Logs - US$130 vs US$569

Logs - US$130 vs US$569

Forestry transfer pricing probe on -Commissioner Singh -Barama, Jialing to come under closer scrutiny
By Nicosia Smith
Saturday, December 9th 2006
In the wake of a flurry of critical letters and concerns about log exports, Commissioner of Forests James Singh yesterday disclosed that a probe is already being done of allegations of transfer pricing in the industry and it was also disclosed that two producers have pledged to push value added output.

Singh also vowed to take action against log exporters found guilty of transfer pricing.

Speaking at a press conference yesterday at the Agriculture Ministry boardroom, Minister of Agriculture Robert Persaud and Singh responded to several concerns raised by letter writers and others in this newspaper over alleged non-compliance by Jialing Forest Industries Inc and Barama Company Ltd (BCL).

Meanwhile, Singh, head of the Guyana Forestry Commis-sion (GFC), told Stabroek News in an interview following the press conference yesterday that the issue of transfer pricing came up several months ago and an investigation is ongoing. "Action will be taken against companies for transfer pricing," he said.

He added that although persons wanted the GFC to make a statement on the issue it could not be done before the investigation was completed. One letter writer (see page 6 of today's issue) quoted the actual export price declared to the GFC for purple-heart logs as US$130 per cubic metre, while the import price at Guangzhou City in China for the same logs was US$569, a large difference. The investigation is expected to uncover if this practice indeed exists as if it does, it means that Guyana is losing millions of US dollars on levies that should be paid on these log exports. read more