For Crystallex, Judge Stark should base his decision on the motion introduced in August 2018 and passed in July 2019, where the judge found that there was no separation between the Venezuelan government and Citgo’s management.
Judge Stark is debating whether he should take into consideration the warning made by the US government stating that the sale of Citgo threatens America’s national security and interests
However, in this week’s audience, Stark asked whether he should take into consideration the warning made by the US government in a brief, stating that the sale of Citgo threatens America’s national security and interests.
To this question, Crystallex responded that the term ‘national security’ is being used very broadly and that the US government has not presented any specific scenarios in which the country’s national security would be affected by the sale of PDV Holdings’ shares.
Following this, the judge also asked the US attorneys what is the difference between national interests and national security issues. To this question, they replied that a letter sent to the Attorney General and the Justice Department by Elliott Abrams, President Donald Trump’s special representative to Venezuela, clearly explains each of the concepts. In this letter, Abrams also said that Crystallex cannot sell the shares without obtaining a license from the US Office of Foreign Asset Control.
The US attorneys added that they are just requesting for the Delaware District Court – where PDV Holdings is incorporated – to temporarily abstain from authorizing potentially damaging measures.
Experts that have been following the case, such as Francisco Rodríguez, founder of the think-tank Oil for Venezuela, believe that Stark is unlikely to make a final decision until the Office of Foreign Asset Control approves the license to sell the shares.
This is because Citgo is protected by a number of sanctions the US has issued against Venezuela in the past year and that are aimed at crippling the Nicolás Maduro administration. Thus, the US attorneys argue that if Stark proceeds without the OFAC’s approval, he would be putting at risk the US’ foreign affairs interests. This, on the other hand, implies the sale could be blocked by other means.
In this context, the judge talked about the possibility of naming a special master to execute his sentence. According to Rodríguez, if this were the case, PDV Holdings’ shares wouldn’t belong to Crystallex nor to Venezuela.
