An investigation into an online seller of illegal refrigerant reveals an intriguing web of shadowy connections linking Eastern Europe with the UK and China.
Over the last three years, the Cooling Post has provided extensive coverage of the European black market in cheap HFC refrigerants and failures of EU governments to tackle the problem. The illegal imports undermine the F-gas regulation and place legitimate EU companies at a financial disadvantage.
Initially denying claims of widespread illegal refrigerant smuggling, the European Commission has belatedly put pressure on member states to enforce the F-gas regulations. It has also called in OLAF, the Commission’s fraud office, to help. Despite this and a number of high profile seizures, there is still a vast amount of illegal product being sold, quite openly, particularly on online platforms.
Recent investigations by the Cooling Post into just one online store offering refrigerant in contravention of the F-gas regulations reveals links to Eastern European crime, exposes failings in the UK company registration system and highlights the inadequacies of the European enforcement agencies.
Although by no means unique in its ability to trade in plain sight, the Latvian website, refrigerantgas.eu, is openly offering illegal refrigerant for delivery within the EU in direct contravention of the F-gas regulations.
Worryingly, the website appears to have links to the murky world of Eastern European crime and money laundering. It also suggests a connection to a major Chinese refrigerant manufacturer.
Latvia was identified as a key entry point for illegal refrigerants in last year’s EIA report Doors Wide Open. Bordered by Estonia, Lithuania, Belarus and Russia – providing major trade corridors from China – it also shares a sea border with Sweden via the Baltic.
The refrigerantgas.eu website is openly offering HFC refrigerants in both illegal disposable and refillable cylinders. It offers the most common refrigerants – R134a, R404A, R407C, R410A and R32 – as single cylinders or on 40-cylinder pallets. R410A is also offered in 740kg isotanks.
Typical prices quoted include, for example, are €169.50 for a 13.6kg disposable cylinder of R134a or €179.50 for the same refrigerant in a 10kg refillable cylinder. A 40-cylinder pallet of R134a in disposable cylinders is priced at €5,600. Delivery is offered to EU-countries including the UK in 3-7 business days.
The website makes no mention of the F-gas regulations and the online purchase process does not mention nor require a purchaser to be F-gas registered.
Following the ban on disposable, non-refillable, cylinders in the EU in 2007, refrigerant can now only be supplied in refillable cylinders or isotanks. However, the F-gas regulation requires that provision must be made for refillable cylinders to be returned for refilling. No such facility is seemingly offered on the refrigerantgas.eu website.
And, despite both the European Fraud Office (OLAF) and the Latvian authorities being informed, as of today the business remains in operation.
The company stated on the website is SIA Hitzlers, operating from an address in Riga. Hitzlers is registered in Latvia as a retailer of motor vehicle parts and accessories.
Investigations found no evidence in Latvia that a company of that name is licensed to handle refrigerant and the name does not appear as a quota holder on a search of the F-gas portal.
SIA Hitzlers has so far not replied to requests for comment by the Cooling Post.
The refrigerantgas.eu website domain was registered in July last year by Rosary Trade LP, a limited partnership company registered in the UK in 2015. It was registered at 272 Bath Street, Glasgow – a mailing address. Its place of business was subsequently changed to 101 Rose Street South Lane, Edinburgh.
Rosary Trade was established by two shell firms registered in the Seychelles – Monter Impex and Solter Management. These companies have featured as nominal partners in a series of other Scottish limited partnerships and been connected with a number of fraud allegations in Eastern Europe.
Scottish limited partnerships have been previously heavily criticised for their links to worldwide criminal money laundering activities. UK government moves to crack down on the abuses and the introduction of a requirement to file persons with significant control documents from 2017 led to a large drop in the number of new registrations.
In line with those new requirements, in 2017 Rosary Trade registered its person of significant control as Ilvars Sloka, a Latvian national. The partnership was dissolved last month (June 2020).
Little is known of Mr Sloka, but we believe that this may not be his real name. Oddly, two short videos linked to that name were posted on YouTube, showing HFC refrigerants in disposable cylinders.
A request for comment directed to Ilvars Sloka via an email address found to be linked to him, has, as yet, received no response.
Rosary Trade also registered another website domain last July, iceloong.eu. That URL redirects to refrigerantgas.eu.
The Ice Loong name is used along with the Ice Dragon brand by major Chinese wholesaler and refrigerant supplier Zhejiang Ice Loong Environmental Sci-Tech Co Ltd. That company is a subsidiary of Quzhou-based Zhejiang Yonghe Refrigerant Co Ltd, one of the leading Chinese refrigerant manufacturers.
It is not suggested that these companies are involved in this shadowy operation and it is not known whether either company is aware that their name is being used in this way. Neither Zhejiang Ice Loong Environmental Sci-Tech nor Zhejiang Yonghe Refrigerant Co have, as yet, responded to questions posed by the Cooling Post.