Trading partner informed KLK that PT KDP has no land clearing activities. Based on Agrosubur’s internal investigation, they found that:
• The coordinate mentioned in the report (-1.359,112.811 and -1.359. 112.817) located outside of PT KDP
concession.
• From 108 ha of land clearing reported, 47 ha is located inside of HGU PT KDP. However, this is for the road corridor by other company which opened up access for encroachment by local community. Meanwhile, another 15 ha located inside Izin Lokasi PT KDP but outside of HGU. The clearing in this area was for the
same road corridor by the company. These encroachment has been reported to the police with report number 023/SSL-RO/VII/2019.
• Another 46 ha of the clearing mentioned located outside of Izin Lokasi, Izin Usaha Perkebunan and HGU of PT KDP.
• PT KDP has increase the security in the area including put up a sign that the area belongs to PT KDP, security post and frequent patrolling in the encroachment area.

Trading partner had a meeting with PT KDP and they have shown the evidences including the overlay map, the police report and photos of the encroachment by the local people.

From the peer review –II HCSA, the results stated that AEP has agreed to conserve the KAP plasma area as a High Priority Patch (HPP), the plasma area is 150 ha. According to the AEP representative, this decision had discussed with HCSA and Mighty Earth.

For more information, PT. KAP has sent a Public Response letter regarding the commitment to conserve the HPP area in the KAP plasma location which has been published on the following website:
http://highcarbonstock.org/registered-hcsa-assessments/

Based on the allegation, AAL commented that they have carried out spatial and field verification and they confirmed that the deforestation occurred is outside PT. Nirmala Agro Lestari (PT NAL’s) concession. Indeed, there was a land clearing activity at the location indicated on the map/reference coordinates which is owned by local community. Current conditions in the field indicated that the cleared land is planted with agricultural crops. The spatial analysis data and land condition documentation are shared with KLK.

Report Attached

KLK representatives engaged directly with AAL on the alleged matters.

AAL has reported to KLK that its subsidiaries – PT Mamuang (“Mamuang”), PT Lestari Tani Teladan (“LTT”) and PT Agro Nusa Abadi (“ANA”) have always operated in accordance with the laws in Indonesia and hold all the necessary permits to conduct their businesses and operations. None of these companies is involved in any illegal land acquisitions. AAL is fully aligned on its Human Rights strategy with the United Nations Guiding Principles on Business and Human Rights, which has been implemented across the company’s entire operations and supply chain.

According to AAL, PT LTT has received its HGU Certificate in 2002 and none of the HGU Certificate referred in the FoE Report (page 11) are related to PT LTT.

On the other hand, PT LTT routinely evaluates air and water quality to ensure its operations do not impact or pollute the surrounding environment, as mandated by government regulations.

KLK will continue our engagements with AAL on this matter to determine the next course of action.

Updated Feb 2023:

KLK had a follow-up engagement with AAL on 10 February 2023.

AAL indicated that they have published a statement on 7 December 2022 in response to the Friends of the Earth (FoE)/WALHI and Econusantara (ENS) reports. AAL will work with an independent third party (or parties) to review the allegations in these reports including all matters arising from them. The findings will be published, and necessary actions will be set out to address them.

Further details on the above are available here.

(AAL Statement on FoE and ENS Reports published on 7 December 2022)

KLK will continue to monitor this case and engage with AAL for updates on this matter.

Updated Apr 2023:

AAL has appointed a 3rd party consultant – EcoNusantara to conduct verification on the above-mentioned allegations.
Further details on the above are available here.

Aug-19

Jan-20

Mighty Earth
Rapid Response 18

Mighty Earth
Rapid Response 23

Bumitama clarified that the areas were impacted by fires. These are enclaved areas owned by local community, and not developed by the company.

Bumitama told trading partner it had submitted information to RSPO part of hotspot monitoring. However the extent of the burnt area was larger than what it recorded. A fire incident report was also submitted to authorities in the village and local police. This was also submitted to the RSPO. Bumitama said it would investigate this case further and revert.

Bumitama provided trading partner clarification after on the ground verification.

PT Putra Utama Lestari (area 1)

PT Putra Utama Lestari (area 2)

Updated Mac 2020

Trading partner confirmed that DSN sent a letter stating that PSA had stopped land clearing activities since 2015. It also reiterated that the land clearing was committed by local communities. In addition, the case had been filed to local authorities and a socialization to the local communities had been conducted to prevent further encroachment and land burning. DSN then informed trading partner that the process of submitting Kadastral Map to BPN/the government land agency was on progress. Area of the land encroached by the local communities has been excluded from the proposed Kadastral Map. DSN then made an overlay analysis using the Kadastral Map. From the overlay map we can see that the locations of land clearing mentioned earlier by Mighty Earth and the location of land clearing detected later by trading partner internal monitoring were both located outside PSA Kadastral Map. See http://bit.ly/2zl6VMl
The RSPO has now published the revised boundaries of PT Putra Utama Lestari and PT Prima Sawit Andalan.

