EQ: Nestle - "DO YOU PLAY BY THE RULES?"

NESTLE: "Do You Play By The Rules?"

by The EQualizer Post, originally published on 29 March 2011

Original and full article available online here.

"Peter Brabeck:Nestle Chairman

It is scandalous, ludicrous and highly irresponsible for the chairman of a global conglomerate that tripled its profits last year to talk about higher corn prices forcing millions into starvation ... Perhaps if Nestle is so concerned about food prices, its board will consider putting more of their $35.7 billion in 2010 profits back into poor communities. Just their profits alone represent more than half the entire farm value of the 2010 U.S. corn crop.

SOURCE: Delta Farm Press

"As the largest bottled water company in the world, it is hypocritical in the extreme for Nestle to be trying to gain media exposure on World Water Day."

HALIFAX, NOVA SCOTIA--(Marketwire - March 22, 2011) - CUPE Nova Scotia President Danny Cavanagh is joining a chorus of water activists who say Nestlé Waters Canada, a private water company, is exploiting World Water Day for profit.
CUPE says the company issued a press release alerting the media that company executive John Challinor II will be accepting calls from the press on World Water Day (today) to talk about the company's "policies on water management and conservation."
The Inside the Bottle coalition – which CUPE is a part of – is encouraging its supporters to call John Challinor II today and let him know that water is not something that can be bought and sold for profit.
Cavanagh says, "As the largest bottled water company in the world, it is hypocritical in the extreme for Nestle to be trying to gain media exposure on World Water Day."

"Isn’t it strange to talk about not wasting when you gave us a water bottle to waste?"

The Globe and Mail newspaper reports that at the launch of Waste Reduction Week, hundreds of schoolchildren were given souvenir bags containing bottled water from Nestlé.

To their great credit, the students reacted badly to the Nestlé promotion (Nestlé Waters Canada sponsors the Waste Reduction Week). They wrote to both the recycling council, the corporate sponsors and to the two Ontario government ministers attending the event.
As one student noted:

"Isn’t it strange to talk about not wasting when you gave us a water bottle to waste?"

Bullies in the spotlight

"Predatory Nestle" by Ducky Paredes (original article appears here).

NESTLÉ S.A, one of the largest food and nutrition companies in the world, operates in 86 countries and employs 283,000 people. Here, it is Nestlé Philippines, Inc. (NPI).

NPI is once again the subject of complaints, filed by two of its Filipino distributors for allegedly engaging in predatory pricing and for two separate cases of perjury.

What is predatory pricing? Wikipedia defines it as "the practice of selling a product or service at a very low price, intending to drive competitors out of the market, or create barriers to entry for potential new competitors. If competitors or potential competitors cannot sustain equal or lower prices without losing money, they go out of business or choose not to enter the business."

What is surprising here is that the complaint of predatory pricing comes from its own distributors who feel that Nestle itself is the predator that would devour them.

The complainants are Service Edge Distribution, Inc.(SEDI) and its sister firm, FDI Forefront II Trading Corporation (FDI 2). The first has been Nestlé’s distributor for the Caloocan, Malabon, Navotas and Valenzuela (Camanava) area since December 2001 while the latter became the distributor for northwestern Quezon City in July 2003.

The predatory pricing complaint is based on Nestlé’s alleged violation of Article 186 of the Revised Penal Code. Docketed as I.S. No. XV-03-INV-10Q-06071, the case is now pending with Quezon City Assistant City Prosecutor Maribel Arriola. Among the respondents is NPI’s former chairman and CEO Doreswamy Nandkishore, now said to be with the Nestlé main office in Switzerland.

The two distributors say that Nestle, among other things, has been forcing them to sell the company’s products to their own clients at prices controlled and dictated by Nestlé. These price bulletins do not consider the actual cost of distributing these products, and other attendant expenses such as municipal taxes of up to 1 percent of sales. Distributors are compelled to follow the price bulletins under threat of termination of their distributorship contracts.

Apart from this questioned pricing strategy, the two distributors also accuse Nestle of withdrawing its promised marketing support. One specific instance cited was when Nestle allegedly ended the in-house financing of inventories that provided a 30-day credit line to distributors. Nestle used to extend its credit line to 45-60 days without penalty to align it with the actual periods within which the distributors’ own clients usually make the payments.

They said that in place of the in-house financing, and without consultation with its distributors, Nestlé Chief Financial Officer Peter Noszek unilaterally negotiated with different banks whereby the banks would provide distributors with revolving promissory note lines (RPNL) on a strictly 30-day credit limit. Since their own clients usually do not pay within 30 days, the distributors are forced to shoulder higher interest rates and other penalties that increase their operating costs. In effect, Nestlé shifted the cost of financing inventories from Nestlé to the distributors.

Among the allegations was that Nestlé Area Sales Manager Elisa Lupena, "in conspiracy with the other respondents even forced complainant FDI 2 to deliver new supplies to customers that owed FDI 2 more than P1 million in unpaid deliveries." Nestle’s Regional Sales Manager Jose Ceballos, "in conspiracy with his co-respondents, likewise ordered complainant SEDI to give a unilateral discount of five percent (5%) discount to George Cua of the Welcome Group of Quezon City."

The same discounts were purportedly ordered by Ceballos to be given to other wholesalers and supermarket customers in its area. These discounts resulted in losses for the distributors of P8.4 million in 2007 and P8.6 million in 2009. In spite of these losses and additional expenses, they were not allowed to go beyond the prices specified in the price bulletins. The complaint includes the accusation that although additional capital from borrowed money was infused into FDI 2 in compliance with the demand of Nestlé, the company still terminated the former’s distributorship agreement on December 21, 2007, or four days before Christmas Day. Thus, the firm was forced to stop operations and lay off its employees.

The perjury charges were an offshoot of the September 17, 2010 counter-affidavits of four top officials of Nestlé, The four are Nestlé Chairman and CEO John Martin Miller, Regional Sales Manager Jose Ceballos, Chief Financial Officer Peter Noszek, and Business Executive Manager for Liquid Beverages Shahab Bacani.

