$1.4m film industry sale null and void

(Weekend Agenda) - A confidential report commissioned by government into the divestiture of the Ghana Film and Company Limited has recommended that the sale contract should be declared null and void because evidence available indicates that neither Cabinet of Flt. Lt Jerry John Rawlings nor the Divestiture Implementation Committee (DIC) approved of the sale.

The report, a copy of which is in possession of Weekend Agenda, also asked the government to rectify the shareholding structure of Gama Film Company Limited in order to protect the interest of the state. Among many other recommendations, is an appeal to government to submit the report to the Criminal Investigations Department of the Ghana Police Service to determine whether or not offences have been committed by persons involved in the divestiture procedure.

?In view of the fact that there is no evidence that the divestiture of Ghana Film Company Limited was either approved by Cabinet or the DIC, the divestiture should be set aside as null and void and of no effect,? said the report.

Both former Minister of Information Kofi Totobi-Quakyi and former Executive Secretary of DIC come in for criticism. ?The former Minister of Information, Totobi Quakyi and E.A. Agbodo, the former Executive Secretary of DIC, should be made to account for the part they played in the divestiture of Ghana Film Industry Company. Both of them knew or ought to have known that proper procedures had not been adopted in the divestiture of the company,? the report affirmed.

The committee found out that the ?assets of Ghana Film Industry Company were sold for $1.4 million, ?a price considered to be unfair and unreasonable, having regard to all the circumstances.?

The committee members found no evidence that ?the divestiture was considered and approved by the Board of Directors of the Divestiture Implementation Committee. ?There is no evidence that the divestiture of Ghana Film Industry Limited received the approval of Cabinet.? The $1.4 million divestiture of the Ghana Film Company has been a subject of controversy since the sale figure became public knowledge.

The report examined the sale and made the following findings: ?The procedure adopted by the former Minister of Information, Totobi Quakyi and the former Executive Secretary of the Divestiture Implementation Committee, E.A. Agbodo to divest government?s interest in the company gives rise to suspicion that proper procedures were not followed.?

Consequently, the committee recommended that assets of the company should be properly valued to determine their true market value and the Board of Directors of Ghana Film Company reconstituted forthwith ?to protect the interest of the government in the company.

According to the report, Minutes and other documents covering the whole divestiture procedures covering the divestiture of the companies were lost. ?This may be the tip of the iceberg. The minutes and other documents covering the divestiture of other companies may be lost as well.

Weekend Agenda can confirm that the DIC wrote in a letter to the audit team, dated 31 December indicating the loss of a number of vital documents. ?We write to re-affirm our assertion that, some vital documents at the Secretariat appear to have been tampered with during the transition period and may include the under-mentioned items which cannot be traced. In the light of the above, we wish to state that, we do not currently have information on the following:

1. Copy of Minutes of the Board Meeting of the DIC at which the decision was taken to implement government?s decision to divest 30 per cent of the interest in the company.

2. Copy of the Notice of Divestiture.

3. Report on the divestiture of the Company prepared by the DIC or body/firm appointed by it.?

According to the report, ?the assets of Gama Film Company Limited, e.g. buildings, studio, workshop, etc., are being used by TV3 Network Limited but evidence is yet to be produced that appropriate rent is paid to Gama Film Company Limited for the use of these facilities.?

In spite of these findings, the report left a window of opportunity for TV3, which operates from the premises of the divested company. ?The facilities of the company being used by TV3 Network Limited should be paid for at the appropriate price for the use of the facilities belonging to Ghana Film Company Limited.?

Reached for comment, a very reliable source with the working knowledge of the divestiture programme told the Agenda that it was not the Cabinet that took the final decision but President Rawlings said, after the whole process had been completed, that the DIC forward the final deal to the President who had to give his ascent to the deal.

He explained that the Ghana Film Industry deal was fast-tracked because of the visit in November 1996 of the Prime Minister of Malaysia Mahathir Mohammed. ?The essence was to make it possible for the Malaysian Prime Minister to participate in activities marking the handover of the project to the Malaysian company. So it could be that not everything about the divestiture was foolproof. I will not be surprised if the state takes-over the film industry.?

Weekend Agenda sources close to the former President told this paper that before the NDC ended its term in office, Flt. Flt Jerry Rawlings expressed anger at the inability of the Malaysians who took over key state assets to deliver. ?Jerry was visibly angry?He was so concerned about the way the Malaysians let everybody down in Tema Shipyards, Ghana Telecom, etc.?