DDB confirmed to trading partner that they have a stop work order on all land clearing on the sites at DDB Bawan (Block 13 Lot 34 and Lot 35) and have agreed to conduct soil investigation to confirm the site is peat or not peat. Trading partner engagement with DD will continue while waiting for the soil investigation report.

Alleged clearance of peat and forest.

Greenpeace
Moment of Truth

Updated Jul 2021:

FGV informed that a verification audit was conducted by an independent auditor appointed by the RSPO between November 2020 and April 2021. The verification audit involved six of FGV’s complexes – four in Peninsular Malaysia and two in Sabah. A draft report of the audit has been prepared by the auditor and once finalised, it will be submitted to the RSPO Complaints Panel for deliberation. FGV has been made to understand by the RSPO Secretariat that a decision on the lifting of the aforesaid suspensions will be made by the RSPO Complaints Panel by the end July 2021, based on the outcome of the verification audit.

On 30 Sep 2020, the United States Customs and Border Protection (CBP) issued a Withhold Release Order (WRO) that it would detain palm oil and palm oil products made by FGV, its subsidiaries and joint ventures at all U.S ports of entry.

KLK representatives engaged with FGV in Oct 2020. FGV informed that on 1 Oct 2020, the company had issued a statement in response to the WRO issued by the CBP against palm oil and palm oil products made by FGV. FGV clarified that the issues raised by the CBP have been the subject of public discourse since 2015 and that the company has taken several steps to correct the situation, which are well documented in the public domain.

A conference call between FGV and the CBP was held on 8 Oct 2020. However, the CBP could not reveal any information about its findings except that its research had identified the 11 International Labour Organization (ILO) indicators of forced labour in FGV’s practices. The CBP informed FGV that it would consider a petition for the revocation of the WRO together with information or reports arising from audits from credible, unbiased, third party auditing firms. In relation to this, FGV is already communicating with several independent organisations to explore options for an imminent audit of FGV’s operations.

Subsequently, FGV has also published FLA Assessment Report on the Implementation of FGV’s Action Plan and their Progress Report (October 2020) Pertaining to RSPO’s Complaints Panel’s Directives. All FGV progress updates and timebound action plan are publicly available here.

Updated Mar 2021:

On 31 March 2021, FGV announced an update on its efforts towards the revocation of the US CBP’s WRO. FGV also published updates on its affiliation to the Fair Labor Association (FLA) including FLA’s report on the progress of implementation of FGV’s action plan on enhancing labour practices. The report outlined progress made between September 2020 and March 2021. In the report, FLA highlighted some gaps in several aspects, including FGV’s grievance mechanism, remediation procedures and worker representation structures. These areas will remain a key priority for FGV in 2021.

Updated Jul 2021:

On 18 June 2021, FGV announced that they have called for proposals from prospective organisations and expects to finalise the appointment of the independent auditor in August 2021, following which the assessment work will immediately begin. FGV estimates that it would be able to submit to the CBP, for its consideration, the assessment report together with FGV’s proposed remediation plan within eight months upon the appointment of the independent auditor.

Updated Nov 2021:

On 16 November 2021, FGV announced the appointment of ELEVATE as the independent auditing firm to conduct an assessment of FGV’s operations against the 11 International Labour Organization (ILO) Indicators of Forced Labour. ELEVATE is an independent sustainability and supply chain service provider with vast experience in advancing social compliance and addressing forced labour risks by applying a worker-centric approach. FGV is in discussion with their US-based legal counsel and ELEVATE on the audit design and plan which is expected to begin in November 2021.

Updated Jan 2023:

KLK representatives engaged with FGV in Jan 2023. FGV informed their progress update as below:
Oct 2022 – ELEVATE provided assessment result to FGV
Oct to Feb 2023 – Implementation of remediation by FGV and verification by ELEVATE
Mar 2023 – Plan to submit report and petition by FGV to CBP to revoke WRO

We maintain regular engagement with FGV and will continue to monitor the progress to decide on the next course of action.

PT Permata Sawit Mandiri

May-19

Mighty Earth
Rapid Response 15

On 16 March 2017, Genting announced that PT Permata Sawit Mandiri (PT PSM) has ceased to be subsidiary of Genting. Genting’s JV partner, Sepanjang Group has also divested from PT PSM since September 2017.

Updated Feb 2020:

Trading partner engaged with IJM. The field visit for the HCS and HCV assessment was conducted in October 2018.

Trading partner continues to monitor the activities to ensure PT Prima Bahagia Permai (PBP) will uphold their commitment to the moratorium.

AspirasiKristal (M) Sdn Bhd (area B)

Satria Eramaju Sdn Bhd

Reference to the engagement of trading partner with their supplier:

1. IJM has already engaged with Aspirasi Kristal and Satria Eramaju, where both their FFB suppliers are required to adhere to the NDPE policy.