In their counter-affidavits, the four officials purportedly committed perjury and offered false testimony into evidence. These are alleged in several instances covering the issues of whether incentives and discounts are mere privileges or a matter of right, the infusion of additional capital in FDI 2 and the subsequent termination of its distributorship contract, the supposed indiscretions of Area Sales Manager Lupena, the mediation entered into by the contending parties, the granting of discounts to certain favored wholesalers as ordered by Lupena and Ceballos

The perjury charges also touched on the separate disbarment case filed by the distributors against Nestlé lawyer Aileen Cero for her alleged violation of the 2004 Rules on Notarial Practice (A.M. 02-8-13-SC) when she notarized a document concerning a negotiation wherein she was a participant.

Complainants also cited Nestlé’s claim that that it never acted in an oppressive, unjust or illegal manner in its dealings with its distributors. They referred to the judgment handed down by the Second Division of the Supreme Court in the case of Nestlé Philippines, Inc. vs. FY Sons, Inc. on May 5, 2006 under G. R. No. 150780.

Nestle filed the case in the Makati Regional Trial court which ruled against it and ordered the multinational to pay defendant FY Sons P1 million in actual damages, P100,000 as exemplary damages and P100,000 as attorneys fees.

Nestlé went to the Court of Appeals where it again lost. In fact, the CA even increased to P1.5 million the amount of actual damages that Nestlé was ordered to pay FY Sons. This was for the unjust termination of the distributorship agreement with FY Sons, unfair imposition of fines, and confiscation of the latter’s P500,000 time deposit to secure FY Sons credit purchases.

Nestlé elevated the CA decision to the Supreme Court but was again rebuffed when the High Tribunal, in a decision written by then Associate Justice Renato Corona, affirmed the ruling. The Supreme Court found Nestlé "at fault and (acting) in bad faith."

Banco de Oro (BDO) also sued Nestlé for P109.792 million in damages, together with its distributor, Interbrand Logistics and Distribution, Inc. The case involved hundreds of millions of pesos in loans and credit facilities that the bank extended to Interbrand on the strength of endorsements and certifications that Nestlé made concerning the financial standing and credit worthiness of its distributor. It turned out that the endorsements and certifications were fraudulently issued.

BDO charged the defendants of having "acted in utmost bad faith, and in wanton, fraudulent, reckless, oppressive and malevolent manner." In particular, BDO accused Nestle of having "knowingly made a false representation with intent to mislead the bank into renewing Interbrand’s credit facilities and allowing Interbrand to make further availments under the same to finance the purchase of (its) products which would eventually lead to (its) benefit".

Nestlé Philippines, Inc. is a member of the European Chamber of Commerce. We wonder if there is any action that this organization is contemplating in regard to this particular multinational considering the many complaints lodged against Nestlé Philippines, Inc..

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Readers who missed a column can access www.duckyparedes.com/blogs. This is updated daily. Your reactions are welcome at duckyparedes@yahoo.com

Bad MNC strikes again! by Ducky Paredes

HOW do you protect yourself from fraud and devious financial schemes if, in spite of all the sworn documents they signed, the presumably respectable parties to whom you had extended a series of loans, deliberately deceive you?

This is a lesson in doing business with entities larger than yourself or your company. What you will read about is a clear case of duplicity, prevarication and unethical conduct by an MNC and its regional sales manager.

The complainant is a leading Philippine bank that extended hundreds of millions in various loans and credit facilities to a local firm, Interbrand Logistics and Distribution, Inc., a top distributor of the MNC. The respondents include the MNC that produces and markets a wide range of food and beverage products. It operates on a global scale, with 2009 sales running above $100 billion.

The bank granted the loans after satisfying itself about the borrower’s credit worthiness and the viability of its business as exclusive distributor of the MNC’s products in Quezon City, Tarlac and Bulacan. The bank checked with the MNC and was advised that indeed, the borrower was "one of its top distributors in the country; that it meets its sales targets; and that its payment record is satisfactory."

Due to this favorable endorsement, the bank granted Interbrand in May 2006 credit facilities of P80 million and a Bills Purchase Line of P10 million. Interbrand availed of this facility in various amounts starting July 2006. It signed a Facility Agreement and issued promissory notes to the bank, to be redeemed upon maturity. It backed up its promise to pay by executing, in favor of the bank, a chattel mortgage over its merchandise inventories.

To further secure the prompt observance of the terms of the agreement, the President/Chief Executive Officer and a director of Interbrand also executed a Continuing Suretyship to answer for the loans.

The credit facility was renewed from year to year, after the bank had reviewed and reassessed the performance of the borrower. As part of due diligence, and prior to renewal, the bank always checked with the MNC about the financial status of Interbrand, and each time, the MNC would give a favorable endorsement.

The bank also conducted random checks with the MNC in between renewals to monitor the borrower’s creditworthiness and its status as distributor. One such random inquiry was made in June 2009. In its complaint, the bank claims that in reply, the MNC’s Head of Distribution Management told the bank that Interbrand remained as its No. 1 distributor in the Philippines. Even when MNC knew that this was no longer the case.

Another trade check was made on the borrower in September 2009 when its credit facility again came up for renewal. Reportedly, the MNC once more gave the usual positive assessment.

These favorable endorsements led the bank to renew Interbrand’s credit facility, allowing the latter to secure a series of 19 loans totaling P123.25 million in the second half of 2009. On January 13 of this year, Interbrand availed of still another loan, amounting to P6 million, backing this up with another promissory note.

But just two days after getting this latest loan, Interbrand defaulted on a P5.3 million borrowing that was due on January 15, 2009. Reminders and demands for payments were given to the borrower but it failed to settle its accountabilities.

In the course of its investigation, the bank discovered what appears to be a horror story, with both Interbrand and the bank ending up terribly scarred – financially and otherwise.

It turns out that the MNC, through its Regional Sales Manager (ASM), had been pulling out inventory from Interbrand’s warehouse. These were then delivered to some of the MNC’s key accounts that were urgently asking for additional product deliveries. In exchange, the ASM would issue credit memos that Interbrand could use, in lieu of cash, to purchase MNC products.

On various dates in May 2009, the multinational company, through its ASM, pulled out some P114 million worth of products from Interbrand’s warehouse. However, the ASM only issued P58 million worth of credit memos. The balance of P56 million was left unsecured.

When Interbrand tried to use the P58 million in credit memos to pay for the purchase of MNC products, the MNC refused to honor these, claiming that the credit memos were forgeries. It also denied having pulled out the P56 million worth of products not covered by the credit memos.

