Reuters logo
UPDATE 2-Argentine court orders prosecution of Cargill execs
October 9, 2010 / 1:28 AM / in 7 years

UPDATE 2-Argentine court orders prosecution of Cargill execs

* Tax agency says Cargill evaded at least $14 mln in taxes

* Fellow grains exporter Bunge also under investigation

* Cargill denies the charges, vows to appeal (Adds details)

By Magdalena Morales and Eduardo Garcia

BUENOS AIRES, Oct 8 (Reuters) - An Argentine court has indicted two executives of agribusiness giant Cargill [CARG.UL] for suspected tax evasion, the tax agency said on Friday.

Last week, authorities raided the local premises of fellow global grains exporter Bunge (BG.N) after the AFIP tax agency accused the company of evading close to $300 million in income tax between 2007 and 2009. [ID:nN07150061]. Bunge has denied the charge.

A court in charge of economic crimes has decided to prosecute the chairman of Cargill’s Argentine unit, Hector Orlando Marsili, and Javier Gustavo Fernandez, an executive working for Cargill’s Uruguay branch.

Cargill Argentina is under suspicion of evading at least 56 million pesos ($14 million), the statement said, adding that Bunge executives could also be indicted.

No one at Bunge in Buenos Aires or Rosario could be reached immediately for comment.

Cargill denied wrongdoing. Cargill Argentina President Hugo Krajnc told Reuters on Friday that “the judge had ignored all the proofs provided by the company” and that the company plans to appeal.

Late last month, AFIP chief Ricardo Echegaray, who is a close ally of the center-left government in the world’s No. 3 soy supplier, accused four of the country’s largest grain exporters of evading taxes in 2009, without naming them.

President Cristina Fernandez commented on the case on Wednesday via her Twitter account saying: “it’s incredible, the more they earn the more they evade.”

Fernandez has justified high export levies -- 35 percent on soybeans -- as a way of redistributing the country’s farming riches in a country where tax evasion is rife.

The export taxes, boosted by a bumper soy and corn harvest, have helped fuel robust tax revenue growth at year-on-year rates of above 35 percent in recent months. Hefty tax revenue allows Fernandez to maintain social spending ahead of a presidential election next year.

As well as being the No. 3 supplier of soybeans, Argentina is the world’s top exporter of soyoil and soymeal and the second-biggest corn provider after the United States.


Krajnc said the court decision on Friday stems from an investigation by the AFIP regarding Cargill’s operations between the years 2000 and 2003.

AFIP accuses Cargill Uruguay, which is a branch of Cargill Argentina, of under reporting revenue in those years.

The tax agency said Cargill Argentina used a scheme to sell grains to its own branch in Uruguay, which would later resell them at a lower price and report losses so that the parent company in Argentina would have to pay less taxes.

Soy is Argentina’s No. 1 export earner and the Rosario grains exchange sees this year’s agricultural exports totaling $24 billion due to a bumper soy and corn harvest.

Privately held Cargill was Argentina’s biggest exporter of soyoil and soymeal last year, followed by Bunge Argentina, Agriculture Ministry data shows. (Additional reporting by Luis Andres Henao; Writing by Eduardo Garcia; Editing by Nick Macfie)

Our Standards:The Thomson Reuters Trust Principles.
0 : 0
  • narrow-browser-and-phone
  • medium-browser-and-portrait-tablet
  • landscape-tablet
  • medium-wide-browser
  • wide-browser-and-larger
  • medium-browser-and-landscape-tablet
  • medium-wide-browser-and-larger
  • above-phone
  • portrait-tablet-and-above
  • above-portrait-tablet
  • landscape-tablet-and-above
  • landscape-tablet-and-medium-wide-browser
  • portrait-tablet-and-below
  • landscape-tablet-and-below