And while Briceno played the popular political said of this very thorny
dispute, there's a whole lot more to it. Last night, we showed the
press conference that Audrey Matura on behalf of the 3 Central American
Butane importers: Gas Tomza Limited, Southern Choice Butane, and Belize
Western Energy Limited.
These 3 companies insist that they are just trying to be responsible
corporate citizens by looking out for Belizeans during this difficult
time.
But viewers will remember that this public relations pivot does not
line up with the Barrow Government's recent characterization of these
companies. Last year, the Government passed the National Liquified
Petroleum Gas Project Law. With this law, a public-private company,
known as the National Gas Company, has been given the exclusive
authority to import LPG into the country. National Gas will basically
take over the responsibility that these 3 importers played in the
supply of butane to your homes. National Gas will import, and they will
then issue supply tenders to distributing companies such as BWEL,
Tomza, and Southern Choice Butane.
That way, the Government directly controls the importation of LPG, and
it is envisioned as a consumer protection mechanism to prevent these
companies from exerting the type of dominance and control that they
currently have on the LPG market.
Then, in December of last year, the Government went back to the House
to pass the Supplies Control Amendment Bill. This was to put a hard
ceiling and floor on the price of cooking gas. They say that these very
same Central American importers were engaging in predatory pricing
where they dropped their prices below the acquisition costs to drive
their local competition out of business.
So, as far as viewers are aware, these Central American companies
aren't exactly the model corporate citizens they are claiming to be.
For context, here are the comments that members of the Barrow
Government made in the House of Representatives during the passage of
these laws to get tough on these importers:
http://www.7newsbelize.com/sstory.php?nid=49992&frmsrch=1
August 16, 2019
Rt. Hon. Dean Barrow, Prime Minister
"What is happening to us now where the Mexicans all get together and
basically, it's one common ownership you know, whether dehn name Z,
whether dehn name BWEL, whatever, and they hold us to ransom. They come
and they say this is the price you will allow us to charge, otherwise
we wahn stop importing the gas. So this, if it does nothing else takes
us out of that stranglehold that these foreigners have, on not just
government, on the people of this country."
http://www.7newsbelize.com/sstory.php?nid=51236&frmsrch=1
File: December 4, 2019
Hon. Tracey Panton, Minister of State - Trade
"They are now selling at below the acquisition cost price and they are
undercutting and undermining the retail sector."
Rt. Hon. Dean Barrow, Prime Minister
"They decided they would take a loss. Why? Capitalists are rational and
that doesn't seem rational. The whole idea is to drive all the local
retailers out of business. When we met with those 25 retailers, some of
them were next to tears. The predatory pricing has been in effect for
maybe a week or so already and there were people saying we have our
loyal customers, but they can't fool with us, because we have not been
able to sell 1 tank of gas, because of what the Mexican mafia (maybe I
shouldn't say that), because of what this family monopoly is doing.
Then when every one of the 25 plus Belizean retailers would have been
driven out of business - when they came to us, some of them were on the
point of shutting down. What you think these people who control
everything would have done? They would have then taken it up 3, 4, 5
times above the market thing and when it is the Ministry's duty to do,
when the ministry would have said to them, no, you can't sell - then
they would cut you off. Then we will not import. They have done it
before."
http://www.7newsbelize.com/sstory.php?nid=51483&frmsrch=1
File: December 23, 2019
Rt. Hon. Dean Barrow - Prime Minister
"Unfair pricing in the sense of those that control the importation, and
in fact the distribution, have, in the past, have tried - or not tried,
succeeded, oftentimes against the wishes of the Government, but
precisely because they were able to hold us to ransom to put the prices
at a level that's unfair to consumers, in terms of being exorbitant.
This is a whole new strategy, the effort to engage in predatory
pricing, to actually take the prices down below even the acquisition
costs, because they have deep pockets, in an effort to force out the
local Belizean distribution. The government is going to allow that to
happen."
Well, at yesterday's press conference, Audrey Matura, one of the
attorneys representing these LPG importers, claimed that the Government
is unfairly maligning them. Here's how she explained why:
Audrey Matura - Attorney For Central American Importers
"When he had said that the companies, that my clients were the cartel,
and the monopoly, that is not true. He is an attorney. He knows the law
of this country. Our company law says that each company is an entity
unto itself. Our client, although they've come together to fight this
case, and the reason we have more than 1 attorney is because, they are
very competitive with each other. They keep fighting for market share.
They've never been a monopoly. They war with each other. 1 minute, one
has more market share than the other. The Prime Minister has said to
this nation that the companies are owned by 1 family. That is not true.
They may be related, but it's not 1 family that owns it, and they have
all of them. Different members of a family."
"No, our clients, individually, none of them control a huge part of the
market. They are always fighting. They've been in business for over 30
years, at different times. Tomza is the most recent of these companies.
BWEL is the eldest of these companies. If you go and look at the
history over the years. At one point, BWEL controlled a majority of the
market share. Then, at some point, it was Zeta. Then at some point, it
was Tomza. And then, they fight with each other, and it goes back to
BWEL. They are paying taxes. They are corporate citizens without
special protection. The only reason they need to be quashed is because
now, they've become a liability when the government is creating a
monopoly. And the only reason you all are hearing now about the lower
prices is that they have always had fights with the Government when the
government should lower the prices and they don't. They now are forced
to go to the court, to protect their interests, which they've had here
for 30 years. It's business, but, it's not an unjust business. They are
always going to be at the mercy of the government."
Of interesting note is that this public dispute between these companies
and the Bureau of Standards over their proposed price drop, has
resulted in bigger ease to customers.
Last week, the companies said that the current price per pound of LPG
is 93 cents, and the price per gallon is $4.20.
Well, the Bureau of Standards passed Statutory Instrument #53 of 2020
today. In it, the controlled price for Butane has been decreased as
follows. In Corozal and Belize City, you can buy your cooking gas for
78 cents a pound or $3.55 a gallon. In Orange Walk, butane retails for
79 cents per pound or $3.59 per gallon. In Belmopan and San Ignacio,
the price is 80 cents per pound and $3.64 per gallon. In Benque Viejo,
the price is 81 cents per pound and $3.68 per gallon. In Dangriga, the
price is 82 cents per pound and $3.72 per gallon. And in Toledo, the
price of butane is 83 cents per pound and $3.77 per gallon.
All of these new prices are bellow the proposed price that the 3
importers wanted to charge. They wanted to charge 88 cents per pound
and $.3.99 per gallon countrywide. Still, just a few minutes ago, the
companies sent out a joint press release patting themselves on the back
for the price decrease that the Bureau announced this evening.
Their press release says, quote,
"This was only possible with the pressure caused when four major
LPG Importers agreed on a promotional sale price for butane as a
form of COVID19 relief.The public, having become aware of the
crisis faced by the LPG Companies for offering lower butane prices,
brought much pressure demanding lower prices."
End quote.
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