The Malta Independent 10 December 2022, Saturday
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Updated: John Dalli pleads not guilty to bribery, trading in influence

Kevin Schembri Orland Wednesday, 9 February 2022, 11:57 Last update: about 11 months ago

John Dalli was charged in court on Wednesday with trading in influence and bribery in connection with the snus scandal, an issue that dates back to 2012 when he was an EU Commissioner.

Dalli has pleaded not guilty to the charges.

The bulk of the three-hour session was mainly taken up by the testimony of Police Commissioner Angelo Gafa, who was an inspector at the time of the scandal.

Dalli, a former Nationalist Party minister, served as EU Health Commissioner between 2010 and 2012.

One of Dalli’s associates at the time, Silvio Zammit, had allegedly asked for a €60 million bribe from a tobacco company called Swedish Match to help overturn a ban in the EU on snus, a form of smokeless tobacco. Zammit had also allegedly asked for €10 million from the European smokeless tobacco council (ESTOC), a lobby group, after the company had refused.

Gafa went through the series of events, first reading from the report drawn up by OLAF, the EU’s anti-fraud office, and then describing what people interviewed by the police had said.

Gafa said that the company Swedish Match, which produced Snus, had alleged that they were asked to pay money by Zammit so that the ban on snus would be lifted. OLAF had passed on its report to the Maltese Attorney General back in 2012.

Gafa said that the Attorney General at the time had determined that there was prima facie evidence to launch a trading in influence case against Silvio Zammit, which it had done, but that more investigations would be needed into John Dalli and Gayle Kimberley (a Maltese lawyer who knew Silvio Zammit).

Gafa told the court how a representative of Swedish Match named Johann Gabrielsson had contacted Kimberley, who worked with the Lotteries and Gaming Authority at the time, to see if she could arrange a meeting with Dalli. Gabrielsson had known Kimberley prior to this point. She then sent a consultancy proposal to Swedish Match for her to be paid €5,000, the court heard.

During the session, the court heard how Kimberley was meant to attend a meeting with Dalli and Zammit in February 2012, but was unable to go. For the meeting, Kimberley had prepared a note for Zammit with pertinent questions to ask the then EU Commissioner, the court heard, such as asking who his friends on the Commission were, information related to the snus ban etc.

According to the OLAF report, Gafa said, following Dalli’s alleged meeting with Zammit, the latter met Kimberley to inform her of the meeting’s outcome. Gafa said that Zammit allegedly told Kimberley that to drop the ban, there would be a six zero cost. Gafa said that Kimberley called Gabrielsson pretending to have attended the meeting herself with Dalli, asking who in the company can make a financial commitment.

Gabrielsson came to Malta and met with Kimberley in Sliema, Gafa told the court. She again told him she attended the February meeting and told him that Dalli was informed about snus and about the positive arguments that ESTOC and Swedish Match were making and that he understood the absurdity of snus being excluded from the internal market, the court heard. She allegedly told Gabrielson that the lifting of the ban was no longer a cause for the Commissioner and that there was a price for pushing this any further, the court heard.

The police had also interviewed Gabrielsson, who told them about the meeting he had with Kimberley in Sliema. She had mentioned to Gabrielsson that the move would shorten Dalli’s political career, hinting that funds would be needed, Gafa told the court. Zammit allegedly then joined the two, and grabbed a small medicine box from his pocket pulled out some medicine and gave it to Gabrielsson, saying that lifting the snus ban would cost €60 million. Gabrielsson told authorities that he was shocked by this.

Gafa said that Gabrielsson said he would need to talk to his boss, and that when he did his boss was speechless. Eventually Swedish Match said they were not interested such a thing, the court heard.

During the sitting, Gafa also said that Zammit had allegedly asked for €10 million from Inge Delfosse, from ESTOC, to arrange a meeting between his boss and her boss. Delfosse said she could not accept and had to speak to her superiors.

Swedish Match had warned Estoc about Zammit, the court heard. The Swedish company informed the Swedish authorities about the issue, and OLAF eventually launched an investigation.

Delfosse had conducted a recorded call on OLAF’s instructions with Zammit, but Zammit was allegedly far more careful during it than he was in other conversations he had with Delfosse, the court heard.

The court heard that Zammit got to know of the investigation and had informed Dalli about it.

