Wednesday 13 March 2013

Myanmar Makro to sue ministry

Myanmar Makro Industry Company will file a lawsuit against Livestock Feedstuff and Milk Products Enterprise, a department of government ministry Myanmar Livestock and Fisheries, Myanmar Makro’s legal counsel told The Myanmar Times on March 5.


U Htun Aye, Myanmar Makro’s lawyer, said: “We will sue the department for a breach of contract with MIC (Myanmar Investment Commission) that is valid under the Yangon Division Court until 2017.”

Myanmar Makro is a Yangon-based can factory in Thaketa Township responsible for the brand Ready Can. It was granted a 20-year contract in 1997 by MIC for the factory. On January 4, 2011, the government’s Myanmar Privatisation Committee (MPC) called a tender for the land and awarded it to Mega Marine on February 28, 2011.

In April 2011, Myanmar Livestock and Fisheries began to refuse rental payments from Myanmar Makro. Mega Marine paid the full amount for the factory in three installments by February 2012. On February 15, 2012, Myanmar Livestock and Fisheries announced that Myanmar Makro must turn the factory over to Mega Marine.

On February 14, 2013, the government again asked Myanmar Makro to vacate the Thaketa site – prompting legal action over whether or not the factory’s contract is valid with MIC or MPC.

“We don’t want to be evicted from our factory. They shouldn’t do it like this. We are not ready to move to another site, and we need a lot of time to prepare a new factory. We want the government to honour our tenant agreement until 2017,” said U Htun Aye.

U Moe Myint Kyaw, the managing director of Myanmar Makro’s factory, said it is facing unemployment and irreparable financial losses.

“There are 214 employees and more than one thousand families dependent on my factory. Nearly K1 billion has been invested in this factory. When the Ministry evicts us, we will lose everything.

“We can’t take any machines with us, which is our main investment. Our brand has a record of success and we export it to neighbouring countries – we will lose that too,” U Moe Mint Kyaw said.

During a press conference on February 14, Dr Pyae Sone, general manager of Livestock Feedstuff and Milk Products Enterprise, said that the department refused taking rental money from Myanmar Makro after April 2011 because it chose to value the Mega Marine-MPC contract when it outbid Myanmar Makro.

“MPC made a bid of K3.3 billion for the Thaketa factory on February 11, 2011 and Mega Marine acquired it for K3.29billion. But Myanmar Makro gave a counter offer of only K1.2 billion [during the tender]. So, they will not get the factory,” he said.

“We know that Myanmar Makro will face many difficulties and losses. But we have no power over this. The new deed with [Mega Marine] is indisputable,” he added.

Following the press conference on February 15, U Moe Myint Kyaw said: “We couldn’t [match Mega Marine’s offer] because we invested a lot of money in our factory. We couldn’t use any more money at that time. We’ve appealed to President U Thein Sein to help us.”

“We plan to eventually release our factory to Mega Marine, but we want to have enough time to prepare our new factory with the time we were originally allotted until 2017,” he added.

On November 22, 2012, Myanmar Makro made an appeal to MIC. On December 20, 2012, MIC responded by saying that Myanmar Makro, MPC and the Ministry must negotiate the issue between themselves.

“The government isn’t helping us, even though we are really seeking to improve our country as much as we can. There is no other local can factory that matches our size and production, and most cans are imported from other countries,” U Moe Myint Kyaw said.

Myanmar Makro also produces Ocean Can and Bravo Chili Sauce. It produces over 100,000 cans a month.

source: The Myanmar Times

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