Oddly enough, the MNC reportedly acknowledged during a meeting with the bank that its ASM had, in fact, issued the P58 million in credit memos to Interbrand but it claimed that these were forgeries and were unauthorized.

Confronted about the false information he provided, MNC’s Head of Distribution Management allegedly told the bank that the company prohibits them from disclosing such information about its distributors.

Clearly, a trusting Interbrand is the victim of a huge scam. It was played for a fool by the MNC and its ASM. The trusting bank was also misled into thinking that everything was hunky-dory even when the MNC already knew that its ASM was a crook.

Interbrand went belly up because of the MNC’s collusion with its crooked ASM. Of course, this does not absolve Interbrand of responsibility over its unpaid accounts. According to the bank, Interbrand became aware of its money troubles as early as mid-2009, yet it knowingly failed to advise its creditor of its dire financial status. And it continued to avail of the credit facility, although it knew that it no longer had the capability to pay the loans.

In its complaint, the bank said Interbrand and its officials, as well as the MNC, deliberately concealed information vital to the decision about the credit facility to protect their own business interests. It said the defendants "acted in utmost bad faith and in wanton, fraudulent, reckless, oppressive and malevolent manner."

The bank also accused the MNC of having "knowingly made a false representation with intent to mislead the Bank into renewing Interbrand’s credit facilities and allowing Interbrand to make further availments under the same to finance the purchase of (its) products which would eventually lead to (its) benefit."

It asked the court to order Interbrand, its four officials and the MNC, to pay the bank P109.792 million in damages as of March 22, 2010 plus interests, penalties and other charges; at least P1 million in exemplary damages; more than P28.448 million in attorney’s fees and litigation expenses; and from Interbrand and its four officials, P30,497.85 in liquidated damages as of March 22, 2010.

Hopefully, Interbrand, as primary victim, has also sued MNC for all it is worth!

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Readers who missed a column can access www.duckyparedes.com/blogs. This is updated daily. Your reactions are welcome at duckyparedes@yahoo.com

versus

Clash of the Titans

WHAT happens when two “titans”—one of the country’s biggest banks and the other a multinational consumer goods giant—collide? The business community is sitting back to watch the potential fireworks explode.

News about this has been kept to a minimum, but the implications of this skirmish have been dominating coffee shop buzz for weeks now (if you’ve been following Biz Buzz, this issue initially surfaced a few months ago). The bank has included the multinational giant as co-defendant in a P170-million suit.

It seems that the multinational giant had some trouble a while back in Central Luzon, when its regional sales manager (coupled with the multinational’s own carelessness and neglect) was able to scam its area distributors a total amount estimated at close to a billion pesos.

Instead of reporting this to its stakeholders (especially creditor banks), the multinational reportedly chose to keep the entire thing strictly hush-hush. In the meantime, the company continued to provide glowing reviews and endorsements for its cash-strapped Central Luzon distributors to enable them to secure loans. As a result of this false representation, banks continued lending the distributors.

Predictably, this cycle eventually crashed. In its wake were left numerous bankrupt distributors and banks holding the bag. One particular bank conducted its own investigation and learned that the very root of the problem was the multinational’s business practices.

Odds are in favor of the bank as sources point out that it has extraordinary leverage against the multinational: the bank just happens to be owned by the country’s biggest retail operation and can therefore lock out the multinational’s products from all its shelves. Daxim L. Lucas

http://business.inquirer.net/money/topstories/view/20100817-287348/Pure-Foods-stalemate

Milo Marathon 2010: Nestle's Audacity to Skirt Responsibility: What's New?

The incident of Remus Fuentes' passing 48 hours after the Milo Marathon was never covered by Media. Insiders in the industry have acknowledged that this will never see the light of day, especially that Nestle, again, is involved. They always use their big advertising budget to squash any unfavorable news about them, threatening pull out of ads should any media outfit publish things such as this.

If you still haven't heard of this, here are the links to both sides of the story.

Remus's Father: http://www.pinoyfitness.com/2010/07/remus-story-as-told-by-his-father/

Nestle's Statement: http://www.pinoyfitness.com/2010/07/milo-marathon-2010-official-statement-on-remus-fuentes-incident/

You can judge for yourself who is telling the truth when you go through the posts. It is also very interesting to take a look at the comments of the people. Nestle thinks it can get away with generic pronouncements, half-truths, outright lying, and yes, even putting the actual blame on Remus by referencing lack of preparation as a big risk factor!

What assholes!!! An eight year old is fatherless now because of Nestle's idiocy! And now, Nestle has the gall to say that they did everything by the book and actually try to state that a tragedy like this is the runner's fault!

Mr. Rudy Fuentes, we support you! Nestle has a history of evading responsibility by using their size, power and money. There are several entities now who have filed cases against them. The biggest one is Banco de Oro. (I will be posting the copy of the case here soon.)

You are alone in this fight. You are not alone in seeking the truth. You are not alone in seeking justice.

They will not get away with this.

Repost from Green Peace April 15, 2010: Activists 'drop' in to Nestlé shareholder meeting

Please visit link here

LAUSANNE, Switzerland — Thirty activist 'orang-utans' greeted shareholders as they arrived for Nestle's Annual General Meeting today asking them to give Indonesia's rainforests a break and stop profiting from destroying rainforest, threatening biodiversity and accelerating climate change.

Inside the meeting itself Greenpeace activists dropped from the ceiling and unfurled two large banners directly over the heads of shareholders. We want shareholders to use their influence to change Nestle's policies and stop using palm oil and pulp and paper products from destroyed rainforests and carbon-rich peatlands.

Since the launch of our Kit Kat campaign (March 17th), 200,000 people have sent e-mails to Nestlé and hundreds have called them. Today hundreds more are addressing them and their shareholders online - we invited Nestle shareholders to receive messages during the AGM directly from online supporters of our campaign by visitinghttp://www.greenpeace.org/kitkat - where they will also be able to watch the Kit Kat video that launched the campaign and has now been viewed over 1.3 million times.

Our International Head of Forests Campaigns, Pat Vendetti, made a short address directly to shareholders. He urged them to ensure that Nestle stop purchasing products from rainforest destruction. The company is not only driving climate change and biodiversity loss if it continues, but it is also damaging its corporate reputation.

Earlier in the day German activists gathered at Nestle's headquarters in Frankfurt where they erected a 'Twitter wall' displaying tweets from online supporters at Nestle employees as they arrived for work.

Following the launch of the Kit Kat campaign, Nestle publicly announced that it would cancel its direct contracts with Indonesia's biggest palm oil supplier, Sinar Mas, because it has a long history of environmental abuse. These cancellations did not really give the rainforests a break, because Nestle continues to use Sinar Mas palm oil, as well as Sinar Mas pulp and paper products, via other suppliers like Cargill and Asia Pulp and Paper (APP), a subsidiary of Sinar Mas.

Each day that Nestle allows Sinar Mas products in it's supply chain, it links itself to the rampant destruction of Indonesia's rainforests and peatlands. Today we have published new satellite and photographic evidence showing that Sinar Mas continued to destroy peatlands and other conserved areas in Indonesia despite making a commitment in February to stop. Nestle is condoning this destruction by not acting immediately to remove all Sinar Mas products from its supply chains.

Deforestation is a major cause of climate change. It is so rampant in Indonesia that the country is the world's third largest greenhouse gas emitter. To avert catastrophic climate change we must end deforestation - to begin with we need an immediate moratorium on destroying Indonesia's rainforests and carbon-rich peatlands.

Take action

• Watch the Kit Kat spoof video and ask Nestlé to stop using palm oil from destroyed forests!

Support us

• To maintain our independence we do not accept funds from companies or corporations. Donations from individuals like you make campaigns like this possible - please give what you can.

For similar reports, you can visit other sites:

http://news.mongabay.com/2010/0415-hance_nestle.html

http://thenextweb.com/socialmedia/2010/04/16/greenpeace-drops-nestle-shareholder-meeting-facebook-comments/

BIG THANKS TO THE CONTRIBUTORS FOR THE LINKS!!!

Repost from Domini Torrevillas, Philippine Star 3/13/10

A lesson plan for DTI

As of the latest, and most likely last, Cabinet reshuffle, Secretary of Education Jesli Lapus will be moving to the Department of Trade and Industry (DTI) by the end of the month. I’d like to express my congratulations to Lapus for accepting the position. A three-term congressman before being named secretary of education, he previously earned his stripes as the chief executive officer of the Landbank of the Philippines, transforming it from a medium-sized development bank to the premiere state bank of its time.

Holding a doctorate in public administration, a master of business administration (MBA) from the Asian Institute of Management (AIM), and a post-graduate of Harvard University, Lapus first joined the government service in 1987 as undersecretary of the Department of the Agrarian Reform.  

Having held top executive positions in some of the largest manufacturing companies in the country, Lapus presents the most credible and capable choice for DTI head, aside from incumbent Trade Secretary Peter Favila.

Since the announcement, Lapus has been lauded by the business community, with highly-respected Philippine Chamber of Commerce and Industry Chairman Donald Dee welcoming him to the position; Executive Director Rob Sears of the American Chamber of Commerce of the Philippines (AmCham) has also given Lapus high marks for his unblemished reputation and intimate understanding of business. Hailed by Sears as being “pro-business,” the onus now lies on Lapus to inspire investors and businessmen alike to achieve greater things with our economy.

From the stands, it seems that the route of localization is the best trail if Lapus wants to make an immediate impact at the helm of DTI. Instead of following the worldwide trend of overextended economies, a logical course of action would be to turn inwards to another economic and cultural exchange, hinged on Small and Medium Enterprises (SMEs). These localization efforts entail increased attention to the tangible, the interpersonal, and the community; direct connections with SMEs and ties with businesses will surely prove useful for Lapus in the following months.

A turn to local business would necessarily move Lapus to ensure the protection of SMEs from unfair trade practices perpetuated by multinational companies that enjoy monopolies, which is a goal perfectly in line with Senate Bill No. 3099, or the Anti-Trust Act of the Philippines. As penned by Sen. Miriam Santiago-Defensor, the Act prohibits monopolies when public interest so requires it.

Presently, developed countries use anti-trust regulation to maintain healthy competition and promote an efficient working market economy; the circular flow of income between producers and consumers in these countries is, for the most part, uninterrupted by unscrupulous practices such as pressuring distributors and other SMEs to continually meet and exceed aggressive sales targets while simultaneously downsizing marketing and promotional support. In the Philippines however, there have been numerous instances of this exact behavior by multinationals forcing their distributors to close up shop, using bullying tactics and pointless mediation.

A well known multinational, for instance, makes it a habit to pass on non-performing accounts onto their distributors and insist that they deal with the problem instead. The same company has been known to cut off their in-house financing for distributors, leaving them to suddenly deal with the higher rates of a third-party bank. Combined with unreasonable quotas and the constant threat of termination, these distributors have no other recourse but to bite the bullet.

While SB 3099 and a slew of other bills on competition law are in enforcement limbo, the often-overlooked yet fully-empowered Ministry Order (MO) No. 69, Series of 1983, puts Lapus at the head of the crusade against unfair practices such as the ones described above.

MO 69 covers everything from price tags to monopolies and unfair competition. As a consumer — but a Filipino foremost — I urge Lapus to see the good he can do in his new position. He can put a stop to our SMEs being trampled under the feet of multinational giants, and maybe even spur our ailing economy to pull itself up by the bootstraps.

I for one am quite excited to see what Lapus has in store for us. If his record at the Department of Education is any indication, the DTI will become yet another feather in his very capable cap.

Repost from Ducky Paredes 3/12/10 Malaya: 10 Commandments of Fair Trade

I HAD been a distributor of San Miguel Beer and, presently, of Coca-Cola, both of which treat their distributors as true business partners. It is not always that way between multi-national companies (MNC) and their dealers.

Following is from a friend who had a bitter experience with a big, bad MNC, which continues operating and continues to mistreat and even abuse treat its business partners in the worst way. I have written about it several times. I find his contribution to this column interesting

Being familiar with the business model and the roles and expectations of both the multinational and the distributor, he wrote the following Ten Commandments of Fair Trade, as a guide to MNC on how not to treat their business partners:

Commandment One: Thou shall not use the bait of initial support. Bad MNC is notorious for promising marketing and promotional support to their distributors, as well as favorable in-house financing rates. A few months later, however, all support disappears into thin air. Furthermore, distributors are suddenly endorsed to a third-party bank for their financing (without prior notice), saddled with rates much higher than agreed upon.

