Akureyri, June 22nd 2021


In the following statement, Samherji seeks to explain its views in the so-called Namibia case and, at the same time, present some of the main findings of an investigation by the Norwegian law firm Wikborg Rein. Initially, it was intended to present the results to the Icelandic authorities a while back, but it has been repeatedly postponed for well-known reasons. Therefore, although that presentation has not yet taken place, it is now appropriate to present some comments from Samherji regarding the main findings from the investigation.


The Namibian authorities are currently pursuing criminal charges against several Namibians accused of various crimes, including accepting bribes from Samherji employees. No employees of Samherji or companies owned by Samherji are among the defendants in these cases. On the other hand, a case regarding the seizure of assets is also pending against several parties, where claims are directed, among others, against Namibian companies affiliated with Samherji. On May 31st, Samherji's representatives submitted their legal arguments in that case. This was the first time that Samherji or companies affiliated with Samherji had the opportunity to submit documents and defend themselves in public courts against the serious allegations made against the company. All the documents have been made public and are available to everyone on the Namibian court's website.


The extensive investigation by Wikborg Rein revealed aspects that raised business integrity and legal risks that had not been sufficiently mitigated in the operations of companies affiliated with Samherji in Namibia. Samherji also notes that the values and responsibility that Samherji's management has always been guided by, both in this country and abroad, were not adhered to. In this light, extensive work was done within Samherji to establish a comprehensive corporate governance and compliance system based on international best practices, to prevent mistakes of this nature from being repeated. Samherji's Board of Directors approved these rules at the end of 2020.

The main issues in Wikborg Rein's report concern relations on fishing rights acquired through agreements with the Namibian state-owned company Fischor and the company Namgomar Namibia, which controlled catch quotas based on bilateral agreements between the Namibian and Angolan governments. The pending court cases in Namibia mentioned above involve individuals associated with these two companies.


Wikborg Rein's main findings related to these transactions, including comments from Samherji

According to the investigation report, companies affiliated with Samherji utilized local consultants' services in Namibia to gain a general knowledge of the country's Namibian fisheries industry and market conditions, including how to access catch quotas and fishing rights. Some of these advisers had political connections, and one of them was later appointed chairman of the National Fishing Corporation of Namibia (Fishcor). He and the parties connected to him provided services to companies affiliated with Samherji based on a consultancy agreement.

One of the main findings of Wikborg Rein's investigation is that hiring these consultants and allowing the involvement of senior members of Namibia's government in their advice raised business integrity and risks that were not sufficiently mitigated by companies affiliated with Samherji. Although the investigation has revealed that Namibian consultants did provide undisputed and genuine advice over the years, they received payments without clear explanations and supporting documents for the services provided.

Samherji firmly rejects the allegations of bribery but accepts the criticism that in the circumstances, it was necessary to pay more attention to how payments were made, who they were made to and on what basis, who had the authority to give instructions about them and where they should be received. It is also clear that the underlying agreements behind the payments should have been precise and formal.

The report also concludes that the former managing director of the companies in Namibia withdrew significant sums of cash from the companies' accounts without any or proper explanations. There are many indications that the cash withdrawals were improperly used. Samherji notes that the former managing director has acknowledged this conduct and apparently various other criminal activities where Samherji's companies were used.


Regarding transactions with Namgomar Namibia:


In the years 2014-2019, companies affiliated with Samherji also fished in Namibia based on catch quotas allocated by the government to the private company Namgomar Pesca (Pty) Ltd. (Namgomar Namibia). The investigation revealed that government officials, both in Namibia and Angola, including the then fisheries ministers of both countries, worked with other individuals associated with them in Namibia and Angola to establish Namgomar Namibia. Behind that establishment were two companies, one from Angola and the other from Namibia. These individuals made arrangements for Namgomar Namibia to be allocated catch quotas based on a bilateral fisheries agreement between the two countries. Companies affiliated with Samherji then leased fishing rights based on these catch quotas. The individuals who were in a position to allocate the catch quotas and the right to utilize them seem to have had a personal interest in the arrangement as the real owners of Namgomar Namibia. There are no indications that Samherji's management was aware of this actual ownership structure of Namgomar Namibia.


