Kirin to Continue Profit Denial to Myanmar Military Conglomerate

By Nan Lwin 7 January 2021

YANGON — Japanese beverage giant Kirin says its probe into its Myanmar partner’s military connections ended inconclusively because access to information was denied. However, it said it would not resume dividend payments from beer profits to the military-owned Myanma Economic Holdings Public Company (MEHL).

Last year, Kirin hired Deloitte Tohmatsu Financial Advisory to conduct an independent review of the financial and governance structures of MEHL after it faced international condemnation for its partnership with Myanmar’s military amid accusations of genocide against the Rohingya. The review aimed to determine the destination of profits from joint ventures Myanmar Brewery Limited and Mandalay Brewery Limited.

Kirin Holdings Company Limited on Thursday said Deloitte’s assessment was inconclusive because it was unable to access sufficient information to make “a definitive determination”.

It said it is wholly unacceptable for any proceeds from its joint ventures in Myanmar to be used for military purposes, which is a fundamental condition of the joint-venture agreement.

It said the suspension of beer dividend payments to Kirin and the military-owned company would continue.

In response to pressure from human rights groups, the company in November suspended paying profits from Myanmar Brewery and Mandalay Brewery to Kirin, MEHL and other shareholders.

Kirin said it will provide an update on the company’s plans by the end of April.

Kirin held 51 percent of both Myanmar Brewery and Mandalay Brewery, with MEHL holding the rest, said the United Nations independent international fact-finding mission on Myanmar in August 2019.

The report warned that any foreign business activity involving Myanmar’s military and its enterprises posed a high risk of contributing to or being linked to violations of human rights law. The report also warned that at a minimum, foreign companies were boosting military finances.

Kirin announced a review of its operations in Myanmar in February last year following allegations by the UN mission’s report.

In June, the company said it made repeated requests to MEHL for proper documentation as the information initially provided was insufficient.

Kirin said it takes its responsibilities in Myanmar seriously and will continue to take action to ensure its activity in the country adheres to the highest standards.

Rights group Justice for Myanmar called on the Japanese company to publish the assessment and cut ties with MEHL.

It said as long as Kirin continues to do business with MEHL, Kirin is complicit in ongoing war crimes and crimes against humanity in Myanmar.

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