Trouble Brewing at Liberty Ostrava over Saleof Emission Allowances
Czech media reported that, amid reports that Liberty Ostrava sold one million emission allowances to the Romanian sister company Liberty Galati at the
Czech media reported that, amid reports that Liberty Ostrava sold one million emission allowances to the Romanian sister company Liberty Galati at the market price for cash, trade unionists are dissatisfied with the actions of Liberty Ostrava and its owner. Therefore, on May 5 they have convened a protest meeting of employees. It starts at 13.45 at the main gate of the smelter. The meeting is convened by trade unions to defend the smelter and against the disbursement of funds generated by the company. Checz Replublic’s Deputy Prime Minister and Minister of Industry and Trade Karel Havlíček will also discuss the current situation in the company. He will meet with representatives of the Supervisory Board, the company's management and trade union representatives.
Trade union OS KOVO Liberty CR chairman Mr Petr Slanina said “Last week we learned that the CO2 emissions that the Ostrava steelworks received free of charge from the state to cover its needs were sent by Sanjeev Gupta to his company in Galati in Romania. His claim that the Romanian smelter will pay the market price and even something extra, for allowances in the amount of one billion crowns seems very unlikely to us, also because such a procedure lacks logic. The Galati company could pay directly out of its obligation to cover its CO2 emissions with the emission allowances it lacks. The repeated violation of all previous promises made by Sanjeev Gupta in recent weeks entitles us to distrust his statements and fears about the future of the Ostrava smelter.”
Liberty Ostrava clarified that “The transaction was carried out under new parameters, which are completely safe and very beneficial for Liberty Ostrava. One million emission allowances were sold directly to the Romanian sister company Liberty Galati for cash. The transaction was carried out at the current market price, which will be paid to Liberty Ostrava immediately in addition to the possibility of buying these allowances back in the future at a lower price.The immediate profit for Liberty Ostrava from this transaction is 260 million crowns. The profit will be used in part to pay an extraordinary bonus of 13,070 crowns to employees on the occasion of the company's 70th anniversary. The remaining part will be used for future investment projects."
Liberty Ostrava added “The acquisition of the smelter in July 2019 was supported by the GFG group Liberty Ostrava in the amount of more than 4 billion crowns. Production for the first quarter of 2021 increased by more than 20 percent compared to the same period in 2020.”
Two weeks ago, at a meeting with government representatives, the management of Liberty Ostrava promised not to lend emission allowances to a Romanian sister company Liberty Galati.
In mid-April, the trade unions operating in the smelter declared a strike alert. The impetus for convening the meeting was the sale of part of the allowances belonging to the Ostrava steelworks to a sister company in Romania. According to trade unionists, the future of the company is threatened. The smelter has saved allowances in recent years, and wants to use them to finance the necessary modernization.
They also called on the European Commission, which approved the GFG as a suitable buyer before selling the Lakshmi Mittal estate, as a suitable buyer, to review its decision. According to them, the EC should immediately take all available measures to save the Ostrava steelworks in order to compensate for the negative consequences of its decision.