Unholy row blows up (again) over TAP privatisation
An unholy row has blown up for the nth time over the last-minute privatisation of flagship airline TAP.
The deal was done 48-hours before the PSD executive fell in 2015, following inconclusive elections
Unlike the ‘huge expenses’ ratcheted up in the dying days of the last Socialist government, this brouhaha is more centred on the ‘enormous sums of money’ allegedly saved by TAP’s new owners in tax, and a ‘nefarious scheme’ (some might say ingenious) for purchasing the airline through an expensive deal with Airbus, which has already been described as a form of TAP being purchased by itself.
According to Correio da Manhã today, the ‘scheme’ at TAP – to which the current infrastructures minister Miguel Pinto Luz, and current European Commissioner Maria Luís Albuquerque were a party – ‘gave’ €2 million to TAP’s managers David Neeleman, Humberto Pedroso and David Pedrosa (Humberto’s son). What the paper really means, is that the trio saved themselves huge sums in tax that would otherwise have been due.
Technically, the privatisation always had a bit of an unwholesome whiff about it – but as seasoned commentators are stressing, ‘there were no other options’. At the time, TAP was so broke it couldn’t have afforded to pay its staff, buy fuel for its planes, or pay ANA airports authority’s ‘dues’.
But the law is the law – and in this case, clearly, the Attorney General’s Office sees something awry.
Lusa explains: “The department of the Public Prosecutor’s Office responsible for investigating the most serious, complex and sophisticated organised crime is investigating alleged corruption in the purchase of TAP aircraft by the company’s previous administrations.
“The report by the general inspectorate of taxes (IGF) on TAP, released this week, states that Atlantic Gateway, a consortium of David Neeleman and Humberto Pedrosa, acquired 61% of the capital of TAP, SGPS, committing to capitalize it through supplementary capital contributions, of which 226.75 million US dollars (MUSD) were made through the partner DGN Corporation (DGN) with funds obtained from Airbus”.
That amount of capitalization “coincides with the amount of the penalty (226.75 MUSD) assumed by TAP, SA, in the event of non-compliance with the agreements for the acquisition of the 53 aircraft (A320 and A330), which shows a possible causal relationship between the acquisition of the shares and the capitalisation of TAP, SGPS and the contracts signed between TAP, SA and Airbus.”
The IGF suggested sending the report to the Public Prosecutor’s Office, especially in view of the conclusions related to TAP’s privatisation process and its relationship with the contracts for the purchase of 53 aircraft from Airbus in 2015, as well as the remuneration of the members of the Board of Directors, says Lusa.
On the latter subject, the report concluded that “available data” led to the conclusion “that the payment of remuneration to the directors in question (Humberto Pedrosa, David Pedrosa and David Neeleman) was made through a simulated service contract (since apparently the purpose was not the same as that for which it was signed), presenting itself only as instrumental to the intended effect”.
This procedure “appears to be irregular in the payment/receipt of remuneration to the members of the Board of Directors, who thus avoided responsibility for IRS and Social Security contributions”, says the report.
Several political parties, including the PSD, have submitted requests to hear the Minister for Infrastructure, Miguel Pinto Luz, who at the time of this deal was Secretary of State for Infrastructure, Transport and Communications in the second government led by Pedro Passos Coelho.
But, the ‘long and the short’ of this latest media fest is difficult to predict. If DCIAP criminal investigators find indications of crime, what can be done so many years after the facts?
Certainly David Neeleman is ‘long gone’ – and adamant that he did nothing wrong. With the Pedrosos still residents of this country, could they conceivably be prosecuted for fiscal fraud? According to CM, the crime of fiscal fraud doesn’t expire. Thus, the answer could be, ‘perhaps’. But with the way accusations and prosecutions run in this country – particularly when large sums of money are involved – no-one could expect any effective decisions for years.
In the meantime, Humberto Pedrosa has stressed that he had nothing to do with the Airbus deal (it was ‘already sorted’ by Neeleman before he joined the consortium).
Pedroso, boss of the Barraqueiro Transport group, recalls that he lost €12 million in the TAP deal. In a statement made earlier this week, he wrote: “During the participation in the capital of TAP, we injected €12 million in ancillary installments to fulfill various commitments, which ended up remaining in TAP, to my detriment”. ND
Source material: LUSA/ Correio da Manhã/ Negocios online
