China customs detained Glencore trader in oil imports

By @ibtimes on

China's customs authorities detained a Glencore trader as part of an investigation into fuel imports and potential tax evasion, sources with direct knowledge of the situation said on Friday.

Li Buhua, a Chinese national, is a member of Glencore's Beijing-based trading team, the sources said. Li was released last week on bail, they added. Glencore, was not immediately available for comment.

The Swiss commodity trading giant, valued earlier this year by one analyst at about $60 billion, is continuing to prepare for what could be a record London initial public offering(IPO).

Chinese customs have since late last year been looking into imports of power kerosene, a fuel of a quality between diesel and kerosene that can easily be turned into diesel but is not subject to a hefty consumption tax which otherwise applies to diesel or kerosene.

The investigation involves a 100,000-tonne cargo Glencore brought in through China's Zhuhai customs late last year, said the sources.

It's still being investigated. There is no conclusion yet, said a trader with direct knowledge of the situation.

China levies a consumption tax of about $125 per ton on imports of diesel or jet kerosene, but power kerosene is exempt.

The customs authorities also detained another trader from chemical firm Kolmar and that trader was also released on bail, sources familiar with the situation said.

Nobody at Kolmar was immediately available for comment. A spokesman with China's General Administration of Customs said he couldn't comment immediately and would check with relevant departments.

(Reporting by Chen Aizhu, additional reporting by Tom Miles and Niu Shuping; Editing by Manash Goswami and Lincoln Feast)

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