CBP Lifts Forced Labor Finding on Sime Darby Palm Oil
CBP is lifting its forced labor finding on Malaysian palm oil producer Sime Darby Plantation Berhad, after finding that, ”based upon additional information" Sime Darby provided to CBP that "establishes by satisfactory evidence that the subject palm oil and derivative products are no longer mined, produced, or manufactured in any part with forced labor,” the agency said in a notice released Feb. 2.
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“It is hereby determined that” palm oil and derivative products classified in tariff schedule chapters 12, 15, 23, 29 and 38, “which are produced or manufactured wholly or in part by the Sime Darby Plantation, its subsidiaries, and joint ventures,” are “no longer being mined, produced, or manufactured wholly or in part with the use of convict, forced, or indentured labor by the Sime Darby Plantation, its subsidiaries, and joint ventures,” CBP said in the notice. The determination takes effect for goods imported on or after Feb. 3. Sime Darby did not immediately comment.
The subject of a withhold release order issued in 2020 (see 2012300007) and the forced labor finding, issued in January 2022 (see 2201270036), Sime Darby said in a recent investor presentation that it began a “continuous improvement plan” in 2021, seeking to ensure “we achieve the expected standards required under the 11 ILO indicators of Forced Labour.” It submitted evidence of “enhancements” to CBP in April 2022, it said in the presentation, which dates from November.
According to a Sime Darby news release from February 2022, elements of the plan included reimbursement of recruitment fees charged to its workers by third-party recruitment agents, which are a forced labor indicator in the form of debt bondage, as well as enhanced monitoring of its recruitment processes. New hotlines and worker dialogues created by Sime Darby allowed workers to raise grievances. Ongoing briefings are intended to ensure workers understand their rights.
The Roundtable on Sustainable Palm Oil (RSPO) produced its own report in November on the labor issues at Sime Darby in response to CBP’s WRO, based on audits of Sime Darby facilities from January to June 2022.
The report said Sime Darby was still falling short during that period. In particular, the RSPO found Sime Darby workers were still not able to explain the palm oil producer’s human rights charter, and the grievance system was often not answered and workers feared retaliation for filing grievances. RSPO also cited insufficient monitoring of third-party recruitment agents and still has not detected the root cause of worker recruitment fee issues, among other things.
Sime Darby said in its November investor presentation that the report “does not reflect the current state” of Sime Darby operations, and “does not take into account the substantial revisions, improvements and modifications that have been implemented.”
A detailed response to the report, also issued in November, said internal “surveys and assessments” show Sime Darby “workers understand their rights, and are aware of the grievance channels and other mechanisms available to them should they believe they are being deprived of these rights.” Worker trust in the new grievance channels is shown by “increased volume of calls” and confirmed by internal surveys, and recruitment fees have “been reimbursed for all current migrant workers beginning 17 February 2022.”