'CIESOT belongs to Ceylinco Insurance employees '

The Supreme Court last week affirmed that the Employee Share Ownership Trust of Ceylinco Insurance (CIESOT) is a legal and a duly constructed trust belonging to the employees of Ceylinco Insurance and that it is in accordance with the Trust Ordinance of Sri Lanka.

This has been confirmed by the Securities and Exchange Commission (SEC).Through the same order the Supreme Court also said that the status quo of CIESOT should be restored to the status prior to an interim order delivered on March 10, 2014 and thereby restored the Board of Directors of CIESOT.

The Supreme Court judgment was delivered by the five bench panel headed by Chief Justice K. Sripavan during the hearing of case (SC/FR/191/2009) filed by a few depositors of the Golden Key Credit Card Company in 2009.

CIESOT is owned by the Employees of Ceylinco Insurance and holds a 22.86% stake of Ceylinco Insurance PLC. ‘CIESOT’ stands for Ceylinco Insurance Employees Share Ownership Trust and this trust fund was created in 2000 for the sole benefit of the employees of Ceylinco Insurance PLC, and was managed by CIESOT (Pvt) Limited as the trustee company.

The main objective of formulating this scheme was to reward employee loyalty and accordingly, dividends have been paid to employees every year since 2000.

The employees union of Ceylinco Insurance in a communiqué said that justice has prevailed and that their sweat and efforts to uphold the values inculcated by the management of Ceylinco Insurance has borne fruit.Once dissolved, CIESOT will distribute the money among the eligible present and ex-employees of Ceylinco Insurance PLC, the beneficiaries of the trust.The position of the employee and the number of years in service will determine the share entitlement and all employee categories starting from peons and drivers to the senior management will receive the benefits.