Rock Hard Cement, owned by Barbadian construction magnate Mark Maloney, has won round one of a trade dispute with the Arawak Cement Company.
The council of trade ministers in CARICOM, together with the global authority on customs classification, have agreed to the disputed classification of Rock Hard cement in the Trinidad market which enjoys lower duties compared to Arawak’s product.
But the final outcome is to be decided when the matter is heard by the Caribbean Court of Justice (CCJ) from June 11 to 13.
Trinidad Cement Limited – the parent company of Arawak Cement in Barbados brought an action before the CCJ against Trinidad and Tobago alleging that the state was misclassifying Rock Hard Cement as “other hydraulic cement”, as opposed to “Portland cement-building cement grey”.
As a result of the classification, the competing cement manufacturer claimed that Rock Hard Cement was attracting a lower rate of duty than it should.
Rock Hard Distribution Ltd applied to join the proceedings and retained legal counsel to defend the classification of its cement as “other hydraulic cement”.
The company provided testimony from international experts on both the composition of cement and its classification, and the interpretation of the Harmonised Commodity Description and Coding System on which the Common External Tariff is based. The CET is the CARICOM duty on extra-regional products which protects good made in the customs union.
After lawyers for Rock Hard presented the expert testimony to the CCJ, both Trinidad Cement Limited and the CARICOM Secretariat argued that the matter of classification falls within the remit of CARICOM’s ministerial decision-making body on trade issues, the Council for Trade and Economic Development (COTED) and should be decided by COTED.
The World Customs Organisation (WCO) which represents 183 customs administrations across the globe that collectively processes about 98 per cent of world trade, considered the global competent authority on customs matters, was asked by COTED to provide a ruling on the classification of Rock Hard Cement.
Both the WCO and COTED have now considered the classification of Rock Hard Cement and have ruled that Rock Hard Cement is correctly classified as “Other Hydraulic Cement” which attracts 0-5 per cent duty under the CET.
Rock Hard Cement said today it fully expects the CCJ to uphold COTED’s ruling in the matter of the classification of its product.
In response to the developments, Maloney told Barbados TODAY tonight: “We are glad to know that the ruling is in keeping with what we know to be true and are glad to see that both WCO and COTED are aligned on this matter of classification.”
The documents submitted to the CCJ in preparation for the hearing were filed last Friday by the CARICOM Secretariat’s general legal counsel, Corlita Babb-Schaefer, acting in the CCJ’s original jurisdiction as arbiter of the CARICOM Treaty.
The document, a copy of which has been obtained by Barbados TODAY, revealed that the case is between claimants Trinidad Cement Limited (TCL) and Arawak Cement Company Limited, the State of Barbados as defendant, and Rock Hard Cement Limited – the intervener.
Efforts to reach Arawak’s General Manager, Yago Castro, tonight proved futile.