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Olympics row: Documents reveal Dow sidestepped Indian trading ban

In a starting revelation that might deepen the controversy surrounding Dow Chemical's sponsorship of the London Olympics, contrary to the claims of the chemical giant, documents have emerged in the US contending Dow's claim that Dow and Union Carbide Corporation are distinct entities which operate independently.

Dow has maintained that owing to this independence in the company structure it is in no way responsible for the Bhopal gas tragedy which killed nearly 25,000 people, nor is the company liable to pay for the damages caused.

Earlier last week George Hamilton, vice president for Dow Olympic Operations, was quoted by Reuters: "We had no association with Bhopal, we bought a company [UCC] that was an investor [in UCIL] so why would we take action that would imply that we were connected or doing something out of guilt?”

 Olympics row: Documents reveal Dow sidestepped Indian trading ban

CEO of Dow Chemical Liveris, President of the IOC Rogge and Chairman of the IOC Marketing Commission Heiberg attend a news conference in New York City. Reuters

It has now emerged in a legal case in the United States that Dow Chemicals flouted the 1992 orders of Indian courts which prohibited the sale of Union Carbide Corporation products without court's approval.

Documents produced in the US court reveal how in 2001 Dow became central to all aspects of the trading arrangement, including pricing of chemicals, cables and wires sold in India, which were to ultimately enter the country as products unconnected to Union Carbide.

The Independent in the UK claims to have access to the documents. It reports: "Legal documents obtained by The Independent show that Dow continued to permit the unlawful practice started by Union Carbide Corporation (UCC), the company ultimately responsible for the disaster, after it bought the “tainted” company in February 2001. The multi-million dollar sales, made possible by a web of independent intermediary companies, breached a 1992 ruling by an Indian court. The court order, which prohibited the sale of UCC products without court approval, was issued to compel Union Carbide authorised officials to return to India to face criminal charges for culpable homicide relating to the 1984 gas explosion."

The documents emerged after intermediaries took Dow and UCC to court over violations of anti-trust and breach of contract.

The case which led to these revelations was settled outside the court room.

Emails accessed and published by The Independent further go on to show that Dow was in knowledge of the orders passed by the Indian courts and yet went on to ensure that UCC products were sold in India under Dow's brand name.

The internal emails show clear knowledge by Dow that UCC remained unable to trade in India directly. You can read all the emails in The Independent's detailed investigation.

Dow, an International Olympic Committee partner, was awarded the stadium wrap contract last August. The controversial deal led to protests from MPs, Olympians and survivor groups who claim Dow is an unsuitable sponsor.

Activists in India want Indian authorities to take forward the case against Dow's sponsorship of the Olympics, and hold the company liable for in the ongoing compensation battle for the gas victims and their families. The case challenges the $470m out of court settlement agreed by UCC, its Indian subsidiary UCIL and the Indian government in 1989, will be heard by the Supreme Court shortly. Dow claims the 1989 settlement was “full and final” and that it has no liability or responsibility for Bhopal.

India has so far expressed its displeasure with the Olympics Committee's decision to go ahead with Dow's sponsorship, although it remains unclear if India would take substantive steps to ensure that its voice is heard.

Dow Chemicals reacted by saying , "None of the alleged business transactions cited as violating the 1992 court involved products or technologies that are covered by the court order. The order only applied to UCC properties in India. It did not apply to UCC products or technologies that were acquired overseas for valuable consideration and brought into India by other separate companies.”

Meanwhile, a London based NGO, Bhopal Medical Appeal, plans to take up the matter with the Olympics organisers.

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Updated Date: Feb 14, 2012 11:15:21 IST

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