Venezuela: the Return of Expropriation

There is news that the government of Hugo Chavez in Venezuela has taken control of the French-owned Exito chain of supermarkets, allegedly for price gouging after a currency devaluation. The Commerce minister, Eduaro Saman, gave a terse explanation that should have in-house counsel looking closely at their facilities maps through risk-colored glasses:

“Starting today, this company becomes a socialist company,” Saman said while surrounded by Exito employees who support the expropriation.

Some more background from the WSJ is available here; not all the store’s workers are cheering the new owners.

There’s a good overview on expropriation from the OECD; I also found a short paper entitled “Expropriation, Nationalisation and Risk Management” by Scot Anderson of the Davis Graham and Stubbs law firm.

Many years ago while still in private practice, I worked on a small part of the insurance coverage dispute related to expropriation of offshore oil facilities in South America. It would have made a good bar exam question; it was definitely a great piece of work for the law firms involved.

In the meantime, there’s a new face on international business development: