Competition Tribunal File No: The Competition Tribunal In the matter of an Application by Safa Enterprises I c. doing business as My Convenience Store for an order pursuant to Section 103.1 of the Competition Act, RSC 1985 c. C-34, as amend d granting leave to bring an application pursuant to Section 76 of the Competition Act
BETWEEN: Safa Enterprises Inc. Applicant AND: Imperial Tobacco Company Limited. Respondent
AFFIDAVIT IN SUPPORT OF NOTICE OF MOTION I, ADNAN MUSTAFA of 11957 96A Avenue, Surrey BC V3V 2AS, MA 1E OATH AND SAY AS FOLLOWS:
1. I am the Manager of the Applicant and such have personal kno •1edge of the facts and 1 matters hereinafter deposed to except where stated to be made on information and belief and where so stated, I verily believe them to be true.
2. I am authorized by the Applicant to make this Affidavit.
3. As the Manager of the Applicant I am authorized by the Applicant to act on its behalf if the leave granted to bring an Application before the Competition Tribunal.
4. Attached are the Financial Statements for the fiscal year endin December 31, 2012 of the Applicant . Exhibit A (Financial Statements for the peri · d ending 2012-12-31} 5. Attached Exhibit "A" refiects the financial position of the ~pplicant; the retained
earnings arie in deficit of $86,933.75 for the fiscal period ending December 31, 2012.
6. Due to shareholders in Exhibit "A" is comprised of mostly borrorl ed capital from banks and other personal sources.
7. Applicant Safa Enterprises Inc. ("SEI") is a small family busin j ss establishment that happened to be a corporation. [ 8. Being a small family business I and my wife Ra ina K. Adnan who is the sole shareholder of the Corporation has invested all our personal and borrowed resources to establish this business.
9. I, my wife and t he Applicant do not have funds to retain a legal Jounsel. We are unable to get any loan from banks or personal sources to retain a legal counsel.
10. I am not a member of Law Society of British Columbia but have an educational background in business studies. I have completed my Master of Commerce degree majored in Finance from Pakistan.
11. I have and am capable of researching the Competition Tribuna l Rules and Procedures necessary to ensure that the Tribunal hea ring will be conducted in businesslike manner and proceed expeditiously thus being concluded within a reasonar time frame. 12. I was diagnosed wit h Colon Cancer in July 2011. I was unable to 1ook after the business 1 affairs from Ju ly to December 2011. During this period the Ar licant started losing customers as t he Applicant's competitor lowered the prices of Cigj rettes.
13. I had to discontinue my chemotherapy as it was hard to see thi business getting shut down when I and my wife had all our savings invested in the business.
14. I found out in October 2012 that Applicant's competitor was on Preferred Pricing Program by the Respondent Imperia l Tobacco Company Limited ("ITCO").
15. Mr. Thierry Schmidt, the Regional Sales Manager of ITCO has ackr owledged and insisted to continue the discrimination policy against the Applicant in his etter dated January 17, 2013. Exhibit B (Mr. Schmidt Letter dated Jan 17, 2013}
16. I tried my best to convince the Respondent "ITCO" to provide us the equal business opportunity but they have not stopped their reviewable practice r date.
17. Now I am going through hard time as my health is deteriorating that my family doctor believes is due to stress I am going through. My doctor says, "Firh three years are most crucial in cancer treatment, as there are more chances of cancel[ re- lapse in first three years". The Respondent "ITCO" will be responsible for the relapse if it happens.
18. It will be hard for the Applicant to be in the business if the Respol dent "ITCO" continues to discriminate the Applicant's business.
19. If cancer relapses then I will not be able to look after the busin ss and my wife is also going to school so that she could financially help in future in the event something happens to me, it is very hard for her to keep up as we have a 3. years old daughter to look after as well.
20. All I am requesting Competition Tribunal to give us an o portunity to present Applicant's case that I believe the practice of the Respondent "ll CO" is reviewable and falls under the Section 76 of Competition Act.
21. Therefore, I seek an order from Competition Tribunal for le ve to represent the Applicant in proceedings, rather than a solicitor, pursuant to R le 120 of the Federal Rules of Court .
Dated at Vancouver, British Columbia, this 6th day of September, 201 . ~ Adnan Mustafa Manager Safa Enterprises Inc.
