___________________________________________________
ICC INTERNATIONAL COURT OF ARBITRATION
21404/ASM
___________________________________________________

PT Ventures, SGPS, S.A.
Claimant
v.
(1) Vidatel Ltd
(2) Mercury – Serviços de Telecomunicacões SARL
(3) Geni SARL
Respondents

___________________________________________________

ANSWER OF THE FIRST RESPONDENT
___________________________________________________

8 January 2016

1

 INTRODUCTION
1.

This Answer is provided on behalf of the First Respondent, Vidatel Ltd (“Vidatel”),
pursuant to Article 5(1) of the ICC Arbitration Rules. Unless otherwise stated and for
ease of reference only, Vidatel adopts the abbreviations and defined terms as used in
the Request.

2.

Vidatel wishes to clarify at the outset that:
(a)

this Answer is not intended as a definitive statement of Vidatel’s position and
Vidatel will wish to set out in subsequent memorials and/or submissions the
detail of the factual and legal propositions on which it relies;

(b)

moreover, the preparation of Vidatel’s Answer has been substantially hindered
by (i) the diversion of resources necessary to respond to a host of interim
applications and parallel proceedings initiated by PTV against both Vidatel
and other persons or entities connected to the transactions complained of in
PTV’s Request; (ii) the further distraction of PTV’s legal challenges under
French law to the constitution of the Tribunal; and (iii) the limited time which
it has been afforded to prepare this Answer;

(c)

in those circumstances, failure at this stage to address any specific allegation is
under no circumstances to be taken as an admission with respect to that
allegation; and

(d)

except where this Answer makes explicit admissions, PTV is required to prove
each and every fact upon which its claims depend.

3.

By way of summary of Vidatel’s responses to the allegations made against it:
(a)

Vidatel uniformly denies all allegations of conspiracy, “looting” of Unitel and
other similar and unfounded allegations of dishonesty or other material
wrongdoing by Vidatel. Vidatel has at all times acted in good faith and in what
it considered to be the best interests of Unitel. In this connection, the
suggestion at paragraph 4 of PTV’s Request that Geni and Mercury – which
(as described at paragraph 7 of the Request) are entities distinct from Vidatel

2

 and Vidatel’s owner, Isabel Dos Santos – have engaged in wrongful
transactions at the expense of Unitel and hence at their own expense as 50%
shareholders (in aggregate) of Unitel, merely to benefit Mrs Dos Santos
personally, is entirely nonsensical.
(b)

Moreover, the repeated attempts throughout the Request to impugn the
integrity of Mrs Dos Santos (including through innuendo and tendentious
descriptions such as the “billionaire daughter of Angola’s President”) are
unacceptable, designed solely to prejudice the Tribunal’s perception of Vidatel
and have no proper place in this arbitration.

(c)

Insofar as PTV claims to be unaware of transactions about which it now
complains this appears to be the result of a lack of information-sharing in the
wake of PTV’s acquisition by the Brazilian telecoms company, Oi. Although
Oi’s lack of communication with PTV’s former representatives within Unitel
(principally Zeinal Bava and Luis Pacheco de Melo) is regrettable, it is not
and cannot logically or legally be held to be something for which Vidatel is
responsible, let alone the basis of a claim for damages.

(d)

In any event, PTV’s attempt in these arbitral proceedings between
shareholders to challenge the validity and effectiveness of transactions entered
into by Unitel (which is not – and could not be – a party to the Shareholders’
Agreement or to this arbitration) is misconceived.

(e)

Even if this arbitration were a proper forum to complain about such
transactions - which for the reasons set out below is not the case - then PTV’s
quantification of its losses for nearly USD 2.5 billion is grossly exaggerated
and on any view fanciful.

4.

Moreover, there is a fundamental defect in PTV’s standing even to advance its
complaints against Vidatel and the other Respondents. Although PTV technically
remains a shareholder of Unitel, that is only so as a consequence of PTV’s deliberate
refusal to comply with its obligation under the Shareholders’ Agreement to offer its
shares for sale to the Respondents. See further below at paragraphs 9 to 15. This is a
free-standing defence to PTV’s claims (since PTV would otherwise be deriving a

3

 benefit from its own ongoing breach of contract). Vidatel also seeks by way of
counterclaim a declaration from the Tribunal in respect of this issue.
5.

Yet further:
(a)

PTV's claim has not been brought as a bona fide attempt to recover
compensation for loss and damage which PTV has sustained as a result of any
material wrongdoing by Vidatel. Rather, the claim is motivated by the desire
of PTV and those controlling it (in particular, Oi, PTV’s majority indirect
shareholder) to: (i) exert commercial pressure upon Vidatel in the context of
recent negotiations between PTV and the Respondents for the sale of PTV's
interest in Unitel, and (ii) exaggerate the value of PTV’s outstanding interest
in Unitel for the financial purposes of Oi.

(b)

As such, PTV's claim amounts to: (i) an abuse of the arbitral process (which
the Tribunal has power to restrain in order to protect the integrity of the
process before it); and/or (ii) an abuse of rights and a breach of PTV's good
faith obligation (under Article 762(2) of the Angolan Civil Code) as a matter
of Angolan law.

(c)

In respect of its defence, Vidatel will rely in particular upon: (i) PTV's gross
inflation of its claim; (ii) the assortment of proceedings brought by PTV in the
courts of the British Virgin Islands, the Netherlands, France and Angola,
designed to maximise pressure upon Vidatel (and Mrs Dos Santos, the owner
of Vidatel), the other Respondents and Unitel; (iii) the parallel settlement
discussions between PTV and Oi (on the one hand) and the Respondents and
Unitel (on the other hand) regarding the potential purchase of PTV’s interest
in Unitel; and (iv) the reliance placed by Oi in its latest financial statements on
the alleged (inflated) value of PTV’s outstanding interest in Unitel.

GENERAL COMMENTS
6.

Much of the background to the dispute is uncontentious. In particular, it is true (as
explained by PTV at paragraphs 4-16 of the Request) that:

4

 (a)

The immediate parties and their ultimate owners are those described in
paragraph 7 of the Request (albeit that the legal relevance of vague and
subjective labels such as “influential” or “most influential” is not understood).

(b)

The relationship between PTV and the Respondents dates back to 1999/2000
and there has been substantial economic growth in Angola since the end of the
civil war in 2002. Unitel has itself grown to a very substantial business with
more than 10 million customers and 2,400 employees (albeit that the
suggestion that PTV was instrumental in achieving that growth is incorrect
and denied by Vidatel).

(c)

Unitel is a major Angolan telecoms company of which PTV (subject to
Vidatel’s counterclaim below) and the Respondents are each 25%
shareholders, all four of them being parties to a Shareholders’ Agreement
dated 15 December 2000 (subject to the validity of PTV’s entitlement to retain
its shareholding as against the Respondents).

(d)

The Shareholders’ Agreement and the Management Agreement between
Unitel and PTV of the same date sought to govern the parties’ relationship for
the establishment and operation of a mobile telecommunications network
pursuant to a licence received from INACOM.

(e)

In so far as PTV provided services to Unitel during the early years of its
establishment in the Angolan market, its remuneration for such services was
expressly set out in Article 5.1 of the Management Agreement. Beyond this,
the relevance of paragraph 8 of PTV’s Request is not understood.

