5 Dec 2013

Cooks committee ready to present preliminary Colagate report

6:05 pm on 5 December 2013

The Public Accounts Committee in the Cook Islands says it is ready to table a preliminary report on the 'Colagate' issue with parliament.

It was revealed at the start of this year that since the mid 1980s the Cook Islands Trading Company, which imports Coca Cola, had an arrangement cutting its import tax.

The so-called 'Colagate' deal is claimed to have hurt competitors and cost the country millions of dollars.

The chair of the Public Accounts Committee, John Henry, says they have called on people from customs and the private sector as part of preliminary hearings over the past two months.

He spoke with Leilani Momoisea about what will happen now.

JOHN HENRY: What we have done is to prepare and update a report to parliament to let parliament know where we stand today after going through the preliminary session of calling well over 10 individuals. They all willingly came to our request. Through that we were then able to receive a lot of information. As to when the formal inquiry is actually going to take place we anticipate at this time we will look into the coming new year.

LEILANI MOMOISEA: Do you expect the formal inquiry to be quite complex?

JH: Not really. When I mentioned the process or what has actually taken place it has given us some very, very clear understanding as to what actually took place and how it started. But we really wanted to get into was how was it that in the first place, one, the authority that was given to go through such an agreement in terms of the invoices involved in the goods that were imported from overseas.

LM: And what are the terms of the inquiry? Are you just tasked with finding out how this happened in the first place and then making recommendations as to how to prevent this from happening or are you looking at the legality of this, whether this was actually legal or illegal?

JH: Since 2009 the whole process was put to a stop following consultation by the new collective revenue here in the Cook Islands to New Zealand customs. The response was that it should not have happened and it is not right so that really has to come to a stop since 2009. At this point in time what there is for us to look into is was there fault to the person involved and issuing the authority or was the act not strong enough or was there any loophole in the act? In terms of legality, we also need to look into the act at the time when the authority was provided for the process of, as people term it, 'displaying of invoices' is concerned.

LM: Would you expect any sort of criminal proceedings to come about as a result at the end of the inquiry?

JH: At this point in time I wouldn't look at that. It all really depends when the more formal inquiry takes place, and I suppose through that process we'll see where our recommendations will come to. At this point I'm not anticipating that.

John Henry says PAC hopes to table the preliminary report with parliament as early as next week.