2. Aspirasi Kristal has stopped their land clearing activities in July 2020, while Satria Eramaju do not have any active clearing activities.

3. Engagement with these companies are still ongoing, updates will be made available when there is new development to the case.

Updated Sep 2020:

Trading partner updated that:
Updated Sep 2020:
Our trading partner has concluded and closed this case on the following basis:
• According to the management of Aspirasi Kristal, the areas as indicated were cleared in 2019. However, the recent activities involve construction of terraces and road development of the cleared areas. AK reiterated no new clearing activities were conducted since 30 July 2020.
• IJM Plantations decided to suspend the FFB supply from AK while investigation is ongoing.

However, AA Sawit Sdn Bhd, whereby the owner of Jernih Kemboja Sdn Bhd is also a shareholder, was appointed by the landowner to clear approximately 25 ha of land in PTD 1815.
KLK has activated Controlled Purchase Plan and no new contract will be entered until the case has been resolved. KLK representatives will continue to engage with Jernih Kemboja Sdn Bhd on this matter.

Jul-21

2. PT Musim Mas

The chronological order of SAL’s Izin is as follow :
1. 1991 : Izin Lokasi (IL) 6,500 ha and Izin Pelepsan Kawasan hutan (IPK) 6,425 ha
2. 1994 : Hak Guna Usaha (HGU) 6,200 ha

With the IPK of 6,425 ha and subsequently HGU, the entire SBAL area should be under Area Penggunaan Lain (APL) land status. There should not be any situation of overlapping into forest.

However, based on Kementerian Lingkungan Hidup dan Kehutanan (KLHK)’s recent forest map (eg version dated 2016) there are areas within its HGU which overlap with HPT, HP and HPK areas. This is very likely due to difference between Rencana Tata Ruang Wilayah (RTRW) and KLHK forest maps issued after the above-mentioned izins and HGU. RTRW maps for example are updated every 5 years. Likewise, KLHK forest maps have also undergone a number of changes since.

To resolve the above, SAL will :
1. apply for registration of extension of HGU in Jan 2022.
2. use the Izin Pelepasan Kawasan Hutan issued in 1991 to appeal during the Expose and Panitia B meeting. In addition, it will seek clarification on the effectiveness of this izin by applying for Surat Keterangan Status Fungsi Area Pelepasan from KLHK and BPKH (Balai Pemantapan Kawasan Hutan).
Note : In the unlikely circumstance that the above is exhausted, SAL will apply for pelepasan kawasan hutan of the affected areas through provisions provided under PP No 24 Tahun 2021 (Omnibus law)

Trading partner has investigated this case and found it appears that Erasakti Wiraforestama (EWF) has clarified that the allegations are untrue.

The Department of Manpower and Transmigration Jambi Province, Indonesia has in fact carried out a field visit on 7 November 2022 to investigate the matter raised by Cash Investigation and found no evidence of child labour in the plantation. Trading partner informed that their supplier has shared with them the report on the outcome of investigations the Department of Manpower and Transmigration Jambi Province, Indonesia. After their review on the document and it supports the claim that there was no evidence of child labour.

Most importantly, it appeared that the video footages were not taken at EWF’s operation as worker’s uniforms and tools used by the workers in the video footages are different from those in EWF’s plantation. The workers did not did not recognize the place/location of the plantation, the people/workers, the uniform used (PT EWF wore a yellow uniform) and the standard of spraying equipment from the France 2 Televisions Program. PT EWF used the Panda brand type PD-16 which has a capacity of 16 liters and the liquid is yellow, so it can be ascertained that the documentary film was not made in PT EWF’s plantation area.

PKPP Plantation Sdn Bhd (Cherating)

Perbadanan Kemajuan Pertanian Negari Pahang (Tembeling)

Nov-20

Mighty Earth
Rapid Response 31

Updated Nov 2020:

Reference to the engagement of trading partner with Tuan Haji Roslan, Director of PKPP Agro:

a. PKPP has agreed to put a stop to all land clearing activity at Ladang Cherating concession.

b. The PKPP management has set aside two land banks located at Lipis, Pahang (426 ha) and Pekan, Pahang (130 ha) for its recovery plan.

c. A group-wide NDPE policy is in the pipeline, pending for written resolution by the Board of Directors of PKPP.

d. A full implementation of NDPE policy is expected to be done latest by 1 Jan-21.

MAKIN’s management clarified that the proposed area (Areal Pencadangan Lahan) given to PT Cipta Karsa Kahuripan (PT CKK) in June 2005, expired at the end of 2005 as no activities were conducted within six months since the proposed area was given.

PT CKK communicated with the Bupati of Ketapang Regency on 19th August 2019 that since 15 September 2016, PT CKK is an inactive company and never conducted any activity, including the deforestation alleged in Mighty Earth Rapid Response Report 21.

Trading partner conducted a physical meeting with MAKIN Group’s management on 13 December 2019 and has verified relevant documents.

