BS S.A. announced Wednesday it is suspending its cattle purchases and slaughter activities in seven facilities

BS S.A. announced Wednesday it is suspending its cattle purchases and slaughter activities in seven facilities in Brazil's Mato Grosso do Sul state for an indefinite period, after a local court decided to freeze BRL730 million ($230.3 million) in assets belonging to the beef processor and its controlling company J&F. The assets were blocked following the request of a Parliamentary Commission of Inquiry on Tax Irregularities organized by legislators at Mato Grosso do Sul state. The Commission was installed after former CEO Wesley Batista revealed in his plea bargain testimony to prosecutors earlier this year that false invoices were used to justify the outflow of money to pay bribes to politicians in Mato Grosso do Sul state in exchange for tax incentives. JBS decided to halt operations in its seven units in the state due to “legal uncertainty,” but said that employees will continue to receive their salaries normally “until the company has a definition on the subject.” JBS is closing all seven of its units in Mato Grosso do Sul: two units in Campo Grande, one in Anastácio, one in Naviraí, one in Nova Andradina, one in Ponta Porã and one in Cassilândia. The company will continue to comply with all of its export contracts, regardless of the temporary closures, according to JBS' press office in São Paulo. J&F closed a leniency deal with prosecutors earlier this year, agreeing to pay BRL10.3 billion ($3.24 billion) in fines to settle charges related to the corruption scandal revealed in May. The company expects this fine to cover any potential claims for reimbursement related to irregularities committed, according to reports by Brazilian media. “JBS clarifies that it is committing its best efforts to maintain the normality of its operations and works to protect its 15,000 direct and 60,000 indirect employees in Mato Grosso do Sul,” the company said in a statement. JBS' workers in the region fear that the blockade of assets could lead to layoffs in the future, although the company has not yet signaled anything to that effect. Local legislators will now request a conciliation hearing with JBS' representatives to try to close an agreement that would secure jobs, according to information released by Mato Grosso do Sul state's legislative chamber.