(f)

The express terms of the Shareholders’ Agreement include those quoted or
summarised at paragraphs 9 to 16 of the Request. Vidatel reserves the right to
refer to the Shareholders’ Agreement for their full terms, meaning and effect.

7.

It is also true, if regrettable, that the relationship between the shareholders has
deteriorated. Much of this, however, is attributable to PTV’s failure to acknowledge
its own obligations to its fellow shareholders as described below.

5

 OI

ACQUISITION:

PTV’S

BREACH

OF

THE

SHAREHOLDERS’

AGREEMENT
8.

In addition to the provisions relied upon by PTV, the Shareholders’ Agreement
further provides (so far as presently relevant):
“ “Affiliated Company” means any company, now or hereinafter existing, which,
directly or indirectly, controls a Party or is controlled by or is under common control
with such a Party; a person “controls” a company, if it, directly or indirectly, holds
or is beneficially entitled to, other than by way of security interest only, more than
50% of its voting rights, income or capital, alone or in combination with another
Affiliated Company.
…
6.1

None of the SHAREHOLDERS shall sell, assign, transfer, pledge, encumber,
hypothecate or in any other manner dispose of or part with its right, title or
interest in any shares in Unitel, or any rights arising therefrom or attaching
thereto, now or at any time hereafter held by either, or, suffer or permit any
such shares to be in any manner transferred, by operation of law or otherwise,
except in accordance with the provisions of this clause 6 or with the consent of
the other Parties.
The SHAREHOLDERS shall, however, be free to transfer their shareholding
in Unitel to any of their Affiliated Companies, as amended, and such transfer
shall not be regarded as a transfer of shares as contemplated in this clause 6.
Where any of Parties' Affiliated Companies which holds the shares in Unitel is
disposed of by any SHAREHOLDER, that SHAREHOLDER shall ensure that
the shareholding in Unitel shall be returned to it prior to disposal and shall
not be disposed of as an asset of their Affiliated Companies.
In the event of a transfer stipulated above taking place such SHAREHOLDER
shall ensure that such Affiliated Companies becomes a Party to this agreement
as is envisaged in terms of clause 6.4.

6

 6.2.

If any of the SHAREHOLDERS (selling party) desires to transfer any or all of
its shares in Unitel, the selling party shall give notice of its intention to
transfer, and the terms and conditions of any offer received from a third party,
if any, to the other SHAREHOLDERS. Such notice shall constitute an offer to
the other SHAREHOLDERS, on the same terms and conditions as contained in
the notice. The other SHAREHOLDERS shall have the right, at its option, to
purchase, pro rata, the offered shares at the price and on the terms contained
in the offer, for the offer of any third party, if any, may be accepted by the
selling party.

6.3.

In the event that any or all of the other SHAREHOLDERS do not elect to
purchase such shares within 30 (thirty) days after the receipt of the said notice
of intention to sell, or it refuses to purchase all such shares offered for sale,
then the selling party shall have the right to transfer such shares not
purchased by any or all of the other SHAREHOLDERS to a third party,
provided that the terms and conditions of a transfer to the third party
(including, but not limited to, price) shall not be more favourable than those
offered to the other SHAREHOLDERS.

6.4.

The third party transferee shall, as a condition of the transfer, submit to the
other SHAREHOLDERS and Unitel a written statement stating that the
transferee agrees to being a Party to and to be governed by all of the terms
and provisions of this agreement and to be fuIly bound by the terms thereof,
assuming all obligations of the Party from which it has purchased the shares.
No SHAREHOLDER shall sell any shares to a third party unless the
provisions of this clause are included as a term of that sale.
…

6.6.

Any share transfer under this clause 6 shall be subject to any necessary
governmental validation or approval, if any.
…

9.7

Notwithstanding any other stipulations of this agreement, the following issues
may only be decided upon by a resolution of a General Meeting of the

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 shareholders of Unitel adopted by shareholders holding in aggregate at least
75% of the shares in Unitel:
9.7.1

issue, allotment, redemption, purchase or grant of options over any Unitel
shares or other securities or any reorganization of Unitel’s share capital;

9.7.2

alteration of the articles of incorporation or by-laws (or equivalent
constitutional documents) of Unitel or … passing any resolution [for] its
winding-up or liquidation;

9.7.3

any change in the nature or scope of Unitel’s business or the commencement
of any new business not being ancillary or incidental to such business;
…

13.1. In the event that any SHAREHOLDER shall commit a breach of any material
obligation imposed upon it by this agreement or allow its shareholding in
Unitel to be attached under any circumstances (in event of default), then the
all (but not some) of non- defaulting SHAREHOLDERS shall be entitled at
their discretion to serve a notice of termination on the defaulting
SHAREHOLDER whereupon the provisions of sub-clause 13.2. shall apply.
13.2. Upon service of a notice of termination pursuant to sub-clause 13.1. the
SHAREHOLDERS shall negotiate in good faith either with a view to finding a
third party purchaser for all of the shares of the defaulting SHAREHOLDER
or with a view to the non-defaulting SHAREHOLDERS purchasing, pro rata,
the shares of the defaulting SHAREHOLDER, in either event at net asset
value.
If no purchaser is found for all the shares of the defaulting SHAREHOLDER
and the other SHAREHOLDERS do not purchase the shares of that
SHAREHOLDER within a period of four months from date of the relevant
notice of termination, the SHAREHOLDERS shall procure that Unitel be
wound up. For this purpose each of the SHAREHOLDERS undertakes with the
other of them to vote in favour of the resolution for winding up. [In the event
of such liquidation, PTI would have the first option to purchase any of the

8

 assets of Unitel, at the value that the asset was taken into Unitel at the
commencement of this joint venture or, at fair market value, whichever is the
lesser.]
…
13.4

Should the SHAREHOLDERS be unable to agree on the net asset value of
Unitel the matter shall be referred to the auditors of Unitel for their
determination. ”

9.

The purpose of the transfer restrictions at Article 6 was to ensure that Unitel remained
within the control of the same four shareholders, albeit that each of them was free to
transfer shares to an Affiliated Company within the same control.

10.

As at the date of the Shareholders’ Agreement on 15 December 2000, the interest of
PT Telecom (“PT SGPS”) was held through its subsidiary PTV (then called Portugal
Telecom Internacional SGPS SA). Article 12 of the Shareholders’ Agreement (as
referred to by PTV at paragraph 16 of its Request) – as well as the Management
Agreement (which recorded at recital III thereof the parties’ intention that Unitel
should be able to access the experience of the Portugal Telecom Group in the mobile
telecommunications market through PTV and other Portugal Telecom Group
Affiliates) further confirms that PTV’s status as a subsidiary of PT Telecom was a
matter of significant importance.

11.

During 2014, the consequence of a series of interrelated transactions (the details of
which do not need to be set out at this stage but which will be the subject of
disclosure and analysis in due course), was that PTV moved out of the control of PT
Telecom and into the control of Oi. This was not a transfer of the interest in Unitel to
an Affiliated Company (as would have been permitted under the Shareholders’
Agreement). Rather, it was a disposal of PT Telecom’s interest in Unitel caught by
the prohibitions on transfer. In support of that analysis, Vidatel relies, notably, upon:
(a)

the express language of Article 6.1, in particular the wide scope of the
prohibition on transfer and the references to not “in any other manner”
disposing or parting with “its right, title or interest in any shares”, or “suffer

9

 or permit any such shares to be in any manner transferred, by operation of
law or otherwise”;
(b)

the obvious intention of the Unitel shareholders, as appearing from the terms
of the Shareholders’ Agreement and the circumstances in which it was entered
into, namely, that no third party outside the original four shareholders and
those owning or controlling them would acquire an interest in Unitel without
the consent of the other shareholders and those owning and/or controlling
them;

(c)

the purposive and flexible approach under Angolan law towards the
interpretation of such transfer restrictions; and/or

(d)
12.

the general duty of good faith under Article 762(2) of the Angolan Civil Code.

