International Trade Law News

International Trade Law News: "April 23, 2005

BULLETIN: U.S. Companies Urged to Assess Impact of Basell Sale on Their Operations
BULLETIN: As recently reported by Bloomberg and other news sources, Royal Dutch/Shell Group and BASF AG the owners of Basell NV ('Basell'), the world's largest producer of polypropylene and advanced polyolefins products, are seeking to sell their stakes in the company. Basell has manufacturing operations in 20 countries, including plants in Louisiana, Tennessee and Texas. According to these reports, the leading bidder for Basell appears to be Iran's National Petrochemical Company (NPC), owned by the Government of Iran. NPC is competing against a consortium that includes India's Haldia Petrochemicals, the Chatterjee Group and several U.S. investors, for the right to purchase the company.

While it appears that Basell's U.S. operations will be excluded from a sale to NPC due to the U.S. sanctions on Iran, the broad reach of U.S. sanctions may prohibit foreign subsidiaries of U.S. companies from purchasing products made by Basell outside the U.S. In addition, such a sale may have a negative impact on the availability and price of polypropylene and polyethylene raw material in the U.S. and abroad.

U.S. companies and their foreign subsidiaries that purchase polypropylene, polyethylene and other products from Basell's U.S. or non-U.S. plants or purchase parts, components and packaging materials produced from polypropylene and polyethylene, are urged to consider the impact of the sale of Basell to NPC on the their operations.

We are closely following this matter for several clients and have some information that may be useful to companies that purchase polypropylene, polyethylene and other products from Basell. Please contact us at info@djacobsonlaw.com for more information on this important issue."