Wyden, Colleagues Sound Bipartisan Alarm on JBS Request to Trade Shares on NYSE, Citing Threat to U.S. Markets
Washington, D.C. – U.S. Senator Ron Wyden joined Senate Colleagues in urging the Securities and Exchange Commission (SEC) Chair Gary Gensler to consider the risk JBS S.A. (JBS) poses to the integrity of U.S. capital markets and the legal rights of U.S. investors as they consider the company’s proposal to list on the New York Stock Exchange.
“As the U.S. Securities and Exchange Commission (SEC) considers this proposal, we urge the SEC to protect the integrity of U.S. capital markets and the legal rights of U.S. investors by exposing the risks that JBS poses to potential shareholders, including its track record of corruption, human rights abuses, monopolization of the meatpacking market, as well as environmental risks,” wrote the senators. “Consistent with the SEC’s powers and responsibilities, should JBS fail to cure any such disclosure deficiencies, we would ask that the SEC decline to declare the company’s registration effective.”
The lawmakers detailed JBS’ extensive international corruption record as well as the bribery scheme organized by JBS owners Joesley and Wesley Batista to acquire U.S. meat producer Pilgrim’s Pride in 2009: “In total, JBS estimates its current criminal exposure at $463.5 million, as well as $2.1 billion for ongoing civil, tax, and labor litigation claims. These are startling figures for a company that now seeks to avail itself of the privilege of having its shares traded on the New York Stock Exchange.”
The lawmakers also expressed concern for the potential environmental impact, citing a recent investigation conducted by the U.S. Senate Finance Committee into JBS’ ties to deforestation: “Dozens of journalistic and NGO reports have shown that JBS is linked to more destruction of forests and other ecosystems than any other company in Brazil. The company has made repeated claims that it will eliminate deforestation but has not taken meaningful steps to do so, despite its direct knowledge of extensive deforestation in its supply chain.” The lawmakers also highlighted that the Brazilian company was at the center of a whistleblower complaint filed with the SEC that alleged JBS’s Sustainability-Linked Bonds (SLBs) framework defrauds investors. Mighty Earth, the environmental organization behind the complaint, has called for JBS’ IPO to be postponed until a determination is made by the SEC.
“Approval of JBS’ proposed listing would subject U.S. investors to risk from a company with a history of blatant, systemic corruption, and further entrench its monopoly power and embolden its monopoly practices. We urge the SEC to consider these issues as it evaluates JBS’ proposed listing,” the lawmakers concluded.
The letter was led by U.S. Senator Cory Booker (D-N.J.). Along with Wyden, the letter is signed by U.S. Senators John Barrasso (R-Wyo.),Richard Blumenthal (D-Conn.), Sherrod Brown (D-Ohio), John Fetterman (D-Pa.), Josh Hawley (R-Mo.), Robert Menendez (D-N.J.), Chris Murphy (D-Conn.), Marco Rubio (R-Fla.), Bernard Sanders (I-Vt.), Jon Tester (D-Mont.), Chris Van Hollen (D-Md.), Elizabeth Warren (D-Mass.) and Peter Welch (D-Vt.).
Full text of the letter is here.
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