In breach of Article 6.2 of the Shareholders’ Agreement, PTV then failed to offer its
shares for sale to the Respondents. This was despite a letter (undated but sent in late
March/early April 2014) from the Respondents to PTV setting out (i) their concerns
about the intended transactions between Oi and PT Telecom which had been publicly
announced at that time; and (ii) their wish to exercise the rights of pre-emption and to
acquire PTV’s shares in the event of those transactions taking place.

13.

The apparent willingness of Oi to flout such pre-emption rights and change of control
restrictions is further illustrated by separate ICC arbitration proceedings also arising
out of the very same 2014 Oi/PT Telecom transactions. These are said by Samba
Luxco S.a.r.l, the 25% minority partner in Africatel Holding BV (the holding
company for PT Telecom’s and now Oi’s interest in Unitel) to have entitled Samba
Luxco to exercise a put option which has not been honoured.

14.

Moreover, the proposed transaction between Oi and PT Telecom which was originally
announced involved a merger. In the event, that merger did not take place and there
was instead a disposal to Oi of PT Telecom’s interest in Unitel (with PT Telecom
being sold separately to Altice). Hence the actual transaction was in even more
obvious conflict with the letter and spirit of the Shareholders’ Agreement than that
originally contemplated. Yet, PTV still did not see fit to seek the permission of the

10

 Respondents or offer its shares for sale pursuant to the provisions of Article 6 of the
Shareholders’ Agreement.
15.

In those circumstances:
(a)

PTV’s ongoing status as shareholder, and hence its standing to bring claims
under the Shareholders’ Agreement, only exists by virtue of its own failure, in
breach of Article 6.2 of the Shareholders’ Agreement, to offer its shares for
sale to the Respondents;

(b)

its standing to initiate these arbitration proceedings is not therefore a
legitimate standing but derives from a breach of contract;

(c)

PTV’s failure to comply with Article 6.2 of the Shareholders’ Agreement
therefore operates as a defence (exceptio) to the claims brought by PTV
against Vidatel irrespective of whether those claims could have succeeded if
brought whilst PTV remained in the control of PT Telecom;

(d)

further, or alternatively, Vidatel is entitled to and seeks a declaratory award by
way of counterclaim: see further below at paragraph 86(d);

(e)

in the yet further alternative, Vidatel will contend that such liabilities as it may
be held to have incurred to PTV as alleged in the Request are themselves the
result of PTV’s breach of Article 6.2 as aforesaid and Vidatel will therefore (i)
counterclaim damages for breach of contract against PTV, and (ii) if
necessary, rely on such counterclaim by way of set-off and/or as a defence of
circuity of action against PTV’s claims;

(f)

the balance of this Answer is without prejudice to the above contentions.

PTV’S ALLEGATIONS: OVERVIEW
16.

So far as the detail of PTV’s claims is concerned, and following the numbering of
PTV’s Request, it is not in dispute that: (i) PTV has had fewer than three appointees
on the Unitel board since about 2006; (ii) there have been substantial delays in
Unitel’s payment of dividends to its two “foreign investors” (being PTV and Vidatel);
(iii) Unitel purchased a stake in BFA from BPI and entered into transactions with

11

 Unitel International Holdings and Tokeyna; (iv) PTV has at times complained about
lack of and/or delay in the provision of information about Unitel’s affairs; (v) there
has been reference by Unitel in meetings and correspondence to a “suspension” of
PTV’s rights and there have been proposals (not yet put into effect) for (vi) changes to
Unitel’s share capital; and (vii) amendments to the Shareholders’ Agreement and
Unitel’s by-laws.
17.

By way of general response to those allegations, the following clarifications are
important:
(a)

References to a “suspension” of PTV’s rights (Issue 5 in Section C of PTV’s
Request) arose in the context of PTV having betrayed the trust and confidence
of its fellow shareholders by allowing new investors into the capital structure
of Africatel without the Respondents’ prior knowledge or approval. PTV then
compounded the situation by failing to follow through on the proposal
(discussed between all four shareholders of Unitel) that PTV should exit its
investment in Unitel. An already difficult situation was made worse still in
2014 by PTV’s breach of Article 6.2 of the Shareholders’ Agreement as
described in paragraphs 9 to 15 above. The purported suspension has not, in
any event, caused any loss to PTV (and Vidatel expressly denies that it did so
in so far as the contrary is alleged by PTV).

(b)

So far as Unitel’s corporate governance and documentary records are
concerned, in so far as those records (in particular as regards the decisionmaking of its corporate bodies and officers) may not be as detailed and
complete as they could be or indeed as Vidatel had believed that they were (as
to which Vidatel makes no admissions), this is to be understood in the
Angolan context, where matters may be handled somewhat informally, as
PTV well knows, given the fact that until very recently it had a designated
representative on the board of Unitel. It would be unreasonable therefore, in
the circumstances to consider that such lack of formality amounts to evidence
of wrongdoing, let alone fraud or conspiracy, nor does it mean that PTV has
suffered any loss as a result. Moreover, as mentioned at paragraphs 3(c) and
(d) above and explained further at paragraphs 18 to 30 below, questions of

12

 corporate authority and validity and/or as to whether wrongs have been
committed by or against Unitel are outside the scope of this arbitration.
(c)

In relation to Tokeyna, Vidatel does not accept that PTV was (as it claims)
previously unaware that Tokeyna is a Unitel vehicle, incorporated by or at the
direction of Unitel and for Unitel’s benefit albeit that, for administrative
reasons and at Unitel’s request, the legal title to its shares has been held on an
interim basis by Mrs Dos Santos. Insofar as PTV’s complaints in this respect
are based on a misunderstanding of the role of Tokeyna then those complaints
fall away in light of this explanation.

(d)

In any event, the significance of Tokeyna within these arbitral proceedings
falls away for a second reason, namely the intention on the part of Unitel to
cancel and/or reverse the Tokeyna transactions so that from the perspective of
Unitel (and hence PTV as a shareholder) it is as though those documents and
the related transactions were never executed. At the time of writing this
cancellation and/or reversal has not yet been effected, but Vidatel understands
it to be imminent and on any view will have occurred prior to the Tribunal
making any award.

PROPER SCOPE OF THE ARBITRATION
18.

There is a further crucial preliminary matter which Vidatel wishes to emphasise
before dealing below with PTV’s complaints. It relates to the proper subject matter of
the arbitration and hence the extent of the Tribunal’s jurisdiction. The parties to the
arbitration agreement are PTV and the three Respondents. The arbitration agreement
at Article 16.1 of the Shareholders’ Agreement provides (so far as relevant):
“Any claim, dispute or other matter in question between the Parties with
respect to or arising under this Agreement or the breach thereof, shall be
decided by arbitration …”

19.

