Consulting with AG’s Department in putting together a strong defence

Jamaican soap manufacturer Blue Power Group has filed a preliminary defence in its year-long trade dispute with its Dominican rival, Dominica Coconut Products Successors (DCPS), which has now ended up in the Jamaican court.

The matter was brought to the Council for Trade and Economic Development (COTED), the trade arbitration body of CARICOM, by DCPS, which won the first round with COTED issuing an adverse ruling against Blue Power and the Government of Jamaica. But, earlier this year, DCPS took the dispute further, filing a lawsuit in the Supreme Court of Jamaica against four government agencies and Blue Power Group.

The lawsuit is seeking to restrain the Trade Administrator and the Trade Board from issuing the company Certificates of Origin in respect of soap produced from soap pellets/noodles imported from outside of CARICOM. The lawsuit also seeks to restrain the classification of soap noodles imported by Blue Power under the Tariff code 38.23 and for declarations that the soap noodles/pellets were wrongfully exempted from the 40 per cent Common External Tariff.

In addition, the law suit seeks to direct the Commissioner of Customs and Excise and the Jamaican Customs Agency to apply the Common External Tariff of 40 per cent on all soap noodles/soap pellets imported by Blue Power and other soap manufacturers form outside of CARICOM and to obtain a referral to the Caribbean Court of Justice for an advisory opinion on the issues of whether: (a) The Certificates of Origin issued to BPGL were validly issued; (b) The Common External Tariff of 40 per cent is to be imposed on imports of soap noodles by Blue Power.

Blue Power argues that the matters being raised by the lawsuit are issues of policy under the purview of the Government of Jamaica. However, it is important to clarify the matter of the tariff classification, which Blue Power is required to use and for this reason it is useful to be a part of the defence.

Blue Power’s legal defence is being will be handled by its attorney, Symone Mayhew, Q.C. who has already filed the company’s preliminary defence and will liaise with the Attorney-General’s Department, which is representing the four government agencies.

Blue Power has already been notified that the use of imported noodles will disqualify its exports to CARICOM for duty-free access. The consequence of this decision is the application of a 40 per cent tariff on soap products sold into CARICOM and this in turn will see a significant immediate reduction in export business.DCPS has complained of unfair competition, arguing that the soap pellets raw material imported from Indonesia by Jamaican producers was simply reshaped as soap without going through a process of manufacturing transformation. The Dominican firm contends is necessary for the finished goods to be classified as being of CARICOM origin thus benefitting from the 40 per cent tariff.