SAIRAKHAN Notary Public #21'.-\, 8~3<l -12flth S reet Surrey, BC V3W 4 2 Tel: 604-591 -5824 Fax: 60 -591-8273 saira@vannotary.c rn
GULZEIB AGHA. PUBLIC ACCOUNTANTS 104 - 7945 13r. STREET SURREY BC, V3W 4N2 TELEPHONE (778) 892-2560 This is Exhibit•A ·t o the 1 1 Affiaavi\/flaclaratiOn olf Ab N A cl ~ l.AS1~1=16, • Sworn/Declared befor1a me at ~ • • .n .n 1 )f BC this.Ji!:::_ day of~ • Saira Khan - \ Notary Public for the Province of British Columbia
NOTICE TO READER We have compiled the Balance Sheet of Safa Enterprises Inc. for the yr ar ended December 31 , 2012 and the Statement of Income and Expenses for the year then en ci:ied , from the information provided by management. We have not audited, reviewed or otherwis:e attempted to verify the accuracy or completeness of such information. Readers are cautione•d that these statements may not be appropriate for their purposes.
August 16, 2013
SAFA ENTERPRISES INC. NOTES TO FINANCIAL STATEMENTS FOR THE YEAR ENDED DECEMBER 31, 2012.
1. GENERAL INFORMATION The accompanying statements reflect the revenue and expenditure for the period of twelve months from Janua1y 01, 2012 to December 31, 2012.
These financial statements reflect the assets, liabilities, revenues and e~penses of and do not include any other assets, liabilities, revenues and expenses of the sharet alders or the liability of the shareholders for taxes on the earnings of the company.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Operation Financial statements have been prepared in accordance with generallV accepted accounting principles. Fixed Assets are recorded at cost. Revenues and expenses are recorded on accrual basis.
3. CAPITAL ASSETS Capital assets are depreciated on diminishing balance method at the following rates. Furniture & equipmHnt 20%-Accumulated Net Book Assets Cost Deoreciation Value Furniture & equipment 4,733 4,733 In the year of acquisition of an asset, one halfofthe above rates are applied. 4. FINANCIAL INSTRUMENTS The company's financial instruments consist of cash, accounts receivable, accou ~ts payable and long term debt. Unless otherwise noted, it is management ' s opinion that the company is rot exposed to significant interest, currency or credit risks arising from these financial instruments. The fai values of these financial
instruments approximate their carrying values, unless otherwise noted.
quCzei6 fig fia
(These notes fo<m an integ<al put of the Financial Sta teT nts)
5. SHARE CAPITAL Authorized : 10,000 Common shares
Issued and fully paid : 1,000 Common shares without par value at $1 .00 each
6. DUE TO SHAREHOLDERS Loans from Shareholders are not interest-bearing and have no fixed terms of repayment. These have been classified as non-current.
C}u[zei6 ;4gfi.a
(These notes form an ;ntegral part of the F;nandal Statemr
Without par 11alue Without special rights or Restrictions 1htached
s)
I I
SAFA ENTERIRSES INC. BALANCE SHEET AS AT DECEMBER 31, 2012 I I (UNAUDITED) LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT I Bank overdraft Accounts payable & accruals I Due to government agencies I I Total Current Liabilities Due to shareholders CAPITAL '
I Issued and Fully paid 1000 common shares @ 1.00 each Retained Earnings Shareholders' Equity I APPROVED ON BEHALF OF THE BOARD I
DIRECTOR I (see notice to reader) The accompanying notes are an integral part of financial statements
~
2012 2011 $ $ - I 4,141 .82 13,488~51 8,997.18 471.46 13,488 . 5~ 13,610.46 249,898.J 155,668.31
I 1,000.00 1,000.00 (86 , 933 . 7~) (52,453.95) ~85 , 933 . 7~) (51,453.95) I 177,453.511 117,824.82 I I
SAFA ENTERIRSES INC. BALANCE SHEET AS AT DECEMBER 31, 2012 (UNAUDITED)
ASSETS 2012 2011 $ $ CURRENT
Cash and bank Accounts receivables Due from govt. agencies Prepaid deposits Inventory Total Current Assets I FIXED I I Furniture & equipment Goodwill Less accumulated depreciation Total Fixed Assets Organisation cost (see notice reader) The accompainying notes are an integral part of the financial statememts.