Gafa spoke of Dalli’s interview with the police back in 2012. Dalli told police that ESTOC tried to put him in a bad light to postpone a Tobacco directive which would have resulted in the loss of millions for the industry. The directive went against the industry, banning flavouring, was against e-cigarettes and nicotine in general, and would place a ban on smokeless tobacco, Dalli told the police.

Regarding snus Dalli made reference to a court decision 20 years ago prohibiting the marketing of snus during his police interview. Dalli confirmed that Zammit was one of 300 canvassers he had, Gafa said.

Gafa said that Dalli told them that on 6 January 2012 Zammit arranged a meeting between Dalli and a female lawyer who he did not know. The meeting he explained his position on snus to the lawyer. Dalli said that he had not met her again after that meeting and was never asked to meet her again, and that he did not know that Zammit and Kimberley knew each other, Gafa told the court. Dalli had said that after that meeting he never discussed snus with Zammit again, Gafa said. Dalli said he never authorised Zammit to do business in his name, Gafa added.

Dalli had told the police that everything was a frame-up. Dalli told police that, the European Commission President at the time Jose Manuel Barroso tried to stop him from proceeding with the Tobacco directive. He admitted to being a friend with Zammit, but held that many of the calls between the two were about Zammit’s candidature for the Sliema local council.

Dalli’s legal defence team said that they wanted the case to move at a quick pace, and said that the prosecution did not present any evidence that was not hearsay, except for Dalli’s own statements to the police.

The case continues on 18 February.

Read minute by minute court proceedings below

Live Blog:

15.28: The session has ended and will continue on 18 February.

15.26: The defence argued that so far all that has been heard is hearsay, urging the police to bring the evidence. "We want the case to move quickly. We don't want time wasting."

15.25: Gafa ended his testimony and cross-examination is reserved.

15.10: On 16 October 2012 Dalli resigned as Commissioner, Gafa said.

OLAF said that this was like a big bomb exploding in the Commission, Gafa said.

Gafa spoke about other people who were interviewed.

Zammit had told police at one point that Dalli had nothing to do with the case and denied mentioning Dalli's name with Swedish Match or Estoc and said he did not know anything of the OLAF investigation, Gafa testified about another interview with Zammit.

After all this, two meetings took place with the AG's office, Gafa said. They went over the case and on the basis of a number of factors, it was concluded that Zammit and Dalli be charged separately with accusations of trading in influence and bribery. Zammit was charged in December 2012. Subsequently, we were receiving correspondence from lawyer Tonna Lowell that Dalli had medical visits abroad and so we could not move forward against Dalli. I found a note where, on 25 March 2013 I drew attention to then Assistant Commissioner Michael Cassar that the last medical certificate had expired and I had explained that Dalli had testified before the Belgium police and so I felt he was fit to be interviewed and brought before the courts. I had asked for a European Arrest Warrant to be issued and the Commissioner at the time decided to bring it up again a couple of weeks later.

Then there was a change in Commissioner and I had again filed an application for an arrest warrant and Dalli came to the Police HQ. Peter Paul Zammit, the Commissioner then at the time, interviewed him with Gafa also present, Gafa said.

Dalli was given opportunity to explain what happened and he insisted that everything was a frame-up by the tobacco industry and local political parties.

Dalli told police that, Jose Manuel Barroso tried to stop him from proceeding with the Tobacco directive. He had attacked the Secretary General of the EU Commission who was putting pressure to stop the directive from moving forward. He admitted to being a friend with Zammit and that many of the calls between the two were about Zammit's candidature for the Sliema local council. He said that Zammit informed him about the OLAF investigation. Decision was taken to wait for outcome of Zammit case before charging Dalli, Gafa said.

Gafa said that he had started a new job soon after and passed over the file to Inspector Jonathan Ferris at the time. When becoming Police Commissioner in 2020, Gafa said, he asked for a briefing of the case to know what stage the Zammit case was at. Time was pressing, he said. Gafa said he asked Alexandra Mamo to review the case and discuss with the AG. The case was passed through many inspectors, he said. A decision was taken in 2021 for Dalli to be brought before the courts.

14.50: Gafa said that the police also spoke to Gabrielsson who told them about the €5,000 employment of Kimberley.  

