Zespri’s Subsidiary Company Sentenced by Chinese Court

Zespri’s Chinese Subsidiary Company Sentenced by Chinese Court

NZ Kiwifruit Growers Incorporated (NZKGI) has been advised that Zespri’s Chinese Subsidiary Company, Zespri Management Consulting Corporation, has been found guilty of smuggling. One of Zespri Management Consulting Corporation’s employees has also been found guilty as an accessory. Zespri Management Consulting Corporation has been ordered to pay a fine of approximately NZ$960,000 and make reparation payments of up to NZ$10 million. Its employee has been sentenced to five years in prison.

NZKGI understands that the importing arrangements which are the subject of the charges, relate to 2008 to 2010 only, and from 2011 onwards, the import arrangements operated by Zespri are not being questioned by the Chinese Authorities.

However, NZKGI is very concerned about this situation and has therefore established an independent inquiry into what has happened. The Inquiry’s Terms of Reference are to inquire into the circumstances that gave rise to the Chinese prosecutions and the effects these prosecutions will have on the Zespri brand and continued trade with China.

The Inquiry commenced its work in early March and is not expected to report until late April at the earliest.

Zespri is cooperating fully with NZKGI’s Inquiry.

“While these matters are historical it is important that we, as the representative grower organisation, undertake a thorough review of this matter. In Zespri, growers have a stake in a hugely valuable global brand, a brand which has delivered real value to New Zealand kiwifruit growers since its inception in terms of orchard values and orchard gate returns.

“Therefore, growers need to have full confidence in Zespri’s activities and we need to ensure that where improvements within Zespri can be made, they are made.”

Mr Chapman said China was an important market for New Zealand kiwifruit, and New Zealand kiwifruit growers were concerned that imports and sales of New Zealand kiwifruit are not stopped or slowed down as a result of this court decision.

“Our enquires indicate that our continued exports to China have not been affected to date. We also want assurances that they will not be affected by this decision going forward.

“We will closely monitor the progression of the 2013 sales season to gain confidence that sales are going as planned,” Mr Chapman said.

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