashion business. Caruana Galizia then said that another in- struction followed as soon as the loan was processed, to have a significant portion of it – approximately US$400,000 – to be paid out of Negarin Sadr's loan account to a bank account held by (as she then paraphrased her source as saying) "a Maltese woman who lives in New York and has a jewellery business called Buttardi." She was referring to Michelle Buttigieg, a Maltese resident in the USA who ran the But- tardi costume jewellery business in partner- ship with Michelle Muscat since 2003. Buttigieg controversially was made a Malta Tourism Authority representative in New York in 2013 and paid €61,000 annually. Negarin Sadr runs the fashion line Negarin London. The allegation was published a day after Prime Minister Joseph Muscat filed an official complaint to have an inquiring magistrate in- vestigate the allegation that his wife was the beneficial owner of the Panama company Egrant Inc, which had been revealed back in 2016 in the Panama Papers as having been opened by Nexia BT but without its owner being revealed in the email conversations with Mossack Fonseca. Caruana Galizia had declared that Michelle Muscat was revealed to have been the com- pany's owner because a declaration of trust had been deposited in a safe held inside Pila- tus Bank. Joseph Muscat dubbed the allega- tion "the biggest lie ever in Maltese political history" but the allegations pushed him to call a general election for June 2017, a year early. Throughout his campaign, Muscat insisted he would resign if any evidence tied him or his family members to the Panamanian offshore company, and challenged Caruana Galizia to publish any proof backing her claims. In the course of events, it emerged that a former Pilatus Bank employee – Russian national Maria Efimova – was the source of Caruana Galizia's allegations. In September 2016, months before the Egrant allegations, Efimova had written an email to the Presi- dent of the Republic, copied to the English- language press, denying the misappropriation claims, and insisting she was not allowed to travel outside Malta while out on bail. Only recently, Efimova told a delegation of MEPs on a mission to investigate the rule of law in Malta, that she had not been Caruana Galizia's original source on the existence of the declaration of trust at Pilatus. In a video conference with the delegation, Efimova made it clear that she could not re- veal certain information which she had passed on to Magistrate Aaron Bugeja. Efimova absconded from Malta in the course of a criminal case brought against her by Pilatus Bank on misappropriation charges. In November 2017, a warrant for her arrest was issued to have her appear in court to tes- tify. Only this month, Cypriot authorities is- sued an arrest warrant on a complaint lodged against her four years earlier by the company IDF Fragrance Distribution, with whom she worked. Efimova was also accused by police of lodg- ing a false complaint against the police in- spector who arrested her, Jonathan Ferris, who later left the corps to become an inves- tigator for the Financial Intelligence Analy- sis Unit. Ferris was, however, fired from the FIAU soon after the June elections, while still on probation. Ferris would later claim his in- vestigations on Pilatus Bank were stalled due to political pressure. He has now requested whistleblower status from the Attorney Gen- eral. Magistrate seeks UK assistance into allegation of Pilatus transfer Michelle Buttigieg (left) is a business partner of Michelle Muscat, who lives in New York. Negarin Sadr (right) is the sister of Pilatus Bank chairman Syed Ali Sadr Hasheminejad