The Office of the United Nations High Commissioner for Human Rightshas registered a claim against Mongolia by Justin Kapla, a U.S. businessman prevented from leaving the country for two years due to allegations of tax evasion.
The claim by Kapla alleges Mongolia is violating the International Covenant on Civil and Political Rights, according to a Nov. 17 letter from the UN body seen by Bloomberg News. The UN verified the letter as authentic in an e-mail on Nov. 21.
Mongolia will be informed of the claim and has six months to respond, the letter says. The claim will be investigated to assess if a violation of human rights has taken place, according to procedures on the UN website.
Kapla of Elk River, Minnesota, hasn’t been charged with a crime and is one of several people prevented from leaving Mongolia due to legal disputes. Most stem from a mining boom that lured in foreign investors, including mining giant Rio Tinto Group.
Kapla was informed of the travel ban in November 2012 following allegations of tax evasion while he was president and executive director of coal miner SouthGobi Sands LLC. Appeals this year by Minnesota senatorsAmy Klobuchar and Al Franken to allow him home on humanitarian grounds failed.
In August the Court of Justice in Ulaanbaatar sent the tax case against SouthGobi back to the Prosecutor General for further investigation due to insufficient evidence, according to a statement released by SouthGobi Resources Ltd.
“The allegations are baseless,” said John N. Viverito, a partner at Gibson Dunn, the firm representing Kapla. “After two years of reviews, investigation, expert reports, and a lengthy trial they have failed to find any wrongdoing.”
Mongolia’s Ministry of Foreign Affairs couldn’t comment because it is awaiting information from the UN office in Geneva, according to a text message from a ministry official who asked not to be named in line with government practices.
Mongolia’s government is now in a state of flux after the appointment on Friday of Saikhanbileg Chimed as the country’s new prime minister, following the ouster of Altankhuyag Norov earlier this month. Saikhanbileg is now trying to build a coalition government.
Kapla, who is married to a Mongolian national and has two children, can travel freely in the capital of Ulaanbaatar, though needs court permission to leave the city. He still has his passport, but has been informed by the authorities he will not be allowed to leave the country.
Kapla’s claim alleges Mongolia violated article 12 of the International Covenant on Civil and Political Rights, which allows freedom of movement within a nation and between nations. Mongolia ratified the covenant in 1974.
Two Philippine nationals, Hilarion Cajucom Jr and Cristobal David, both former employees of SouthGobi Sands, are also on travel bans in the tax evasion case. Sarah Armstrong, an Australian attorney formerly employed bySouthGobi Resources Ltd. (1878), the parent company to SouthGobi Sands LLC, was subjected to a travel ban in late 2012.
Kapla’s claim comes amid waning foreign investment in Mongolia fueled by a nearly two-year dispute with Rio over the development of the Oyu Tolgoi copper mine. The government jointly owns the mine with Rio subsidiaryTurquoise Hill Resources Ltd. (TRQ)
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