Commandment Two: Thou shall not impose unreasonable quotas under the constant threat of termination. Bad MNC has been known to force distributors to sell at a loss, just to meet quotas. Is that how a "partnership" works?

Commandment Three: Thou shall not pull out thy products from the market without any explanation. One fine day, distributors of bad MNC were shocked to learn that batches of a certain milk product were being recalled. No explanation nor prior warning was given.

Commandment Four: Thou shall not instigate and fuel a price war. A near-scandal broke out among bad MNCs Central Luzon distributors when they found out that one dealer was being given ridiculously high discounts, and subsequently underselling counterpart distributors from Metro Manila. Obviously, Manila distributors were forced to lower their prices, but because the discounts were so unbelievable, many were forced to close. It turns out that the "discounts" was part of a scam perpetrated by bad MNC’s Regional Sales Manager, who has since fled with the money and gone into hiding. Oops.

Commandment Five: Thou shall share thy profit evenly. If distributors are working to the bone making the business earn, and yet are still at a net loss after five years of operation, something is wrong.

Commandment Six: Thou shall not condone tax evasion. Distributors of bad MNC pointed out that if they pay the local tax of one percent on gross sales imposed by cities, they would operate at a loss. Bad MNCs reply? Fine, don’t pay the tax.

Commandment Seven: Thou shall not deliberately delay lawful reimbursements. Bad MNC has a very effective – albeit crooked – way of dealing with the valid complaints of its distributors. They delay the reimbursements for months on end, thus crippling the distributor’s cash flow.

Commandment Eight: Thou shall not "hand over the empty bag". Whenever bad MNC has a problem account, or a buyer whose payment habits are terrible, they just pass these on to their distributors. These problem accounts suddenly become the distributor’s dilemma. Nice, right?

Commandment Nine: Thou shall not tolerate any conflict of interest cases, under any circumstances. The DTI is currently investigating a situation wherein bad MNC allowed yet another one of their regional sales managers to have an illicit affair with the managing officer of one of its distributors. Despite numerous parties repeatedly calling their attention about the matter, bad MNC took a hands-off policy. In a way, they actually encouraged the affair, since the distributor was achieving record sales. It was soon discovered that the numbers were padded, ghost deliveries were being made, and the unfaithful couple were all behind it.

Commandment Ten: Thou shall not ignore nor disrespect the proper authorities. The Department of Trade and Industry (DTI) has the power to enforce grave sanctions on a company for violating any of the commandments written above. They have full authority on the matter thanks to Ministry Order (MO) 69. MNCs cannot assume that they can get away with bullying Filipino entrepreneurs just because they are big.

The DTI does have the teeth with which to to bite the bad MNG back. Now, if only Jesli Lapus, the new DTI head, would only do something about this.

Nestle, The World is taking Notice! - Repost from Communique de Presse Gratuit, February 15, 2010

A popular French News Site has gotten hold of the Nestle's abusive practices. While the article is in French, it does not take a genius to gather from the article that Nestle is using its resources to bully and overpower small enterprises in developing countries. Where is Honesty, Integrity and Fairness? What happens to the higher standards of guidance when legalese is not enough? This is corporate hypocrisy at its best.

Click HERE for the link to the website.

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Société et entreprises : une dénonciation de la politique abusive des firmes multinationales

Moyens mis en œuvre pour régler parfaitement et confortablement une situation X(façon NESTLE). Les pratiques sans scrupule, trompeuses de ce monde géant et célèbre qu’est l’agro-alimentaire, font que ce mot Nestlé ( Niche ) a été abâtardi dans l’infamie.

John Richardson, de “Opines Global Watch Investissement”, fait remarquer que Nestlé a un côté sombre dans son comportement de citoyen corporatif. D’ un point de vue humain, nous considérons que la compagnie est un investissement à haut risque. “L’image respectueuse de la société Vevey, productrice de produits laitiers et alimentaires, basée en Suisse, est éclipsée par les nombreuses critiques, controverses, ainsi que par des informations non fondées qu’elle a obtenues au fil des années. Aux Philippines, cette société a ouvertement défiée la décision de la Cour suprême, datée d’août 2006, lui demandant de retourner à la table des négociations, concernant le Régime des retraites de ses 600 travailleurs géré par une ACB. Mais ce n’est pas son pire crime pour le moment.

La politique commerciale de Nestlé Philippines est synonyme de pratiques prédatrices. Nestlé a réussi à attiré des distributeurs de petite et moyenne taille, par le biais de mesures incitatives, comme des aides initialement financières, en équipement, en services, leur procurant ainsi un bon bénéfice net au départ.. Par la suite, Nestlé a imposé a l’ensemble de ces distributeurs de leur verser à l’avance les bénéfices à collecter, grâce à un système tripartite( Nestlé => Bank => Distributeur) auxquels ils donnèrent le non de “billets tournants en ligne”(R.P.N.L). Une telle mesure a laissé le soin aux distributeurs de Nestlé, de collecter auprès de leur clients ces bénéfices. Clients historiques de Nestlé dont certains non jamais acquittés toutes leurs factures.

En transférant ainsi ses stocks financiers, et si l’on applique le taux de change moyen annuel de la Banque Centrale des Philippines) en 2006, à 3.7 milliards de pesos (soit 80,2 millions de dollars) en 2007. Ses coûts de financement ont également diminué de 60,8 % passant de 734 millions de pesos(soit 14,3 millions de dollars) à 288 millions de pesos (soit 6,2 millions de dollars) pour la même période, explique Atty. Lorna Kapunan, le conseiller juridique de l’un de ses distributeurs philippins. Nestlé a mis en place ces mesures sans même concerter ses distributeurs. Faute de pouvoir se plaindre, Nestlé leur a «caché le miel», et a laissé ses partenaires dans le froid. L’ensemble des distributeurs de Nestlé ont donc été “nichés”(autrement dit floués)!

