Zespri company's smuggling appeal fails

Last updated 05:00 26/07/2013

Relevant offers

Agribusiness

Dairy farmers under no illusions of year ahead Pressure mounting on the dairy farm as cost cutting takes its toll Dairy lift key to Northland's economic future: report Research backs a reduction in Fonterra's board size Disaffected farmer group presses on with reform call Reviewing Owl Farm’s mating performance Milk price and trade closely linked Opuha restrictions lifted is good news for farmers 'Hazardous' palm kernel dust spotted blowing off ship at Timaru's port Toyota Fortuner takes the road hardly travelled (or no road at all)

Zespri says it is disappointed after an appeal against smuggling charges in China failed.

A Shanghai court today upheld smuggling charges against the Kiwifruit exporter's Chinese subsidiary and one of its employees.

The subsidiary has been fined RMB5 million, about NZ$960,000, and the worker sentenced to five years in prison.

The charges related to under-reporting the import duties on Kiwifruit coming into China between 2008 and 2010.

Zespri had argued it had paid full duty but its appeal failed, with the court finding that the documents the company filed were not relevant to the smuggling charges.

Chief executive Lain Jager said the decision was disappointing and the focus was now on the wellbeing of the convicted employee.

"We will continue to work with his family and legal representation to explore how we can support him personally and legally," he said.

He said Zespri had failed to ensure its importer was working within the law and was now working with Chinese Customs to minimise the risk of that happening again.

In May, The Sunday Star-Times reported that Zespri was aware its invoicing system in China was potentially illegal from the start and some senior management were involved in trying to have it rubber-stamped by Chinese Customs.

The system that the Shanghai court has found to be illegal involved producing two invoices - one for the actual price of the fruit, and a second for a lower amount that would not appear on its books but would be used by the importer to pay lower customs duty.

Zespri has never denied the dual invoicing but says its importer misled the company by claiming to have ratified the deal with Chinese customs.

Customs duty was his responsibility as the importer, it says.

Zespri is a single-desk monopoly that controls New Zealand's $1.6 billion kiwifruit industry.

Ad Feedback

- BusinessDay.co.nz

Special offers

Featured Promotions

Sponsored Content