Chiquita Case
Chiquita was the successor of the United Fruit Company which was founded in 1899. “In the past few years, Chiquita has been involved in paying bribes to Latin American government officials in exchange for preferential treatment, encouraging or supporting U.S. coups against smaller nations, putting in place dictatorships in Central America’s “banana republic’s,” exploiting local workers, creating an abusive monopoly, and now doing business with terrorists.”
In 2010, bananas were ranked third on the list of staple crops in the world after wheat and coffee, making them critical for economic and global food stability. The largest consumers are the U.S, the European Union, and Japan. There are three main companies that dominated the banana business.They are Chiquita, Dole, and Del Monte, and they control 60 percent of the global banana trade. Although bananas are merely a tasty fruit, the business of growing and selling this fruit creates serious environmental, economic, social, and political problems.
Colombia, with a population of over 45 million people, has the 29th largest population in the world and the second largest in South America. During the civil war in Colombia, AUC was created with the primary purpose of protecting sponsors and local economic, social, and political interests. However, AUC is seen as a terrorist organization by countries like the United States and those included in the European Union. Chiquita was accused of sponsoring the AUC by providing payoffs to them in order to keep their employees out of harm’s way.
Chiquita found itself trying to do business in an unstable environment. Colombia is a corrupt and dangerous country where local and violent organizations cause chaos. Chiquita knew they could not rely on the local government for help when it came to be protected from these organizations. In order to protect themselves, and their employees, Chiquita was forced to pay“protection payments” to the AUC. If they had not done this, the AUC would kidnap, and even kill, Chiquita’s employees.
The payments to the AUC began in 1997 and lasted for seven years. Prior to that, Chiquita was paying off another violent organization called FARC. Chiquita sent money to the AUC every month for “protection,” and the terrorist organization made it clear that a lack of a payment would result in violence. The AUC had already murdered at least 50 of Chiquita’s employees. At the time, paying AUC was strictly an ethical dilemma. This is because it was not considered a crime to provide payments to such an organization in the United States or Colombia. However, in 2001, AUC’s legal status changed, and they were listed as a terrorist organization. Since the AUC was now considered a terrorist organization, it was illegal to provide any sort of monetary payments to them.
There were a couple highly debated issues throughout the case. One issue was when Chiquita discovered AUC was classified