Tian Tang Group speaks out on partnership dispute with fellow Chinese company

Tian Tang Group, which oversees the Sino-Mbale Industrial Park, has addressed concerns surrounding its partnership dispute with Automobile Group (U) Limited, a fellow Chinese company.

In an official statement, Tian Tang outlined the origins of the conflict, dating back to a cooperation agreement between shareholders Mr. Liu Qingshan, Mr. Yan Sheng, and Mr. Zhang Zhigang, signed in December 2019.

The agreement established Automobile Group (U) Limited to engage in automobile assembly, with all three shareholders committing to avoid any conflicting business activities.

As part of the agreement, Tian Tang Group allocated 10 acres within the Sino-Uganda Mbale Industrial Park to the company, along with a 640-square-meter exhibition hall, a 2,700-square-meter workshop, and a rent-free apartment in the Namanve Industrial Park for three years.

However, the group now accuses Mr. Liu of breaching the agreement.

In April 2023, Mr. Liu registered a competing company, Watu Auto Works (U) Ltd, without consulting his fellow shareholders. By October 2023, he had also registered NEC-WATU AUTOMOBILE (U) Ltd, holding 80% of shares, with the remaining 20% owned by NEC, the commercial arm of the Uganda People’s Defence Forces (UPDF).

Tian Tang Group claims that both of Mr. Liu’s companies began operating from the premises of Automobile Group (U) Ltd, while excluding other partners from the business and failing to provide any accountability for investments.

The company also alleges that Mr. Liu forged the signature of Tian Tang’s chairman to manipulate the shareholding in favor of himself and his son.

Efforts to reconcile the parties, facilitated by Col. Edith Nakalema from the State House Investors Protection Unit, have so far failed, according to Tian Tang.

A mediation agreement signed over a year ago included plans for a comprehensive audit of Automobile Group (U) Ltd to assess its financial state. However, the audit has not been concluded, as Mr. Liu allegedly did not cooperate.

Tian Tang Group reports that they sought the eviction of Mr. Liu and his entities from their premises, a move that has been resisted. Legal proceedings to evict Mr. Liu are currently underway, with assistance from K&K Advocates and further mediation efforts led by General James Mugira.

Additionally, Tian Tang Group addressed rumors that it charges investors to facilitate meetings with Ugandan President Yoweri Museveni and other government officials.

The group suspects that Mr. Liu’s camp is behind the allegations, which they strongly deny.

“Tian Tang Group offers free services to investors, including business registration, certification, marketing, and tax compliance,” the company stated, adding that it maintains a professional relationship with all relevant government bodies.

In closing, Tian Tang Group reaffirmed its commitment to transparency and industrial development in Uganda, urging the public to disregard false reports and unfounded allegations.