PT KLS clarified that the company has good relationship with the local community and currently does not have any ongoing issue with the community. A copy of Environmental Impact Assessment is shared with trading partner. The document signifies that proper socialization of the company’s activity has been conducted to the local communities prior to the commencement of operations.

In addition, PT KLS also shared several local news featuring PT KLS’ efforts in supporting community during COVID period, and other general support including infrastructure for religious activities.

Based on the provided information, trading partner considered PT KLS is operating well and having a good relationship within the surrounding community.

All reports are published and available on HCVRN, HCSA, and RSPO websites, respectively.

Update Mac 2020

NT Corp communicated the following to trading partner in a letter:

a. PT BSL will conduct an HCS/HCV assessment using a HCSA/ALS registered assessor and will follow-up with a peer review;

b. NT Corp will adopt a commitment to no development of HCS/HCV/peat regardless of depth across at a group level. Point (a) will apply for all land clearing in the future;

c. This commitment is effective from 7^th Nov 2019.

Based on the above statement, a land clearing moratorium for PT BSL is in effect from 7 Nov 2019.

Trading partner is indirectly linked to Padana Enam Utama (PEU). Their supplier has contacted PEU and is currently reviewing the evidence provided.

In line with the supplier’s Grievance Handling procedure, they may request a verification/assessment process if deemed necessary and agree on a time-bound action plan. The whole process will become the basis for the company’s decision on a further commercial relationship with PEU.

Trading partner commented the alleged company on deforestation is PT Marita Makmur Jaya (PT MMJ), is not their supplier. Trading partner source from PT Peputra Supra Jaya (PT PSJ) and PT Peputra Masterindo (PT PM). Trading partner have completed desktop assessment and arrived at a conclusion that there is no strong argument to deem PT MMJ as PT PSJ/PT PM group.
PT PSJ/PT PM does not have management control over PT MMJ.

Updated Dec 2020
In Oct 2020, KLK engaged with PT Sahabat Mewah Dan Makmur (PT SMM) of ANJ group. As the mill is RSPO Certified under MB model, KLK is then decided to resume trading relationship with PT SMM and will continue engage with them on the traceability and sustainability related matters.

Trading partner informed that they no longer received any oil from PT Dewa Rencana Perangin Angin (DRPA) since late January 2022 due to some operational issues. Meanwhile, trading partner will engage with PT DRPA and seek clarification on the allegation of human rights abuses once the operational issues have been resolved and resume trading relationship with PT DRPA. For the time being, PT DRPA oil will not enter into trading partner’s supply chain.

Updated Oct 2022:

Trading partner has suspended sourcing from PT DRPA.

Updated Oct 2020:
According to trading partner, PT Global Sawit Semesta (PT GSS) has shown progress in its action plan as follows:
1. PT GSS has informed (its FFB suppliers) on the location of high-risk areas and of TTP requirements.
2. PT GSS has prepared Mutual Agreement Letters with its FFB suppliers and still continuing its efforts to inform and sign agreements with all its suppliers.
3. Suppliers’ FFB legality verification is still ongoing.
4. PT GSS has prepared and issued a SOP for Traceability to Plantation (TTP).
5. PT GSS has reported having achieved 100% of FFB Traceability.
Field verification is still not possible due to the COVID-19 situation.
Overall, PT GSS has completed 95% of the action plan.

Updated Oct 2021:
Trading partner conducted field verification to PT GSS on 13-15 October 2021 to review the agreed action plan progress. PT GSS has stopped purchasing FFB from PT Laot Bangko on 10 June 2021. PT GSS also has a Corporate Policy dated 01 September 2021, which includes a commitment to implement the principles of sustainability according to national and international standards. The policy can be accessed via this link.

Updated Dec 2021:
Following up on the findings from the field verification on 13-15 October 2021, trading partner recommended points for improvements to be carried out by PT GSS in order to achieve full compliance. PT GSS has agreed to go through a verification process for the first 2 years of supply.
Considering the commitment and progress in traceability, trading partner decided that PT GSS can re-enter into their supply chain. Trading partner will continue to monitor the progress of PT GSS.

Trading partner informed that they had engaged with PT Global Sawit Semesta (PT GSS) and the following progress have been made:
• Based on satellite monitoring, PT Laot Bangko (PT LB) stopped land clearing since June 2021;
• PT LB has committed in writing on 7 June 2021 to an action plan including their commitment to NDPE policy, HCV/HCS assessments for peer review, and a recovery plan to be developed based on land use change and assessment results;
• PT LB committed to a sustainability policy on 28 June 2021;
• Currently, PT LB has initiated a process of HCV/HCS assessment to be conducted by HCV RN-licensed assessor for peer review.
• PT LB to strengthen supply chain monitoring and traceability procedure to ensure that such violation will not be repeated.

Trading partner confirmed that they will continue engage with PT GSS for them to commit to NDPE and implement an agreed action plan, which includes tightening its sourcing policy and requirements to prevent from repeated case. Meanwhile, trading partner has held off sourcing from these suppliers.

