BREACHED operational procedures and financial reporting requirements underscore the premise of an originating summons in civil proceedings being advanced by Mr Reaz Khan against Guyana Stores Limited (GSL).Khan, as a shareholder, told the Guyana Chronicle that GSL is a public company that has been “struck off the Register of Companies” because of its failures. As such, the Registrar of Companies, GSL’s Chief Executive Officer (CEO) Mohammed ‘Tony’ Yassin, and Finance Minister Dr Ashni Singh have been named as defendants in the matter in the summons.

Khan explained that the summons details 15 lines of questioning in an effort to bring GSL to account for shortcomings evident for more than a decade. “The company failed to have a meeting of its directors; it had no AGM (Annual General Meeting), no dividends were declared, it failed to file annual returns since 2000, and it has been struck of the Register of Companies for two years now…. All of these raise questions of procedural compliance,” he said.

Khan also matched the failures of GSL against the requirements set out in Article 153 of the Companies Act. While it is still not clear who would constitute the legal defence team of those listed as defendants in the matter, the aggrieved shareholder is being represented by Attorney-at-Law Peter Hugh.

This is not the first time questions have been asked regarding the operations of GSL.
Prior to this case, other GSL shareholders had publicly demanded explanations why the company had not been complying with relevant legislation regarding the Registrar of Companies, the Guyana Securities Council (GSC), and the Guyana Revenue Authority (GRA).

GSL was state-owned up to the late 1990s. The company was privatised in 2000, and Mohan ‘Glenn’ Lall and Mohammed ‘Tony’ Yassin of Royal Investments Inc. (RII) acquired 70 per cent of its shares, while the remaining 30 per cent was collectively owned by employees and other small shareholders.

RII is also being sued by Government for money owed from the sale of the company, and is currently before the High Court in a legal battle over the outstanding US$2M owed to the State for the sale of the company.

Under terms of the privatisation agreement, the balance owed by RII, which acquired 70 per cent of GSL’s shares in the sale, was due by September 2002. The company, however, failed to make this payment, and in a subsequent agreement between the plaintiff and the defendant, the parties decided on October 5, 2000 that the latter would pay interest on the said sum at the US prime rate prevailing at the time of payment, commencing one year after September 30, 2000.

In June 2004, the Government holding company initiated legal action against RII for the recovery of the US$2 million plus interest. The court battle began in late 2010 and had almost a year’s break before resuming.

Senior Counsel Edward Luckhoo, in association with SC Rex Mc Kay, is representing RII.

The matter will continue on March 19 before Justice Roxanne George-Wiltshire. This most recent court action, filed by Khan on March 5, 2015, is yet to have a date decided for its hearing.