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Puerto Rico oversight board narrows list for law firms

NEW YORK (Reuters) - The federal board tasked with overseeing a major financial overhaul in Puerto Rico has held interviews with a handful of candidates for its counsel from a wide list of applicants, people familiar with the talks said on Tuesday.

The board has interviewed candidates including Chadbourne & Parke LLP, Proskauer Rose LLP, Morrison & Foerster LLP, Sidley Austin LLP and O’Melveny & Myers LLP, the people said.

A full list of law firms that the board has interviewed could not be immediately determined, and it is possible the board hires a law firm not identified by Reuters.

The chosen law firm will advise the board as it seeks to help Puerto Rico right its economic ship after a decade of contraction. The commonwealth is facing $70 billion in bond debt, $45 billion in pension debt and a shrinking population,

Created under the federal Puerto Rico rescue law known as PROMESA, the seven-member, bipartisan board will oversee debt restructuring talks with the U.S. territory’s bondholders and must sign off on annual budgets.

The board last month asked law firms and strategic consultants to submit applications for the job.

The people asked not to be named because the talks are confidential. O’Melveny declined to comment. The other law firms did not immediately return requests for comment.

Morrison & Foerster recently represented Puerto Rico creditors, and Proskauer previously advised Puerto Rico on a local debt restructuring law that was later invalidated by the U.S. Supreme Court.

The board is controversial in Puerto Rico. Some locals see it as a necessary answer to financial mismanagement by the island’s government, but many others revile it as an extension of U.S. imperial control.

The board’s first public meeting, held Sept. 30 in New York, featured heavy protests, as well as hecklers who interrupted the meeting, calling the board’s presence akin to “slavery.”

Island leaders have committed to working with the board, which will hold its next meeting on Friday in Fajardo, Puerto Rico.

Reporting by Nick Brown and Jessica DiNapoli in New York; Editing by Leslie Adler