HAMBURG: UN court on Saturday ordered the release of an Argentine naval training ship detained in Ghana at the request of a hedge fund trying to force Argentina to pay up on defaulted government bonds.
The Argentine navy's tall sailing ship ARA Libertad, a training vessel, was held in Ghana's port of Tema on Oct. 2 at the request of NML Capital Ltd, which says Argentina owes it $300 million on bonds which have been in default since 2002.
International Tribunal for the Law of the Sea president judge Shunji Yanai of Japan said the court ruled Ghana should release the Libertad "immediately" and provide the assistance the crew needs to leave the port.
Argentina had argued the United Nations maritime convention gives warships including unarmed training vessels immunity from civil claims when calling in foreign ports.
Creditors including NML have won several billion dollars in damages over Argentina's bond default in US courts, but they have largely been unable to collect because most Argentine assets are protected by sovereign immunity laws.
Argentina refers to funds like NML as "vulture funds" because they buy distressed or defaulted bonds and then sue in international courts to get paid in full.
The court, a United Nations body, considered a statement from Argentina that attempts by authorities in Ghana to move the ship "could lead to an escalation" which could lead to "incidents which could endanger life," Yanai said.
The court also considered Argentina's claim that the ship could not be maintained correctly during its arrest and that the vessel' safety could so be endangered.
A skeleton crew of sailors remains on board the Libertad after around 300 crew and naval cadets were flown home to Argentina in October.
A lawyer for NML in Accra, Ace Ankomah, said he was not yet aware of the ruling and could not comment.
A government official in Ghana said the foreign ministry was preparing a statement, and could not immediately comment.
Ghana had said the issue involved complex legal action between bondholders and Argentina and that the separation of powers meant Ghana's executive government could not overrule a court decision.
Both countries must pay their own costs.
The two countries must provide a further report to the court by Dec. 22, 2012, to enable the tribunal to make further examinations of the dispute, Yanai said.
Center>Copyright Reuters, 2012
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