Field report: Demand US Customs block imports of tainted palm oil

Update July 1, 2021:

Today the US State Department’s 2021 Trafficking in Persons (TIP) report downgraded Malaysia to Tier 3 — the lowest possible ranking — due to the government’s failure to address human trafficking. Forced labor in the country’s vast palm oil sector was highlighted as a key issue, and our campaign was alluded to in the report, which states “The government did not adequately address or criminally pursue credible allegations of labor trafficking in the rubber manufacturing and palm oil sectors made by international media, NGOs, and foreign governments.” 

Notably, the TIP report points out that the Malaysian government has yet to investigate the two Malaysian palm oil companies that have been sanctioned by Withhold Release Orders.

Update December 8, 2020:

On September 30, 2020 US Customs and Border Protection issued a Withhold Release Order (WRO) against FGV Holdings Berhad (FGV) — one of Malaysia’s largest palm oil companies and a joint venture partner and major palm oil supplier to Procter & Gamble — due to concerns over forced labor in their supply chains.

The WRO was issued in response to a Tariff Act complaint filed in 2019 by Global Labor Justice – International Labor Rights Forum (GLJ – ILRF), Rainforest Action Network, and SumofUs and a campaign by Freedom United. According to 19 U.S.C. §1307 imports produced by forced labor are to be blocked from the US. This effectively serves as a block on imports of FGV palm oil into the United States and US Customs and Border Protection (CBP) has enforcement capacity.

FGV is currently protesting the WRO and asking for the ban to be lifted. FGV is in talks with US Customs and Border Protection. According to an FGV media statement, CBP 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.”

At the same time, FGV is pointing to their affiliation with the Fair Labor Association, which is tasked with reporting on the implementation of FGV’s 2020 Action Plan to address labor rights violations. However, as evidenced in the Fair Labor Association’s first report, “Findings on the Progress of FGV’s Action Plan 2020,” published on September 30, 2020, there remain numerous unresolved labor issues and significant delays in rectifying exploitation. Strikingly, the Fair Labor Association concludes that undocumented migrant workers hired by FGV remain “at risk of labor rights exploitation, including forced labor.” The next report on FGV from the Fair Labor Association is due out on March 31, 2021.

Freedom United and our partners, Global Labor Justice – International Labor Rights Forum (GLJ-ILRF), Rainforest Action Network, and SumofUs, are closely monitoring the status of the WRO and request that CBP consult with us as petitioners while enforcing the WRO and prior to taking any steps to revoke it. We are committed to seeing concrete remedy for victims of forced labor, reimbursement of all recruitment fees imposed on migrant workers, and robust measures to protect and uphold workers’ rights that can be publicly monitored and tracked over time.

Background:

In August 2019, GLJ-ILRF, Rainforest Action Network, and SumofUs petitioned US Customs and Border Protection to issue a Withhold and Release Order against imports of palm oil produced by FGV Holdings Berhad due to concerns over forced labor and human trafficking.

Subsequently, Freedom United joined the advocacy efforts, launching a global campaign to bring attention to the problem and mobilize consumers to voice their opposition to imports of palm oil linked to modern slavery.

In January 2020, the Roundtable on Sustainable Palm Oil (RSPO), resuspended FGV’s Sawit Serting mill after “unsatisfactory” findings from audits. The RSPO is an industry certification body comprising oil palm producers, processors or traders, consumer goods manufacturers, retailers, banks/investors, and environmental and social non-governmental organizations (NGOs) aimed at promoting sustainable palm oil. The RSPO’s Principles & Criteria sets standards for members to protect workers’ rights and prevent human trafficking and forced labor in accordance with international laws. Specifically, RSPO audits found that pay and work conditions were not aligned with domestic labor laws and that FGV had failed to prevent migrant workers from paying exploitative recruitment fees and that workers were not adequately informed of their working conditions.

In August 2020, we sent a joint letter with our partners to US Customs and Border Protection, along with our petition signatures and hundreds of messages from consumers who supported issuing the WRO against FGV palm oil. In this letter, we highlighted issues in FGV’s 2020 Action Plan, namely the company’s history of inaccurate reporting, the lack of independent verification of progress, and the fact that many initiatives to address forced labor and other labor rights violations had yet to begin.

Finally, on September 30, 2020 US Customs and Border Protection announced the result of their investigation into FGV palm oil, issuing a WRO. Specifically, CBP noted the following abuses:

CBP’s Office of Trade directed the issuance of a Withhold Release Order (WRO) against palm oil and palm oil products made by FGV based on information that reasonably indicates the use of forced labor. The order is the result of a year-long investigation that revealed forced labor indicators including abuse of vulnerability, deception, restriction of movement, isolation, physical and sexual violence, intimidation and threats, retention of identity documents, withholding of wages, debt bondage, abusive working and living conditions, and excessive overtime. The investigation also raised concerns that forced child labor is potentially being used in FGV’s palm oil production process.

GLJ-ILRF, Rainforest Action Network, SumofUs, and Freedom United welcomed the decision by US Customs and Border Protection but warned that proper enforcement is crucial. View our joint press release here.