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17th August 1997

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Cooray judgment to come on Tuesday

The Supreme Court is expected to deliver its judgment on the Fundamental Rights case filed in relation to the detention of former UNP General Secretary, Sirisena Cooray on Tuesday.

The petition was filed by Attorney-at-Law, Sunil Rodrigo after Mr. Cooray was taken into custody.

The petition was supported before Justices Ranjith Amarasinghe, Somawansa Wijetunga and Asoka de Z. Gunawardena.


Protest against war crime

An organization known as Vigil Coalition-Sri Lanka, last Friday carried out a picketing campaign at Colombo Hyde Park Corner in protest against the alleged gang rape and killing of 35-year-old Koneswary, mother of four children by some policemen at 11th colony village bordering Ampara.



Merchant Bank appeals against fine of Rs. 139 million

The Merchant Bank of Sri Lanka Limited has filed an application in the Court of Appeal against the Controller of Exchange asking, among other things, that the penalty to the tune of Rs. 139,082,925 imposed by the Controller on the Bank for an alleged violation of the Exchange Control Act over the controversial Kotagala Plantations deal, be quashed.

The Bank stated that in early 1994 George Steuarts & Co. Ltd. (GSL) approached it seeking its corporate advisory services for the purpose of restructuring the latter and pursuant to extensive discussions, the Bank entered into a memorandum of understanding in this connection on October 13, 1994.

The objectives of the agreement included the introduction of capital, to thereby increase the profitability of George Steuarts, to raise funds at low cost for expansion and diversification, reduce the cost of borrowing and to take necessary steps to establish a good track record to justify an issue of ordinary shares to the public at a premium, the court was told.

It was further said that under this agreement the Bank granted George Steuarts a bridging loan of Rs. 18.36 million at an interest of 19% an year. The Bank later sought to convert the loan to equity along with a further investment of Rs. 31.64 million and it was alleged that George Steuarts failed to issue or allot the required shares.

Subsequently, when the government decided to privatise regional plantation companies, George Steuarts Management Services Company Ltd., (GSMS), a subsidiary of GSL, which was then the Managing agents for Kotagala Plantations Ltd, became eligible to an option to purchase 51% of it on a pricing formula laid out. Since neither GSL nor GSMS had the necessary finances to exercise this option on their own, the Merchant Bank was requested by GSL to find investors who would fund the purchase and to negotiate for a premium for the option with the prospective investors, it was said.

In its capacity as Financial Advisor to GSL and GSMS, the Bank prepared a Purchase and Sale Agreement on the instructions received, finally submitted it to GSL on November 22, 1995. The Bank said thereafter it ceased to have any dealings with GSL, GSMS and the investors on this transaction.

Moreover, the Bank argued that it did not have any knowledge of the final terms of the agreement signed between GSL and the investors, as at the time it ceased its dealings the agreement had not reached finality.

The Controller of Exchange, M.R. Fernando last month imposed the above fine on the Bank for having abetted the commission of an offence punishable under Section 51 of the Exchange Control Act in the light of its alleged involvement in the transfer of shares to persons resident outside Sri Lanka without the permission of the Central Bank.

The Bank asked for a Writ of Certiorari and Prohibition quashing the determination of the Controller of Exchange and preventing him from giving effect to his finding respectively. The court has also been asked for an interim order suspending the operation of such determination and staying the controller from taking any further steps against the Bank under the Act until the final adjudication of the application.


End food shortage:

Allow food ships passage, plea to LTTE

By Imran Vittachchi

Government rations for close to a million people, affected by food and relief supply shortages in the North, could run out within weeks, Tamil politicians told The Sunday Times on Friday.

Rations have already run out for as many as 300,000 displaced persons who are facing "an emergency" in LTTE-controlled sectors of the Vanni, according to the General Secretary of the EPRLF.

"People badly need food and medicine urgently and immediately," said Kandiah Suresh Premachandran.

Matters hadn't been made any easier by the Sri Lanka Armed Forces when it launched Operation Jaya Sikurui in June.

He added, "All the time, people are on the run because of aerial bombardments and artillery shelling. Because of the war, people just can't stay in one place. People are suffering a lot, particularly in the Vanni region. The entire population there is displaced."

Further to the North, stocks of rice, flour, dhal, sugar and milk foods earmarked for nearly 500,000 people — dispersed along the Jaffna peninsula and a part of Kilinochchi — could be exhausted by mid-September, according to a Tamil Member of Parliament.

"My information is that there are stocks for only about a month," said S. Sivathasan of the EPDP. "We have generally been urging the government to have necessary buffer stocks for at least three months."

