The French Polynesian government faces a mounting financial crisis over its controversial destruction of hundreds of thousands of pearls—a policy now deemed illegal, with compensation claims potentially exceeding 100 million Fcfp.
1. Background: A Flawed Policy
- 2017 Mass Destruction: The Direction des Ressources Marines (DRM) seized and destroyed thousands of “imperfect” pearls, citing a 2005 regulation banning their sale.
- Ruled Illegal: Courts later determined the policy violated property rights, opening the door for pearl farmers and traders to sue for damages.
2. Escalating Legal Battles
- Early Victories (2021): Two pearl farmers won compensation, setting a precedent.
- Expanding Claims: 15 additional producers are now demanding reparations for 585,000 destroyed pearls.
- Hidden Scale: Lawyers estimate millions of pearls may have been unlawfully destroyed since 2005, suggesting even greater liability.
3. Valuation Dispute: From 575 Fcfp to 250 Fcfp per Gram
- Initial Ruling (2021): The Papeete Administrative Court set pearl value at 575 Fcfp/gram.
- Appeal Reduction: Paris’ Administrative Court of Appeal slashed this to 250 Fcfp/gram, drastically lowering payouts.
- Pending Awards: The public rapporteur recommends 1–37 million Fcfp per case for the remaining nine claims.
4. Total Financial Exposure: ~100 Million Fcfp
If courts uphold the rapporteur’s guidance:
- Current Claims: 96.5 million Fcfp for nine cases.
- Cumulative Total: Combined with earlier settlements, the government could owe over 100 million Fcfp.
5. Sector-Wide Fallout
- Regulatory Distrust: Pearl farmers accuse authorities of arbitrary enforcement and unfair destruction of their stock.
- Compensation Lifeline: Payouts could help producers recoup losses but won’t undo years of lost revenue.
- Systemic Reforms Needed: Calls grow for clearer pearl-grading standards and transparent policies.
6. Next Steps: June 7 Decision
The final ruling (expected June 7) will determine:
- The total financial hit to French Polynesia’s budget.
- Whether the government must adjust pearl industry regulations to prevent future disputes.
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