vested
GENTING MALAYSIA BERHAD ("GENM" or "the Group")
- Participation as the Manager to the operation of an integrated gaming facility and resort in Taunton, Massachusetts
The Board of Directors of GENM refers to the announcement dated 1 April 2016, whereby the Group has subscribed to the promissory notes issued by the Mashpee Wampanoag Tribe (“Tribe”) to finance the pre-development expenses of an integrated gaming resort in Taunton, Massachusetts, United States of America (“U.S.”).
In September 2015, the U.S. Federal Government (i.e. U.S. Department of Interior (“DOI”)) issued a Record of Decision (“ROD”) (i.e. Category 2 ROD) to take the Tribe’s aboriginal lands into trust, in Taunton and Mashpee, Massachusetts for the Tribe under the Indian Reorganization Act of 1934 (“IRA”). This enabled the Tribe to pursue the development of the integrated gaming resort on its initial trust land in Taunton (“Project”).
In February 2016, legal action was brought by a group of local Taunton residents (“Plaintiffs”) against the DOI for issuing a ROD to hold the Tribe’s reservation lands in trust under Category 2 of Section 479 of the IRA.
In July 2016, a judge of the U.S. District Court in Massachusetts ruled against the DOI, but allowed the Tribe’s lands to remain in trust while the DOI and the Tribe decide how they wanted to move forward.
The Tribe chose to appeal the case to the U.S. Court of Appeals for the First Circuit, where it remains pending today. Given that the lawsuit remains pending and further rulings are expected to be made, construction of the integrated gaming resort has been put on hold pending further court developments and/or actions by the DOI or other relevant governmental authorities that will enable the Tribe to ultimately proceed with the integrated gaming resort project.
In December 2016, at the request of the Tribe, the DOI initiated a review process to determine whether it would continue to hold the Tribe’s lands in trust under a different legal category (i.e., Category 1 of Section 479 of the IRA), join the Tribe in its appeal of the U.S. District Court’s adverse ruling on the Category 2 ROD or take the Tribe’s lands out of trust.
The U.S. Department of Justice, on behalf of the DOI, decided on 27 April 2017 not to join the Tribe in appealing the U.S. District Court’s decision on the Category 2 ROD, but the DOI is continuing to evaluate its ability to keep the Tribe’s lands in trust under a different legal category.
On 27 June 2017, the Tribe announced that it requested a suspension of the DOI’s review of its Category 1 submissions. The intent of the request was to preserve the Tribe’s rights to seek further review and consultation at a later date and investigate all options available to secure the Tribe’s land base.
On 30 June 2017, the DOI announced that it declined the request made by the Tribe to suspend its Category 1 review process. Instead, the DOI decided to extend and expand its review process by requesting further materials on whether the Tribe’s history supports its rights to trust land.
The DOI requested parties (i.e. the Tribe and the Plaintiffs) to specifically focus on whether the early exercise of state jurisdiction over the Tribe by the Commonwealth of Massachusetts provides a legal basis for keeping the Tribe’s land in trust.
The DOI set a timeline of 31 August 2017 for the Tribe and the Plaintiffs to submit materials to facilitate the additional analysis and until 30 October 2017 to reply to the opposing submissions. Meanwhile, the Tribe’s lands remain in trust unless ordered by a court to take it out of trust.
As disclosed in the Group’s 2016 Annual Report, the recoverability of the promissory notes is dependent on the resolution of this legal case.
The total amount invested in the interest bearing promissory notes (including accrued interest) as at 30 June 2017 amounts to US$347.4 million (or the equivalent of approximately RM1.49 billion).
The Group will work with the Tribe to review all options available for its investment in the promissory notes, and assess its recoverability and impact to the Group’s consolidated earnings and net assets for the financial year ending 31 December 2017.
The Group is supportive of the Tribe’s endeavour to protect its land base and their associated development rights.
Source: Bursa Malaysia
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