Ordering the withholding of the credits, which could have employment implications, in the hacienda La Clementina, is null and void, illegal and illegitimate, because, there is, in the Fourth Chamber of the Tax District Court, and exception lawsuit, raised by Exporter Bananera Noboa, which suspends the execution of the coercive process as provided by the law in article 214 of the Tax Code; lawsuit that remains pending resoltuion.
This was affirmed by Dr. Sylka Sanchez, attorney of the company, in response to the notification of the seizure of the hacienda “La Clementina” carried out this morning by the Internal Revenue Services (SR!, for its Spanish acronym).
She said that the procedure was conducted in an irrational and daunting way, totally unnecessary, using the armed forces, the police and tax officials, in an another act within the political media show, now common to the SRI.
She added that Exporter Bananera Noboa, has denounced publicly, the exercise of legal proceedings of effective legal protection and legitimate exercise of their right to defend themselves, and also the successive arbitrairness of the tax administration, and that they reserve their right to take the proper legal international actions against the officials that are acting against the law.
She was worried because the action will generate a social problem to employees and national and international consumers, because, despite that the company has not been embargoed, it was ordered the withholding of the credits, which could have employment implications.
She explained that through the collection of their debtors, the company operates and pay the employees, suppliers, inputs, etc. In other words, if the withholding remains, the cash flow of the company would be affected, and in a matter of weeks, the hacienda La Clementina would go broke with the consequent reduction of its market value.
Lawyer Sanchez, insisted in the request for the intervention of President Rafael Correa as a mediator, so it can be demonstrated technically, the illegality of the gloss and therefore, close this regrettable episode of abuse against Exporter Bananera Noboa.
DR. SYLKA SANCHEZ
EMBARGO OF THE HACIENDA LA CLEMENTINA
Well, as you already know, one more time the SRI has acted in an intimidating way, this time they have embargoed the Hacienda “La Clemetina”, this is illegal, because, currently, there is an exception lawsuit in the Court of Guayaquil. This is the only case in the country that, although knowing the existence of an exception lawsuit that is being processed in the Court, which suspends any coercive action, they continue to act outside the law.
It seems that what they want is to damage, one more time, a company of our group, because if you take a look at the order to seize the hacienda, it is being ordered to retain the funds of the company; if this happens ladies and gentlemen, it’s impossible to fumigate, a week goes by and if a banana farm is not fumigated, the plantations will burn and this will result in the bankruptcy of the company.
This is very serious, because there are thousands of people working for the hacienda and if they have no cash flow to pay the salaries, to fumigate the plantations, the employees will be damaged and the hacienda will burn, as it is technically called in the banana business, when a plantation is not fumigated.
We insist, one more time, and request the President, economist Rafael Correa, to appoint a commission to mediate in this process, a technical commission to see the bottom of this subject and for the SRI to explain to the country why they are pretending to collect from Bananera Noboa the amount of 101 million dollars, when Dole, for the same fiscal year of 2005, was charged 700 thousand dollars.
We know that the SRI does not want to act legally, they are acting arbitrarily, using policemen, military personnel, who should be protecting the streets of Guayaquil, the streets of Ecuador, which are insecure, and they are using, at the moment, more than 400 people payed by the State to carry out an action that is illegal, because the SRI knows that if we take this to Court they will not be able to prove, how, for the fiscal year of 2005, only, they pretend to collect 101 million dollars, and a little bit more, when Dole exported more fruit than Bananera Noboa the same year of 2005 and only paid 700 thousand dollars.
Press: Dr. Sanchez, good afternoon, a question, the embargo that was carried out on the hacienda “La Clementina” that its been justified on the fact that the assets that were seized before didn’t cover the 102 million dollars. Have you conducted a valuation of the assets that were seized at first to see if they cover the debt or not?
Sylka Sánchez: Only with the goods in Playas, that encompass 14 million kilometers, the alleged debt is more than paid, which we are challenging and still remains in Court. We are taking the process to international courts, it has to end this way because is required by law. First to national bodies, then to international ones, but is clear that they want to damage the Noboa Corporation , and the employees. I repeat, with the lands that cover 14 thousand kilometers, that have been seized, the alleged debt would be covered, perhaps, but if you go to a property that is worth several million dollars and it is not fumigated, because it has no cash flow as determined by the seize order, there will be no fumigation and the banana plantations will die. And what is going to happen? The price will fall, so what we are seeing here is an act of bad faith.
Press: What is the estimate value of the hacienda La Clementina?
Sylka Sánchez: we just went there and appointed a technician, we had some problems because there are several policemen, as you saw in the pictures on Twitter. We had to go because the administrators asked the lawyers to go. There will be an appraisal of the property, an inventory of all the goods, because they worth several million dollars. I can’t tell you exactly, but are several million dollars as is one of the biggest farms in the country.
Press: How many employees work for the farm?
Sylka Sánchez: Approximately 1.500 employees.
Press: You say that the land in Playas worths 14 million dollars?
Sylka Sánchez: No, 114 million dollars
Press: So, you know the price that the SRI is putting to the goods that were seized at first and which are going to be auctioned.
Sylka Sánchez: Yes, we are contesting that prices, because a plane, and I have the data here, because I come from Babahoyo, it has been valued aproximately in 20 thousand dollars. A plane does not worth 20 thousand dollars, not even a car worths 20 thousand dollars; so is evident that all the movable and immovable property, planes, cars, are being valued with a lower price; in the case of the cars, we contested the appraisal, because they valued a brand new Mercedez Benz, 0 kilometers, from 60 thousand dollars to 50 thousand dollars in the first auction, in a second auction that prize could drop to half, so, they are really trying to damage us, there will never be enough, no asset will cover the alleged debt with those appraisals which don’t correspond to reality.
