Ports company ordered to buy diesel exclusively from MPs’ company

The civil court on Monday night ordered the state-owned Maldives Ports Limited to buy oil exclusively from a company owned by the family of ruling party MP Riyaz Rasheed.

The temporary order will be in effect pending a judgment in a lawsuit filed by Meridiam Services, which claims the MPL is buying diesel from other suppliers in breach of the “spirit and purpose” of an agreement signed last April.

Meridiam had won a bid to supply diesel to vehicles and vessels used on the MPL site.

Granting Meridiam’s request for a temporary order, the court agreed that the company would suffer “irreparable” damages if MPL continued to buy diesel from other suppliers.

The MPL meanwhile refused to accept a summons to appear for a hearing.

The civil court cited regulatory provisions that allow orders to be issued in absentia in cases where delays could cause losses to the plaintiff.

The opposition-aligned Raajje TV reported in February that the anti-corruption watchdog was investigating allegations of corruption in Meridiam Services’ agreement to supply lubricant oil to all powerhouses operated by the state-owned Fenaka Corporation.

The state utility company provides electricity services in more than 150 islands.

Meridiam Services is also locked in litigation with the state wholesaler. Last week, the State Trading Organisation appealed a civil court ruling in favour of Meridiam to recover MVR19.3 million (US$1.2 million) released as a credit facility.

The STO claims that Meridiam failed to pay for fuel released on credit from March to December 2010 along with fines imposed for non-payment. But the civil court ruled in June that STO was unable to produce original documents to prove that the fuel was ever released to Meridiam.

MP Riyaz Rasheed, the deputy leader of the ruling Progressive Party of Maldives’ parliamentary group, has reportedly transferred his majority shares in Meridiam to two of his children.