Displaying items by tag: Legal

US: Cemex has settled a lawsuit that accused it of discharging polluted storm water runoff from its West Sacramento cement terminal in California into the Sacramento River. The cement producer has agreed to implement an infiltration basin to treat runoff from its unit, according to the Sacramento Business Journal newspaper. It will also make a donation of US$40,000 in grants to environmental projects in the Sacramento-San Joaquin River Delta and pay the legal fees of the plaintiff, the California Sportfishing Protection Alliance. The alliance had originally sought US$88m from Cemex.

Syria: An investigation by the Agence France Presse has found that one local employee of Lafarge in Syria was killed and another has been missing for five years. According to the news agency, Syrian mechanic Yassin Ismail, who was employed at Lafarge's plant at Jalabiya, was kidnapped by jihadist fighters in 2013. He was subsequently executed, according to relatives and former work colleagues. Another mechanic Abdul al-Homada, was disappeared in Aleppo in 2013 while attempting to collect his salary.

LafargeHolcim is being investigated in France over claims that Lafarge Syria had paid extremist groups to keep its Jalabiya cement plant operational after the outbreak of war in Syria. Six former Lafarge executives have been charged with financing a terrorist organisation. Those managers could also face prosecution for endangering the lives of their local Syrian employees after 11 of them filed their own lawsuit alleging that Lafarge put financial profit before their personal safety.

India: Vijaykumar Iyer, a resolution professional with Deloitte Touche Tohmatsu India working for Binani Cement, has alleged that fraudulent transactions have taken place involving the promoters of the company. Iyer made an application in mid-March 2018 to the National Company Law Tribunal (NCLT) in Kolkata asking the court to take action and ‘appoint an appropriate investigation agency to investigate the directors of Binani Cement and the counter parties,’ according to the Economic Times. Sources quoted by the newspaper say that the application is likely to receive a hearing imminently. Binani Cement has denied the allegations.

Iyer’s application said that he had appointed Haribhakti & Co as a ‘forensic consultant’ in November 2017 for reviewing and identifying ‘suspect’ transactions. He said that since the inception of the corporate insolvency resolution process, he had not been provided access to all the required information and documents. He alleges that Binani Cement made several payments to ‘potentially related and/or connected customers and entities,’ such as Saraswati Sales (SSPL) and US$75.4m was outstanding at the end of November 2017, suggesting that sales were made to SSPL despite the fact that corresponding payments were not made to the corporate debtor. Other inconsistencies were also found suggesting that money was being removed from the business without paying outstanding debts.

Dalmia Bharat beat UltraTech Cement in a bidding war to buy Binani Cement for US$974m in early March 2018 in an auction was run by the National Company Law Tribunal under insolvency proceedings. However, UltraTech Cement has since made a US$1.11bn bid directly to Binani Cement to stop the insolvency process. UltraTech Cement has said it is ‘shocked’ by the allegations by Iyer and that it was unaware of any pending investigations when it made its latest offer.

India: UltraTech Cement has made a new US$1.11bn bid directly to Binani Cement in order to buy it. Binani’s parent company Binani Industries is independently seeking to stop the insolvency proceedings of its cement subsidiary using the money offered by UltraTech Cement in a so called ‘comfort letter.’ In a statement UltraTech Cement said it had in principle agreed to buy 98.5% of the shares of Binani Cement.

However, a consortium led by Dalmia Bharat won an auction for Binani Cement with a bid of US$974m in early March 2018. The auction was run by the National Company Law Tribunal under insolvency proceedings. Binani Cement has since complained that the bidding process was not run on a transparent process, according to the Economic Times newspaper. It added that the ‘shortcomings’ in the insolvency process had prompted the company to look at other options. The on-going struggle by UltraTech Cement and Dalmia Bharat is expected to test local bankruptcy law.

India: The price of imported petcoke has hit a multi-year high in March 2018. Increased demand and a shortage due to maintenance work at refineries has caused the rise in price, according to the Mint newspaper. In November, the Indian Supreme Court temporarily banned the use of petcoke in Delhi, Haryana, Rajasthan and Uttar Pradesh. The import duty of the fuel was then raised to 10% from 2.5%.

Deepak Kannan, managing editor of Asia Thermal Coal at S&P Global Platts, said that local demand for petcoke is around 23 – 24Mt/yr but that local supply is only 14Mt/yr. Much of the country imported petcoke comes from the US or Saudi Arabia. Petcoke prices are expected to relax in April 2018 as refineries return to normal operation.

France: Lafarge Syria’s former director Christian Herrault has claimed that Eric Chevallier, the former ambassador to Syria, knew about payments to armed groups by the cement producer. French investigators questioned Herrault in the presence of Chevallier, according to a source quoted by the Agence France Presse. Herrault allegedly said that he had met Chevallier several times, that he knew about the situation and that he said that the company should stay as, “…these problems won't last long."

Jean-Claude Veillard, the group's former security boss, has said he regularly informed French intelligence services about its operations in the region. Investigators have also found evidence of meetings between Lafarge and diplomats, including a note suggesting that one took place in Paris in January 2013.

The investigation is attempting to determine whether LafargeHolcim’s predecessor company Lafarge Syria paid terrorist groups in Syria and how much managers knew about the situation.

Italy: Legal firm Eversheds Sutherland has suspended a Euro1.8m fine imposed by the Italian Competition Authority on Calme. Fines were made to a number of Italian cement producers in August 2017, according to the Il Sole 24 Ore newspaper. They were in relation to allegations of price fixing and market share coordination between 2011 and 2016.

Pakistan: Mian Saqib Nisar, the Chief Justice of Pakistan, has said that the Supreme Court will prevent the construction of any new cement plants or upgrades to existing plants near Katas Raj Temples in Punjab. However, he said that no existing plants in the area would be shut down, according to the Business Recorder newspaper. The investigation by the court had been taken in response to media reports that the pond at the Hindu heritage site was drying out due to water consumption by nearby cement plants. The local government has also been taking steps to stop new cement plants being built in parts of the province.

Zambia: The High Court of Zambia has set 25 February 2018 as the date it will hand down a judgement on a case involving Zambezi Portland Cement (ZPC) between businessman Rajan Mahtani and the Vetriglia family. The case concerns a battle over the shares and management of the company between Mahtani and members of the Vetriglia family, according to the Times of Zambia. Mahtani originally attempted to close the company in 2015 but the original owners resisted the attempt. However, Mahtani maintains that he holds a majority share in the cement producer.

Pakistan: Shahbaz Sharif, the chief minister of Punjb, has approved summary legislation banning the installation of new cement plants in the province on environmental grounds. The summary will be passed to standing committees on legislation for deliberation and recommendations, according to the Nation newspaper. The region has 12 cement plants, of which eight are located in the Salt Range of hills, where local residents have become increasingly intolerant of new industrial plants due to damage to underground water tables and increased air pollution.

The summary will also examine expansion plans by existing cement plants in the province and it has hired a consultancy, Artelia, to study the situation. The Supreme Court of Pakistan also being looking at the issue separately. However, the local cement industry is in an expansion mode as it copes with resident and public sector construction markets and large-scale infrastructure projects driven by the China-Pakistan Economic Corridor initiative.