October 3, 2018 / 2:59 AM / a month ago

Former Gunvor manager jailed for 12 years in China - Bloomberg

SINGAPORE (Reuters) - A former Singapore-based managing director for commodity merchant Gunvor Group was given a 12-year prison sentence in China for his role in evading Chinese tariffs on oil imports, Bloomberg reported.

Dikun Yin was charged by Chinese authorities in June last year with smuggling 1.3 million tonnes of fuel, mostly between the Philippines and China, and evading nearly 378 million yuan ($55.7 million) in taxes. He had, by that time, already been held for a year.

Gunvor said in an emailed statement to Reuters on Tuesday it had “been notified of the situation regarding its ex-employee in China” and added that “Gunvor itself has not been charged and is not a party to those proceedings.”

In May 2016, Chinese authorities seized a tanker and detained several people, including Dikun Yin, as part of a probe into suspected tax evasion on imported oil.

The charges against Yin centred on sales of light cycle oil (LCO) from the Philippines to Chinese buyers over a two-year period.

Prosecutors argued that the LCO, a refinery by-product for diesel blending, had not originated from the Philippines, and was therefore taxable.

Under a free-trade agreement between China and the Association of Southeast Asian Nations (ASEAN), goods that are manufactured in ASEAN countries are exempt from Chinese import tariffs. The Philippines is an ASEAN member.

Gunvor said it disputed the conclusions in the case because “the Philippines customs authorities have confirmed relevant customs documentation was issued in full compliance with applicable customs rules and regulations.”

Gunvor said it was assessing its legal position on the matter.

($1 = 6.8680 Chinese yuan renminbi)

Reporting by Henning Gloystein in SINGAPORE and Julia Payne in LONDON; Editing by Christian Schmollinger and Darren Schuettler

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