En avril 2009, Nestlé a ordonné le retrait des produits laitiers de la marque Bear de l’ensemble des rayons de ses distributeurs, et cela sans même justifier publiquement cette décision. Nestlé a délibérément caché de façon cynique le retrait de ces produits en prétextant que c’éait un exercice de simulation pour observer le temps de réponse nécessaire aux distributeurs pour mettre en place la mesure. Aucune somme d’argent qui sera attribuée dans une campagne de relation publique permettra de cacher l’indifférence de Nestlé sur le bien- être et la santé des consommateurs philippins. En somme, vous avez été “niches” Aucun montant de la campagne de relations publiques ne peut cacher son indifférence à la santé et le bien-être des consommateurs Filipino. Vous avez été nichés (autrement dit floués)!

Lorsque l’un de ses distributeurs, les IDE Forefront II Trading Corporation(IDE2),une philippine faisant partie de la petite entreprise, engagée comme distributrice de ses produits, a découvert que le Nestlé Area Sales Manager avait une liaison illicite avec son Président, celui-ci étant un homme marié. IDE Forefront II Trading Corporation(IDE2) a immédiatement attiré l’attention de Nestlé par rapport à ce conflit d’intérêt. Le fait que son directeur commercial de zone exerçait idéalement un pouvoir d’accroissement sur la demande du président, des objectifs de vente du distributeur, étant aussi son amant. Cette situation amoureuse a obtenu pour Nestlé, plusieurs «contrats de complaisance» sans oublier les commissions exponentielles de l’IED 2 sur les objectifs des ventes. Les propriétaires portèrent la question à la direction de Nestlé, qui n’a accordé aucune attention à ce sujet. Dans cette affaire Nestlé n’a pas eu le comportement attendu par la société plaignante. Apres une enquête menée discrètement par Nestlé, il s’est avéré que l’affaire fut jugée strictement personnelle puisqu’elle démontrait une relation amoureuse entre deux adultes n’ayant aucune conséquence sur le bon fonctionnement du distributeur. IDE 2 ne pouvait que constater, hélas, qu’il s’était fait “nicher” par Nestlé(autrement dit floué)!

Par la suite, Nestlé a résilié son contrat de distribution avec l’IDE 2, en prenant le risque aussi de perdre le contrat de distribution la société soeur d’IDE 2 : Service Distributors Inc Edge (SEDI). Comme si cella ne suffisait pas, Nestlé a contraint les propriétaires de l’IDE 2, à signer un accord de remboursement des sommes avancées pour le matériel promotionnel ainsi que le Quitclaim . Ce que Nestlé aurait du faire, c’était d’évaluer la véracité des propos, ainsi que la solidité des bases financières présentées par l’IDE 2 ainsi que sa demande de remboursement. Nestlé a délibérement choisi de s’en prendre à cette situation déplorable et de s’éloigner de toutes responsabilités supplémentaires.

Le Notaire et Conseiller juridique philippin de Nestlé en dépit de toute pièce contradictoire apportée au dossier a ainsi préparé le document qui, de toute évidence, est un acte manifestement illégal et une grave erreur de la marque Nestlé.

Faisant suite à ce document, IDE 2 a déposé une plainte devant la Cour suprême, cherchant à faire radier le conseil juridique de Nestlé pour faute grave et pour violation du serment de d’Hippocrate ainsi que la violation au code de la responsabilité professionnelle.

Deux ans à peine après avoir été présenté par Nestlé comme son “Distributeur de l’année,« l’IDE 2 se trouvé le dos au mur, sans un pouce de répit ou de remise de son «partenaire», et d’ y être poussé par la même main qui l’a attirée dans cette impasse - une impasse Nestlé.

Après la réalisation de l’audit judiciaire, l’IDE 2 a demandé un dédommagement supplémentaire pour perte de 235 millions supplémentaires de pesos (4,9 millions de dollars), plus 252.6 millions de pesos(5,3 millions de dollars) basé sur le coût de l’argent en remboursement des frais juridiques et professionnels engagés pour la période allant de Septembre 2008 au 31 Mars, 2009 ainsi que le reniement de son engagement précédent. Nestlé refuse désormais de reconnaître ces affirmations en disant que le compte de IDE 2 est une affaire close. Nestlé cherche maintenant à élucider sa responsabilité en utilisant le document Quitclaim qu’il avait obtenu en utilisant de fausses promesses, des pratiques contraires à l’éthique du droit, et des manœuvres sournoises.

Après avoir été acclamé comme Nestlé “Distributeur de l’année”, pendant deux années consécutives, l’IDE 2 a maintenant elle-même sa niche(elle s’est fait flouer par Nestlé)!

Happy New Year, Nestle! Remember your Cabuyao Workers?

Kung Hei Fat Choi to Everyone! As the new lunar year starts, let's remind our dear Nestle friends that they CONTINUOUSLY AND BLATANTLY deny the striking workers what is due them. Supposedly, while the Supreme Court says that the retirement benefits the strikers are asking for are legit, the SC also said that Nestle Philippines did not violate any laws! Talk about paradoxical decisions. While the Supreme Court is the final decision maker in the land, I do believe that there is nothing final so long as there is wrong done to anyone. In this case, that wrong has not been corrected, injustice still reigns and therefore this will never be final.

To the workers, ITULOY ANG LABAN!

To refresh you of the issues, here are a couple of articles:

KMU on CA decision: Where’s national interest in protecting Swiss firm Nestle?

Date:

31 August 2009

Reference Person:

Elmer "Bong" Labog, KMU Chairperson

Contact information:

0929-629-3234

Labor center slams unjust decision upholding firing of Nestle workers

Labor center Kilusang Mayo Uno slammed the Court of Appeals decision which essentially upheld the corporate interests of Nestle and justified the illegal dismissal of more than 500 Nestle workers, saying invoking “national interest” as primary ground only grants big foreign corporations more power to abuse Filipino workers.

KMU said the CA decision, which upheld the firing of Nestle workers who went on strike over Nestle’s refusal to grant retirement benefits in the collective bargaining agreement negotiations, is “simply unjust and unreasonable.”

“Where’s national interest in protecting the operations of Swiss company Nestle when the rights of Filipino workers are heavily under attack? Would there be a national emergency if workers, who are simply fighting for their just demands, refuse to abide by the DOLE order? KMU Chairperson Elmer “Bong” Labog asked angrily.

“How could workers return to their work if truckloads of heavily-armed AFP and PNP units are the ones implementing DOLE’s Assumption of Jurisdication and return-to-work orders?” he added.