Hence the dispute must arise between the Parties and must be with respect to or
arising under the Shareholders’ Agreement between them.

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 20.

Those limitations on the scope of the Tribunal’s jurisdiction give rise to two distinct
sub-issues:
(a)

the position of Unitel so far as its relationship with shareholders and the status
of its transactions is concerned; and

(b)

the distinction between Vidatel and Mrs Dos Santos.

Unitel
21.

Unitel is, of course, a legal entity separate from its shareholders (see Article 5 of the
Angolan Commercial Companies Law, Law No. 1/04 of 13 February 2004). The
actions of Unitel in that separate legal capacity feature prominently in PTV’s Request.
Indeed, PTV variously alleges that:
(a)

dividends due and owing from Unitel have been improperly withheld: see
paragraphs 34 to 48 of the Request;

(b)

various high-value transactions purportedly entered into by Unitel with third
parties are in truth null and void (see paragraph 45 of the Request);

(c)

BFA dividends received by Unitel have not been credited (see paragraphs 48
to 50 of the Request); and

(d)

information rights with respect to the affairs of Unitel have not been respected
(see paragraphs 53 to 57 of the Request).

22.

Although it is nowhere acknowledged within PTV’s Request, such allegations in
relation to Unitel create insuperable difficulties for PTV in bringing its claims against
Vidatel and its fellow shareholders. Unitel is, of course, not a respondent to the
arbitration, nor a party to the underlying Shareholders’ Agreement containing the
agreement to arbitrate. It follows that the Tribunal would have no power to make any
award binding on Unitel as to the rights and obligations as between PTV and Unitel or
the legal status of the transactions between Unitel and third parties which PTV seeks
to impugn.

23.

Moreover, since Angolan law provides a coherent corporate law regime and its own
avenues of recourse to dissatisfied shareholders (e.g. to seek annulment of corporate
14

 resolutions or vindication of information rights), which avenues, to the best of
Vidatel´s knowledge, PTV has recently resorted to on several counts and which in
part overlap with the matters submitted to arbitration (details of which shall be
disclosed in future memorials), then an arbitral Tribunal ought to be especially astute
to ensure that it does not exceed its proper remit. Even if this was not the case, still
PTV cannot be entitled to use the Shareholders’ Agreement for obtaining relief
against Unitel, whether directly or indirectly in the form of purported claims against
the Respondents, as this Tribunal lacks jurisdiction to determine or grant relief in
respect of the rights and obligations of Unitel.
24.

So far as the alleged “looting” is concerned, the problem for PTV goes further. That is
because whether or not those transactions are null and void is an essential preliminary
issue which logically must be resolved before the alleged liability of the Respondents
can be addressed. Indeed, if the transactions are null and void then Unitel has not
suffered the losses about which PTV complains and which in turn form the basis of its
own claim for loss in its capacity as shareholder. Although, in theory, Unitel might
suffer a loss if the effects of the allegedly void transactions could not be unwound,
there is no allegation by PTV (and certainly no evidence) that payments could not, in
principle, be reversed in Unitel’s favour if a competent Court concluded that this is
what needed to happen. In any event, there is no room for such speculation whilst the
prior question of whether the transactions in question (which are transactions to which
Unitel, but not the Respondents, is party) are valid or invalid in the first place remains
unresolved.

25.

The only appropriate response on the part of the Tribunal is therefore to decline to
deal with any of PTV’s complaints which are: (i) in substance allegations against
Unitel; or (ii) which in any event cannot be fairly adjudicated upon in proceedings to
which Unitel is not a party; and (iii) clearly fall out of the scope of the arbitration
clause and jurisdiction of the Tribunal.
Vidatel and Isabel Dos Santos

26.

It is true that Mrs Dos Santos owns and controls Vidatel. It is also true (as PTV
asserts at paragraph 25 of its Request) that she has been a director of Unitel since
2001 and served as President of the Board of Directors since 2013.

15

 27.

However, it clearly does not follow that PTV is entitled to advance complaints against
Mrs Dos Santos in her capacity as director and/or President under the guise of a claim
against Vidatel under the Shareholders’ Agreement. Like Unitel, Mrs Dos Santos is
not a party to the arbitration agreement and therefore cannot and should not be made a
respondent to the arbitration proceedings.

28.

Yet, much of the substance of PTV’s complaint is in reality directed at Mrs Dos
Santos personally as distinct from Vidatel in its capacity as shareholder. Importantly,
PTV’s allegation at paragraph 4 of its Request is not that the Respondents’ alleged
“scheme to loot Unitel” has been for Vidatel’s benefit or, at paragraph 26 of the
Request, that Vidatel is particularly responsible for decision-making. Rather, PTV
alleges that the looting has been for the benefit of Mrs Dos Santos and that Mrs Dos
Santos is the key decision-maker. Indeed, there is no allegation in the Request that
Vidatel as a company has derived any benefit from any of the impugned transactions.
The only allegation which (even if proved, and it is hotly contested: see paragraphs
36-53 below) would represent any benefit to Vidatel is the dividend issue, in relation
to which PTV incorrectly alleges that Vidatel has received preferential treatment.

29.

PTV cannot sensibly suggest that Vidatel is responsible in its capacity as shareholder
for having procured Mrs Dos Santos to act in a certain way. Such allegations make no
sense when Mrs Dos Santos controls Vidatel and not the other way around.

30.

In summary, insofar as PTV’s complaints are in substance complaints against Mrs
Dos Santos, then the Tribunal has no jurisdiction to entertain them. Given the
importance of these jurisdictional arguments, Vidatel reserves the right to request a
bifurcation of proceedings so that questions of jurisdiction and/or lis pendens are
resolved in advance of hearing evidence on the substance of the claims.
PTV’S INDIVIDUAL COMPLAINTS

1.

Board representation

31.

PTV makes the stale and unconvincing complaint that since 2006 it has been denied
its right to appoint three board directors. The contractual provision to that effect is at
Article 9.1 of the Shareholders’ Agreement and its language is common ground. The
historical reason for the inclusion of this provision was the way in which PT Telecom

16

 wished to account for its indirect investment in Unitel. As Vidatel understands it, in
order for PT Telecom to book its interest in Unitel on a consolidated basis, accounting
rules required that PTV have the right to appoint a majority of the board of Unitel.
32.

Irrespective of the original reason for Article 9.1, the short response to the complaint
which PTV now makes is that it has not insisted upon or sought to enforce its rights
under that provision for nearly a decade. Rather, it has approved the composition of
the board, including at General Meetings held on 18 October 2006, 29 September
2008, 18 June 2012 and 22 October 2012. Indeed, it is unsurprising that PTV was
content with this arrangement given that the provision in the Shareholders’
Agreement for PTV to have three appointees had been linked to the Management
Agreement between Unitel and PTV, the five year term of which expired in 2005.

33.

The board was thereby authorised to act on Unitel’s behalf and to bind Unitel.
Having approved the board in General Meetings in this manner and been content with
a single appointee on the board since 2006, it is simply not open to PTV now to
assert, in response to transactions with which PTV is (now) uncomfortable or
unhappy, that the position would have been different if the composition of the board
had been different. Yet, that is precisely PTV’s submission at paragraph 30 of its
Request.

34.