On Zammit, Kimberley described him to Gabrielsson as a gateway to John Dalli, Gafa said.

Gabrielsson had mentioned a meeting he had with Kimberley where she said that the move would shorten his political career, hinting that funds would be needed, Gafa added. No amount was mentioned at this stage. Zammit met them and grabbed a small medicine box from his pocket, pulled out some medicine and told Gabrielson to have one, and that the lifting of the snus ban would cost €60 million. Gabrielsson said he was shocked by this and that Kimberley looked embarrassed, Gafa said.

Gabrielsson said it was clear the money was going to Dalli but did not know if it was all going to him, Gafa added.

Gabrielsson said he can't take decisions on his own and had to pass on his message to his superiors but said that he did not see a way this could be done.

Gabrielsson said he spoke to Hildingston who was speechless, Gafa testified. 

14.40: Gafa continued to give testimony, detailing what Delfoss had told the authorities, among other things, most of which has already been said.

Delfosse had confirmed that Zammit had asked €10 million and had known that Zammit had asked for money from Swedish Match before that also, Gafa said.

14.25: Gafa testified that while being interviewed, Dalli said that after Zammit was interviewed by OLAF, he had a call with Zammit, where Zammit alerted him about the OLAF investigations. Gafa said that Dalli had a dinner with EU President at the time Jose Manuel Barroso but did not feel the need to inform him about the investigation. Dalli said that in hindsight, that was a mistake, Gafa testified.

Zammit assured him he never mentioned his name or negotiated in his name, Dalli told the police.

Gafa said that Dalli knew about the OLAF investigations even before he was asked to be interviewed.

When asked by OLAF if he had ever been told about the existence of the investigation, Dalli told OLAF 'No, absolutely not,' Gafa said.

On 13 November Dalli continued his interview with the police, Gafa said, adding that he remembered Zammit telling him that the OLAF interviews were intense and that Zammit told him the investigators were bluffers.

Gafa said that Dalli remained in contact with Zammit to get information to better understand what was going on. After being released, Dalli passed on letters between his lawyers and Zammit.

Zammit, on the basis of what Dalli said and the letters, was interviewed again, Gafa said. Zammit gave the impression he would speak but his only words regarded Kimberley. He said Kimberley had told him that OLAF were investigating him, Gafa told the court.

Asked about the call where he informed Dalli about the Olaf investigation, Zammit did not answer.

A friend of Zammit was spoken to and confirmed that in October 2011 he (the friend) went with zammit to Sweden where they had lunch with two women and that the discussion surrounded Snus and that one of the two was Delfosse, Gafa said. He could not remember if Zammit had, during the meal, made any phone calls or received any, Gafa added.

14.10: Gafa testified that Dalli  said that during a meeting with Zammit, they discussed Zammit's candidature with the PN for a position on a local council.

Regarding the Tobacco Directive, Dalli told police that it was closed in February 2012, and direction forward had been taken. The draft directive had passed through two impact assessments, and after that only minor amendments were made, Gafa said.

Asked why he chose to meet the tobacco industry in March to take their intake on the directive proposed, Dalli told police that the meeting did not result in any changes to the directives, but at the same time kept the door open to studies based on science.

In July 2012, the Secretary General of the EU Commission asked DG SANCO to make amendments to the directive and were given instructions to delay the directive till after August 2012, Dalli told police.

In September 2012, the EU Commission asked DG SANCO to postpone launch of directive until after October.

After Dalli resigned, the directive was suspended, Dalli told police. "The implementation of the directive could have saved many lives," Dalli had said, Gafa testified.

Dalli told police that after being interviewed by OLAF, he spoke with Zammit to understand what happened between Zammit and Swedish Match and ESTOC. Dalli said Zammit passed him emails but results that an email Zammit sent to Delfosse was never given to Dalli, Gafa testified.

Regarding the calls between Dalli and Zammit in March 2012, when Zammit asked €10 million from ESTOC, Dalli made reference to a letter in October 2012 he sent to then OLAF Head Giovanni Kessler, Gafa said. Dallisaid he had a strong recollection of Zammit calling him about the privatisation of the Malta lotteries that was happening at the time, Gafa said

Dalli insisted that he never authorised Zammit to do business in his name, Gafa said.