Updated Oct 2021:

PT Laot Bangko has launched a website and published their sustainability policy. The policy can be found here.

The company has started working with consultant on the HCV/HCS assessment.

Updated Feb 2022:

Since PT GSS has completed the action, the case has been closed. PT GSS will continue monitor the progress of PT LB and maintain ceased sourcing from PT LB including PT Bima Golden Powerindo.

Based on the investigation and engagement with PT GSS by our trading partner, the information below was obtained:
1. PT Runding Putra Persada (PT RPP) is not a supplier of PT GSS;
2. Ibu Nasti in Runding, Subulusalam and PT. Bangun Sempurna Lestari are not suppliers of PT GSS;
3. Mr. Mahmudin in Trumon, South Aceh
• PT Natama Prima (or “collection point A”) is a supplier of PT Global Sawit Lestari (PT GSS)
• PT Natama Prima sourced from 3 estates (Mahmudin 1,2,3), which are located on legally-permitted (APL) and non-forested areas. PT GSS had verified the locations physically at sites, and overlaid the GPS locations with Spatial National Map of Indonesia. It is clean and clear for smallholder estates.
• The Mahumudin oil palm plantation, entrance, and “collection point B” presented in the report is located at a different location (away to the south);
• A Weighbridge ticket showing FFB delivery from PT Natama Prima to PT GSS does not form a valid basis to assume any FFB delivery from collection point B to another collection point A (PT Natama Prima), then to PT GSS. No evidence was presented in the report to verify this claim. Additionally, the travel distance between collection point B and PT GSS is 96km.
• Based on investigation, PT GSS confirms that the collection point B (illegal source) is not a supplier of PT GSS;

4. PT GSS has taken immediate action to cease sourcing from all the Mr. Mahmudin’s estates.

The investigation demonstrates due diligence carried out by PT GSS on FFB sources, and the alleged illegal FFBs is not part of the PT GSS supply chain.

Trading partner has informed its suppliers not to source from this alleged illegal source, and will continue monitoring the actions implemented to ensure all FFB must come from traceable and NDPE compliant sources.

AidEnvironment
Ten oil palm concessions in Indonesia have already cleared 8,100 hectares of forest and peat in 2022 so far

Our trading partner confirmed that PT Permata Sawit Mandiri (PT PSM) is not their supplier but the oil from PT PSM was allegedly entered into their supply chain indirectly via their supplier. As confirmed by trading partner, their supplier has already ceased sourcing from PT PSM since end of Jan 2022.

Updated Jan 2020

PT Sampoerna Agro responded that the area was not conducted by the company. The area in question belongs to community, where the landowners have no intent to relinquish their land to the company.

The outcomes of Shin Yang Forestry’s (“SYF”) investigation and verification are:
• All the alleged areas are under Shin Yang Forestry Sdn Bhd LPF/0019 tree planting operation.
• LPF/0019 is the land allocated by the Sarawak government for Trees Planted Forest with a valid license for Planted Forest with a tenure of 60 years with the main condition to carry out land development for tree planting within an agreed timeframe.
• The alleged deforestation is actually land development solely for tree planting in accordance with terms and conditions specified in LPF license. It has been verified that the land development activities are within the legally designated area for tree planting development and does not encroach into any Government approved agricultural land.
• The tree planting activities including land development for Tree planting are carried out as per approved State Government Environmental Impact Assessment (EIA) and LPF requirements and guidelines.
• The field verification photos and map are provided to KLK showing the existing land development activities and tree planting carried out immediately after the land preparation to mitigate soil erosion and ensure the ground cover established soonest.
• A report “PUBLIC SUMMARY FOREST PLANTATION MANAGEMENT PLAN FOR LPF/0019” is publicly available.

On the other hand, Shin Yang Oil Palms Division (SYOP) as a supplier to SOPB, confirmed that it has differentiated management control from SYF. SYOP also reaffirmed compliance towards MSPO and SOPB’s Oil Palms Sustainability Policy, Supplier Code of Conduct, Stop Work Order since 1 January 2021, and cooperation on monitoring of concession and NDPE compliance verification. SYOP stated that it would not be liable for any allegations of land clearings carried out by SFY.

Updated Nov 2021:
As a legally permitted incentive by the Sarawak state government under the Forests (Planted Forests) Rules 1997, LPF holders are permitted to plant oil palm up covering 20% of the LPF area for one cycle of 25 years as an initiative to encourage and incentivised forestry companies to reforest the land so as to regenerate the biodiversity value. It is a condition of the LPF that after one-cycle of oil palm planting, the land would need to be reforested.

