Fiji Water reverses stance on pulling out of Fiji

The L.A. bottled water company decides to comply with the island nation's tax hike and will resume operations in Fiji.

November 30, 2010|By Tiffany Hsu, Los Angeles Times

Well, that was fast.

Fiji Water Co., the day after shutting down its operations and firing all its workers in the island nation of Fiji in protest over a large tax increase, has reversed itself.

Representatives of the Los Angeles bottled water company, which says it gets its product solely from an artesian aqueduct in Fiji, met with officials of the military-led government Tuesday and decided to comply with the tax hike.

The company, owned by billionaire entrepreneurs Lynda and Stewart Resnick, had issued an angry statement Monday, saying it was quitting the country and canceling supplier orders after the government announced that it was raising the water extraction tax to 15 Fijian cents a liter from one-third of a Fijian cent. In U.S. dollars, that made the new tax about 8 cents a liter.

The tax applied to companies taking out more than 3.5 million liters — or 920,000 gallons — of water a month. Fiji Water was the only firm that fit the profile.

Before meeting with Fiji Water lawyers, Commodore Frank Bainimarama, the interim prime minister of the country and leader of the coup that installed the military government in 2006, said he was ready to reach out to potential replacements for the bottling company.

Fiji Water said in a statement Tuesday that its factory would start up again at 8 a.m. Wednesday. The company added that it was "committed to working with the Fijian government."

The company would not comment further on the decision.

Bainimarama told the Fijivillage news site that Fiji Water's decision was "great news." Fiji Water employed about 400 workers on the island.

The Resnicks, who made their fortune by operating companies such as the Franklin Mint, Teleflora and Pom Wonderful, bought Fiji Water from its original Canadian owner in 2004.

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