The suggestion that PTV “protested repeatedly” on the issue also mischaracterises the
position. As footnote 22 to that allegation at paragraph 28 of the Request shows
(referring to letters of 24 November 2014 and 30 January 2015), the complaints that
PTV relies upon were in fact made just twice, in fairly quick succession and only after
PTV had failed to complain about the issue for more than eight years. Vidatel infers
that these complaints were initiated by Oi, following the acquisition of its majority
holding in PTV in 2014, in disregard to the established course of conduct whereby
PTV had accepted that it was content for a single appointee on the Unitel board.

35.

Further or alternatively, Vidatel will contend that PTV’s attempt to now rewrite
history and portray its acceptance of a single board appointment since 2006 as a
breach of Article 9.1 of the Shareholders’ Agreement is a breach of its duty of good
faith under Article 762(2) of the Angolan Civil Code.

17

 2.

Dividends

36.

PTV’s complaints that it has not received dividends due to it are, as stated above and
will in due course be explained in further detail, a matter concerning Unitel and fall
outside the scope of the arbitration clause and the Tribunal’s jurisdiction and may
indeed be subject to lis pendens considerations. Additionally and in any event, PTV’s
complaints:
(a)

fail even to identify what it is that Vidatel as shareholder is said to have done
or failed to do to prevent Unitel from making such payment;

(b)

fundamentally and crucially misunderstand the nature of PTV’s legal
entitlement (which is to participate in Unitel’s profits in Kwanza);

(c)

overlook the acute and widely publicised foreign exchange difficulties in
Angola and the chronic shortage of US Dollars;

(d)

proceed on an incorrect premise as to the sums received by Vidatel; and

(e)

wrongly assume that the mere delay in payment of a debt by Unitel (a
creditworthy entity) entitles PTV to claim the full amount as damages as
against Vidatel.

No relevant allegation against Vidatel
37.

The first and fundamental problem facing Vidatel in seeking to respond to PTV’s
claim is that PTV’s Request advances no factual case against Vidatel as to what
Vidatel is alleged to have done or failed to do in order to prevent PTV from receiving
dividends. Paragraph 38 of the Request refers to the “Respondents’ Actions” but
makes no attempt to explain what those actions are.

Indeed, it is not easy to

understand how in its capacity as shareholder Vidatel can have stood in the way of
payment by Unitel.
39.

On the face of it, PTV’s complaint about non-payment of dividends is purely against
Unitel.

Indeed, at paragraph 35 of its Request, PTV refers to the shareholders

(including Vidatel) having voted for the distribution of dividends. Self-evidently, this
reflects the intention that the sums be distributed rather than withheld by Unitel on the

18

 part of the shareholders.

There is no allegation that Vidatel, as shareholder,

subsequently sought to countermand that instruction to Unitel or block its execution.
If PTV’s belief or suspicion is that Mrs Dos Santos caused Unitel not to pay dividends
then that is a complaint against her personally and falls outside the scope of the
arbitration (see above at paragraphs 26 to 30 above).
40.

In any event, if and when PTV articulates a proper complaint against Vidatel along
with the evidence in support, then Vidatel will respond.
Kwanza/US Dollars

41.

As to the nature of PTV’s entitlement, Vidatel agrees with PTV that it arises under
Articles 23 and 24 of the Angolan Commercial Companies Law. Those provisions,
however, make no reference to receiving payment in a foreign currency.

42.

On the contrary, Article 550 of the Angolan Civil Code states that all payments in
Angola (including dividends) must unless otherwise expressly agreed – which is not
the case - be made in Kwanza, the official Angolan currency.

43.

The shareholders’ entitlement and, correspondingly, the company’s obligation, with
respect to the payment of dividends is therefore in Kwanza. Insofar as a company
may choose to assist a foreign investor (authorised as such under Angola’s foreign
investment laws) in relation to the process of conversion from Kwanza into a foreign
currency, then that is a purely voluntary exercise which neither reflects nor creates
any obligation as a matter of Angolan law. The fact, therefore, that historically PTV
and Vidatel have had their dividend entitlement in Kwanza converted into US Dollars
does not mean that Unitel is obliged under the Shareholders’ Agreement or as a
matter of Angolan law to tender and make dividend payments to those (or any of its)
shareholders otherwise than in Kwanza.
Foreign exchange issues

44.

Vidatel will adduce evidence in due course as to the foreign exchange controls in
Angola and the difficulty in exporting US Dollars. Strikingly, PTV’s Request does
not even acknowledge or refer to these issues.

19

 45.

As the Kwanza is not a freely convertible currency, the legal route to obtain the
conversion from Kwanza to foreign currency for the purpose of expatriating dividends
is as follows:
(a)

an application is made to a commercial bank to expatriate dividends outside of
Angola;

(b)

the commercial bank will apply to the Angolan Central Bank for permission to
convert the dividends into US Dollars and subsequently expatriate them
outside of Angola;

(c)

once and only if such approval is granted, the commercial bank will convert
the dividends. Conversion of the Kwanza to US Dollars will then depend on
the availability of US Dollars within the commercial bank in question.

46.

A shareholder’s ability to convert Kwanza dividends into a foreign currency therefore
depends upon not only the approval of the Angolan Central Bank but also the ability
of commercial banks in Angola to effect the exchange. This is part of doing business
in Angola.

47.

If PTV wishes to receive payment of dividends without further delay, it can nominate
an Angolan bank account (and indeed is obliged to maintain such an account under
the Private Investment Laws from time to time in force, namely Article 53 of the 2003
Law, Article 75 of the 2011 Law and Article 53 of the 2015 Law, as a matter of
Angolan law, albeit that Vidatel understands that PTV is in breach of this obligation,
as it never nominated said bank account). The relative ease with which Unitel is able
to make Kwanza payments can be seen from the fact that Geni and Mercury (who
receive dividends in Kwanza) have received far greater sums by way of dividends and
the sums outstanding to them as recorded in Unitel’s accounts are correspondingly
lower than the sums due to PTV.
Incorrect allegations as to Vidatel receipts

48.

No doubt in order to put its claim as high as possible, PTV has assumed and asserted
(without identifying any basis for doing so) that Vidatel has received payments in
respect of dividends declared for financial years since 2011.

20

 49.

This is simply wrong: although Vidatel has received payments in 2013 and 2014 they
correspond to the dividends declared in respect of FY2011. Vidatel has yet to receive
any payment at all in relation to FY2012 or FY2013.

50.

The detailed accounting information and proof of payments will be provided in due
course in order to rebut PTV’s allegations if they are maintained.

51.

As to whether PTV intends to maintain its allegation in its current form, Vidatel notes
that in one of the rounds of evidence filed by PTV in the British Virgin Islands in
support of an interim freezing injunction against Vidatel, PTV has submitted a
spreadsheet reflecting PTV’s analysis of the declaration and receipt of dividends: see
Exhibit CGSB3 to the Third Affidavit of Charles Balmain, p 264. As submitted by
Vidatel in the course of those interim proceedings, the conclusions that PTV has
sought to draw from that analysis (as to which see Balmain 3, p 52) are entirely
consistent with Vidatel’s own explanations that it has not received payment of
dividends declared in respect of FY2012, FY2013 or FY2014.

PTV has made no

attempt to amend its Request to reflect information and evidence which has
subsequently come to light.
Misconceived quantum
52.

