The transaction advisors on the Agyapa Royalties Agreement deal are fighting back after a leaked document from the office of the Attorney General described the deal as onerous, unconscionable, and a violation of Bank of Ghana Act.
In a letter from Attorney General Gloria Akuffo to Finance Minister Ken Ofori Atta dated July 22, she expressed concern the deal curtails independence of Ghana’s Judiciary and Legislature.
She said the agreement will amount to executive interference of the powers of the judiciary, which is a violation of the concept of separation of powers as provided under the Constitution of Ghana.
Madam Akuffo’s office said the expected returns to the country are limited, considering the strict commitment demanded of government and penalties per the deal.
“It is noted, that the nature and purpose of the Minerals Royalties Investment Agreement and the related agreements that there will be a one-off payment of the sum of $1 billion.
“It is, however, unclear what benefits will come to the Republic of Ghana and the fund other than the one-off payment, considering that this agreement runs in perpetuity with stringent responsibilities of the fund throughout its lifespan.”
“Further, it is noted that the terms and conditions of the agreement are very onerous. The provisions are skewed against the interest of the Fund and the Republic. Both the Fund and the Republic have strict obligations and liabilities with punitive consequences in the event of a breach or default while the other contracting parties are to use their best efforts to ensure the execution of the transaction.”
The Attorney General was also worried that the agreements “appear to be cast in stone with no option to evaluate their effectiveness or satisfactory performance so as to review or terminate the same if the need arises.”
But Gabby Asare Otchere Darko of Africa Legal Associates, which is one of the legal firms advising on the deal told Osei Bonsu on Asempa FM’s Ekosi Sen show that Gloria Akuffo subsequently made a u-turn after several engagements with the lawyers.
In said in letter dated August 12, the Attorney General wrote “we have reviewed the latest letter under reference and the submitted drafts agreement and note that our comments have been incorporated and changes effected to the draft agreements.”