ILVA Steel Exec Arrested in UK

ILVA has been the center of an environmental scandal in which prosecutors have been fighting efforts by the Italian government to keep the plant operating. More than half a dozen company officials have been under investigation for allowing operating conditions that have contributed to a high incidence of cancer in the region.

Prosecutors ordered seizure of the plants assets in July 2012. Parliament approved legislation last month to allow the plant to continue to operate while making necessary improvements. However, prosecutors challenged the law’s constitutionality as well as parliament’s power to intervene.

Judges rejected a plea by ILVA president Bruno on Tuesday to release $1.3 billion of seized steel products so they can be sold in order to pay workers and carry out environmental improvements. According to labor union sources, Ferrante warned on Wednesday that 6000-8000 employees will be put on indefinite leave in the next few days if the plant is not fully reopened.

The Italian government is fighting to keep the mill operational to preserve jobs in a steel supply chain that employs over 20,000 including the 12,000 employees at ILVA. The company produces about 8 percent of European steel and the government estimates that stopping production would cost the Italian economy more than $10 billion a year. In 2011 ILVA produced 8.5 million tonnes of steel, about 30 percent of Italy’s total output.