The flaws in PTV’s claim are not limited to its incorrect allegation that Vidatel has
been paid in respect of the FY2012 and subsequently declared dividends. Indeed,
there is an even more fundamental defect. Unitel’s obligation to pay dividends to
PTV is a debt and recorded as such in Unitel’s books and reflected in its annual
financial statements. Unitel is good for the money (and PTV has certainly not sought
to suggest otherwise).

53.

The delay in receipt of dividends (whether in Kwanza or US Dollars) is not therefore
a loss of principal. Even if PTV could make out a factual case, as yet unpleaded, that
Vidatel had obstructed payment of dividends that Unitel would otherwise have made,
PTV it is not entitled to say as against Vidatel that the whole of its entitlement to
dividends has been lost.

The claim for losses asserted at paragraph 97 of PTV’s

Request is untenable so far as unpaid dividends are concerned (and, indeed, untenable
more generally for the reasons set out below).

21

 3.

Alleged looting

54.

Faced with transactions which PTV’s current management seem not to fully
understand, PTV has jumped to the frankly ridiculous conclusion that they are part of
a concerted scheme to “loot” Unitel. Vidatel vehemently denies those allegations. In
any event they are not on a proper analysis allegations against Vidatel at all. Rather,
they are complaints about Unitel and/or the conduct of Unitel’s individual directors.
For the reasons given at paragraphs 18 to 30 above, such claims are outside the scope
of this arbitration and the Tribunal’s jurisdiction.

55.

The claims fail on the facts in any case. Vidatel repeats paragraph 17(b) above with
regard to any shortcomings (as to which no admissions are made) that there may have
been in the internal processes, communication and record-keeping within Unitel.
Board meetings and shareholder meetings are relatively infrequent and necessarily
deal with matters at a high level. As a foreign investor with no Angolan presence,
PTV has not been involved and has shown limited desire to be involved (or at least
not recently) in the day-to-day financial and operational challenges of the company.
Inevitably, PTV will not therefore have had a grasp on the detail of some of Unitel’s
transactions and the rationale for them.

56.

With regard to the Tokeyna transactions, the concept of Tokeyna was developed by
Unitel in conjunction with third party management consultants, tax and legal advisors
(none of the advice from whom Vidatel is in a position to disclose without Unitel’s
consent). The concept was for Tokeyna to be incorporated in the British Virgin
Islands and operate from Dubai. It would provide support services to Unitel with
greater operational flexibility in terms of hiring and retaining key personnel, access to
foreign currency and tax optimisation than would be possible if all such services were
provided from Angola. The establishment of Tokeyna was therefore undertaken bona
fide at the direction of Unitel and in order to further the commercial interests of
Unitel.

57.

Indeed, Unitel recognised throughout that Tokeyna was a related party so that there
needed to be a transfer pricing mechanism in order to ensure that the price for
Tokeyna’s services was set on an arm’s length basis. Plainly, Unitel would not have

22

 gone through this exercise if Tokeyna had been established simply to act as a
repository of funds for the benefit of Mrs Dos Santos.
58.

For essentially administrative reasons and to enable Tokeyna to be incorporated
swiftly (having particular regard to the burden and delay of Know Your Client
checks), Mrs Dos Santos, at the request of Unitel, agreed to act as the registered
shareholder of Tokeyna on an interim basis. Unitel having organised and paid for the
incorporation of Tokeyna, Mrs Dos Santos signed a Declaration of Trust and a share
transfer form (with the transferee left blank) enabling Unitel at a later date and at its
sole discretion to transfer Tokeyna into its own ownership or into the ownership of a
nominee entity of Unitel’s choosing. All this will be explained further in due course
in the proceedings by reference to witness evidence and contemporaneous documents.

59.

As it turned out, Tokeyna never became operational and never in fact provided any
services to Unitel. Governmental authorisation was necessary for the “outsourcing”
to Tokeyna of management services as contemplated under the Unitel/Tokeyna
arrangements.

Despite Unitel’s requests and a further protest against the initial

refusal, such consent was refused by the relevant government authority.
Services Agreement between Tokeyna and Unitel therefore never began.

The
No

payments were ever made and no services provided. Vidatel understands that Unitel
intends: (i) to formally cancel the Services Agreement; and (ii) to reverse such
accounting provisions as were made to reflect payments which would have been due
but which have not and will now never be paid to Tokeyna.
60.

As well as being counterparty to the (unimplemented) Services Agreement, Tokeyna
is also party to the loan assignment by which Unitel’s right to repayment under loans
entered into with the Dutch company Unitel International Holdings (formerly Jadeium
BV) was sold to Tokeyna for USD 150,000,000.

Like the Services Agreement, no

funds have in fact changed hands under this assignment, and Vidatel understands that
Unitel intends to reverse the assignment (whether by exercising the contractual right
to repurchase the loans or by another route).
61.

The rationale for entering into the assignment in the first place was part of Unitel’s
strategy to have access to foreign currency which (as noted above and as will be fully
developed in evidence) is in short supply in Angola. The underlying loans between

23

 Unitel and Unitel International Holdings (which were in Euros and US Dollars)
required the authorisation of the Central Bank of Angola (“BNA”) to enable the
foreign currency to be acquired and exported for the purpose of financing foreign
investment. Unitel thereby had the benefit of a right to repayment in foreign currency
from a creditworthy counterparty, Unitel International Holdings, whose repayment
obligations were secured over the shares in the foreign telecoms companies (in Sao
Tome, Cape Verde and Portugal) which the funds from Unitel were used to acquire.
62.

That right to repayment is valuable to Unitel and it is simply incorrect for PTV to
assert that there is “no strategic or other benefit whatsoever” (see Request, paragraph
42).

63.

Insofar as PTV alleges that Mrs Dos Santos sought to create deliberate confusion
between Unitel Holdings (a Unitel subsidiary) and Unitel International Holdings, a
company of which she is the shareholder, this is misconceived. PTV has always been
aware of the distinction (see, for instance the minutes of the General Meeting of 12
June 2013). Indeed, Mrs Dos Santos’ role as the shareholder of Unitel International
Holdings was publicly reported in the press in the context of her investment in
telecoms companies outside Angola.

64.

As to whether the transactions were validly authorised and executed, for the reasons
given at paragraphs 18 to 30 above, this is not an area which the Tribunal can
properly consider given that Unitel is not a party to this arbitration nor to the
underlying Shareholders’ Agreement.

Vidatel’s enquiries suggest, however, that

there may not have been specific approval for individual contracts by the Audit
Committee (also referred to as the Supervisory Board) of Unitel. However:
(a)

if Unitel failed to take the necessary steps to secure such approval, then that is
not a complaint which can be levelled at Vidatel. Indeed, Vidatel has no
visibility of, nor ability to control, the affairs of an entirely separate corporate
entity as is Unitel, let alone a corporate body within Unitel;

24

 (b)

if the purported contracts need to be unwound as a consequence of their
invalidity then that will need to be considered in some other forum;1

(c)

nevertheless, even on the basis of Vidatel’s limited information, it appears that
the question of authorisation may not be clear-cut.

