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GreenPak to take legal action - Mario Schembri

Reference is made to Green MT’s statement titled ‘GreenPak should tell the truth’. GreenPak intends to proceed with legal action against Green MT following a defamatory statement claiming that the recycling cooperative had violated State aid rules.

According to media reports, Green MT alleged that GreenPak violated State aid rules between July 2013 and November 2017 when local councils in St Julian’s, Qormi and Mosta paid tens of thousands of euros to third-party contractors for waste collection.

The State aid rules that Green MT is accusing GreenPak of breaching were actually performance-related contracts GreenPak had secured with St Julian’s, Qormi and Mosta, which councils had sought to sever relations with Green MT at all costs.

Furthermore, contrary to Green MT’s allegation related to sums paid by the local councils to GreenPak, the opposite actually took place as GreenPak paid the following sums: Mosta local council €112,000; the St Julian’s local council €27,000, and the Qormi council €90,000. These councils were remunerated under the terms of a performance-related contract based on the number of green bags collected in each locality. This legal practice ceased in 2017 following the publication of a legal notice.

Green MT’s unfounded allegation follows revelations in The Sunday Times of Malta that Green MT had notified local councils that it would be charging them for carrying out the door-to-door collection of recyclable waste as well as a premium to service bring-in sites.

The councils were remunerated under the terms of a performance-related contract based on the number of green bags collected in each locality

Green MT took this arbitrary decision after it was ordered by the Environment and Resources Authority last month to reverse its decision to discontinue the collection recyclable waste from six councils in Gozo. The authority said Green MT was not entitled to take such action simply because this practice was not financially sustainable.

Green MT’s reaction was to disregard the law stating that its members should pay for the free service provided to local councils and it informed several local councils in Gozo that it would be charging them as from today.

Furthermore, the Environment Ministry said it had not been informed by Green MT that it was discontinuing the collection of grey/green bags in a number of localities around Malta and Gozo.

The ministry has made it clear that no such action can be carried out without giving at least two months’ notice to the Environmental Resources Authority. This was stated in the permit conditions as amended in January.

Green MT is attempting to divert attention from its improper behaviour by attacking GreenPak, which has consistently honoured its obligations and abided by the law.

It is hypocritical of Green MT to call for a level playing field when it is Green MT that has repeatedly failed to submit its annual accounts to the Malta Financial Services Authority. The only accounts ever submitted were for 2008 and these were filed in 2013.

Furthermore, it should be noted that it was actually Green MT that received State aid - to the tune of €690,000 in 2011 - thanks to a secretive environmental fund that was established in breach of public procurement regulations and State-aid rules to benefit one single company, Green MT, and effectively save it from impending bankruptcy.

This matter is currently the subject of court proceedings and will surely shed more light on the business practices employed by Green MT with the blessing of State authorities between 2010 and 2011.

Mario Schembri is CEO, GreenPak Co-op Ltd.

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