Senators call for review of JBS national security risks

JBS SA has repeatedly used its significant presence in the U.S. meat packaging industry to inflate profits at the expense of American families, according to a letter from American Sense Marco Rubio, R-Fla., And Bob Menendez, DN. J., to the secretary. Janet Yellen to renew their request that the Committee on Foreign Investment in the United States (CFIUS) conduct a formal review of the transactions of the Brazilian meat-packing conglomerate JBS SA

The investigation is requested for JBS, its holding company J&F Investimentos, and any entity owned or controlled by Wesley and Joesley Batista. Over the past fourteen years, the conglomerate has become increasingly active in the food business in the United States, acquiring numerous American companies. However, its expansion has been largely fueled by corruption, illicit financial activities and unfair business practices that undermine legitimate methods of competition and harm U.S. businesses and consumers, senators said.

The letter says that in February 2021, Pilgrim’s Pride, majority owned by JBS, pleaded guilty to conspiring to increase chicken prices and pass the costs on to consumers and agreed to pay a fine of $ 107.9 million. dollars. Just two months later, JBS USA agreed to pay $ 12.75 million to resolve a series of civil antitrust cases involving alleged similar pricing in the pork industry.

In 2017, the Batista brothers admitted to paying more than $ 150 million in bribes to acquire public funding from the Brazilian Development Bank to fund its acquisitions in the United States. In October 2020, the Department of Justice confirmed that J&F Investimentos had violated the U.S. Foreign Corrupt Practices Act by using bribe money to buy Swift Foods and Pilgrim’s Price.

“When foreign companies take advantage of corrupt practices and disseminate them in US markets, they jeopardize our economic security, pose direct risks to our businesses, and undermine our efforts to fight corruption abroad. With JBS SA planning further US acquisitions in the near future, the need for a full investigation is urgent, ”the senators wrote, condemning JBS SA’s use of corruption to acquire public funding to fund its US acquisitions. and its abuse of its dominance in the United States. meat packaging industry to inflate profits at the expense of American families.

“It is only after we know the extent and details of JBS SA’s acquisitions, after a thorough review by CFIUS, that American businesses and consumers will be safe,” said the senators.

JBS is more and more in the acquisition market lately. JBS is looking to buy the remaining shares of Pilgrim’s Pride, according to reports. JBS already owns nearly 80% of the capital of Pilgrim’s Pride.

The letter explains that JBS SA made record profits in the first quarter of 2021 and now plans to diversify beyond the meat packaging industry. In June 2021, the company acquired Vivera Topholding BV, the third largest manufacturer of plant-based food products in Europe. It also announced its intention to expand into the U.S. FinTech sector through a subsidiary, Banco Original, which is under investigation by Brazil’s Securities and Exchange Commission for allegedly taking advantage of inside information.

The Batista brothers faced legal ramifications for JBS SA’s corruption-fueled expansion and even served time in prison following the 2017 corruption revelations. However, in May 2020, a Brazilian appeals court allowed the Batista brothers to resume their management roles at J&F Investimentos.

“The Batista brothers, who are worth more than $ 6 billion, have the means to continue their expansion fueled by corruption. Based on their track record, they are likely to continue to use unfair business practices to exclude fair methods of competition and harm both competing US businesses and consumers, ”the letter said.

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