Although the Audit

Committee may not have been asked for or given their approval as to specific
contracts, it appears that they did approve some or all of the annual accounts
in which the economic effects of those transactions are clearly and
unambiguously reflected;
(d)

further and in any event, Vidatel does not accept (as alleged at paragraph 45 of
the Request) that the loan transactions between Unitel and Unitel International
Holdings were in the nature of transactions between Unitel and its directors
(directly or through another person or intermediary) within the meaning of
Article 418 of the Angolan Commercial Companies Law. Even if they were,
Vidatel denies that PTV is entitled to complain of the matter in this arbitration
and/or seek any relief (including damages) in respect thereof because:
(i)

PTV has expressly agreed under Article 9.6.5 of the Shareholders’
Agreement that 4 out of 5 directors on the Unitel Board of Directors
can approve contracts between Unitel and its shareholders and/or the
latter’s Affiliated Companies (which agreement, on PTV’s own case as
to the ownership of Unitel International Holdings, must apply to the
loan contracts between Unitel and Unitel International Holdings);

(ii)

PTV implicitly accepts that the 4 directors of the Unitel Board other
than the director appointed by PTV approved the making of those
loans; and/or

(iii)

those 4 directors could in any event have approved the making of those
loans pursuant to Article 9.6.5;

1

As to which forum, possibilities include the chosen forum under the various agreements (albeit, on this premise, void), the home courts of any relevant defendant who has received a benefit which requires to be reversed or
the Courts of a country such as Angola with a sufficiently close connection to the claims.

25

 (e)

it is denied in any event that these loan transactions have caused any loss to
Unitel.

BFA
65.

The matter of Unitel’s shareholding in BFA and other matters deriving therefrom, as
in the case of alleged lack of payment of dividends or record of the same are
complaints about Unitel and/or the conduct of Unitel’s individual directors. For the
reasons given at paragraphs 18 to 30 above, such claims are outside the scope of this
arbitration and the Tribunal’s jurisdiction. In any case, this is yet another area of
apparent misunderstanding on the part of PTV, which appears to be the result of a
lack of communication within the PT group.

PTV complains that Unitel has not

received the benefit of dividends paid by BFA, in which Unitel acquired a 49.9%
stake in 2008. PTV even suggests (and calculates its loss on this basis) that Unitel
should have received the gross sum of 49.9% of the dividends declared by BFA in
each of the years from 2008 to 2013 without taking into account at all of any
financing costs of Unitel in relation to the acquisition.
66.

Again, this is a misconceived claim by PTV which is explicable only on the basis that
PTV has sought to inflate its claim as far as possible.

67.

Moreover, as recorded in the minutes of the board meeting of 21 February 2011, at
which Luis Pacheco de Melo was present on behalf of PTV, it was expressly agreed at
board level (with no dissent from PTV) that the dividends received from BFA would
be used by Unitel to repay its loan from BPI. By reason of this agreed set-off, Unitel
has not suffered any loss in connection with this transaction.

4.

Information rights

68.

Vidatel insists that, once again, these are primarily complaints about Unitel and/or the
conduct of Unitel’s individual directors, since it is the corporation that has the duty
under Angolan law to provide any or all of its shareholders with the information PTV
complains to have been deprived of. PTV is perfectly aware of this and has acted
accordingly as Vidatel shall in due course explain and demonstrate in further detail.
For the reasons given at paragraphs 18 to 30 above, such claims are outside the scope
of this arbitration and the Tribunal’s jurisdiction.

26

 69.

In any case, PTV complains about having been “kept in the dark” and denied access
to information. It is not alleged, however, that this has caused PTV any loss (nor
could any such allegation sensibly be made). Nor does PTV seek any sort of
mandatory relief but instead a declaration that there has been a prior failure by Vidatel
to “procure that Unitel” keep PTV informed as to its financial and business affairs.

69.

In those circumstances, the dispute over information rights is a somewhat sterile one.
For the record, however, Vidatel understands that:
(a)

PTV’s legal adviser (Maria Manuela Cunha) was allowed to access and
inspect Unitel’s records at its registered office pursuant to a shareholder’s
statutory right of inspection at a company’s registered offices under Article
320 of the Angolan Commercial Companies Law;

(b)

In any event, to the extent that PTV complains about any lack of access to the
records of Unitel, or any alleged refusal to allow copies to be made this is not
a complaint which can sensibly be levelled at Vidatel. The Claimant should
take this issue up with Unitel (and in fact has);

(c)

There has been no scheme to “sideline” or “oust” PTV2 and insofar as PTV’s
complaint is that documents and information packs have been supplied at or
only shortly before meetings (allegedly in breach of Article 321(2) of the
Angolan Commercial Companies Law) then any such breach was nonmaterial, as this is how matters have been organised as between all attendees
at those meetings, and no loss has been suffered by PTV as a result;

(d)

If, which is also denied, there have been shortcomings in the record-keeping
and administration at Unitel (see paragraphs 17(b) and 55 above), this is not
due to any conspiracy but instead the consequence of Unitel’s rapid and
exponential growth, with which its administration has sometimes struggled to
keep pace; and

(e)

The competing pressures on the management of Unitel, as well as its
shareholders, are also why PTV’s letters have on occasions gone unanswered.

2

See Request, paragraph 57.

27

 5.

Purported suspension

70.

Vidatel has addressed this issue at paragraph 17(a) above.

6.

Threatened dilution

71.

This is another sterile complaint: PTV’s stake has not been diluted and it has therefore
suffered no loss in this regard. It is another issue where PTV has misunderstood the
position and sought to find wrongdoing where none exists.

72.

Moreover, it is also an issue which has been overtaken by events since PTV issued its
Request so that the current formulation of its claim is now unsustainable. At a General
Meeting of 30 November 2015 at which the matter was reviewed, PTV’s
representative clarified that PTV accepted the principle of an increase in Unitel’s
nominal value per share and an increase in shareholder capitalisation, albeit under
certain conditions. The 30 November 2015 meeting had been preceded by a
distribution of information to shareholders on 20 November 2015 (in compliance with
Article 321(2) of the Angolan Commercial Companies Law) explaining the proposal
both as to: (i) the Angolan law obligation (under Article 305 of the Angolan
Commercial Companies Law) to maintain a nominal value per share equivalent to
USD 5 per share, and (ii) the desirability for commercial reasons of increasing
Unitel’s shareholder capitalisation (including to bring Unitel closer to its competitors
and to prepare it for future opportunities such as international investments or a
possible flotation).

73.

In light of PTV’s agreement in principle to the proposed increase in Unitel’s nominal
value per share and in the shareholder capitalisation, no question of breach of PTV’s
alleged right of veto under Article 8.1 of the Shareholders’ Agreement (as alleged at
paragraph 69 of PTV’s Request) arises. Moreover, if need be, Vidatel will contend
that the proposed increases in nominal value per share and shareholder capitalisation:
(a)

do not constitute “a change in the capital structure of Unitel” within the
proper scope and meaning of Article 8.1 of the Shareholders’ Agreement; or

(b)

alternatively, that by virtue of Articles 9.7.1 of the Shareholders’ Agreement
which takes precedence over any other conflicting provision of the

28

 Shareholders’ Agreement (“Notwithstanding any other stipulation of this
agreement”), the proposed increases are a “reorganisation of Unitel’s share
capital” which the Respondents, as holders in aggregate of 75% of the shares
of Unitel, were and are entitled to vote upon irrespective of PTV’s objection
(if there is any such objection).
7.

Proposed amendments to the By-Laws and Shareholders’ Agreement

74.

