The United States Customs and Border Patrol agency has directed the nation’s ports to seize shipments of palm oil and palm oil derivatives from Sime Darby Planatation Bhd after concluding the Malaysia company uses forced labor.
The January 28 finding came 13 months after the agency said that it was investigating the company. At that time Customs and Border Patrol told ports not to release Sime Darby shipments entering the country.
In last month’s announcement, Customs and Border Patrol said it believed Sime Darby palm oil or products derived from palm oil were entering the country. The new finding gives ports authorization to seize shipments, meaning that Sime Darby Plantation or the current owner would lose ownership, whereas the December 2020 order authorized ports to temporarily detain them.
Based in Kuala Lumpur, Sime Darby Plantation is the world’s largest operator of oil palm plantations. Palm oil is the world’s most common vegetable oil, used in a range of products including foods and pharmaceuticals, as well as to make base stocks for lubricants.
Sime Darby Plantation called the agency’s action “hugely disappointing,” saying that a consultant hired to compile an independent assessment of its employment practices is on the verge of issuing its report. It said the consultant specializes in ethical trade.
The assessment “was delayed by the government-mandated COVID-19 restrictions across Malaysia, but is now close to completion,” Sime Darby Plantation Group Managing Director Mohamad Helmy Othman Basha said in a written statement. He added that the company has cooperated fully with the agency’s investigation.
In announcement last month, Customs and Border Patrol said that on Sime Darby’s oil palm plantations it found evidence of all 11 indicators of forced labor as defined by the International Labour Organization. Those indicators include: employers abusing worker vulnerability; employers deceiving workers; employers restricting worker movement; physical or sexual violence against workers; debt bondage; abusive working and living conditions; and excessive overtime.
When the case was opened last year, Sime Darby Plantation said it had programs aimed at preventing forced labor and child labor and that the allegations suggested breaches of those programs. It is one of several Malaysian companies that Customs and Border Patrol has opened cases against. Malaysian agricultural companies and factories lean heavily on migrant workers but have been criticized for their treatment of them.