The plight of the northerners had been sharpened recently by Sea Tiger attacks on merchant ships carrying food, other materials and returnees to Jaffna, he said.

This led to a virtual standstill in government efforts to send humanitarian relief and commercial supplies to the peninsula.

By the MP's reading, the logistics are likely to become more complicated with the onset of the Northeast monsoon in October.

"During this period it would be very difficult for ships to sail," he said, adding that Jaffna has no in-port cargo handling facilities.

Government relief officials were not available for comment.Meanwhile, Medecins Sans Frontieres, the French medical relief agency, reported on Friday that, since June, it has screened and confirmed cases of acute malnutrition among displaced children in LTTE-controlled areas around Madhu.

"In Mulikulam and Palampiddi, we are facing problems of malnutrition," Saim Malika, MSF's Country Co-ordinator, told the Times.

"Among the newly displaced population, there are 50 severely malnourished children between six months and five years old."

Citing a lack of equipment, facilities, and space over the past few months, MSF had also recorded a high number of child deaths in Jaffna paediatric wards — particularly in premature baby units.

In June, child deaths — mostly from respiratory complications — accounted for 46.2 percent of out-patients. Normally, this figure should not exceed 15 percent, she said.

On top of this, 32 cases of malaria were diagnosed in that month in displaced children who had returned to the peninsula by sea from the Vanni.

To Premachandran of the EPRLF, both the government and the LTTE could do a lot more to relieve the suffering of uprooted Tamils.

"If the government feels that the Northern people — the Tamils are part and parcel of the country, then they'll have to take a decision on that," he said.

To restrict the movement of displaced Tamils to zones North of Mannar has only strained Jaffna town's finite resources and postponed the question of how to supply their most basic needs.

"If these things are there, the situation will definitely get better," Premachandran said.

He also had harsh words for Tamil separatists.

"The LTTE does not want to have a peaceful situation or normalcy in Jaffna," he added. "If they allow the ships to go, the food will go, the refugees will go, and then the people will feel that there is some sort of normalcy there."


Legal steps taken to protect journalists, minister claims

The government is not dismissive of threats made on journalists by intimidators and there is no acquiescence on its part, says Mangala Samaraweera, Minister of Posts, Telecommunications and Media in a letter to three international organisations concerned with media freedom. Responding to the concerns they expressed over "harassment in the form of surveillance" of 'The Sunday Times' journalist Iqbal Athas, Mr. Samaraweera has said: "Her Excellency the President has requested me to write to you, that the Government shall deal decisively with this type of situation by taking the appropriate legal steps.

His letters were addressed to the New York based Committee to Protect Journalists, the Paris based Reporters Sans Frontiers and the UK based Article 19.

Mr. Samaraweera adds: "The legal authorities who did not carry-out the surveillance, as there was no need to do so in regard to a respected Journalist like Mr. Iqbal Athas, advised me to request him to lodge a formal complaint in a Police Station in conformity with proper procedures."

This appears to have been carried out by some "irresponsible persons in such amateurish way indicates apparently, as you say, to intimidate Mr. Athas and visitors to his house. "Even more than that, it is feared that this has been done with a sinister motive to embarrass the Govt. and put it in an awkward position."


New laws will help foster media growth

The motion to appoint a Parliamentary Select Committee seeking to introduce sweeping changes in the media laws of the country will be moved in Parliament by the Leader of the House on Tuesday.

With the government and the opposition arriving at a consensus regarding the final draft of the Bill, most of the archaic and draconian pieces of legislation which so far stunted and stultified the growth of local media would be repealed with the implementation of the new legislation.

Some of the vital government proposals seek to repeal of the Press Council Law, establishment of a Media Council and a Broadcasting Authority, while the opposition UNP has forwarded proposals urging the abolition of criminal defamation and the repealing of the Public Security Ordinance, Official Secrets Act and other related laws that cripple media freedom.

Meanwhile, National List MP Ravi Karunanayake has also submitted a private member's motion seeking the setting up of a Permanent Media Commission to regulate activities of state owned television, radio and newspapers etc.

UNP MP Dr. Sarath Amunugama told The Sunday Times that the 29- member committee will study proposals made both by the UNP and PA to help institute a free media policy.

The committee will also study the R.K.W. Goonasekara report on media reform which advocates repelling the use of criminal defamation law against the press and any other law against the press and any other law that could infringe on media freedom.

The select committee on media reform will deliberate on the terms of reference and seek public recommendations.

No time frame has been set for the deliberations.

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