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BASF Subsidiary Charged with Illegal Pesticide Sales
September 21, 2001

Last week, the U.S. Environmental Protection Agency (EPA) charged Micro Flo Company–a wholly owned subsidiary of BASF Corporation–with importing and selling millions of pounds of illegal, counterfeit pesticides in the U.S. over several years.

EPA’s charges against Micro Flo, a pesticide formulator and distributor headquartered in Memphis, Tennessee, constitute the largest enforcement case ever brought by the U.S. government for pesticide-related violations. EPA assessed a fine of US$3.7 million and has listed 673 separate violations by Micro Flo of the U.S. Federal Insecticide, Fungicide, Rodenticide Act. Micro Flo has 30 days from the date they received the complaint to respond to EPA’s charges by either contesting them or paying the fine.

In May 2000, EPA officials conducted inspections at Micro Flo’s primary pesticide formulation plant in Sparks, Georgia and at Micro Flo’s warehouse located in Tifton, Georgia. Based upon the findings at these inspections and EPA’s review of records submitted by Micro Flo, EPA determined that the company was in violation of U.S. law.

EPA’s alleges that Micro Flo offered pesticide products and active ingredients for sale whose composition differed from the description in their registration. EPA also charges that Micro Flo falsified notices accompanying shipments of active ingredients claiming that they were produced by an EPA-approved producer, United Phosphorus. In reality, the imported chemicals were from foreign companies whose products were not approved by EPA.

Permethrin and acephate were two chemicals imported illegally. While they are both registered for use in the U.S., they must be imported from EPA-approved companies. During 1999, Micro Flo imported large quantities of both of them from unapproved sources. For example, EPA documents show that over 400,000 pounds of acephate, a nerve toxin and possible human carcinogen, were imported using falsified documents.

The case originated when United Phosphorus, an Indian-based producer of generic pesticides, discovered that Micro Flo had registered with EPA various pesticides produced by United Phosphorus in India. EPA granted those registrations based on Micro Flo’s certifications that its products would contain only United Phosphorus’ active ingredient pesticides.

Independent of the EPA lawsuit, United Phosphorus is pursuing separate legal action against BASF and Micro Flo, seeking over US$50 million in damages. United Phosphorus is the fourth largest generic agrochemical company in the world and one of the largest pesticide producers in India.

In 2000, BASF ranked as the seventh largest agrochemical company in the world, with global sales of US$2.2 billion comprising 11% of the world market. The company predicts an almost 50% increase in agrochemical sales this year, expecting 2001 sales to hit US$3.1 million.

Sources: U.S. EPA Enforcement and Compliance Update, September 18, 2001; U.S. EPA Civil Complaint, FIFRA-04-2001-3000, September 11, 2001; Wright & Sielaty Press Release, September 14, 2001; AGROW, April 13, 2001, August 31, 2001.

Contact: PANNA.

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