Singapore firms in ‘shocking racket’

Press, 27 December 1980, Page 4

Singapore firms in ‘shocking racket’

NZPA Singapore West European companies have lost millions of dollars during the last few years by exporting goods to dubious Singapore firms which either went bankrupt or closed, diplomatic sources said yesterday. They said about 190 Singaporean firms were blacklisted by members of the European Economic Community between October, 1976, and December last year. A full list of the companies, compiled in the last few months, has been distributed 'to the diplomatic missions of E.E.C. member countries in Singapore.

The exports, which include perfumes, clothes, food, and engineering and dental equipment, were shipped on credit, the sources said. "Small European , firms were often told a threemonth credit was the usual :way to do business here,” tone diplomat said. “Then the ■ local firms voluntarily wound up or went bankrupt

and the exporters never saw their money or goods again.” The countries most affected by what one diplomat called a "shocking racket” were France, Italy, Denmark, and Austria. Belgium, Britain, West Germany, and the Netherlands also were affected, but to a lesser extent.

A Singapore Government spokesman said it had not received any complaint about local firms and did not know of any company blacklist.

Government officials said scores of new companies were registered every year in Singapore and dozens wound up within 12 months of being established. The procedure involves an application stating the purpose and paid-up capital of an intended firm, which was approved easily, said officials.

They said it was common for an individual to set up and fold one company after another, either under his own or someone else’s name.