Hogan Lovells helps the Libyan National Transitional Council obtain release of 1.86bn Libya Dinar (approx £950 million)
01 September 2011
LONDON, 1 September 2011 - Hogan Lovells, the international law firm, has advised representatives of the Libyan National Transitional Council (NTC) on its negotiations with the UK government and De La Rue on the release of approximately 1.86bn Libya Dinar (approx £950m) in bank notes that were printed in the UK and then frozen by the UK government in March this year. The bank notes were frozen as a result of sanctions imposed by the United Nations in February.
The team of lawyers based in London started working in early June through Tarek Eltumi, the NTC's designated representative to deal with this matter.
The team advised on a pro bono basis on contractual, constitutional and sanctions law and regulation, enabling the bank notes to be released to a branch of the Central Bank of Libya and under the control of the NTC. The team has been working with Jonathan Crow QC at 4 Stone Buildings who has also been advising on a pro bono basis.
Hogan Lovells worked closely with HM Treasury and De La Rue, and these collective efforts resulted in the release of the bank notes under the Export Control Order 2008, the Libya (Asset-Freezing) Regulations 2011 and the Libya (Financial Sanctions) Order 2011, enabling the bank notes to be sent to Libya. The move required notification to and approval from the United Nations, which gave its consent earlier this week.
Libya is a cash society, and following the revolution there was a run on the bank and Central Bank of Libya’s reserves of bank notes were exhausted, meaning that Libyan citizens could no longer withdraw money to pay for basic necessities, such as food, power, water and medical services. The bank notes will be used by the Central Bank of Libya to replenish banks throughout Libya so that Libyans are able to withdraw money they need to survive.
Other uses of funds will likely include: aid for refugees, medicines and food subsidies.
The team was led by London-based partner Jeremy Brittenden alongside partner Louise Lamb and Of Counsel Charles Brasted. Washington, D.C. partners Jeanne Archibald and Aleksandar Dukic assisted from the U.S.
According to Jeremy Brittenden, who was in Benghazi earlier this week:
"There is a strong sense of optimism and energy in Libya at this time.
"The release of the notes is a significant step for the Libyan people in unfreezing assets belonging to them which run into the many billions in US dollars which are being held abroad. The UK government has shown leadership and a clear understanding of the impact that unfreezing assets will have on the lives of ordinary Libyans as they look to move forward with their new interim government.
"De La Rue have responded very positively in what has been very fluid conditions.
"There are few firms that could have taken on this project and have the experience of working in the region combined with an understanding of the government issues involved on both sides of the Atlantic.
"The UK government's decision to recognise the NTC and unfreeze assets for humanitarian purposes has acted as an important precedent for other countries to do the same."
According to Louise Lamb:
"Our role has focused on working with representatives of the NTC in relation to its discussions with HM Treasury and De La Rue on securing the necessary sanctions and export control licences for the release of the bank notes and on demonstrating that the NTC could take responsibility for the notes through the Central Bank of Libya in Benghazi. That has involved explaining the importance and use of the bank notes to support normal day to day life. Libya tends to run on cash rather than credit and an injection of dinars into the country will help keep the public and private sector economy turning over."
Says Charles Brasted:
"The decision by Foreign Secretary William Hague to expel the Libyan Charge d'Affaires and other London-based Libyan diplomats is also part of a long term process that has led to the recognition of the NTC as the representatives of the Libyan people and the new government of Libya. A key objective in doing this is to facilitate the potential unfreezing of other assets which could be used to benefit the people of Libya and relieve their hardship."