<p>Wilmar International's Chinese subsidiary, Guangzhou Yihai, has been convicted of contract fraud by a Chinese court and ordered to jointly bear a loss of 1.881 billion RMB (approximately 350 million SGD). Guangzhou Yihai has filed an appeal in court.</p>
<p>Wilmar International announced on Wednesday (November 19) after the market closed that its affiliated company Yihai (Guangzhou) Grain and Oil Industry (referred to as &#34;Guangzhou Yihai&#34;) received a criminal judgment from the Intermediate People's Court of Huaibei City, Anhui Province, China. Guangzhou Yihai is a subsidiary of the group's Shenzhen-listed subsidiary Yihai Kerry Arawana Holdings (referred to as &#34;Arawana&#34;). Wilmar International holds 89.99% of Arawana's shares.</p>
<p>According to the court's first-instance judgment, Guangzhou Yihai was found to be an accomplice in contract fraud and was fined 1 million RMB. The company's former general manager, Liu Degang, was convicted of contract fraud and bribery, sentenced to 19 years in prison, and fined 2.8 million RMB.</p>
<p>Guangzhou Yihai was prosecuted in January 2024 along with its former general manager Liu Degang, accused of assisting Yunnan Huijia in contract fraud in a palm oil transaction between the state-owned Anhui Huawen International Economic and Trade Company (referred to as &#34;Anhui Huawen&#34;) and Yunnan Huijia. This ultimately led to Anhui Huawen suffering an economic loss of 1.881 billion RMB.</p>
<h3>Guangzhou Yihai Appeals in Court, Arawana Fully Supports</h3>
<h4>Further Reading</h4>
<p>Wilmar International Faces Negative News Again in Indonesia, Analysis: The Toughest Times May Be Over

 Judge Who Acquitted the Company Arrested, Wilmar International: Not Involved in Investigation

</p>
<p>Wilmar International and Arawana stated that they do not accept the judgment result. Arawana issued a statement indicating that its subsidiary Guangzhou Yihai has never participated in any fraudulent activities, and the company was unaware of this and did not provide any assistance. It fully supports its subsidiary's appeal
Wilmar pointed out that since the case is under appeal, the first-instance judgment has not yet taken effect, and Guangzhou Yihai is not required to pay the relevant fines. Given that the final responsibility depends on the outcome of the appeal, it is currently impossible to assess the impact of the incident on the company's finances.</p>
<p>Previously, Wilmar was also embroiled in a scandal in Indonesia. Among them, five subsidiaries of the group in Indonesia were accused by authorities of bribing to obtain export permits during the edible oil shortage in Indonesia from July to December 2021, ultimately being ordered to compensate for national losses and pay fines. As a result of the judgment, Wilmar reported a net loss of up to $347.7 million in the third quarter of this year (approximately SGD 451 million).</p>
<p>Wilmar's stock price closed at SGD 3.29 on Thursday, down 0.90%</p>

<p>Wilmar's Chinese subsidiary, Guangzhou Yihai, has been ruled by a Chinese court to have committed contract fraud and is ordered to jointly bear a loss of RMB 1.881 billion. Guangzhou Yihai has filed an appeal in court. The company's former general manager, Liu Degang, was sentenced to 19 years in prison for contract fraud and bribery, along with a fine of RMB 2.8 million</p>

Wilmar's affiliated company in China was convicted of contract fraud and filed an appeal in court | Lianhe Zaobao