In regards to concerns over conversion of LPF lands to oil palms plantation, SYF commitment on “no oil palm planting in LPF 0018 or in any LPF” is substantiated by law where oil palm planting in LPF is no longer permitted by the Sarawak state government effective since Jan 2021. These new rulings are part of the “Revised policy direction on industrial forest plantation in Sarawak” from the state Urban Development and Natural Resources Ministry. Details of the revised policy are published in the latest issue of Perkasa, a quarterly newsletter of the Sarawak Timber Industry Development Corp (STIDC). A news report is available here.

Despite SYF is not a FFB supplier to SOPB, both SYOP and SYF had signed the SOPB Supplier code of Conduct (SCOC) and pledged an oil palm planting moratorium by 31st Dec 2020.

U.S. Customs and Border Protection (CBP)
CBP Issues Withhold Release Order on Palm Oil Produced by Forced Labor in Malaysia

With regards to the recent Withhold Release Order (WRO) issued by the United States Customs and Border Protection (CBP), SDP informed that the company is continuing its effort to secure details of the complaint from the US CBP including Liberty Shared (LS) who raised the petition. With the details, SDP is committed to take the necessary actions and work towards resolving any weaknesses in their system.

SDP has issued a Press Release on 31 Dec 2020 in response to the CBP issuance of its WRO against SDP’s products.

At this juncture, SDP informed that the main course of action for them to address the WRO is to work out exactly what failings the US CBP have found in their investigation and their expectations on measures to rectify these. There has been very little shared in terms of the underlying facts and details of the US CBP’s justification for the WRO.

SDP also released a public statement on the 10 Jul 2020 that provides an inventory of the practices and approaches SDP has taken to address the areas of concern outlined in the petition.

Further detailed information on these initiatives had been shared with the US CBP in the months following the petition, with the intention of receiving feedback on gaps and areas to prioritise. SDP informed that they have received no response to these submissions, so far.

SDP indicated that they actively seek third party perspectives on opportunities to improve their Human Rights and labour programmes. Towards this end, SDP engaged PricewaterhouseCoopers (PwC) and an independent international NGO specialising in migrant worker rights, in Nov 2020. This builds on the support that SDP has been receiving from the Shift Project, an independent, non-profit centre for business and human rights, since 2016.

It is also worth noting that all SDP operations undergo annual third party audits for Roundtable on Sustainable Palm Oil (RSPO) certification. This includes stringent requirements on labour practices. An initial review of audit findings conducted by the RSPO on the 31 Dec 2020, did not generate any red flags against SDP. RSPO Statement is available here. The RSPO will be continuing to investigate this further.

Updated Mac 2021:

SDP advised that they have appointed Impactt Ltd as a third-party assessor to its newly established Expert Stakeholder Human Rights Assessment Commission (the Commission) to conduct the labour assessment of its Malaysian operations. Impactt, is an ethical trade consultancy with specific expertise in detecting and remediating forced labour issues in company supply chains.

SDP has also established a Stakeholder Panel to the Commission to review Impactt’s assessment methodology and forced labour indicators within SDP’s operations as well as proposed remediation plans. The members of the Stakeholder Panel include Shift – a leading center of expertise on the UN Guiding Principles on Business and Human Rights; Mr Andy Hall – a migrant worker rights activist and human rights researcher; and a Representative of the National Union of Plantation Workers (NUPW) – the largest trade union for plantation workers in Malaysia.

SDP expects the independent assessment by Impactt to be completed by May 2021, following which the Commission’s findings and remediation measures will be shared by SDP to all key stakeholders and the public. SDP’s media statement on this development is available here.

Updated Jul 2021:

SDP announced the dissolution of its Expert Stakeholder Human Rights Assessment Commission (the Commission) to provide more time for an independent evaluation of its labour practices to be carried out. According to SDP, due to the strict movement and travel restrictions imposed throughout Malaysia as a result of the Covid-19 pandemic have meant that Impactt Ltd. (Impactt) has not yet been able to finish its assessment.

SDP further announced that its Board’s Sustainability Committee shall take over the important oversight function over the evaluation exercise. The Sustainability Committee is chaired by independent director Dato’ Henry Barlow. The other members of the committee are senior independent director and chair of the Board Governance and Audit Committee Datuk Zaiton Mohd Hassan, chair of the Board Risk Management Committee Zainal Abidin Jamal, chair of the Board Nomination and Remuneration Committee Dato’ Halipah Esa, and Tunku Alizakri Raja Muhammad Alias.

SDP committed that the evaluation will resume as soon as is practicable. SDP would continue to work proactively, moving forward with Impactt and other key stakeholders to review its operations.

Updated Feb 2022:

On 28 Jan 2022, the US CBP issued a Notice of Finding that certain palm oil and derivative products from Sime Darby Plantation Berhad (SDP) are produced using convict, forced or indentured labour.

Subsequently, SDP issued a public statement announcing a range of improvements, changes and new measures that have been implemented across its Malaysian operations. This includes, steps taken for the reimbursement of recruitment fees, the adoption of a revised Responsible Recruitment Procedure (RRP), the implementation of a new way of “Social Dialogue” for worker engagement in the field, as well as, the strengthening of management structures and performance monitoring.

