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Prada Korea shuns good causes

Prada Korea transferred most of its net profits for 2009 to its parent firm, while providing nothing in the way of social contributions to Korea, placing the company among foreign firms accused of turning a blind eye to social causes.

The Korean vendor of the Italian fashion brand is wholly owned by Prada Far East, based in the Netherlands.

According to Prada Korea’s regulatory filings, more than 15 billion won ($14 million), or 77.2 percent of the 19.4 billion won net profits the company posted in 2009 was paid in dividends to its Netherlands-based parent firm.

In contrast, despite soaring profits, the company’s donations to local causes have remained at zero since 2006.

In the fiscal year starting Feb. 1, 2008 and ending on Jan. 31, 2009, the company’s net profits came in at about 9.97 billion won.

In the following year, the figure jumped to 19.4 billion won, and again to 32.4 billion won in the fiscal year ending on Jan. 31, 2011.

Prada Korea, however, is far from unique in directing much of the profits as dividends. The local vendor of the French fashion brand Louis Vuitton allocated more than 84 percent of its 2010 operating profits as dividends to its parent firm, while Mercedes Benz Korea’s dividend payments for 2010 took up about 90 percent of its net profits.

By Choi He-suk (