In October 2023, TosCuba S.A. (“TosCuba”), a Cuban joint venture company in which CEIBA Investments Limited (“CEIBA”) holds an indirect 32.5% interest, received a copy of Cuba’s Supreme Court judgement in its favour rejecting the appeal of a March 2023 Court of Appeal decision confirming the original judgment issued in November 2022 by a municipal Court in favour of TosCuba.
The court case was initiated in May 2022 by TosCuba to demand payment under guarantees and damages resulting from the default by AEI Construcciones Trinidad and its partners under the turn-key construction contract executed on 5 April 2018 for the construction of the Meliã Trinidad Península Hotel. In the original November 2022 award, AEI Construcciones and its partners were ordered to pay to TosCuba approximately US$3.85 million.
The three favourable decisions are in line with the expectations of the legal specialists of TosCuba and confirm in this case the robustness of Cuba’s commercial legislation and the proper functioning of the commercial chambers of Cuba’s judicial system. Whether or not TosCuba will be able to obtain payment, in whole or in part, will depend on the liquidity and solvability of the parties involved.
Opening of the Meliã Trinidad Península Hotel
The Meliã Trinidad Península Hotel, largely constructed during the Covid-19 pandemic and its aftermath, is expected to open its doors in November 2023. It is a state-of-the-art international five-star hotel with the most modern amenities in Cuba. Fitted with energy saving systems, approximately 500kWh of installed solar panels and batteries, and located at the first beach next to the UNESCO world heritage city of Trinidad, expectations are high.
The official opening ceremonies of the hotel are scheduled to take place in January 2024 during the festivities surrounding the 510th anniversary of the city of Trinidad, founded in 1514 by Diego Velázquez.
Stays at the Meliã Trinidad Península Hotel may be booked through the website of Meliã Hotels International: https://www.melia.com/en/hotels/cuba/trinidad/melia-trinidad-peninsula
Details of the Decision of the Cuban Supreme Court
On 29 September 2023, the Commercial Chamber of the People’s Supreme Court of the Republic of Cuba, the highest judicial authority in the country, ruled by way of final and binding judgement against the Cuban company DINVAI CONSTRUCCIONES S.A. and the Italian company TOMA S.p.A., the two parties to the International Economic Association named “AEI Construcciones Trinidad”, in their appeal of the judgement in favour of TosCuba issued on 27 March 2023 by the Civil, Family, Administrative, Commercial and Labor and Social Security Chamber of the People’s Provincial Court of Sancti Spíritus ratifying an earlier decision in favour of TosCuba rendered by the Commercial Chamber of the People’s Municipal Court of Sancti Spíritus whereby the Municipal Court found that the AEI Construcciones Trinidad and its partners were liable for numerous defaults under the construction contract and were ordered to pay to TosCuba damages in the amount of US$3,861,600 and CUP16,000.
Prior to June 2021, AEI Construcciones Trinidad was the turn-key constructor of the Meliã Trinidad Península Hotel. On 9 June 2021, the construction contract was terminated by TosCuba as a result of repeated defaults and delays in the performance thereof. From that point onwards, TosCuba, assisted by Mosaico Hoteles S.A., CEIBA Property Corporation Limited and Meliã Hotels International S.A., took on the full construction management of the hotel, including the contracting of all goods and services and the installation of all FF&E.
CEIBA, through its 65% shareholding in the Spanish company Mosaico Hoteles S.A., which in turn is the holder of 50% of the shares in TosCuba, has a 32.5% interest in TosCuba.