VSAT Accuses ICE of Violating CAFTA

by Director of Intergalactic Communications and Marketing on March 15, 2012

(Photo by: Paul Tople/Akron Beacon Journal)

 

VSAT Systems, an Akron, Ohio based satellite company, saw a great opportunity to expand into Costa Rica. But after three years of trying they still have not succeeded.

The company says ICE is violating CAFTA.

They still have not been granted a license to operate in Costa Rica.

In the Akron Beacon Journal, the president of VSAT complains:

Costa Rica has created hurdle after hurdle designed to prevent a foreign telecommunications company from moving into the country, company President Mike Kister said. And during the delays, ICE has inked long-term contracts with banana plantations, banks, groceries and other high-profile clients that use satellite services, he added.

The company has spent $300,000 on legal fees and other related costs in an effort to bring high speed data service to Costa Rica.

“CAFTA was supposed to provide opportunities for U.S. businesses to do business in Costa Rica,”  “That’s the idea. And for their businesses to do business here and reduce the barriers to trade. We still don’t have a license to do business there. We’ve spent a tremendous amount of money trying to get a license that should have been granted to us routinely.”

Kister said.

For readers familiar with how the Costa Rica government operates, their story is not uncommon.

VSAT formed a subsidiary called Datzap and signed a deal with a satellite carrier to cover all of Central America. That $44,000-a-month deal runs through 2024.

Don Jacobs, affiliated with VSAT, also bought property in Costa Rica, applied for residency and hired local counsel to help with the licensing process, Kister said.

The company visited SUTEL to apply for a license, it was told the country hadn’t set up the application process, Kister said. Then, when Datzap was finally able to apply, they were informed they needed to submit its application to the Ministry of Environment, Energy and Telecommunications (MINEAT).

But….

SUTEL couldn’t transfer the application because it had no record of receiving one, Kister said. Eventually, Datzap was told by MINEAT that it had to apply with the original regulatory body after all.

That was just the beginning.

 Other problems included Costa Rica initially writing its own telecommunications rules instead of adopting the worldwide International Telecommunications Union standards, the government continually seeking additional information and one agency rejecting financial information because it wasn’t considered an accepted Spanish translation of the document.

“I can only imagine what the next thing that they are going to create is going to be,” Kister said. “For three years, the issuance of the license has been imminent. It’s right around the corner. We need you to finish this one thing. Give us this one certification. Provide us this additional document. Show us your financials. Just one thing after another.

Why not give up and go to more business friendly countries?

Kister said it was the principle. Even with the Costa Rican government signing long-term deals with clients, he believes the company could somehow make money there.

“We are supposed to be allowed to go down there,” he said. “Our government signed a treaty to allow us to go there. Their government is getting benefits from the treaty. Our government should get benefits from the treaty.”

Read the entire story in the Akron Beacon Journal at Ohio.com.

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