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Union Carbide sold its products in India for 14 years after Bhopal Disaster through dummy companies: Claims report citing internal documents

Al Jazeera says that while it was known that Union Carbide used dummy companies to do business in India after the Bhopal disaster, the extent of the covert operation is being published for the first time now, including the fact that the covert business went on for 14 long years.

Union Carbide, the company responsible for the death of over 15000 people and illness of over half a million victims in the Bhopal disaster, resumed business in India just three years after the tragedy through a dummy company, a report by Al Jazeera citing internal company documents claims. The report states that Visa Petrochemicals Private Limited based in Mumbai is actually the front company of Union Carbide, which was formed to continue business in India after Carbide was banned in India after the 1984 disaster.

Al Jazeera states that The Reporters’ Collective accessed internal company documents of Union Carbide Corporation (UCC), which show how the company plotted an elaborate scheme to resume its business in India bypassing the authorities and courts in the country. According to the report, this front company operated for 14 years in India, which means the company was active in India from 1988 to around 2002.

According to the report, UCC sold its products covertly to several firms owned by the central and state governments, as well as some large private corporations. Among them was a buyer from Bhopal itself, a company owned by the Madhya Pradesh government. The company was a joint venture partner with a cable company that purchased UCC products through the front company.

UCC and its associates established three firms in India, the United States, and Singapore to create a discrete backdoor into India, because UCC was seen as the devil of the Bhopal Disaster by the public, and courts were pursuing it. Union Carbide employees referred to these three companies as “front” and “dummy” companies in internal documents.

Sometimes, they referred to these companies as their “extended arms”. These front companies took orders from Indian customers, rebranded UCC products, routed them through multiple ports to hide the true source, and delivered them to customers. The company sold materials used in the manufacture of household goods in everything ranging from telephone cables to paints.

In the internal documents, UCC admitted that these dummy companies were “a legal requirement” to help it maintain its “distance from India.” This admission was made in an internal business plan for UCC to continue selling goods in India despite the fact that Bhopal District Court had ordered the seizure of all of its moveable and immovable assets in the country.

The report also claims that the government entities that did business with Visa Petrochemicals knew that it was a front company for Union Carbide, because the company itself informed them during tender procedures. This arrangement ended in 2002, after American giant Dow Chemical acquired Union Carbide for $9.3 billion.

The Al Jazeera report claims that the records show that the company sold more than 55,800 tonnes of wires and cables in India between 1995 and 2000. The report further states that Indian media had earlier reported that Union Carbide was selling its products in India after relabelling them, but its true extent was not known.

Earlier in 2012, it was reported that UCC products were continued to be sold in after relabelling them and rerouting them through other companies. This was revealed in US courts during a litigation against Dow Chemical over pricing of products in the early 2000s.

A 2001 email by Graham Fox, Dow Chemical regional GM for Middle East & Indian subcontinent had stated that UCC was selling its products in India through Mega Visa. In the email to Ravi Muthukrishnan, country manager, Dow Chemical International Pvt. Ltd. (Mumbai), Fox had stated that UCC had used Mega Visa to handle many of their sales of specialty chemicals, some bulk chemicals and wire & cable products. “They work across our Dow businesses and have some several million $ sales revenue as I understand it,” the mail had added.

Al Jazeera adds that while this covert operation was reported earlier, its actual scale was not known at that time. It says that the extent of the operation by Union Carbide is being published for the first time now, including the fact that the covert business went on for 14 long years.

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