Regional soap producer Dominica Coconut Products Successors Limited, DCPS, has followed through on a threat of legal action in a long-standing feud with certain Jamaican state agencies and Jamaican soap manufacturers and exporters.
In a lawsuit brought to the Kingston Supreme Court on June 8 by Jamaican law firm Hylton Powell, DCPS appointed the trade administrator, the Board of Trade, the Commissioner of Customs, the Jamaican Customs Agency and the a listed company Blue Power Group Limited as respondents in a matter concerning the export of Jamaican-made soaps to Caricom markets and the import of raw materials for the manufacture of soap.
The lawsuit prompted Jamaican authorities last week to immediately suspend the issuance of certificates of origin certifying soaps produced in Jamaica as being of Community origin and therefore eligible for duty-free export to domestic markets. Caricom.
Industry and Trade Minister Audley Shaw told the Financial Gleaner On Thursday, the decision to suspend certificates while the case was in court for decision was communicated to soap producers at a meeting on Wednesday. The meeting was also reportedly attended by Foreign Trade Minister Kamina Johnson-Smith, who chaired a COTED meeting earlier this month where issues resurfaced, as well as representatives from the Trade Board and Jamaica Customs Agency.
The Dominican company and its principal, Yvor Nassief, argue in court documents that the Trade Board and Blue Power violated a ruling by Caricom’s trade policy-making body, the Council for Trade and Economic Development, which took a decision. majority decision last November demanding that Jamaican authorities stop issuing certificates.
The decision was the result of a DCPS challenge, supported within COTED by representatives of the Dominican government. They argue that the raw material for soap lozenges imported from Indonesia by Jamaican producers was simply turned into soap without going through a manufacturing transformation process that the Dominican company says is necessary for the finished products to be classified as being of Caricom origin. These goods benefit from the non-imposition of the common external tariff of 40 per cent enjoyed by goods of non-Community origin.
Following the ruling, Jamaica appears to have continued to issue the certificates pending different levels of appeal, a situation that upset Dominica, which filed a non-compliance petition against Jamaica at the last meeting of the COTED, held virtually earlier this month. .
While Blue Power took the initiative to inform the Jamaica Stock Exchange on December 8 that COTED’s decision would effectively shut it down from Caricom and other Jamaican soap exporters, the Trade Board said at the time that ‘he had received no political decision from his parent company. Ministry, the Ministry of Industry, Investment and Trade, to change its certification process.
Checks with the Caricom secretariat provided little clarity on the issue. Joseph Cox, Caricom’s deputy general secretary for trade and economic integration, said in mid-December that the soap issue was “awaiting resolution” even after COTED’s decision, and that discussions continued. continued.
“As a final decision has yet to be made by COTED, we cannot comment at this time,” was all he was ready to say when contacted by email last week. .
Trade administrator and CEO of Trade Board Limited, Douglas Webster, declined to comment on Thursday, referring the matter to the Commerce Department.
“I think the portfolio ministry will make a statement on this, so I will leave it up to the ministry to give an official notice,” he said by phone. Jamaican Customs said on Friday it would not comment on pending or pending litigation.
Minister Shaw, meanwhile, vigorously defends Jamaican soap producers, echoing their claims, previously reported by the Financial Gleaner, that DCPS was trying to lock them into buying its raw material, which they say is inferior to the quality they need.
“The Dominican company has not made the quality noodles our manufacturers want, and they are seeking COTED protection for that; and they are trying to force our manufacturers to use their raw materials. They tested it. It doesn’t even smell good, ”Shaw told the Financial Gleaner.
“Now that this case has been taken to court, what the manufacturers are just going to do, for now, is cut back on exports to other Caricom countries where they might have to pay the duty. Otherwise, we will continue to help our manufacturers to produce high quality materials, and if they cannot get the raw materials in the region, and they have to import them from third countries, then they go ahead and do. We will not issue the certificates while the matter is in court, ”he said.
The DCPS request asks the court to compel the trade administrator and the Trade Council to respond to an unspecified DCPS access to information request of March 2, 2021, and to make a declaration that the trade authority illegally issued Certificates of Origin to the Blue Power Group, contrary to the Revised Treaty of Chaguaramas which governs trade and other relations between Caricom member states, or that the matter be referred to the Caribbean Court of Justice. The CCJ is designated in the trade treaty as the appropriate arbiter of disputes between Caricom countries.
DCPS is also seeking a Supreme Court order prohibiting the Trade Board from issuing certificates of origin to Blue Power or any other soap producer “with respect to soap produced with soap noodles / soap pellets imported from countries outside the region ”or for the issuance of such a hold pending a decision by the CCJ.
The Dominican company has also sought “indirect damages” against the trade administrator, the Board of Trade, the Commissioner of Customs and Jamaican Customs for what is described as breaches of legal duty related to their alleged breach. their obligations and duties under the revised treaty, the Customs Act and the Tax Administration Act.
In the case of the Jamaican Customs and Customs Commissioner, DCPS alleges and requests a statement that they wrongly exempted Blue Power from a 40% CET that would be applicable to soap noodles or soap pellets, which it imports from non-Caricom countries. , or for a referral of the matter to the CCJ. He also wants the customs agency to be obliged to apply the law.
The request also urges the court to order Blue Power Group to refrain from what DCPS alleges as “adulterating the soap noodles it imports from non-Caricom countries in the form of fatty acid lozenges bearing the heading tariff 38.23 instead of the correct tariff heading 34.01 ”.
Nassief and his lawyers, Michael Hylton QC and Soundiata Gibbs, made no comment when contacted last week.
Blue Power Chairman Dr Dhiru Tanna told the Financial Gleaner in an interview on Friday that he had hired a lawyer to mount the defense of his company.
“Since December we have had six shipments to Caricom, for which we have requested certificates of origin, and they have been granted by the Trade Board. We did everything perfectly legally. We had certificates of origin in circulation that had been issued, which we returned to the Office of Commerce. We don’t plan to use any until the situation changes, ”Tanna said.
“We applied for the permits, we got them, we shipped the goods. We’ve done everything legally since we opened many years ago. We followed the rules regardless of the rules. We haven’t done anything illegal or untoward, ”he said.