Samherji notes that after the former managing director of Samherji's subsidiaries had been terminated it was revealed that he had taken part in the arrangement of payments for fishing rights directly to the parties mentioned above or others who were closely associated with them. An example of such an arrangement for payments for fishing rights, based on Namgomar Namibia's catch quotas, was payments to the company Tundavala Invest Ltd. listed in Dubai. The investigation revealed that the employees of Samherji and its subsidiaries, other than the former managing director, had been under the impression that that most of the payments that did not go directly to Namgomar Namibia were for catch quota usage fees and that some were for consultancy services. Samherji's understanding is that, as these employees viewed the payments, their legal validity will not be questioned.

Furthermore, Samherji rejects the unfounded allegations that Samherji or its subsidiaries organized the structure of a bilateral agreement between Namibia and Angola in order to provide them with improper benefits. The countries' agreement had a long history and was based on the countries' mutual interests and years of work.


Samherji notes that after new management took over at Samherji's companies in Namibia, it became clear that there was a lot of chaos in the operation of the companies, including regarding payments for fishing rights. For example, there was no formal documentation or correct finalization of many expenses. Therefore, it took the new management a long time to realize and understand the agreements that were made during the time the former managing director ran the operation. When the new management realized how these agreements were structured, it was negotiated that all usage fees for fishing rights paid to Dubai would be stopped, and these payments ended at the beginning of 2017. Four payments for consultancy services were paid in 2018 and at the beginning of 2019.


Regarding transactions with Fishcor:


The Namibian state-owned fishing company Fischor managed catch quotas that the government allocated to the company and then transferred fishing rights based on catch quotas to third parties for a usage fee.

During the period listed above (2014-2019), companies affiliated with Samherji in Namibia along with many others, fished on the basis of such catch quotas from Fishcor. It has been revealed in the investigation that part of the payments due to agreements with Fishcor was paid into accounts owned by third parties in connection with the so-called Fischor "government objective" grant project of the Government of Namibia. Despite instructions from competent Fischor representatives, the investigation revealed that payments for fishing rights allocated to government funding projects were not always supported by invoices or linked to a specific government funding project. Nevertheless, Samherji notes that the employees of Samherji's companies did not question these instructions and paid according to them in good faith of their legitimacy.


According to the investigation, unclear and at times lacking contractual basis is a general feature related to many payments to the consultants, to Namgomar Namibia, Tundavala Invest and Fishcor. This insufficient contractual basis and adherence to unsatisfactory instructions by recipients to make payments to entities and into accounts that were not named in relevant agreements caused confusion among the employees of companies affiliated with Samherji and was also conducive to threaten the reputation of the companies and expose them to risks.


The structures and systems portrayed above were initiated and put in motion under the autonomous leadership of the former managing director of Samherji's Namibian operations. Email correspondence reviewed as part of the investigation following his departure in 2016 reveals unacceptable behaviour while he was in charge of the business. The correspondence also shows confusion among Samherji employees in their attempts to fully understand the structures and their vague and unclear contents.

Samherji notes that they gradually managed to take control of the operation in Namibia, understand and improve what went wrong, and eventually wind it down. It is clear, however, that the business practices outlined here should have been stopped much earlier. Unfortunately, they were allowed to go on for far too long.

Samherji also notes that it does not appear that employees other than the former managing director have incurred criminal liability in their work.


As a substantial part of the findings in the Wikborg Rein report concern business practices that allowed abuse due to shortcomings in compliance and governance structures in Namibia, Samherji's Board of Directors has already adopted a compliance system that includes extensive and improved governance and compliance rules. This includes e.g. a third party management system with risk-based screening procedures of intermediaries and other third parties. The overall objective of these governance and compliance measures will be to protect the Samherji group against any future wrongdoing committed by individuals.


Mistakes in the Faroe Islands

It has been revealed that mistakes were made in our operations regarding the international ship register in the Faroe Islands. The details of these discrepancies have not yet been fully mapped out, but Samherji has paid an insurance amount that will be available when the case has been finalized. We want to correct the mistakes that were made in the Faroe Islands and apologize for them. Hopefully, a more detailed conclusion will be reached regarding this matter soon.

Samherji apologizes

"It is my and Samherji's firm position that no criminal offences were committed in Namibia by companies on our behalf or their employees, apart from the conduct that the former managing director has directly confessed to and acknowledged. Nonetheless, as Samherji's top executive, I am responsible for allowing the business practices in Namibia to take place. It has upset our staff, friends, families, business partners, customers and others in our community. I am very sorry that this happened, and I sincerely apologize to all those involved, both personally and on behalf of the company. Now it's important to ensure that nothing like this happens again. We will certainly strive for that," says Thorsteinn Már Baldvinsson, CEO of Samherji.