Prior to the return-to-work order, an Assumption of Jurisdiction Order was issued by DOLE in Nov. 28, 2001 over the union’s notice of strike, enabling police and military forces to swoop down on the Cabuyao factory to preempt the strike.

The Supreme Court already ruled in favor of Nestle workers in 1991, saying that retirement benefits is a mandatory collective bargaining issue. In March 2008, it reaffirmed its decision as final and executory. The labor department, however, has not lifted a finger to implement the decision and has even denied the writ of execution filed by the workers last March 5.

“Nestle has continously ignored the two decisions of the highest court for several years. I ask the Court of Appeals, who’s the one breaking the law?” said Labog.

Sheer violence against workers

In their seven-year strike, Nestle workers have suffered violent dispersals by police and military forces who have an encampment inside the Cabuyao plant up to now.

On Sept. 22, 2005, Nestle Cabuyao union president Diosdado “Ka Fort” Fortuna was gunned down by suspected hired armed agents of Nestle on his way home.

“Clearly, the workers have no option but to continue their strike amid sheer intimidation by the armed forces in cooperation with Nestle. It is their best defense against Nestle’s desperate strategy to use the courts and armed forces to attack and end their just struggle,” Labog said.

“It is simply infuriating to hear that the appelate court has upheld corporate interest over the just and legal demands of Nestle workers. This is certainly a bad ruling that further exposes Philippine courts as anti-labor instruments of local and international capitalists.

"The recent CA decision has again clarified to the public that justice in this land favors big foreign corporations, not Filipino workers who are victims of unfair labor pratices committed by such big businesses,”said Labog.

Behind Nestle ad blitz

Submitted by PAMANTIK-KMU on Wed, 2007/02/28 - 9:45am.

• Wages, Work and Rights campaign

Media such as print, radio, and television continues to be bombarded by Nestlé commercial advertisements, featuring big names in Philippine show business. Vilma Santos, Cesar Montano, Tweety de Leon, Margie Barretto, Ruffa Gutierrez, Ai-Ai delas Alas, and Kris Aquino are only some of the highly-paid personalities promoting the values-oriented “Choose Wellness, Choose Nestlé” commercial aphorism.

What the public does not know (or what might have been kept from their knowledge), the Swiss-owned multinational company covers up its most atrocious acts against its workers and scoffs at the Supreme Court (SC) decision by way of conditioning the public with the hypocritical “choose wellness” ad. Nestlé promotes a culture of deception while denying justice to its workers for more than five years now.

The Nestlé Cabuyao workers in Laguna, Philippines went to strike on January 14, 2002 when the company used as pre-condition in the collective bargaining negotiations the non-inclusion of the workers’ Retirement Benefits. Despite the sacrifices perceived by the workers, the legitimate strike is backed by the 1991 SC decision affirming the NLRC (National Labor Relations Commission) decision that the Retirement Benefits is a legitimate collective bargaining agreement (CBA) issue.

Unfortunately, the workers’ picketline which was supposed to barricade the company gates was often destroyed by the management’s brutal rampage. Company guards, goons, police and military are garrisoned within and outside the gates.

The campaign “There’s Blood in Your Coffee, Boycott Nestlé” was launched by the workers as one of the leverages to air their legitimate grievance to the public and compel the Nestlé management to settle the labour dispute. It also aimed to counter the vast influence of Nestlé in media as well as its monopoly in the Philippine market.

At the start, the campaign hardly affects the company’s market reputation. However, the campaign caught popular attention and gained wide support in the local, as well as the international community, when two Nestlé unionists were murdered consecutively in September 2005. Luciano Enrique Romero Molina, a Sinaltrainal leader and Nestlé worker who was among the many workers tagged by Nestlé as persona non grata, was murdered on September 11 in Colombia. Diosdado Fortuna, Nestlé Cabuyao union president and chairman of Pagkakaisa ng Manggagawa sa Timog Katagalugan-Kilusang Mayo Uno (Solidarity of Workers in Southern Tagalog-May First Movement), was murdered while on his way home from the picketline on September 22.

Many believe that the murder of the two Nestlé workers is not coincidental. The murder of Nestlé Cabuyao union president Meliton Roxas in front of the company gates during their strike in 1989 is another case to prove Nestlé’s blood debts to its workers.

The SC ruled on the labour dispute in Nestlé Cabuyao on August 22, 2006, reaffirming its 1991 decision; hence, directs the Nestlé management and union to go back to the negotiating table to pursue the CBA negotiations.

The Nestlé management persistently snubs the highest court of the land. In fact, in its statement in a news article, Nestlé claimed that the workers who tried to barricade the company gates on January 14 are no longer Nestlé workers (Niña Catherine Calleja, “Workers at multinational food firm barricade factory”,Philippine Daily Inquirer 17 January 2007: A15). Such a statement diverts the real issue and is a blatant disrespect to the latest SC decision.

The ads blitzkrieg came in time and attuned to complement the news statement after January 14.

As Nestlé lavishly spends millions in ads, we have to scrutinize well enough their many purposes, aside from the endorsement of products and conquering the market. After probably knowing the real score, we don’t have to choose wellness if it’s Nestlé. Do we?

Deceptions: Laki sa Gata

If your publicly stated values are Honesty, Integrity and Fairness, then nothing of this sort should be written against you. The fact is, there is and it is really a concern for all Filipino consumers who are being mislead.

Dahli Aspillera, Columnist, Malaya

November 19, 2009:

AND I am talking about big celebrity endorsers. None involved in ad production care whether what they are saying is true or whether the way they say an English word is correct. Endorser, advertiser and ad agency won’t open reference book. Consumers, especially children, are victims.

No less than Vilma Santos-Recto, sadly, will allow herself to receive endorsement fees for endorsing "milk" when in fact, what she is pushing is not milk, but a milk drink. Very different. Not the best for infants. Check it out, Mrs. Governor.

The deception is the claim that her brand of milk has been around nourishing healthy babies for decades. In fact, the milk Vilma is endorsing today is not of the same quality that that brand sold 30 years ago. It was good, whole milk 30 years ago, but technology taught them to mess around, for the sake of profit, with true milk, by adulterating it.

Vilma never bothered to research that the product she sells as milk drink is a lot inferior to what a mammal produces for its young. Vilma obviously does not know, and never asked why the manufacturer latched on the word "DRINK" to the word milk.