Press: Are you afraid of new embargoes in the future in the case that the amount of 102 million dollars is not covered?
Sylka Sánchez: They have threatened with that, they cannot auction the goods when a challenge has been made, so that is why they are seizing more goods. But the banana business is complex, because there are 1.500 employees to deal with, the plantations have to be monitored in a technical way, is really dangerous when is not properly managed and the administration has no experience, because it can go broke, it can be burnt in just a week, if the banana plantations are not fumigated.
Press: Mister Carrasco said they have appointed an administrator to prevent all that you said to happen, and this means that the farm is being guarded so it is being administrated as well, so it can remain productive.
Sylka Sánchez: They have appointed a custodian. They will see how the farm needs to be managed, we have explained the technical aspects, we have explained to them that within a week without cash flow, as provided by the order, the company will be declared bankrupt, because he SRI is going to send all the goods to an account that is not the company’s account, so they won’t be able to pay the salaries or fertilizers.
Press: The farm will nor produce?
Sylka Sánchez: That we don’t know yet, all the lawyers are there right now, and I have to go back, I only came for this press conference.
Press: Dr. Sanchez, will there be any support measures from the other farms, like protests or something like that?
Sylka Sánchez: No, we are analyzing all the documents as we have been discussing with all the shareholders; the employees of Noboa Coroporation are the ones who are very worried, because these measures are arbitrary and unfair and only damage the large amount of jobs that Noboa Corporation provides.
Press: When is Lawyer Alvaro Noboa going to talk about the matter?
Sylka Sánchez: As you know he is out of the country, we, the lawyers, are analyzing all the documents, we are going through the legal aspect ad the legal strategy, were are delivering the information to the people.
Press: Mister Carrasco said this morning, also, that if Bananera Noboa wants to recuperate their goods they have to go to the SRI and pay the 102 million dollars. Is that an option?
Sylka Sánchez: We are in litigation, we have been very clear, even I published a press release, is not that we don’t want to pay the taxes, we want to pay the fair taxes, before a fair judge, once a technical assessment is carried out that tells us that they pretend that Bananera Noboa, who paid the same official price and exported to the same markets as Dole in the year of 2005, to pay 101 million dollars, now 102 million dollars, when Dole only paid 700 thousand dollars.
Prensa: How much does the company can pay?
Sylka Sánchez: The amount would be 700 thousand dollars tops, because Bananera Noboa exported in 2005 less fruit than Dole, and they payed 700 thousand dollars when they exported more fruit to the same markets, but that has to be settled in Court no by force, taking possession of the farms that belong to Bananera Noboa.
Press: How much the company exported?
Sylka Sánchez: I don’t have that information at the moment.
Press: The cash flow of the company is affected if they cannot export the proper amount of boxes?
Press: The exporting company will go broke, the farm will go into bankruptcy?
Sylka Sánchez: The farm, the exporting company will not go into bankruptcy.
Press: But the farm produces the bananas for the company
Sylka Sánchez: But the company, at this moment, is not exporting, just the farm will be affected.
Press: In 2205, how much did the Noboa Group payed for income tax?
Sylka Sánchez: I understand that it was like 250 thousand, I don’t know exactly
Press: What you are saying is to ratify that the taxes have been payed?
Sylka Sanchez: No, is to sit down so the SRI can demonstrate in a technical way what transfer price mechanism was used in our gloss, so we can reach an agreement, and we can pay a fair tax. It is not possible that they are charging Bananera Noboa, who is not the largest exporting company in the country, one hundred times more than what they charged Dole, who exported more fruit than Bananera Noboa in 2005.
Press: Do you have an estimate of all the goods that were seized by the SRI the first time?
Sylka Sánchez: No, we don’t have one, we are conducting our own appraisals and there are many goods that have already been valued but the planes and the cars don’t, because we don’t have them.
Prensa: But all those goods exceed the 102 million dollars?
Sylka Sánchez: The land, only, exceeds the 102 million dollars, La Clementina worths several millions, but if is declared bankrupt it won’t worth the same.
Press: Dr. Sanchez, please repeat the kilometers that the land in Playas encompass. You said there were 14 million of kilometers, we are talking about Ecuador. How many kilometers are?
Sylka Sánchez: Sorry, I made a mistake, 14 thousand kilometers.
Prensa: What did the employees of La Clementina do, was there violence or protests?d
Sylka Sánchez: The employees are worried for this situation, were are discussing with the lawyers the recision of several documents issued by the SRI that we have brought from Babahoyo. We are going to check them here, but we think they will recover their sanity and they won’t send the cash flow of the company to the SRI
Press: The employees are still inside the property, or the activities have been suspended and also the entrance of the personnel?
Sylka Sánchez: They have a Union for many years, since the time of Luis Noboa Naranjo, in La Clementina, and they are there, because many of them live there. They are waiting, today they didn’t work.
Press: Do you think that the SRI will guarantee the stability of the workers as said by economist Carlos Marx?
Sylka Sánchez: If they are withdrawing the funds of the company they cannot guarantee it, because the company will not be able to pay the salaries. They sell bananas and if they sell them and the money does not return to the farm they won’t be able to fumigate and they will not receive their salaries.
Press: La Clementina only produces or have infrastructure, like equipment, machinery? What else is inside the farm?
Sylka Sánchez: It has infrastructure, a packaging system.
Prensa: How many farms are?
Sylka Sánchez: I don’t have the list of farms right now.
Press: How many hectares does La Clementina have?
Sylka Sánchez: I don’t have that information