Displaying items by tag: Legal

Pakistan: The Capital Development Authority (CDA) has cancelled the mining lease for Fescto Cement and issued a fine against it of US$4m for illegally operating in the Margalla Hills National Park near Islamabad. The CDA has also requested that the local explosives inspector ask the cement producer to remove explosives dumped in the park area and it has asked police to take action.

A report by the CDA says that the cement producer’s 30 year lease was extended for another 18 years by the director of the Industries and Mineral Development department of the Islamabad Capital Territory in June 2012. However, a forestry director raised objections to the extension.

India: LafargeHolcim has received the approval of the Cabinet Committee on Economic Affairs to simplify its corporate structure. The transaction has already been approved by all other stakeholders, including independent directors, minority shareholders, the Securities and Exchange Board of India, stock exchanges and respective High Courts in India. LafargeHolcim is now awaiting formal communication from the Foreign Investment Promotion Board in order to close the transaction.

Through intragroup restructuring, LafargeHolcim will increase its shareholding in Ambuja to 61.14%. Ambuja, in turn, will acquire LafargeHolcim’s 50.05% stake in ACC Limited.

The transaction will be effected through a merger of Holcim India Private Ltd. (HIPL), a wholly owned financial holding subsidiary, with Ambuja. In a two-stage deal, Ambuja will first acquire, through a purchase, a 24% stake in HIPL for a cash consideration of US$521m, followed by a stock merger between HIPL and Ambuja. As part of the merger, LafargeHolcim will receive 584 million new equity shares of Ambuja resulting in an increase of its ownership in Ambuja from the current 50.28% to 61.14%.

Israel: The Supreme Court has posted a temporary injunction preventing the Israel Ports Development & Assets Company and the Ashdod Port Company from halting the cement imports of Lev Baron Commodities. The injunction was imposed in response to an appeal by Lev Baron against Israel Ports and Ashdod Port, according to Israel Business Arena. The move by the court is the latest in a battle between Lev Baron and Israel Ports over the terms of their relationship.

Lev Baron imports cement into Israel, mainly from Cyprus and Turkey. In 2015, it imported 800,000t of cement and is expected to reach 900,000t in 2016. Lev Baron’s imports account for 14% of the cement supply in Israel and the Palestinian Authority.

India: Malabar Cements will restart operations at its Cherthala cement grinding plant following approval from the Kerala High Court. The cement producer says its has been granted permission to produce Portland Pozzolana Cement (PPC) using clinker, gypsum and fly ash at the plant. Previously the Bureau of Indian Standards objected to the cement producer manufacturing PPC.

China: Shanshui Cement has regained control over Liaocheng Shanshui, a subsidiary that was illegally occupied by ‘unidentified people’. The local government and police helped the company take back the cement plant and its offices. Normal production has resumed.

During the occupation the offices were ransacked and the official seal and business license of Liaocheng Shanshui were stolen. Shandong Shanshui and Liaocheng Shanshui have announced that, the stolen seal of Liaocheng Shanshui has been invalidated since 16 June 2016.

In a statement the company has confirmed that a corporate dispute is on-going between Shanshui Zhonggong, Shandong Shanshui and Liaocheng Shanshui. It believes that the occupation was related to this. Shanshui Cement has faced financial troubles since a shareholder battle for control of the company took place in late 2015.

Europe: The European Court of Justice (ECJ) has ruled that a Greek law that requests employers to receive approval by the Labour ministry before making bulk redundancies is incompatible with European Union law. The judgement was made in relation to the layoff of a group of workers at the Halkida cement plant when Lafarge purchased the plant from AGET Heracles in 2013, according to the Athens News Agency. The Labour ministry blocked the request, citing conditions in the labour market, the financial situation of the company and the interest of the national economy. Lafarge then appealed to the Council of State, which then referred the case to the ECJ.

Australia: The Australian Competition and Consumer Commission (ACCC) has filed an appeal against a US$12.6m fine against Cement Australia, which it views is too low. On 16 May 2016 a Federal Court published orders imposing a penalty of US$13.7m on the cement producer. One order was then set aside, reducing the fine to US$12.6m. However, the ACCC contends that a penalty of over US$66m is more appropriate for the breaches of Australia’s competition legislation.

“The ACCC will argue to the Full Court that the penalties imposed on Cement Australia are manifestly inadequate, and not of appropriate deterrent value,” said ACCC Chairman Rod Sims. He added that suitable financial penalties were considered ‘essential’ as a deterrent to anti-competitive conduct and to prevent businesses viewing such behaviour as an acceptable cost of doing business.

The proceedings relate to contracts that were entered into by Cement Australia companies between 2002 and 2006 with four power stations in South East Queensland, to acquire fly ash. The court found numerous contraventions of the Competition and Consumer Act 2010. It also fined Christopher White, a manager in the Cement Australia fly ash business during the relevant period, a penalty of US$14,700 for his involvement in making the contravening contracts with the operator of the Swanbank power station in 2005.

Ireland: The Competition and Consumer Protection Commission (CCPC) has appealed against a High Court judgment preventing the CCPC from accessing or reviewing certain electronic documents seized by the CCPC during a search conducted in May 2015.

The High Court judgment arose from a court action taken by CRH against the CCPC following the seizure of hard copy and electronic documents by the CCPC during an unannounced search at the premises of CRH’s subsidiary, Irish Cement, on 14 May 2015. The search related to an investigation by the CCPC into alleged anti-competitive conduct in the bagged cement sector. The orders made by the High Court prevent the CCPC from accessing or reviewing material in the mailbox of Seamus Lynch, a director of Irish Cement, unless the CCPC and CRH agree to appoint an independent third party to ‘sift’ the seized documents for material relevant to the investigation.

The CCPC’s investigation into alleged anti-competitive practices by Irish Cement in the supply of bagged cement continues.

India: The Calcutta High Court has dismissed two petitions by members of the Birla family intending to challenge the takeover of Reliance Infrastructure by Birla Corporation. Justice Jyotirmoy Bhattacharya held that the petitions were not maintainable stating that decisions taken by the directors could not be called into question by the probate court.

The challenge by the Birla family represents the latest move in a long-running legal battle between the family and accountant R S Lodha, father of the current chairman of Birla Corporation. The cement company announced in February 2016 that it was planning to buy Reliance Infrastructure for US$715m.

China: Harbin Xiaoling Cement in Heilongjiang province has taken the environment ministry to court after its approval to operate was rejected following complaints by residents. The cement company’s representatives say the ministry was wrong to overrule a decision by the local authorities in 2011 that granted approval for production at the plant, according to the South China Morning Post.

The ministry took action following complaints by residents about noise and dust pollution. They argued that residents living within 500m of the plant should have been relocated following the recommendation of an environmental review conducted when the plant expanded production in 2009. However, the cement plant has countered that it was built in 1932, whilst the area was under Japanese occupation, before any resident moved to the area.