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After Arrest in Govt Crackdown, Retailer Points to Alcohol Imports by Tycoons

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Imported wine in Rangoon, a product that is hard to come by these days in Burma following a govenrment crackdown. (Photo: The Irrawaddy)

RANGOON — Premium Food Service Products, a supply company owned by Burma’s biggest retailer City Mart Holdings, has defended its business operations following the arrest of one its directors on Friday during a government crackdown on unlicensed imported wine and liquor.

Premium said the alcohol was imported and supplied by firms belonging to Htoo Group of Companies and ACE Group of Companies, two large conglomerates owned, respectively, by well-known tycoon Tay Za and Phyo Ko Ko Tint San, who is the son of Minister of Sport Tint San.

Premium argued that the importers share blame for the situation and should also be targeted by the Ministry of Commerce, which so far has prosecuted only retailers. The firm also called for a revision of what it deems unclear government policy on alcohol imports.

Since October, two mobile taskforces—comprising officials from the Commerce Ministry, customs department and the special investigation bureau of the police—have been raiding retail warehouses in Rangoon and Mandalay to investigate the legal status of imported alcohol, tobacco and preserved frozen foods.

Most retailers have now stopped sales of foreign booze out of fear for being raided, leading to a shortfall of liquor supplies and complaints from consumers and restaurants.

A Rangoon warehouse belonging to Premium was raided early this month and last Friday Premium director Phyo Hein Kyaw was arrested on accusations that he was involved in sales of illegally imported alcohol.

He became the second retail executive to be arrested. The managing director of Quarto Products was detained and charged in October following a raid on the Rangoon warehouse of Quarto, a large beverages distributor. The retail executives could face three years imprisonment.

Soe Aung, an assistant director of the Rangoon mobile taskforce, said it found 87,000 bottles of wine and 1,200 bottles of liquor, worth about US$560,000, at a Premium warehouse in Tharketa Township.

“We asked Premium to show the original [import license] documents for these bottles, but they couldn’t show them and now we sued them,” he said.

In an interview on Tuesday, Nge Nge, marketing executive of the Premium Food Service Products marketing department, confirmed that it had been unable to hand over the original import license documents for most of the alcohol, but it said that its suppliers share responsibility for this situation.

“Though we have called both our suppliers asking them to show their original import documents for our products [to the taskforce], they actually failed to do that,” she said.

ACE Trading Co. Ltd and Myanmar Shopping Mall supplied Premium with its imported alcohol and only ever provided copies of the import licenses, Nge Nge said. “But, the mobile task force neglected the copies and asked for the originals. We could not and then they sued us,” she added.

ACE Trading is part of ACE Group, a conglomerate with interests in hotels, restaurants, construction, media and travel. ACE is run by Phyo Ko Ko Tint San, who is the son of Sport Minister Tint San.

Myanmar Shopping Mall is a duty-free shop in downtown Rangoon that is owned by Htoo Group, one of Burma’s largest conglomerates, which has interests in banking, mining, construction and hotels. It is owned by Tay Za, a powerful businessman who the US government has sanctioned for his involvement in arms deals for the Burma Army.

Like all retailers in Burma, Premium was forced to seek supplies of imported alcohol from hotels and duty-free shops due to long-standing government import restrictions.

Since the mid-1990s, the government has implemented a ban on the import of alcohol, tobacco and other luxury goods, only allowing certain hotels and duty-free shops to carry out such imports. The ban was part of the former military government’s policies under which military- or crony-owned companies controlled large parts of the economy.

The hotels and duty-free shops are formally banned from commercial sale of alcohol they are allowed to import. Until recently, however, the government made little effort to prosecute retailers, hotels and duty-free shops for involvement in this supply and import chain.

Premium feels it is unfair that it is only being targeted in the current government crackdown, since ACE Trading and Myanmar Shopping Mall imported and supplied the alcohol.

Premium showed The Irrawaddy letters addressed to the firms, requesting them to send import license documents for the alcohol they sold the retailer. Both companies failed to do so.

A reply by ACE Trading Company, dated Dec. 13, denied that it had conducted any transaction with Premium. It claimed that a director on its board by the name of Thura Soe had acted alone in supplying thousands of bottles of alcohol to Premium.

“Thura Soe has used the company’s name for his own initiative to sell imported alcohol that the mobile taskforce has checked. Those products did not come from ACE Company, these came only from Board of Director member Thura Soe,” the letter stated.

Nge Nge, of Premium Products, said the company found this claim hard to believe, adding that the both ACE Trading and Myanmar Shopping Mall should be included in the Commerce Ministry’s investigation.

So far, this has not happened. Raids by the mobile teams, led by senior official Nyunt Aung, have only targeted retailers, leading to concerns that authorities are afraid, or unwilling, to tackle the well-connected firms involved in importing and sales of alcohol.

Asked about this, Soe Aung, of the Rangoon mobile taskforce, denied that hotels and duty-free shops should also be targeted in the crackdown. “It is not our responsibility to check importers directly; buyers have to deal with importers,” he claimed.

The Irrawaddy was unable to reach ACE Trading and Myanmar Shopping Mall for comment on Tuesday.

Clarification: A change was made in this story on 18 December. Premium Food Service Products is under police investigation. City Mart Holdings is a separate company from Premium.


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10 Responses to After Arrest in Govt Crackdown, Retailer Points to Alcohol Imports by Tycoons

  1. If Htoo company is importing those seized alcohols without license, government must go to Htoo company. Instead of catching big fish, government is trying to bully the small fishes. What a shame!