13.53: In November 2012, Dalli was interviewed. An arrest warrant was presented to him at the time, Gafa said. The interview was audio recorded and was held inside the office of the Police Commissioner.  Dalli said he did not have a copy of the OLAF report and that according to the report he was not part of corruption.

He said that ESTOC tried to put him in a bad light to postpone a Tobacco directive which would result in the loss of millions for the industry. It would mean that 75% of cigarette packaging would need warnings on them.  The directive went against the industry, banning flavouring, was against e-cigarettes and nicotine in general, and would place a ban on smokeless tobacco. The directive was suspended twice before, he told police.

Regarding snus he made reference to a court decision 20 years ago prohibiting the marketing of snus, Gafa said. Dalli confirmed that Zammit was one of 300 canvassers he had. In 2010 Zammit called him while Dalli was in a Gozo hotel that a foreign person wanted to speak to him. Dalli accepted and the meeting took 20 minutes. The foreign person that Dalli thought was a lawyer passed on to him two PWC reports that emphasised the benefits of smokeless tobacco on the economy. Dalli said he did not remember much about the meeting, as it was not an important or formal meeting for him.

Dalli confirmed that on 6 January 2012 Zammit arranged a meeting between Dalli and a female lawyer who he did not know. In the meeting he explained his position on snus to the lawyer. The report read that during this meeting, Dalli said he was willing to take unpopular decisions as long as science supported it.

Kimberley just asked him about his position on Snus, he told police.

On the 6 January meeting, Dalli said that it did not seem Kimberley knew a lot about the subject.

Dalli denied the major part of the conclusions that Kimberley had said. He emphasised that he had not met her again after that meeting and was never asked to meet her, and that he did not know Zammit and Kimberley knew each other.

He said that after that meeting he never discussed snus with Zammit again, Gafa said.

13.40: Gafa said Zammit chose not to answer for the majority of questions asked to him by the police, and that he referred to theatrics by the Head of OLAF. Zammit said a number of times that he will say what he had to say in court and challenged investigators to charge him in court for the truth to come out.

A number of questions were made to confirm whether the request for cash allegedly made to lift the ban was made behind Dalli's back or not, but he chose to remain silent, Gafa said. Searches were made and documents as well as devices were elevated from Zammit.

Gafa said that devices were also elevated from the Lotteries and Gaming Authority regarding Kimberley.

Zammit said that the truth was very far off from OLAF's findings but would not elaborate, Gafa said.

13:27: Gafa continued to speak about Kimberley's statement to the police.

At one point, Kimberley was meant to attend a meeting in 4 February 2012 but was rescvheduled for 10 February - the meeting where Zammit met with Dalli. She prepared the note for Zammit. She was unable to meet but explained that Swedish Match wanted a regulated market where customers would have access to the best possible products.

Zammit told her that he was to be the direct liaison with Dalli. Zammit told her that Dalli had a lot of respect from the other Commissioners except for the French one.

Zammit allegedly told Kimberley that the cost for lifting the snus ban had a six zero cost and that Dalli had a lot to lose with lifting it, meaning Dalli's political life would be shortened, Gafa said.

On the basis of what was discussed, Kimberley asked Gabrielsson to come to Malta so that Zammit can make the proposal directly to him. Kimberley said that Zammit asked for €60 million from Gabrielsson in her presence, Gafa testified.

Kimberley was asked what she was promised from the €60 million, and she insisted she was to take nothing and that her interest was to keep a retainer with Swedish Match. She said she was threatened and blackmailed over this case, and OLAF told her to be careful of third parties, Gafa said. But when asked to elaborate on this blackmail or threats, she didn't want to mention, Gafa said.

13.16: The report found that there was no conclusive evidence of the direct participation of Dalli either as instigator or mastermind of the operation of requesting money in exchange for the promised political services (...) nevertheless, there are a number of unambiguous and converging circumstantial evidences gathered in the course of the investigation, indicating that Commissioner John Dalli was actually aware of both the machinations of Silvio Zammit and of the fact that the latter was using his name and position to gain financial.

Gafa said that arrest warrants against Kimberley, Zammit and Dalli were later issued. The arrests and searches began in October 2012. First Kimberley was arrested. A number of devices were also elevated and interrogations were done by Commissioner John Rizzo, Gafa, as well as others.

Many statements were recorded on Cassette tapes.

