D. K. Sengbeh
At least 35 ‘mineral water’ companies under the banner the Liberia Water Producer Association (LWPA) have cried foul, accusing the Ghanaian-Indian owned Liberty Investment Inc., producer of Aqua Life mineral water, of bad business practice.
The aggrieved ‘mineral water’ producers said the Management of Aqua Life has engaged in predatory pricing aimed at kicking them out of the market, and that water business is restricted exclusively for Liberians.
The Ministry of Commerce and Industry has confirmed the bad dealing of the Company, but has not taken any measure (s) to halt the company’s act which is said to be at the detriment of at least 30 other ‘mineral water’ companies in the Liberian commerce.
Addressing a news conference in Monrovia Monday, two officials of the LWPA (Madam Elvina L. Dennis of Jake’s Frost and Hamilton Saye Zeepa of Mama Liberia) said Liberty Investment dropped the price of a sachet of water (containing 30 bags) from an agreed L$65 to L$40.
The action of Liberty Investment, the officials, representing the aggrieved companies, said was hypocritical and unwholesome after all water producing companies had signed an MOU to sell at a fixed price.
They said Liberty Investment, being a foreign-owned company, was using its outside financial sourcing and free privileges provided by the government to kill Liberian owned businesses.
The officials of the LWPA called for a modification of the terms of the company’s establishment which they claimed has given Liberty Investment an uncalled-for advantage over Liberian-owned businesses.
The lamenting water producers also want the National Legislature to properly reexamine the Investment Incentive Act of 2010, which set aside some 26 businesses, including sachet water production and sale, exclusively for Liberians.
The Investment Incentive Act of 2010 met the Liberty Investment already existing and it, according to the Ministry of Commerce, can to affect the Liberty Investment, because the law is not retroactive.
On October 15, 2010, the LWPA wrote the Assistant Minister for Industry, filing several counts of complaints against Liberty Investment.
Among other things they said Liberty Investment is involved in unfair business practices with, attempts to destroy the local water producers through predatory pricing.
They alleged that the incentives granted by that contract (Liberty Investment and the Government of Liberia) were especially for bottled water production, yet Aqua Life has not restricted itself to the bottled water business, but has engaged in sachet water business.
The complainants also alleged, among others, that Liberty Investment has engaged in an active pursuit and expansion of its packaged water business, an area that is exclusively reserved for Liberian owned companies.
They also presented the by-laws and constitution of their association signed by the defendant on the agreed pricing sachet water, which they said Liberty Investment had grossly violated.
Following a probe into the issue, the Ministry of Commerce noted that the intention of Liberty Investment to engage into predatory pricing “is to undermine the MOU signed by all parties regarding the price structure agreed upon.”
“Count one (1) against the defendant by the complainants is true and the company should be held liable. Hence the defendant should desist from under pricing the sachet water and adhered to the terms and conditions of the MOU,” the Ministry ruled.
On whether there is any provision in the incentive contract for production of only bottle water by Liberty Investment, the Ministry stated: “No, there is no clause to that effect in the document. The document is silent on the sachet water production.” The Ministry of Commerce also ruled that Liberty Investment has done no violation by expanding its operations. “No, it is not a violation.”
The Ministry also nullified the LWPA’s concern that the defendant bringing of equipments and raw materials on a duty free undermines the local businesses. The Ministry said it is not a violation because “it is allowed by the incentive contract granted it [Liberty Investment] by the Government of Liberia.
However, the Ministry noted that by signing the by-laws and constitution of the LWPA, Liberty Investment submitted itself to the Association’s terms and conditions of the MOU; therefore, “the company is liable because it subscribed to the document.”
The Investment Act of 2010, approved May 15, 2010, printed and published by Authority of Ministry of Foreign Affairs, Republic of Liberia in schedule 2 count (g), states that “operation of water purification or bottling plant by 100% foreign company (excludes the production and sale of water in sachet)”.
However, in the same Investment Act of 2010, Section 15.3 states “where an enterprise in existence immediately before the commencement of this Act has duly complied with the Investment Incentive Act of 1973 and other applicable Legislations, the enterprise shall be deemed lawful not withstanding any provision of this Act to the contrary. Any transfer of ownership or ownership rights must conform to this Act.”
Similarly, Section 10 of the Investment Incentive Act of 2010 provides: “No adverse law, regulation, instruction or other Act having the force of law shall be applied retroactively.”
The Ministry of Commerce, using these provisions, stated that Liberty Investment was already existing and engaged in the production of sachets water, (any lawful business) in accordance with its Article of Incorporation. “[Therefore, it can] not be affected by The Investment Act of 2010, Schedule 2, Count (g) provisions and is covered under Section 10 of the Act.”
The aggrieved Mineral Water Producers said, with these provisions, the law is meaningless. “The National Legislature has to explain this law to us. They can not make laws to protects us, we the struggling Liberian businesses, and at the same time allow foreigners to put us out of the market. This is not fair and we will fight it,” Madam Elvina L. Dennis, proprietor of Jake’s Frost, a sachet water firm, stated angrily Monday.
“What you are seeing happening here can not happen in Ghana or any other countries. The Ghanaians will never allow a foreigner to sell ice or cold water or engage into small businesses set aside exclusively for their citizens,” Hamilton Saye Zeepa of Mama Liberia, added.
The LWPA (describing the situation as a cleaver attempt of getting Liberians out of the water business) said it will not rest until justice is done.
The officials said some big hands at the Ministry of Commerce may as well be involved and are protecting Liberty Investment to foment atrocities against the local Liberian businesses.
Officials of Liberty Investment have not commented despite several calls.