Chávez Government also went through Mossack Fonseca

Pequiven, a subsidiary of Petróleos de Venezuela, sought shelter in tax havens to legalize its association with Iranian company National Petrochemical Company, from which Veniran emerged. Although the Panamanian law firm was suspicious of the alliance between the then presidents Hugo Chávez and Mahmud Ahmadinejad, it finally solved the inconvenience to please both clients.

9 May 2016

Pequiven also registered companies in tax havens. To register companies in the British Virgin Islands, the Petrochemical Corporation of Venezuela used the Panamanian law firm Mossack Fonseca, from which the already famous Panama Papers came out.

Established in 1977, the Venezuelan state company resorted to the same services required by some private entrepreneurs to avoid taxes or remain anonymous. It did it together with its Iranian counterpart of the National Petrochemical Company to formalize company Veniran, the joint venture that promises methanol for 10 years under a business alliance between Caracas and Tehran.

The company was registered on August 7, 2007, under the name of Veniran Petrochemical Company Limited in the registry of the British Virgin Islands, an overseas territory of the United Kingdom, east of Puerto Rico, which shares its economy between the Caribbean tourism and the bonanza offered by offshore jurisdictions.

The original idea was to register the company in Panama, but the directors of Mossack Fonseca rejected that option in January 2007, a few days after the first resolution issued by the United Nations Organization against the Iranian government because of the nuclear program developed by the country without the approval of the West.

"We have decided not to register the Panamanian company due to the recent United Nations restrictions on Iran," said Mossack Fonseca by an email addressed to the managers of Amaco, an Aruba firm that Pequiven had hired for this task. "Even if your client has not declared that the company is engaged in these matters, we rather not to involve any of our firms with any business that has relations with Iran," they added.

The decision was made even in the highest levels of the law firm. Chris Zollinger - one of the partners - warned that it was not a good idea to get close to the Caracas-Tehran alliance: "It seems too risky for our reputation. Besides that, even though we are not politicians, I do not think we should indirectly help Chavez and Ahmadinejad with their common plans. "

That was noticed on January 15, 2007 in one of the many communications that are now known after the filtering of the so-called Panama Papers. Three months later, however, the same firm ended up taking steps to establish Veniran not in Panama City but in Tortola, the capital of the 40 British Virgin Islands.

Always Accomplishes

After a new request, Mossack Fonseca's office in the Virgin Islands answered that there was no problem with opening the company in that jurisdiction, and it finally opened the company under registration number 1423568, in the name of Venezuela and Iran in equal parts.

Pequiven holds 49% of the shares while the remaining 1% of the Venezuelan portion is held by International Petrochemical Holding Limited, another offshore firm that Pequiven established in the Virgin Islands and from which it manages its share in joint ventures operating in Western Venezuela, such as Sofilago and Grupo Zuliano, as well as the trading company International Petrochemical Sales Limited.

The Iranians, for their part, only insured 1% of the pie directly in their territory, through Petrochemical Industries Investments Company. The other 49% of this financial engineering is in the United Kingdom in the name of NPC International Limited, a subsidiary of the Iranian National Petrochemical Company, on which international sanctions are imposed since it appeared on the so-called Clinton list of the Office of Foreign Assets Control (OFAC) of the Treasury Department.

Although the Venezuelan State companies have accounts and subsidiaries all over the world, Pequiven is an unprecedented case. There is no expert who ventures to point out the reasons why a state company has chosen to register a company in a tax haven. But Veniran is not Pequiven's only offshore company. Laying low in the English Caribbean, the Venezuelan petrochemical industry also has other companies that have nothing to do with Iran and international sanctions imposed against their government, namely, International Petrochemical Holding Ltd, International Petrochemical Sales Ltd, and International Petrochemical Ltd.

Also in the Virgin Islands, Pequiven registered Monomeros, a Colombian subsidiary that until recently appeared on its website as "the only subsidiary in which Pequiven participates, with headquarters outside of Venezuelan territory." However, there is no one in the Venezuelan state company who can give information on the subject. Their website is down and last week there was no one to answer the phone in their offices.

Not even in person was there any way for someone to answer why a state company uses the offshore world. Its offices in Caracas remained closed last Friday due to the electricity rationing schedule implemented by the Venezuelan Government. In any case, there has been no good news about Veniran for a while. The CEO of Iranian state-owned Persian Gulf Petrochemicals Holding Co., Adel Nejad-Salim, said two years ago that the partnership with Venezuela for the construction and operation of a methanol production plant has been "partially" canceled.

In a visit to the Persian Gulf coast, former Venezuelan President Hugo Chávez announced in 2007, together with his Iranian counterpart, Mahmud Ahmadinejad, the construction of a 1.65 million metric ton per year methanol plant in the Iranian energy sector Pars, as well as another twin plant in Venezuela.

"This is the unity of the Persian Gulf and the Caribbean Sea," Chávez said before ending that trip. Things, however, did not end as clear. In declarations to Iran's Mehr agency, Nejad-Salim reported on April 28, 2014, that Venezuela granted around 60 million Euros to start the Iranian part of the operation despite the fact that eight years later there were no results. The Iranian plant said that it could be built in the port of Assaluyeh in the future, while it showed no hope about the Venezuelan plant: "Based on ongoing negotiations, the construction of the plant in Venezuela seems to be canceled".

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