CIG Biodiesel must provide more information to consumers who have invested money in one of this company’s projects. If CIG Biodiesel does not do this, it must pay 4,000 euros for each day the information is not provided. The AFM imposed this order for incremental penalty payments on 7 September 2010.
CIG Biodiesel, with its registered office in Hoofddorp, has attracted money from consumers for a project in Austria. It says that it has invested the money in an oil mill and biodiesel plant in Enns (Ennshafen) on the Danube, in Austria.
Following media reports about CIG Biodiesel, the AFM initiated an investigation of CIG Biodiesel. The investigation revealed that CIG Biodiesel is acting unlawfully, because essential information is being withheld from the consumers who have invested money in this project.
The AFM believes that the consumers who gave their money to CIG Biodiesel have received too little information. Therefore, the AFM has imposed an order for incremental penalty payments on CIG Biodiesel. CIG Biodiesel must publish the following disclosure on its website and in a letter to the consumers concerned:
- The recent situation concerning the (purchase of the) land on which the mill will be located, especially concerning the down payment for the land, the status of the purchase contract for the land, and the implications of this for the down payment;
- The deployment of CIG Biodiesel’s issue proceeds of some EUR 4 million, as well as disclosure and an overview of the investments made and funds lent;
- The arrangements that have been made with the mortgage lender, also the largest financier of the project, concerning the financing;
- The current state of affairs concerning the applications for grants and loans.
The AFM considers the information identified above to be important for consumers who have invested money in this project, so that they can decide about exercising their contractual rights and are able to make a better assessment of the feasibility of CIG Biodiesel’s project.
By not providing this information, Biodiesel is performing an unfair trade practice, as referred to in Sections 6:193b and 6:193d of the Dutch Civil Code. This constitutes a violation of Section 8.8 of the Dutch Consumer Protection Enforcement Act.
Interested parties can submit the AFM’s decision to a court for a review.
If you have any questions or complaints, you can contact the AFM's Financial Markets Information Line on: 0900 5400 540 (0.05 euros per minute).
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