SDP also informed that Impactt’s independent labour assessment is still underway and a summary of their findings will be shared with stakeholders by the end of the First Quarter 2022.

Updated Feb 2023:

On 3 Feb 2023, US CBP has modified its forced labour finding against Sime Darby Plantation Berhad (SDP) based on satisfactory evidence that SDP, its subsidiaries, and joint ventures no longer produce palm oil and its derivative products using forced labor. With immediate effect, the U.S. will allow shipments containing Sime Darby-produced palm oil and derivatives to enter the U.S. commerce, provided the imports are otherwise in compliance with U.S. law. Announcement is available here.

On the same day, SDP published the same statement on its website.
SDP will continue to work with non-governmental organisations and like-minded parties to advocate for change at an industry level. SDP’s commitment to all its stakeholders is vigilance and a continuing responsibility to produce palm oil that is free of forced labour.

Reference to the engagement of trading partners with SIPEF:

The development on the PT Agro Muara Rupit (AMR) concession was approved through the RSPO New Planting Procedure (NPP) process1 in August 2014, at a time during which integrated HCV-HCS assessments were not a requirement and the HCSA methodology had not yet been approved as such. Subsequent to ratification of the current RSPO Standard, in November 2018, integrated assessments for new developments became the requirement. The current development has, however, undergone a standalone HCSA assessment, which is currently still under review by the HCSA Secretariat. No clearing within any of the HCS areas indicated in that report has been undertaken.

SIPEF has issued its commitment to do integrated HCV-HCS assessments for new developments following the RSPO 2018 standard. For the existing pre 2018 developments the RSPO guidance was followed to ensure no HCS forest would be cleared in the ongoing development.

AMR 3 & 4 concession is currently undergoing the NPP process. There has been no clearing in those areas, and there will not be until they have gone through the RSPO NPP requirements, which include the HCS assessment using the HCSA methodology.

SIPEF also clarified that they have no association with PT Medco Papua Hijau Selaras (Capitol Group).

Trading partner has initiated engagement with Ta Ann since May 2019 to seek clarifications on allegation of deforestation. Ta Ann has provided written commitment in adhering to the NDPE policy and shared their concession maps for further investigation. Moratorium has been put in place. As part of the investigation, trading partner has conducted a field assessment from 22-27 July 2019 to verify the allegation. The field assessment has verified that the deforestation happened outside Ladang Selezu’s concession boundaries.

2. Accommodating, purchasing, processing, selling, and marketing oil pam products from illegally-grown plantations in Bukit Betabuh protected forest

Trading partner is indirectly linked to PT. Tasma Puja (TP). According to the engagement between their third-party trader and PT. TP:
• PT TP stated that it had obtained all the mandatory legal permits (legal requirements) for the land and operations long before the problematic area was categorized/designated as a forest zone by the government in 2014 and 2016 i.e. the Decrees of Forestry Ministry No.SK 878/Mehut-II/2014 and SK.903/MENLHK/SETJEN/PLA.2/12/2016. These facts indicate that at the time the permits were issued the land did not overlap a forest zone.
• Given the legacy issue due to those decrees, subsequently the Indonesian government issued another decree i.e. PP No.104/2015. The decree gives companies with legacy issues like PT TP the opportunity to propose conversion of a forest zone category into a cultivation/other purposes zone category (In Bahasa Indonesia: Pelepasan Kawasan Hutan/APL).
• PT TP has submitted the first proposal in a letter No.188/TP-KP/XII/2016 dated 19 Dec 2016 to the Forestry Ministry but unfortunately, the process of the proposal could not be completed due to the pending ratification of the Riau Province’s Spatial Map (Tata Ruang) at that time. Following this, a second proposal in a letter No.141/TP-KP/VII/2017 dated 26 July 2017 was submitted to the Forestry ministry but the process is still ongoing up to today.
• Last year, the government revisited and addressed these legacy issues again in the UUCK (Undang-Undang Cipta Kerja) / Omnibus Law / Job Creation Law issued in late 2020, giving 3 years for the companies with such legacy issues to fulfill the requirements in accordance with the regulations of law in the forestry sector, as stated in Omnibus Law Article 110A paragraph (1).
• Pertaining to the allegation of sourcing from illegally-grown plantations in Bukit Betabuh protected forest, PT TP has rebutted that a survey to the farm is always carried out as a due diligence against each of their new FFB suppliers to check the FFB quality and make sure that the farm is not located in forest zone. The report only stated a claim/assertion, wherein the photos are showing truck delivering CPO/Oil to a refinery, not FFB’s from the farm inside Bukit Betabuh National Park to the mill.

I. Ladang Sawit Bintulu Sdn Bhd (LSB) owned two estates i.e; Ladang Semilajau (Semilajau) and Ladang Sebauh (Sebauh) in Bintulu. Probably, the people in Bintulu referred Semilajau and Sabauh as “Ladang Tabung Haji”.

