Casino du Liban. (Credit: DR)
A week after the revelation that a memorandum of understanding between the Ministry of Public Works and an Irish company for the construction of the second terminal at Beirut airport did not go through the appropriate channels, causing caretaker Public Works Minister Ali Hamieh to backtrack on announced plans for the project, the Public Procurement Authority (PPA) faces yet another non-compliant entity: Casino du Liban.
Despite the adoption of the public procurement code (Law No. 244/2021) on July 19, 2021, and its implementation exactly one year and 10 days later, it appears that there is still a lot of work to be done in order for Lebanon’s institutions to comply with it. Instead, these entities continue to resort to the traditional method of mutual agreement contracting, perhaps out of habit or preference.
On April 6, Casino du Liban came under attack from both PPA chairman Jean Ellieh and caretaker Prime Minister Najib Mikati on two separate matters.
Ellieh condemned the casino and its chairperson and general manager, Roland El Khoury, for failing to adhere to the law. Meanwhile, Mikati directed the Finance Ministry to “freeze” a contract that was recently signed with several companies in connection with the casino’s new digital gambling platform, “betArabia.”
Khoury, however, told L’Orient-Le Jour that the contract was awarded following a tender process.
Ellieh told L’Orient-Le Jour that he refuses to discuss with a party that “fails to grasp the content of a letter and uses it as an excuse to evade the law.”
The PPA sent the letter in question to the casino on Nov. 14, 2022, as a reminder to start implementing the provisions of Law No. 244.
According to a financial expert, who requested L’Orient-Le Jour maintain his anonymity for professional reasons, “The casino has done nothing since the law came into effect last summer and is unwilling to cooperate with the PPA.”
The casino, however, offered a different explanation. “The PPA’s document does not concern us but Middle East Airlines (MEA),” the casino press office told L’Orient-Le Jour, pointing out that they requested that the PPA resubmit the request and correct the error.
L’Orient-Le Jour viewed the letter, which was addressed to the Lebanese airline with the following subject: “Request for the filing of documents related to transactions carried out by Middle East Airlines.”
The public procurement law is ‘clear’
A lawyer specializing in public administration issues, who asked to remain anonymous for professional reasons, said whether it was a typing error or a copy-paste mishap, this issue speaks volumes about the Lebanese administration’s state of chaos.
The lawyer asserts that the PPA must send the corrected request directly to the casino to comply with the procurement law.
The lawyer acknowledges the theory of acquired knowledge in the administrative sector, but stresses that any notification must be concrete and sent through the appropriate channels. He noted that the casino can rightly consider the document as non-existent since it was not addressed directly to the organization.
Ellieh sees the mistake as “silly” and believes it hides a more serious issue: the casino’s failure to notify the authority upon receiving the document, which could indicate bad intentions.
Even if the PPA corrects the mistake and returns the document, Khoury still insists that his company’s private nature exempts it from Law 244.
“This is not true,” Ellieh said. For his part, the lawyer insisted, “The law is clear,” emphasizing that Article 2 of the public procurement law explicitly outlines the contracting authorities subject to its provisions. The article states that the law applies to “any company whose shares are owned by the state and which operates in a monopolistic environment and public services managed by private companies for the benefit of the state.”
This means that, despite the fact that the Casino du Liban is run as a private company, the fact that it operates in a monopolistic environment and the state is involved in it legally obliges it to comply with the procurement law.
The aforementioned financial expert said the casino, founded in 1959, is 52 percent owned by Intra Investment Company, which has been partially owned by Banque du Liban since its bankruptcy. MEA is also partially owned by BDL. Additionally, the casino must pay a portion of its revenues to the Treasury each year.
Will ‘betArabia’ be suspended?
The casino had to fight another battle.
On April 6, Mikati sent a letter to caretaker Finance Minister Youssef Khalil, asking him to verify whether the casino’s new digital platform complies with the laws of the Court of Auditors and the public procurement law.
In addition, the cabinet requested the suspension of all procurement processes until the court and the PPA issue their opinions. This effectively freezes the contract of “betArabia.”
This would temporarily suspend the platform’s activities, which were launched on Nov. 17 in time for the football World Cup’s kickoff in Qatar, and for which the casino received the necessary operating licenses from the Finance Ministry.
According to Khoury, the contract between Casino du Liban and its online platform’s management companies was awarded through a tender launched in October 2020. He further told L’Orient-Le Jour that the current controversy may stem from the recent decision to crack down on the black market of online gambling sites that are prohibited under Lebanese law.
Khoury added that he suspects some parties are trying to target the casino in this manner, but did not further elaborate or identify who these parties might be.
Earlier reports claimed that Mikati reversed his decision on the casino platform following a meeting with Khoury, caretaker Tourism Minister Walid Nassar and the Finance Ministry’s director general. The prime minister’s press office denied these reports and reiterated that the caretaker premier continues to wait for the opinion of the Court of Auditors and PPA.
However, until an official order is received, Casino du Liban will not suspend its platform.
This article was originally published in French in L'Orient-Le Jour. Translation by Sahar Ghoussoub.