Kimberley said she worked as a lawyer with EU Council in 2004 and her focus was on the internal market. She became friends with the wife of Gabrielsson before he went to work at Swedish Match. In October 2011 Gabrielson had made the call to her, that he knew Silvio Zammit was close to Dalli and asked her if she could handle some meetings on behalf of Swedish match. This is when she asked the €5,000 consultancy fee.

13.15: The case resumed.

The Commissioner continued his testimony and said that Zammit allegedly asked Estoc for €10 million to organise a meeting between his boss and the Estoc boss, to lift the Snus ban. Zammit continued to tell Delfosse that the meeting could be organised anywhere in the world.

Delfosse said that she would have to report to the Estoc board, Gafa said. Zammit was speaking in the plural during this phone call, Gafa added.

The Commissioner spoke of phone calls which had taken place.

At the end of March, Gabrielsson called Kimberley asking if the negative turn of the DGCom was linked to their refusal of Zammit. She said she had not had more contact with Zammit after Swedish Match told them that they were no longer interested.

Swedish Match informed the European Commission with what allegedly happened and the OLAF investigation began, Gafa said.

13.05: The magistrate has suspended the sitting for ten minutes.

13.00: The OLAF report, the Commissioner said as he continued testifying, read that Swedish match had denied the offer.

Later a call was made by  Zammit saying he could do things for Estoc but for payment, Gafa testified

In March 2012, Delfosse, the Secretary General of Estoc, participated in an official meeting that Dalli attended as well as representatives of the tobacco industry. Delfosse made reference to the DG Sanco report which said that snus like products were 90% less harmful than traditional smoking.  According to the report, Dalli asked her to send him information that could substantiate this.

On 8 March, the day after this meeting, Zammit sent an email to Delfosse as a representative of ESTOC, proposing services, including meetings with Dalli. The text was nearly identical what Kimberley sent to Swedish Match in November 2011.

Between 7-8 March, 10 SMS and telephone calls were registered between Zammit and Kimberley.

Delfosse sent a letter to Commissioner Dalli after, referring to a number of scientific arguments sustaining what the lobby group was requesting and the lifting of the snus ban, Gafa said.

The OLAF report adds that Swedish Match told Delfosse to be careful of Zammit and informed her of the request for money to lift the ban, Gafa said.

Silvio Zammit had responded to an email by Delfosse answering that the offer for services he sent to Estoc was made alone and personally.

Delfosse asked Zammit to set up a meeting with John Dalli to talk about bad rumours flying around Brussels. On that same day, Zammit called Delfosse and they spoke for 18 minutes.  Later that same Day Zammit received a call from Kimberley and they spoke for 5 minutes and later in the day Zammit also spoke to Dalli for 3 minutes.

12.48:Continuing to testify from the OLAF report, the Commissioner said: In December 2011, Gabrielsson came to Malta with a Swedish Match colleague where they met with Kimberley and they explained the snus issue in detail to her.

Kimberley sent a report to Gabrielsson that she was satisfied with the outcome of the meeting and that she understood that Dalli has an open mind and is in no way preconditioned. She wrote that he did state that we are breaking barriers and that he was not adverse to lifting the ban, "what matters to him is having the grounds".

She said that if any Commissioner had what it takes to lift the bans it is this one, Gafa said.

On 7 February 2012,  Kimberley was informed by Zammit that she was not attending a meeting which was arranged to take place on 10 February. For this meeting, Kimberley prepared a note for Zammit, so that he can ask pertinent questions to Dalli. In a note, she wanted to ask Dalli who his friends were in the Commission and how he wanted to proceed on the snus ban, what he needed in that regard.

The OLAF report, he said, read that after Dalli met with Zammit,  the latter and Kimberley met in Sliema. On that day Zammit informed her about the meeting.

