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Displaying items by tag: Investigation
LafargeHolcim admits to deals with armed groups in Syria
02 March 2017Syria: LafargeHolcim has accepted that its conduct at a cement plant in Syria in 2013 and 2014 was ‘unacceptable.’ An internal investigation by the group into Lafarge’s behaviour has reported that staff committed ‘significant errors in judgment.’ The probe, supervised of the Finance and Audit Committee of the Board, was started in response to media allegations in 2016 that legacy Lafarge operations had engaged in dealings with armed groups and with sanctioned parties during 2013 until the plant was ultimately evacuated in September 2014.
The investigation has found that the Lafarge subsidiary appears to have provided funds to third parties to work out arrangements with a number of armed groups, including sanctioned parties, in order to maintain operations and ensure safe passage of employees and supplies to and from the plant. The investigation could not establish with certainty the ultimate recipients of funds beyond those third parties engaged. However, LafargeHolcim says that it believes its staff acted in a manner they believed was in the best interests of the company and its employees.
Following the review, the board has approved the creation of a new Ethics, Integrity & Risk committee, supervised by a member of the Executive Committee. The group will also adopt a more rigorous risk assessment process focusing in particular on high risk third parties and joint venture partners, a restricted party screening program, a new sanctions and export control program and further efforts resulting from a benchmarking exercise it has undertaken.
Finally, LafargeHolcim does not believe that its culpability poses any financial impact to its business. It says that its operations in Syria operated at a loss during the time period in question and represented less than 1% of the group’s sales at the time.
HeidelbergCement appeals against investigation by European Commission into purchase of Cemex Croatia
28 February 2017Croatia: HeidelbergCement has appealed against an investigation by the European Commission into the proposed joint purchase with Germany’s Schwenk Zement of Cemex Croatia. The cement producer asserts that by considering Schwenk and itself rather than Duna-Dráva Cement (DDC), a subsidiary that both companies own equally, the commission has given the transaction a ‘Union dimension,’ according to the Official Journal of the European Union. Although DDC is based in Hungary, within the European Union (EU), it imports cement into Croatia (in the EU) from Bosnia & Herzegovina, a country outside of the union. The appeal was made in late December 2016 but only reported in late February 2017.
The European Commission revealed that it was investigating the proposed acquisition of Cemex Croatia by HeidelbergCement and Schwenk in October 2016. The commission was concerned that the transaction would merge the biggest producer in the area with the biggest importer, potentially reducing local competition.
Colombia: Cemex has received a subpoena from the US Securities and Exchange Commission (SEC) seeking information to determine whether there have been any violations of the US Foreign Corrupt Practices Act (FCPA) in relation to a new cement plant being built by Cemex Colombia at Maceo in Antioquia.
In late September 2016 Cemex fired several senior staff members in relation to the Maceo project and its subsidiary’s chief executive resigned. This followed at internal audit and investigation into payments worth around US$20.5m made to a non-governmental third party in connection with the acquisition of the land, mining rights, and benefits of the tax free zone for the project. Cemex referred the situation to the Colombian Attorney General at the same time. The group has also confirmed that it maintains an anti-bribery policy applicable to all of its employees and subsidiaries.s
Brazil: Brazil's antitrust watchdog Cade has decided to end its investigation into 18 companies from the cement sector over alleged anti-competition practices. The allegations were that some of the companies had reached an agreement to refuse to provide three types of cement to competitors outside of an economic group, which would lead to increased prices of the products, according to the Valor Economico newspaper. Cade determined punishments were to be applied to Holcim Brasil, Cimento Tupi and Votorantim Pimentos. However, case leader Paulo Burnier decided that there insufficient evidence to apply sanctions on the majority of companies concerned. He also noted that some of the companies had already been set punishments by Cade for involvement in cartel practices.
Nigeria: The Economic and Financial Crimes Commission (EFCC) has raided the Lagos office of the Bank of Industry (BOI) following an investigation. Officials of the development bank say that the raid was part of the investigation by the EFCC of the allegation of misapplied funds belonging to the Cement Technology Institute of Nigeria (CTIN), according to All Africa.
In a statement the BOI said that concerns regarding the new terms on how to manage a fund accrued from tariffs on imported cement between 2011 and 2015 had been addressed. The bank was appointed by the federal government to use the money to develop the country’s cement industry. However, following the creation of Cement Technology Institute of Nigeria (CTIN) the BOI was asked in 2013 to transfer the fund to CITN. This did not happen. On 17 June 2016 the fund had grown to US$47m in the BOI’s accounts.
Dangote Cement faces investigation in Ghana
03 February 2016Ghana: The Ghanaian Ministry of Trade and Industry (MTI) has announced that it will investigate Dangote Cement's operations, following allegations of predatory pricing made by Diamond Cement, according to the This Day newspaper. A ministry spokesman said that it was looking at the 'price of input' in manufacturing cement.
"There was no way Dangote could produce in Nigeria, bring goods into Ghana, pay tariffs and still sell at a price lower than Diamond Cement," said Ahmad Nasir, Deputy Communications Manager at the MTI. Diamond Cement are reported to have complained that competition from Dangote has reduced its cement production from 1.8 million bags to 1.3 million bags.
CCI examining fresh complaint against India’s cement makers
18 December 2015India: The Competition Commission of India (CCI) is examining a fresh complaint of alleged unfair business practices made against cement makers, according to CCI chairman Ashok Chawala. The development comes against the backdrop of the quashing of a US$949m fine imposed on them by the regulator in a previous case.
Chawla said that the CCI is looking into a fresh complaint filed against cement companies. The Confederation of Real Estate Developer's Associations of India (CREDAI), which has about 10,000 members, approached the CCI against the Cement Manufacturers' Association (CMA) in September 2015. In October 2015, the CREDAI said that the association had filed a complaint against the CMA as prices have risen sharply despite low demand for cement.
"To control the cost of construction and make home prices work for the common man, the CREDAI has moved the CCI against cement manufacturers who have been unduly increasing the cost of cement," said the CREDAI. Despite low demand, the association had said that the prices of cement have jumped by 20 – 40% in major cities across India since October 2015.
Jammu Department of Legal Metrology raids Ambuja Cement
18 September 2015India: The Jammu Department of Legal Metrology has registered a case against Ambuja Cement and seized a large quantity of cement bags.
The minister for Consumer Affairs and Public Destruction (CAPD), Choudhary Zulfkar Ali, said that the Department of Legal Metrology had received various complaints about the abuse of Ambuja Cement's dominant position by selling cement at different prices across the state of Jammu and Kashmir.
The department said that it could not get a 'satisfactory' response from Ambuja Cement. As a result, a team of officers inspected Ambuja Cement's depot at Kunjwani and booked Ambuja Cement for gross violation of the Legal Metrology Act and Rules. They were also found to be in violation of the Competition Act of 2002 by selling their products deliberately at the predated price to sabotage the local competition. Zulfkar Ali said that, during the inspection, it was found that Ambuja Cement was selling the same batch of Pozolana Portland Cement in different coloured bags marked with different prices for Jammu and Kashmir. The bags were also found to weigh 400 – 600g less than the 50kg label, while mandatory declarations were also not marked as per the provisions of the Packaged Commodity Rules.
A seizure memo has been issued and the cement sales have been stopped until Ambuja Cement provides the reasons for the discrepancies, according to Zulfkar Ali.