Norway’s Yara International ASA today said a probe initiated by the company has found an “unacceptable payment” of USD 1 million to a consultant during negotiations for setting up a fertiliser joint venture with Krishak Bharati Cooperative Ltd (Kribhco) in India.
When contacted,Kiribhco Managing Director B D Sinha said,”None of our officials are involved in the irregularities. No financial transaction has ever taken place with Yara. No trading has taken place with it.”
In 2007,Yara was in talks with Kribhco for a joint venture to produce and market mineral fertilisers. However,the proposed project was abandoned after a commercial review by the Norwegian player.
The findings of the probe conducted by Yara-appointed law firm Wiersholm has said irregularities were committed by the company in India,Libya and Switzerland. Yara President and CEO Jorgen Ole Haslestad said in a statement that it was disappointing to confirm that unacceptable payments have been made from the company.
“An unacceptable payment of USD 1 million in 2007 to a consultant in India is documented,related to negotiations with Kribhco,” the company said.
Yara,a leading chemical company,appointed Wiersholm in April last year to conduct a broad external investigation,amid concerns of suspected corruption overseas. Separately,the Norwegian National Authority for Investigation and Prosecution of Economic and Environmental Crime is also probing the alleged irregularities. According to Yara,until the Norwegian probe agency completes its investigation,the company “cannot conclude on questions related to responsibility of individuals or individual companies”. Yara also noted that Wiersholm have had access to a more limited body of evidence than the official agency. The Wiersholm probe has also found payments,over a period of several years,by the company Balderton totalling about USD 15 million in Switzerland. Yara has a significant shareholding in Geneva-based Balderton.
Regarding Switzerland,Yara said the payments have been made to persons employed by or associated with companies which are suppliers to Yara or Balderton. Payments from Balderton which have no commercial basis have also been uncovered,the firm noted.
“Unacceptable offers of payment to a consultant are documented,related to the establishment of Libyan Norwegian Fertilizer Company (Lifeco). The completion of the actual payment is not documented,” the statement said. Haslestad said the company has invested considerably in its long-term work to ensure compliance with ethical standards.