  2. That’s obvious! Nobody could have legally imported this amount of alcohol…except military and the cronies

    • How much do they mark up the price of California red wine ..
      Cabernet Sauvignon?The world’s largest retail supermarket Walmart sells here US $ 4.00 in Japan.The great value!
      Wine from Napa Valley ,Calif.is ranged US $ 8_10 for a bottle of good red wine.
      Never try to import Vodka because Russian Mafia makes Vodka with ethanol and somekind of woods.I think Mexican Tequila is available in Burma,too.

  3. The Thura Soe part in the story seems to be an old Myanmar style as the story goes now that U Htay Myint, Hlutaw mamber & of Yuzana avoided Prion for biggest amounts of Alcohol in his Ngwe Saung Yuzana Hotel ( and Yuzana Markets in the family with Alcohol )for his GM and paid 2000 $ US to one electronically enginer which just came out after a 2 years prion term to just stay there again or three weeks acting as Yuzana Ngwe Saung Hotels GM —
    U Tun Kyi old trade Ministers until November 1997 went only to house arrest as his PA as the obedience system runs in Myanmar went to jail for some years and his family save and until live end secured …
    The Thura Soe story at ACE if true as they say – would only be a statement how bad this ACE company is managed and controlled if such with ten thousands of bottles would be possible.
    Sure U Tay Zar and Htoo Trading will the next days also name such a bag person in their company and than they are clear as well, maybe still bargain how much such person need to get ????
    All Bars as Union and 50th street were also raided , illegal alcohol many found but what a surprise the Mobile team told the Bar men, ls take it off the shelf so when we come again we can not see it and all was OK — where is the Governments constancy or equality in front of the Law if we compare with Quarto MD and Premium now ??? Seems to be another country for each case…

  4. The Sport Ministers son Phyo Ko Ko Tin San is reported to have just bought an illegal built and illegal constructed Hotel in Ngapali Beach – the so called Arrakan Hotel or Shwe Eingyi. The land was stolen some years ago from Public Land with the involvement of the than Division Commander. Built illegal as no one noticed it but could as the Democratic Government came into place never get a Hotel operating license ,,,,, now ACE bought over the project recently and it is to see if Money can talk and make all legal what is illegal as he is the son of the Sports Minister of Myanmar.
    Another Hotel they bought over there which was built over years by people very close to the former Military Intelligence, had stolen and closed an important villager access road to the Beach, – driving local villagers away from their century old Business as fishermen there at the small Linthar Bach – the CCR Hotel, name might change now with the Union Sports Ministers so involved. Surprising the growth of wealth , as some years ago the Minister him self was just a carpenter and was in charge for the renovation of the Karweik Restaurant in Yangon under now Hlutaw member U Khin Shwe. Myanmar is a real ” Golden Land ” from dishwasher to Millionair – all gentlemen style of course and always pray the Buddha for good Luck, better Gold Luck.

  5. ” Myanmar Watergate 2013″
    NO Illegal Import – but illegal Sales:
    It looks more and more , clear and clear, not illegal import is the issue here ( as Quarto and Premium Food as it looks did not import at all but distributed ).
    So the Yangon City Mall near Sule pagoda is long known as the Htoo Trading – U Tay Zar Duty Free shop where only Foreigner with passport according to procedure by Ministry of Commerce can buy goods. This was openly & daily since many year not needed and all was sold to every one who came in.. Sure they have their Import Licenses, also sure possible that ACE and Union Sport Minister – family do have some Duty Free License for the Yangon International Airport so as Htoo Trading also has a shop there. ( at Htoo Tradings Duty free departure you were never able to get a received or voucher had to ask twice, were given one with 1 bottle when you bought two and often used for their own copy a sheet between so could later write what ever they wanted ??? Htoo Save tax,Staff steel from U Tay Zar ??? ).
    So these companies very well might have legal but ” Duty Free Import ” Licenses,— but than ( as the near Sule Htoo Shopping mall is always empty since month s or year – no sales management, no control , no way to sell big amounts ) found others to distribute the goods , let them believe all is legal imported as they are the big company. So if that is the way of sales , clear there was no illegal Import as thje Mobile Teams wrong statements in media — but there was a lot of illegal sales and distribution from ACE and Htoo Trading, Sports Minister Family and U Tay Zar to Premium Food done… If they requested as stated above original documents — sure they would not send as they were not allowed to sell in NON Duty Free Zones.
    The Mobile Team and Ministry of Commerce are also a bit simple,– why not to cross check with the Custom Department at port and airport , take the premium food import copy papers for legal import and compare with the Documents the Custom also must have as 90.000 bottles someone might have noticed at Custom, and SB is still also there and watch…. compare the copies and take it as a prove ….
    So the Ministry of Commerce could also check their own Ministry – which than must have files where they gave these license , of which Premium food now has only copies , Sure it looks more and more like a Big ” Myanmar Watergate 2013″ brought to surface by the Mobile teams and Ministry of Commerce – the Minister him self Merry Christmas – we see some Minister already not reaching the year 2014.

  6. So the democratic reform is coming along well, then.

  7. ” I don’t know how to choose real alcohol.”

  8. No comment, because all of them and their acts are of the blue print of wrong doings. The vast majority of public are in abject poverty trying to survive in the hell. The cronies are of the scam of the earths. Daw Aung San Su Kyi is stressing for need of RULE OF LAW. Without it, you will never be able to hit the untouchable gangsters of Cronies. Watch out for Reform of illegal constitution and coming 2015 general election. The public must unite behind DASSK and NLD. the D-day for Burma is coming soon.

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