Gem Mining Laos was established in 1994 with 2 shareholders Ms. Julie Bruns
(82 ½%) and Mr. Somkhit Vilavong (17 ½ %). Julie Bruns was the Chairwoman
of GML. Her husband, Mr. Bjarne Jeppeson, was the director of GML. Mr.
Sommay Bounnaphol was a director and manager of GML from its inception
until 14 August 2000.
On 22 July 1994 GML and the Lao government executed a mining concession
agreement. The agreement authorized GML to explore and exploit sapphires in
Borkeo Province Lao PDR. The agreement has a 15 year term with an option to
extend the term to 25 years. It contained causes governing its termination
and resolution of disputes between parties and thaat in addition to the
terms, GML employ two staff members from the Department of Mines. Those
government officials kept records of all sapphires extracted and placed in
safe keeping by GML pursuant to the agreement. They were also responsible
for checking GMLs daily stock levels.
In 1998 Ms. Julie Bruns purchased a jewellery boutique including its stock,
from GML for approximately US$76,875. Ms Bruns paid for the purchase by
way of the retention of GML of her salary until such time as GML had
withheld US$76,875. From time to time Ms. Bruns paid for stock purchased
for the boutique from GML by way of sacrificing her GML salary. All of
these transactions were recorded in the accounts of GML.
On 3 December 1999, the Director of the Prime Ministers office [Laos]
notified the Foreign Investment Management Cabinet [FIMC] that the export
of raw and semi-processed sapphires by GML Be suspended on grounds of
alleged wrong-doings. He also ordered Ms. Bruns and Mr. Jeppeson not to
leave Lao PDR until such alleged wrong-doings had been resolved. Prior to
this an Ad Hoc Committeewas established apparently to investigate GML. Mr.
Bounmaly Vilayvong from FIMC often acted as its spokesman.
The Ad Hoc Committee prepared a long list of allegations of wrong doings
against GML, Mr. Bjarne Jeppeson and Ms. Julie Bruns. These allegations
were denied as they set to respond to the allegations by way of submissions
and evidence but such attempts were thwarted. They allege that their
lawyers and geologists were told by FIMC to keep quietand their geologists
were not permitted to produce evidence which would have exposed the FIMCs
allegations as unfounded.
On 5 April 2000 Mr. Somsavat Lengsavad, the Deputy Prime Minister and
Foreign Minister of Lao PDR as well as the Vice Chairman of the Foreign
Investment Management Cabinet [FIMC], issued an order to terminate the
agreement. He alleged the survey and mining undertaken by GML were
unproductive in all respects.
Mr. Jeppeson and Ms. Julie Bruns allege that this purported termination was
in breach of the terms of the agreement, including the terms of the
agreement governing dispute resolution. Thereafter the Ad Hoc Committee
took control of the assets of GML.
On 28 May 2000 Mr. Bjarne Jeppeson and Ms Julie Bruns left Lao PDR to
enable Ms Bruns to obtain urgent medical treatment. They did not return out
of concern for their safety.
Gem Mining Laos has suffered mass destruction at the hands of the Laos
Government, willful destruction of property and blatant disregard for the
assets and integrity of Foreign Investors.
Gem Mining Laos operated for over a decade and was subject to continued
interference by corrupt officials, which compounded existing difficulties
experienced frequently by many investors to Laos. The eventual result was
illegal expropriation of one of the worlds richest sapphire deposits.