II. LSB was 100% owned by TH Ladang (Sabah & Sarawak) Sdn Bhd (THLSS). THLSS in turn is wholly-owned by Lembaga Tabung Haji (LTH).

III. In June 2008, LSB (a company) sold its properties, Semilajau and Sebauh to a third party. Neither THLSS nor LTH was a public listed company. There is no requirement for them to make any public announcement.

IV. As of June 2008, Semilajau and Sebauh are no longer properties belongs or related to LTH Group. LSB became a dormant company.

V. TH Plantations berhad (THP) is a public listed company, a subsidiary of LTH. THP assist LTH to manage LTH’s Oil Palm Estates.

VI. On April 1 2009, THP announced its purchase of 100% equity interest in LSB from THLSS for RM 200,000. LSB was a dormant company without owning any properties.

VII. In summary:
a. THP never owns Semilajau and Sebauh.
b. No announcement by THP on the sale of Semilajau and Sebauh because these estates were owned by THLSS, a subsidiary of LTH which is not listed then. (However, subsequently THP acquires the entire equity of THLSS from LTH)
c. Bursa announcement date April 1 2009, proved that THP only acquired LSB in April 2009. After LSB disposed all its properties (Semilajau & Sebauh) in June 2008. THP is not privy to the sale document of Semilajau and Sebauh.

On the alleged case, they clarified that THP had entered into a Management Agreement with Deru Semangat Sdn. Bhd. (“DSSB”) in year 2015 to manage their oil palm plantation of approximately 30,000 acres in the Mukim of Tembeling, Jerantut, Pahang. THP merely acts as a management agent and is not the owner of the land. DSSB is a joint venture company between Lembaga Tabung Haji and the Pahang Royal Family.

In 2019, the new top management of THP which took over the helm of the THP Group decided to terminate the Management Agreement with DSSB. The parties are now finalising the agreements and documentations to that effect and the handing over process had been scheduled to be in March this year. However, the Movement Control Order (MCO) in Malaysia that had been imposed by the government had put matters on hold and the parties now hope to complete the handing over soonest once the MCO is lifted. In January 2021, THP representative shared with KLK that THP had terminated the management agreement with DSSB on the 23rd December 2020 and was effective on the 15th January 2021. They are currently working on the recovery plan and KLK will continue engage with THP on this.

KLK has put on hold new purchases from THP with effect from October 2020 pending a concrete action plan from THP to be made public.

Updated Feb 2020:

Trading partner confirmed that land clearing was not conducted by the company, it happened outside their concession boundary.

Trading partner has classified this as an ineligible case as Yayasan Pelajaran Johor is not a supplier to them.

Based on the RSPO’s definition of group ownership (refer here and here), a review of ownership documentation and shareholdings found that Yayasan Pelajaran Johor is not related at group level to trading partner’s supplier, YPJ Palm International Sdn Bhd.

Updated May 2021:

Trading partner has updated the investigation outcome on this case as listed in their ineligible list:

Total concession area of Sungai Ara is less than 90 ha, where the entire concession was largely cleared prior to 2019. The remaining area of less than 5 ha which was developed in January 2019 is a combination of mixed scrub with pioneer species. After January 2019, there was no further land clearing. Since January 2020, the case was brought to YPJ’s attention and they have immediately developed a NDPE policy to demonstrate their commitment to adopt NDPE to guide their future development.

Trading partner informed that through the investigation conducted by its supplier which includes document review, field verification on IPB concession maps and photo, they concluded that the land development is not related to oil palm operation. In fact, the activities were related to tree-planting mainly Laran (Neolamarckia cadamba) planting. However due to confidentiality, the supplier couldn’t disclose maps and the field visit report/photos with external stakeholder.

Updated Mar 2023:
Trading partner reiterated that they have initiated an investigation on the case since August 2020, and the investigation concluded that the land development was not related to oil palm operations. The land development activities were related to timber tree planting, mainly the timber species Laran (Neolamarckia cadamba). During the course of investigation, the supplier has submitted comprehensive documents for their review, including:
• Detailed concession maps showing planting blocks, in shapefile format.
• The Sabah Forestry Department (SFD) approved Annual Work Plans (this is a formal document required to be submitted to SFD annually and shows the planned work in relation to both their timber and oil palm operations)
• The supplier’s internal field visit reports, including ground and drone photos of random selected points to show condition on the ground

In November 2021, when Malaysian authorities eased its Covid-19 movement control restrictions, our trading partner deployed a technical team, consisting of conservation, GIS and plantation sustainability experts to carry out field verification. Their team has visited the area to verify the condition on the ground. Drones were deployed for photo/video taking where the area is not easily accessible due to lack of roads. The outcome of their field visit is consistent with the supplier’s clarification where the area was indeed cleared for Laran tree planting.

Mighty Earth has also reported the same case in their Rapid Response Report in 2021, where trading partner has responded the same and reported on their Ineligible listing.