During the meeting between Zammit and Kimbeerly, the former told the latter that to drop the ban, there would be a six zero cost. She called Gabrielsson and pretended to have attended the 10 January meeting with Dalli, which she didn't, and asked who in the company can make a financial commitment, Gafa said. Gabrielsson came to Malta and met with Kimberley in Sliema. She again told him she attended the 10 February meeting and told him that Dalli was informed about snus and about the positive arguments that ESTOC and Swedish Match were making and that he understud the absurdity of Snus being excluded from the internal market. She told Gabrielsson that after receiving replies, she was asked to leave the room and that Zammit was nominated as the contact person between Swedish Match and Commissioner Dalli. She told Gabrielsson however, that the lifting of the ban was no longer a cause for the Commissioner, and that there was a price for pushing any further, Gafa said

The understanding of the company was that the funds were intended for Dalli, Gafa said

Later Zammit entered the meeting with Gabrielson and Kimberley and told him the same things that Kimberley had told him. Dalli had heard enough arguments to support the lifting of the snus ban, they told him. Zammit also told Gabrielson that the operation would have a cost and suggested €60 million that had to be paid to Dalli, and said that the Commissioner and CEO of Swedish Match could meet anywhere in the world, Gafa said.

12.39: Police Commissioner Angelo Gafa took the stand. He said: This case started on 24 October 2012. On that day a meeting took place with then Commissioner John Rizzo, then Attorney General Peter Grech and Donatella Frendo Dimech (who worked with the AG at the time), among others. The meeting was about the OLAF report regarding trading in influence and corruption allegations against three Maltese people: Silvio Zammit, Gayle Kimberley and John Dalli.

The allegations were made by Swedish Match, a Swedish company which produced snus - a form of smokeless tobacco. The company alleged that they were asked to pay money so that a ban on the product would be lifted by the EU. The AG passed on the OLAF report which he received on October that year to those in the meeting. In the meeting, the AG determined that there wwas prima facie a trading in influence case against Zammit, but that more investigations should take place with regard to Dalli and Kimberley.

The Olaf report read that an EU official received information from Swedish officials that Swedish Match was asked to pay €60 million in two payments in order for the Swedish snus ban to be dropped. The money, allegedly requested by Silvio Zammit, Gafa said. Gafa added that Zammit allegedly said he was acting in the name of Dalli. Kimberley acted as a representative of Swedish Match but the company told her they were not interested in the bribe. the allegation was that she allegedly colluded with Zammit, when the latter made a similar request for €10 million from the European smokless tobacco council (ESTOC), a lobby group.

Snus was only able to be sold in Sweden.  OLAF said that Dalli had an informal meeting with the ESTOC chairman in Gozo, during which Zammit had attended.

A year later, Zammit sent an email to the Chairman on the ESTOC email address, but he was no longer in that position and communication continued with the Secretary General of Estoc, a certain Delfosse. A few days later, Zammit met with the Secretary General and had lunch with her.  In this meeting, Zammit allegedly said he was a friend of Dalli and to show how close they were, called Commissioner Dalli. Zammit on the same occasion allegedly called Kimberley who that day worked in the Lotteries ad Gaming Authority in Malta.

When Zammit allegedly spoke with Kimberley, she informed him that she had a friend who started working with Swedish Match, Johann Gabrielsson. Gabrielsson found out Kimberley was a friend of Zammit and asked her if she could arrange a meeting with Dalli. There was a communication exchange and in 2011 she had sent a consultancy proposal to Swedish Match for €5,000.

12.32: A number of documents related to the Silvio Zammit case were presented.

12.30:An inspector Scerri takes the stand.  He said that the case regards alleged corruption and trading in influence and laws that were being formed at EU level. The allegation was that Dalli was involved as well as his canvasser Silvio zammit.

In 2012 the case started and an investigation by OLAF launched. On 10 July 2012 Maltese police received request from OLAF to investigate as well.  The investigation then started and a number of people were arrested, including Silvio Zammit and John Dalli.

He said that in December 2012, Silvio Zammit was charged alone and the case is sub Judice. John Dalli was abroad at the time and due to medical certificates stating that he couldn't travel at the time, he wasn't charged, the inspector said.

Dalli later was spoken to by former Police Commissioner Peter Paul Zammit, in the presence of Angelo Gafa who was an inspector back then, the inspector added.

It was decided that the Silvio Zammit judicial process had to end before charging John Dalli, he said. However, it was later decided that the Dalli case could no longer wait as the proceedings against Zammit was taking long. He said that the decision to prosecute Dalli was taken by Attorney General.

12.25: He pleaded not guilty to the charges, which have not yet been read out in court.

12.24: John Dalli says he is 72 years old and resides in Siggiewi.

12.23: Magistrate Caroline Farrugia Frendo starts the court session

 

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