This is another sterile complaint in relation to a proposal which in the event was not
implemented and so has given rise to no loss to PTV (indeed, it does not feature in
PTV’s prayer for relief). The agenda for the 15 December 2014 General Meeting
included proposals for such amendment but all shareholders voted to suspend
consideration of the above agenda item. Consequently, the issue was not discussed
further at the General Meeting of 15 December 2014. This goes to show that there
never was any intention on behalf of the Respondents to oust PTV from Unitel.

75.

Furthermore, as far as Vidatel has been able to establish, PTV has filed proceedings
before the Angolan Courts against Unitel, requesting the annulment of the
shareholders resolutions passed in the 15 December 2014 General Meeting, in which
case the Tribunal must stay and refuse jurisdiction on this matter altogether.

76.

In any event, Vidatel will, if necessary, rely on Article 9.7.2 of the Shareholders’
Agreement in support of the contention that, notwithstanding any other provision of
the Shareholders’ Agreement, it is sufficient for holders in aggregate of 75% of the
shares of Unitel to vote upon amendments to Unitel’s articles of incorporation or bylaws (or other equivalent constitutional documents).
QUANTUM ISSUES

77.

PTV quantifies its claim as nearly USD 2.5 billion, presupposing that:
(a)

the value of its equity interest in Unitel has been lost entirely (notwithstanding
that (subject to Vidatel’s counterclaim below) PTV remains the legal and
beneficial owner of this interest and that PTV’s indirect parent Oi still values
it on its books at around USD 1.3bn);

29

 (b)

its entitlement to payment of dividends from Unitel is worthless
(notwithstanding that Unitel is a creditworthy debtor which recognises PTV’s
dividend entitlement in all relevant financial statements); and

(c)

PTV has suffered a loss of 25% of the sums allegedly “looted” from Unitel.

78.

None of this bears scrutiny.

79.

Subject to Vidatel’s counterclaim below, PTV remains a shareholder in Angola’s
largest private company and its shares are extremely valuable, hence the USD 1.3bn
valuation on Oi’s balance sheet. As to dividends, its rights to payment from Unitel are
valuable and undiminished, and PTV must give credit for them, even if PTV is able to
establish some (currently unpleaded) claim for losses arising out of the delay (which
itself has been caused by PTV’s failure to nominate an Angolan bank account and its
refusal to accept the payment of its dividends in Kwanza, the currency in which
Unitel’s obligation to pay dividends is denominated). As to the alleged “looting”,
PTV’s claim for losses cannot be reconciled with its claims that the transactions in
question are void.

80.

In any event, PTV has identified no basis for saying that if the impugned transactions
had not been entered into then PTV would have received 25% of the funds, let alone
received them in US Dollars. Meanwhile, Unitel remains entitled to repayment of the
loans which it has made to Unitel Holdings International (a substantial creditworthy
entity) and there is no suggestion in PTV’s request, nor would there be any basis for
suggesting, that Unitel Holdings International would not be able to repay those loans
to Unitel in accordance with the agreed terms.

COUNTERCLAIM
81.

By reason of the facts and matters set out notably at paragraphs 8 to 15 above in
relation to the Oi acquisition, PTV is in breach of the Shareholders’ Agreement and/or
its obligation under Angolan law to deal in good faith with its fellow shareholders.

82.

Indeed, as set out above and will in due course be demonstrated in further detail, by
failing to notify the remaining shareholders of the intended transaction with Oi and

30

 rather attempting to disguise it as a merger and/or assignment to an affiliated party as
a means to avoid such notification and subjection to the provisions of Article 6.2. of
the Shareholders’ Agreement, PTV has indeed violated both the letter and the spirit of
the said Agreement.
83.

PTV’s conduct has prevented the Respondents from exercising their pre-emptive right
to acquire PTV’s shares in Unitel and effectively resulted in an unauthorised transfer
of the economic ownership of the shares to a fifth entity, outside the initial group of
four shareholders. Indeed, whereas initially the Respondents were ultimately dealing
with PT Telecom, they are now dealing with Oi, an entirely different corporate entity.

84.

Having regard to the importance within a closely held and extremely valuable
company of the restrictions on transfer of shares, PTV’s breach is on any view a
breach of a “material obligation” within the meaning of Article 13.1. The
Respondents are therefore entitled to serve notice under Article 13.1 in order to
commence the process under Article 13.2 for sale of PTV’s shares at their net asset
value. Vidatel seeks declarations to that effect.

85.

Further, as set out in paragraph 15(e) above, if contrary to Vidatel’s primary case it
has incurred liabilities to PTV as claimed in the Request, Vidatel counterclaims
damages for breach of Article 6 by PTV, the full extent of which are still being
assessed and will be set up by way of set-off and/or in support of a defence of
circuity of action (exceptio).
PRAYER FOR RELIEF

86.

For the above reasons, the First Respondent requests that the Tribunal:
(a)

decline to deal with any of PTV’s complaints which are in substance
allegations against Unitel, or which in any event cannot be fairly adjudicated
upon in proceedings to which Unitel is not and cannot be a party and clearly
fall outside of the scope of the arbitration clause and jurisdiction of the
Tribunal, such as is the case with matters regarding (a) payment of dividends
and related damages, (b) validity of and alleged damages arising from
contracts and agreements entered into by Unitel with Tokeyna and / or Unitel

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 International Holdings and BFA, and (c) alleged violation of PTV’s
information rights under Angolan law;
(b)

stay and refuse jurisdiction on the matter of the shareholders resolutions
allegedly passed in the 15 December 2014 General Meeting;

(c)

in any case, dismiss all claims made by the Claimant;

(d)

declare in relation to the First Respondent’s Counterclaim that:
(i)

PTV is in breach of a material obligation under the Shareholders’
Agreement by reason of the Oi acquisition;

(ii)

upon a notice of termination being served upon PTV by all three
Respondents terminating the Shareholders’ Agreement PTV shall be
obliged to negotiate in good faith with a view to selling its shares at net
asset value to either a third party purchaser or, pro-rata to the
Respondents and furthermore obliged to recognize and accept that
should the Shareholders be unable to agree on the net asset value of
Unitel the matter be referred to the auditors of Unitel for their
determination.

(e)

in the event that any of the Claimant’s claims for damages succeeds, order that
the Claimant pay damages or an indemnity to the First Respondent for
damages due to breach of Article 6 of the Shareholders’ Agreement, the full
extent of which will meanwhile be assessed and quantified and with
appropriate set-off as between claims and cross-claims; and

(f)

order that the Claimant pay the First Respondent all costs and expenses
incurred by the First Respondent in relation to this arbitration.

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 PROCEDURAL MATTERS
87.

The First Respondent’s details in the Request are correct.

88.

The First Respondent is represented in this arbitration by:
Quinn Emanuel Urquhart & Sullivan, LLP:
Robert Hickmott
Philippe Pinsolle
Martin Davies
John McElroy
Alexis Foucard
Marina Boterashvili

89.

The First Respondent agrees with the Claimant that, pursuant to the Shareholders’
Agreement:

90.

(a)

the place, or legal seat, of arbitration shall be Paris, France;

(b)

the language of the arbitration shall be English; and

(c)

the Shareholders’ Agreement shall be governed by the law of Angola.

As to the constitution of the Tribunal, this has been addressed in separate
correspondence, the most recent of which (at the time of filing this Answer) was sent
on behalf of the First Respondent on 18 December 2015.

Respectfully submitted on behalf of Vidatel Ltd
8 January 2015

QUINN EMANUEL URQUHART & SULLIVAN, LLP

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