Slapped with $20M fine: RAMPS Logistics breached and bypassed local systems
Hours after Ramps Logistics – a Trinidadian company offering full-service supply chain management in Guyana – denied manipulation of local systems, it has come to the fore that the company is currently facing a multi-million dollar fine for its breach and bypass of systems at the Guyana Revenue Authority (GRA).
High-level sources have told the News Room that a few months ago, the company was fined $20 million by the GRA for breach of its customs regulations as attempts were made to bypass the safeguards put in place.
Further, GRA is reportedly still awaiting a response from the logistics company, which holds major stakes in the logistic sector of the oil and gas industry, on why its brokerage license should not be revoked.
GRA has reportedly written to the company several months ago but to date, the company has not responded.
This revelation was made one day after Ramps Logistics publicised a decision by the Local Content Secretariat to deny its application for a local content certificate amid accusations that the company had violated the laws and hatched a plot to guarantee access to a schedule of services set aside for Guyanese.
Head of the now divested Trinidad-owned company, Shaun Rampersad revealed on Wednesday that following the enactment of the Local Content Act in December 2021, the company sold 51 per cent of the company to a Trinidad-born businessman, Deepak Lall, who has Guyanese parentage, with the sole intention of qualifying to be on the register.
Many persons have rejected the move to use a Trinidadian with decades-old Guyanese heritage to satisfy the requirement in the law as “fronting” or a “rent a citizen” arrangement.
Sources within the business community say it is a clear attempt to find ways around the law that will have to stand legal scrutiny.
In addition to the 51 per cent ownership, the law also stipulates that Guyanese nationals must hold at least 75 per cent of executive and senior management positions and at least 90 per cent of non-managerial and other positions.
And by its own admission on Thursday, the Board of Directors of Ramps Logistics comprise three Guyanese (including Lall) and two foreigners.
The Board structure has also been criticised as failing to meet the requirements that companies must have Guyanese holding 75 per cent of executive and senior management positions in order to be considered a local company.
Rampersad had rightfully underscored the importance of the certificate, saying the company stand to lose big and might have to trim its staffing if it stayed and operated in the sector without the certificate.
The News Room understands that amounting to billions, the company currently handles the majority of logistics contracts offered by US oil giant, ExxonMobil.
After it was made public on Wednesday that Ramps Logistics was denied the certificate, the Private Sector Commission issued a statement expressing its full support of the government’s intention to take strong action against entities that are attempting to circumvent Guyana’s Local Content Law.
“The PSC is concerned by the ongoing practice to bundle contracts which often limits local businesses participating in the value chain. The Commission will continue its advocacy to ensure that the Local Content Law aids the utilization of Guyanese goods and services and supports skills development, and the training and employment of citizens,” the statement noted.
Meanwhile, on Thursday, the Georgetown Chamber of Commerce & Industry (GCCI) noted in a statement that benefits accrued through local content provisions are not just for Guyanese owners, but for Guyana.
The GCCI used the statement to repudiate any enterprise or citizen that seeks to exploit the local content framework by operating under the guise of local participation when this is not, in fact, the reality of the operation.
“This phenomenon – commonly referred to as fronting or rent-a-citizen’– has the potential to reduce the amount of value which accrues to Guyana and runs counter to the spirit and intent of the Local Content Act. As such, the Chamber calls on the Local Content Secretariat to examine the beneficial ownership of enterprises seeking to obtain Local Content Certificates and recommends that the burden of proof regarding beneficial ownership lie with the enterprise seeking to apply for the Certificate,” the statement noted.