Vilma, a mother, is endorsing a milk drink for children. A milk drink is not pure milk. It no longer has the nutrients infants and children most need. Mrs. Recto should get together her Batangas nutritionists to research the difference between whole milk and milk drink; whole milk and filled milk.

There ought to be a law requiring endorsers to understand and be responsible for what they are endorsing. A responsible endorser, especially if it involves with the health and wellbeing of children, should be as concerned about the quality of the product.

Even Edu Manzano, before he became vice-presidentiable, was endorsing powdered creamer as milk substitute. When I confronted him with this and informed him that mothers are using his product as infant formula, he was quick to tell me that there’s a warning in the package saying it’s not milk. Yes, but how many gullible mothers out there have a magnifying glass to read the almost illegible package English warning?

Another one. There’s the irritating commercial endorsed by no less than Vilma’s ex-future daughter-in-law, actress Angel Locsin. This commercial is all about Angel’s worry about her body odors. Angel warns about taking a bath and taking a bath and taking a bath, and body odor is still there. She tells us (as if we didn’t know) that we need to use underarm odor-remover, and she adds, even "anduors"--this is how Angel Locsin pronounced the word: Anduors.

Will someone please email me what is "anduors"? If this is a mispronunciation, didn’t those brilliant ad agency and Unilever executives think to check a dictionary?

They’ve had Angel Locsin’s body odor ad on for years. (When I’m close enough to the radio, I reach over to turn the commercial off, or change stations so I don’t have to hear the ligokanangligokanangligokanangligo...) I still couldn’t figure out what word it was that Angel calls "anduors."

Anyway, I have something cheaper and better against entire body odor, not just underarm: Soak ten pesos worth of tawas (alum) in a small jar of water for two days. Put the water in a sprayer bottle. Spray all over your skin. No more body odor! All imported commercial deodorants have tawas as major ingredient because multinational pharmaceuticals have found it economical, harmless, and hypoallergenic.

Another commercial that’s been on for too long has the celebrity endorser saying "shahr" for the word sure. Our impressionable children will be saying "shahr" and "anduors" and "anyhows..." because that’s what they hear on TV. And we blame the schools for bad English. Why don’t those brilliant ad agency executives think to consult smart-books to correct their endorsers who don’t seem to know any better?

January 25, 2010:

DEAR Ms. Aspillera: I am impressed and enlightened with your article in Malaya. November 19. We are where we are because of our own faults and ignorance. Look at the majority of squatters (I won’t even bother calling them informal settlers since what they’re doing is illegal) who came to the city and left/sell their piece of land in the province. Are they just lazy or victims of circumstance? Giving proper education and information to Filipinos can still make our nation go in the right direction. Best regards, Rene Serrano, Senior Biomedical Engineer, rserranoc@rkt.com

Vilma Santos or her ad agency must have read my November 19 column. I see that her endorsement of "milk drink" and "filled milk" has been modulated. Victims are babies and mothers who don’t know any better. Other milk ads are still pushing their deceitful claim of "laki sa gatas." Commercials for filled milk and milk drink are not telling the truth. Vilma’s and my generation 40 years ago may have been "laki sa gatas" because all they sold then was pure good unadulterated milk.

The generation of today is more "Laki sa gata (palm oil)"--the milk producers having learned the technology of extracting the expensive buttermilk from true whole milk and putting back cheap highly saturated vegetable oil.

And mothers, watch out for those "coffee creamer... better than milk..." if we are to believe Edu Manzano. No milk at all in those creamers. More saturated fats, and no redeeming value. Really bad for children.

Our unsustainable milk obsession is imitated from dairy-rich countries. In those countries, milk is cheap, not imported, they do not have to add palm and coconut oil in milk as manufacturers do in the Philippines. Every affordable "milk" on Philippine store shelf is adulterated. In dairy countries, even poor families buy true fresh milk two or three jugs at a time. (In America, my jugs are initialed so that coming home thirsty from school, ball games, or work, we each can have gulps of fresh milk straight from our own ice-cold jug–saves dirtying a drinking glass.) Having jugs of delicious fresh whole milk in the ref is conducive to milk drinking.

But the "filled milk" and "milk drink" that was pushed by Vilma Santos in this country is not milk. There are more than 30 brands of "milk" but almost all of them are reconstituted and adulterated, tastes nothing like whole fresh milk. The original more valuable nutrients of mammal’s milk have been removed.

My concern is the children. For children, get whole or skimmed milk--these are not adulterated with non-milk ingredients.

The Philippine nutrition agencies and tax-paid nutrition administrators go along with this "fake milk" push–"Ako’y laki sa gatas!" they reverberate. Don’t our nutritionists know what’s in filled milk, what’s milk drink? Help push cheap healthy sustainable nourishment for babies and children.

Tax-paid nutritionist should worry about: 1) The deception--that it’s more like, "Ako’y laki sa gata (palm oil)!" 2) These tax-paid nutrition practitioners should counter this multinational campaign with public service info on indigenous food substitutes with milk-type nutrients.

Solid food-ready babies can get the nutrients of good milk–calcium, protein, iron, vitamins and minerals from family meals. My baby, born in South America , got his nutritional needs not from milk and baby foods of dubious quality from stores, but from healthy family meals. Into the masher/grinder I put whatever vegetables, fish, meat from family meals–pinakbet’s yellows and greens, squash, beans, tinola, adobo, eggs, oatmeal, etc. I’d strain this and put in the baby bottle. The liquid has the color of unpalatable mud, but it has all the nutrition that is in real milk.

My son grew up healthy, no tooth cavity, with strong bones. He got milk only when pure fresh milk was available, like when we were in the US . The good nutrients can be had by babies from the family’s regular meals. I wish nutritionists would spend enough time teaching the poor which foods can replace milk, instead of pushing "milk drinks" and "filled milk"--expensive fake milk.

***

If I can add: I wish Nestle, the manufacturer of Bear Brand, lives up to its values and really tell consumers what the real score is. It doesn't take a genius to know that values are there for ultimate guidance, not lip service. However, manager morons (you know who you are) won't be able to discern such. It's so sad that the powerful idiots in Nestle Philippines are the ones dictating to the poor Pinoy that gata (palm oil) is good for them. Tsk, tsk.