I I ~ I
2,192.14 500.00 700.00 -25,627.70 15,191 .15 11 ,300.00 6,500.00 120,000.00 78 ,000.00 159,819.84 100,191 .15 4,733.67 4,733.67 12,500.00 12,500.00 - - I 17,233.67 17,233.67 400.00 400.00 177,453.51 117,824.82
SAFA ENTERIRSES INC. STATEMENT OF RETAINED EARNINGS FOR THE PERIOD ENDED DECEMBER 31, 2012 (UNAUDITED) ' Balance at beginning of period Net Income (Loss) for the period Balance at the end of period I I I (see notice to reader) I
i ~ ~ - - -
2012 2011 $ $ (52,453.95) 0 (34,479.80) (52,453.95) (86,933.75) (52,453.95)
SAFA ENTERPRISES INC. STATEMENT OF INCOME FOR THE YEAR ENDED DECEMBER 31, 2012 (UNAUDITED) REVENUE
Sales Other DIRECT COST Inventory-opening Supplies Inventory-Closing Cost of goods sold GROSS MARGIN EXPENSES Accounting Advertis ing and promotion Automobile expenses Bank charges & intrest Business licence and permits Entertainment Office supplies and sundry Rent Repairs & maintenance Security Telephone Wages & benefits TOT AL EXPENSES Net Income before management salary Management Salary Net Income after managE!ment salary (see notice to reader) (The accompanying notes are an integral part of financial statements)
I k ' -
2012 2011 $ $
324,079.83 198,227.84 11 ,668.79 3,954.00 335,748.62 202,181 .84 78,000.00 -321 ,168.45 256,506.10 (120,000.00) (78,000.00) 279, 168.45 178,506.10 56,580.17 23,675.74 2,000.00 2,000.00 - 100.43 1,080.66 4,402.59 3,979.70 3,378.05 287.00 281 .00 184.73 503.27 662.57 431.75 57,957.14 43,035.71 1,149. 11 3,577.30 364.00 142.87 4,514.27 3,618.11 12,880.79 8,658.61 85,059.97 70, 129.69 128,479.80' (46,453.95) 6,000.00 6,000.00 (34,479.80) (52,453.95)
IMPERIAL TOBACCO COMPANY
Saira Khan . Notary PubHc for the Province of British Columbia January 17, 2013 #213, e364~12sth Street ,( Sum~y, BC V3W 4G2 Tel: 604·t\l!l1 ·fllii!" !" a~·1 604-all 1· 9~ 3 Without Prejudice salra@vannataFy ,eem Safa Enterprises Inc. dba My Convenience Store (ERP # 1060295) c/o Mr. Adnan Mustafa, Manage 450 West Hastings Street Vancouver, BC V6B lLl
Dear Sir, I am writing in response to the complaint you made recently to your Account Representative, Rob Laing, in relation with our expansion, preferred pricing progmm (the "1PP"). As you probably know, the main objective of this program is to ultimate!~ offer lower retail prices to consumers on Imperial Tobacco products. The PPP is offered to selected retailers, comprised of both independent small businesses as well as corporate banne1. It is legal to offer the PPP to some retailers, and not to all. We have attempted to select as many independent retailers as possible, keeping in mind that limited financial resources prev Int us from offering the PPP to all customers .
Let me reassure you that we are, and continue to be, fully committed to~ll our customers, including those who are not participating in the PPP. We express our com "tment to you and your business in various manners. First, by offering you a winning brand ortfolio comprising high quality products and unique innovations. Our portfolio provides yo 1 u with the leading brands that adult smokers are looking for. Our commitment to your business continues day in and day out through our DSS model, which ensures that your ITCO products are delivered to your store, hassle free and your ITCO Account representative is always a JIa ilable to help you with any issues that you may encounter. Finally, our commitment to your business is also to keep our prices as competitive as possible in each segment. In essence, our commitment to you is to offer popular and innovative brands, competitive prices and unique service through our DSS model.
Imperial Tobacco Company Limited
1329 - 45th Avenue NE Calgary, AB T2E 2P3 Canada Tel. 1-403-717-8020 Fax 1-403-531-9589 SAIRAKMAN Toll free 1-888-896-691 O Ntl\dty PubliG _ www.imperialtobaccocanada .com
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lMPERIAL TOBACCO COMPANY
1329 - 45th Avenue NE Calgary, AB T2E 2P3 Canada Tel. 1-403-717-8020 Fax 1-403-531-9589 Toll free 1-888-896-6910 www.imperialtobaccocanada.com
I understand yo}lr disappointment from the fact that your outlet is not eligible to PPP. But you should not underestimate the . benefits that you derive from. your particifa tion in our Low Segment Term Program ("LST Program"). Indeed, the LST Program frovides you with substantial rebates (w ich are equivalent to the PPP rebates) on John Playe~· Standard which is the number 1 selling brand in Canada. In addition, if you wish to obtain higher rebates on our products, we invite you to consider the. option of adopting the PAD 0 day\s payment term. It would award you an additional rebate of $0.45 per carton of Premium and $0.35 per carton of Below Premium cigarettes. P.lease consult with your Account Representative (Rob Laing at 778-874-7823) or your District Manager (Vincent Chai at 604-366-5085) if you wish to learn more about this option.
Thank you and regards, ·e rry Schmidt Regional Sales Manager
Imperial Tobacco Company Limited
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