Embassy Suites: A Case of Poor Governance or Poor Management?

In a court ruling dated November 14th, 2023,  between the Aruba Birdlife Conservation Foundation and the Prime Minister/Minister of Infrastructure & Spatial Planning, the court scrutinized a decision involving a zoning-related permit (“In Dutch: aanlegvergunning and hereinafter “Permit.” The Prime -Minister issued the permit on June 16, 2023, for the elevation and smoothing of the seabed to create a beach and construct two jetties (breakwaters) by Natura, operating as Embassy Suites. Read my previous columns here: LinkedIn Part 1,  Part 2, and Part 3. You can also find them on my blog here, here, and here.

No Construction Allowed

The court concluded that the appeal was justified and the permit should not have been granted. The permit was for beach construction on lands designated as ‘Marine Zone’ under the Spatial Development Plan with Prescriptions (ROPV). This zoning designation does not allow for the construction of a beach. It also doesn’t allow for the construction of the two jetties breakwaters. The court ruled that beach construction does not align with the primary functions of the Marine Zone, which focuses on preserving, restoring, and developing the natural values present. Creating a beach would instead harm these values. The ROPV also distinguishes between lands designated as Marine Zone and Beach, indicating that beach construction is inappropriate within the Marine Zone. The court had to decide if the jetties were constructions as defined in the ROPV. It concluded they were, as they were large stone structures directly connected to the ground, built to keep sand in place. As such, these constructions are not allowed within the Marine Zone..

Embassy Suites’ position

Embassy Suites argued that a Permit was not required unnecessarily and, if needed, should not be evaluated against the ROPV as their application predated it. However, the court ruled that since Embassy Suites did not appeal against the (conditions of the) Permit, they could only respond as a third party to ABC’s appeal. In a previous column, I questioned how the Embassy Suites and its legal team managed this application process. My concerns remain valid. I simply cannot fathom how or why the Embassy Suites chose to wait until after the hotel and the tunnel were built to apply for the Permit. Or have solid legal opinions to bank on their ability to build the deserted beach and jetties. The ROPV was no secret. Anyone could have accessed it online on the DIP website and read what is and is not possible under the ROPV. If they failed, it could prove to be one expensive oversight. It is perhaps ignorance if they knew about it and (had reasons to) believe the rules would not apply to them. The investor(s) knew or should have known that the access to the beach would impact the rates they can demand for their rooms and directly influence their Return On Investment (ROI).

Decision

The appeal was deemed valid, and the decision of June 16, 2023, was annulled (herroepen) by the Court. The court ruled that the ROPV doesn’t allow changing the Marine Zone designation to Beach nor permits an exemption for beach construction within the Marine Zone. The parties involved, the Minister and ABC, have six weeks to appeal the decision. While ABC sees no reason to appeal, the Minister might. Embassy Suites will have to determine if it has the right to an appeal since it is not a (direct) party to the proceedings.

Poor governance

The word “poor” in the heading above is used loosely. Bad governance might be more appropriate. From the decision, we must conclude that the Prime Minister had no legal authority to issue a Permit to construct a beach or jetties at the location desired by Embassy Suites. The applicable law states that the Minister MUST reject any application if it contravenes the statute. The statute does not allow for any discretionary powers. Nevertheless, the Prime Minister issued such a Permit. This raises a question of good governance or lack thereof.

How is it possible that the Prime Minister, a qualified attorney in her own right, supported by her legal team of advisors, both in-house and external, supported by the Department of Infrastructure & Planning (DIP), the Department of Public Works (DOW) and the Department of Environmental Protection (DNM) could decide to issue a permit against the law? I would love to review the file and see what all these departments recommended. Will we get an explanation and transparency, or will we be served a healthy dosage of Red Herring?

Without further documentation or explanation, one can only conclude that this was an unfortunate mistake or a case of bad governance. Bad governance because all public officials, starting with the Prime Minister, must exercise good governance in all matters and all decision-making. Until and unless the decision from the court is overturned, this will be the reality. The parliament seems not to be disturbed by this disturbing course of events and the fact that the Prime Minister acted against the law. This is unfortunate because of the lack of accountability and failure of the checks and balances embedded in our parliamentary democracy. This evidences again that the parliament, our legislative body,  is not the highest public organ in the land but is instead a support system for the executive body.

Kudos to the NGO that initiated action that prevented gross non-compliance with the zoning laws and a potential assault on nature caused by a total failure of the government and the departments involved.

The Prime Minister as a Role Model

Let us not forget that a statesperson must lead by example. Suppose it is accepted that the Prime Minister can (indeed) act against the law, and there is no consequence. How can we expect the other ministers, heads of department, civil servants, and (certain) parliament members not to follow suit? It would also be unfair that we, ordinary citizens, must follow the law. Why should they suffer consequences of noncompliance if those at the top are absolved?

Minister of environment

The Minister of Environment dodged a bullet. For the Embassy to use the Permit to build the desired beach and give the two jetties a second approval was required as an exemption. This exemption was one of the conditions of the Permit. With the permit revoked, the environment minister is relieved from having to decide whether to grant or reject the exemption. Until a valid and legally compliant Permit is issued, the minister of the Environment has no role to play in discussions with Embassy Suites. After all, neither he nor the Prime Minister has the authority to issue the Permit, nor does he have the authority to change the designation of Marine Zone or Beach Zone in the zoning regulations. Hence, I can’t quite follow his statement in the local media indicating that he would be meeting with the Embassy Suites to work on a solution.  Construction of a beach or jetties within the Marine Zone or Beach Zone is out of the question. Besides, the Minister doesn’t have the authority to “reach a deal” with the Embassy Suites and circumvent the entire Permit application procedure involving all the departments in that process.  If he or the Prime Minister did so, it would be against the law. It would also show subjectivity towards the Embassy Suites that a publicly elected official should not show.

The investor(s)

The decision from the court is undoubtedly exciting reading and is a topic of discussion among many. However, one should not ignore that one or more hotels with 300-plus rooms effort and money into developing a sizable 300-plus rooms hotel. The property was not located on the beach but across the street from the beach. They dug and built an underground tunnel to connect the property to the beach. It is hard to imagine that the investors would do all this without having either a Permit and the exemption required in hand or at least some significant assurance from the government or their legal team that “everything was covered.” If this was a “booboo” from the legal team, it could lead to a malpractice suit. If the government overreached somehow created certain expectations in the eyes of the investor, this could lead to some kind of legal action. Except for the mere potential of a legal action against the government or the prime minister does not change the zoning limitations I mentioned supra under “No Construction Allowed.” The Prime Minister simply can’t issue a Permit for a beck or jetties in the designated area. All in all, there are situations where several parties are left with a pickle and going up Jacob’s Creek without a paddle. 

Red Flags

The laws must be followed, and nature needs to be protected. However, this situation raises “red flags” for other investors. If the government is perceived as an unreliable partner or a government that follows poor governance, this will spook other investors. The parliament and the general public can’t ignore this. Current investors will be following this outcome and future developments with hawk eyes. Risk mitigation strategies will be designed and implemented. This ruling raises questions about other hotels, like Secrets in San Nicolas and the upcoming Ibero in Arashi, and their prospects for beach access. Are those areas Marine Zones or Beach Zones? Will those beaches remain as is today or be added to the domain of those hotels? Could this be a move towards sustainability and nature conservation? Only time will tell. 

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