For One Businessman, the Justice System Falls Short

The case involves a group of French businessmen, one of Southeast Asia’s most elegant hotel chains and runs to the core of the many pitfalls in doing business in Cambodia.

When Pierre Ader arrived in Cambodia in 1996 and decided to become one of the first foreign investors in Cambodia’s nascent property sector alongside his friend and colleague Jean Francois Henin, his plans were largely untested here. For many foreign investors in Cambodia at that time, the risk levels were colossal if not unknown.

“We immediately decided to build serviced apartments because we saw there was a very big need at that time,” he said in a recent interview in Phnom Penh.

Mr Ader, CEO of Fine Sky Investment Cambodia, which owns the Les Jardins du Bassac residential estate on Norodom Boulevard, even met with Prime Minister Hun Sen in 1997 prior to construction on the 46 furnished villas and apartments was underway.

“I spent more than one hour with him and I spoke with him,” Mr Ader said in reference to Mr Hun Sen. “He was trying to tell what was his image for the future…Really he was convincing.”

Mr Ader had been placed on a pedestal by the government as a beacon of hope that foreign investor would one day enter the country en masse. And with confidence levels running high he and his business partner, Mr Henin, a director on the board of French-listed company Electricite et Eaux de Madagascar, also acquired land in Siem Reap to build a luxury hotel.

EEM owns Victoria Hotels and Resorts, which runs five luxury hotels in Vietnam, appeared to be perfectly poised to enter Cambodia’s tourism sector, which was just beginning to come back to life again after decades of civil unrest.

The “Les Jardins du Bassac” residential complex was completed in 1999 and work on the Victoria Angkor Resort swiftly began.

But in 2001 Mr Henin decided to sell his share in EEM to a man by the name of Francois Gontier, who according to French court documents and media reports, has previously been found of guilty of breach of trust, fraud and disseminating false information to the public.

“I never think that at one time [Mr Henin] would be obliged to sell” his share, Mr Ader said.

Nevertheless, work continued on the Victoria Angkor Resort with Mr Ader and Baudoin de Pimodan, formerly EEM’s general director, doing the brunt of the work. The hotel opened in 2003.

In the hotels opening days Mr Ader said EEM and other investors that made up Victoria Angkor Company operated the company smoothly, although profits did not come immediately.

“We let them run the hotel, we trust the deal,” Mr Ader said.

But in early 2005, Mr Ader learned that Mr Gontier was interested in buying the former Siem Reap provincial courthouse behind where the Victoria Angkor Resort not stands.

“I went to the bank and I saw that he had [taken money] even though the deal was not made,” he said, adding that Mr Gontier had allegedly withdrawn a total of $200,000 as a deposit for purchasing the courthouse building.

Mr Ader said that since then end of 2003 the company had held no annual shareholder meetings to disseminate such decisions to the company’s shareholders.

Infuriated by the actions of Mr Gontier, he decided to file a lawsuit against him in August 2009 for refusing him access to the company’s accounts and not having held an annual shareholders meeting, required under the law.

Mr Ader also said that Mr Gondier had changed the company’s auditing firm without informing shareholders.

Rendering the accusations even murkier, Mr Ader claims that Mr Gontier has taken $1.1 million from the company’s account and repatriated it somewhere in France.

“If this money was not sent to EEM but to another company in France, for them they go direct to jail in France. That’s sure,” he said.

Mr Ader said he was unsure about whether or not the money had been sent to finance EEM or other companies owned by Mr Gontier.

Upon arrival at the Siem Reap Provincial Court, Mr Ader saud his case was mysteriously dropped by the prosecutor.

“When the judge has done his work in the investigation, he sent it to the prosecutor and then the prosecutor refuse to prosecute,” he said.

Meanwhile, Mr Gontier has counter sued Mr Ader for breach of trust and defamation.

Mr Ader said that his case against Mr Gontier, having failed at both the provincial court and the Court of Appeal, was now at the Supreme Court.

Mr Gontier’s lawyer, Kao Soupha declined to comment on the case and You Bunleng, director of the Appeals Court could not be reached.

Several emails to Mr Gontier went unanswered and a lady who answered the phone at EEM’s head office in Paris yesterday said Mr Gontier would be based outside of France until the end of August.

Ty Sivinthal, prosecutor at Siem Reap Provincial Court said yesterday that he had charged both Pierre Ader and Francois Gontier and their cases were both being investigated at the appeal court.

“All cases are pending at the appeals court,” he said.

Mr de Pimodan, the former director general of EEM, said in a telephone interview yesterday that Mr Gontier had participated within EEM as a “pure financier” rather than any kind of entrepreneur interested in the well being of the Victoria Angkor Resort.

“He neither respected the form nor the spirit of the contract with Pierre,” he said. “His actions affected the core of the company’s management and he refused them access to the accounts.”

Mr de Pimodan added: “I heard that he tried to use the treasury of Victoria Angkor for his personal operations.”

Whatever the truth behind the case, if Mr Ader goes to jail on the count of defamation his 15 year period in the country and that meeting with Mr Hun Sen back in 1997 will seem somewhat in vain.

Mr Ader said he was dismayed that his court case against Mr Gontier had been dismissed by the courts and believed that corruption was probably to blame.

“I think for many things Cambodia has really improved. But for the judicial system, it’s a mess,” he said.

(Phann Ana contributed to reporting)


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