US lifts ban on importing palm oil products from Malaysia’s Sime Darby

The United States on Friday lifted a block on products made by Malaysia’s largest palm oil firm, Sime Darby, saying it no longer used forced labor in its manufacturing.

U.S. Customs and Border Protection said the change in status of the company’s products reflected “tremendous success” in its agenda to prohibit abusive conditions in the workplace.

“With forced labor concerns addressed, CBP allows Sime Darby Plantation Berhad palm oil and derivative products into the U.S.,” the agency said in a statement.

“Effective immediately, 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.”

That means CBP modified its earlier finding of December 2020, which had said that an “investigation reasonably indicated the presence of all 11 forced labor indicators” in the company’s production processes.

These indicators included restricting workers’ movement, physical and sexual violence, intimidation and threats, retention of identity documents, withholding of wages, and excessive overtime. A U.S. federal statute prohibits the import of goods manufactured by forced and indentured labor, including child labor.

“We see every modification as a tremendous success,” CBP Acting Commissioner Troy Miller said in Friday’s statement.

“Our mandate as an agency is to prohibit forced labor from entering the U.S. commerce. In the best-case scenario, our enforcement affects the remediation of forced labor to help improve living and working conditions for workers around the world, just as it did in this case.”

Headquartered in Selangor state, Sime Darby employs more than 20,000 people. Malaysia’s labor-intensive palm oil industry has a workforce of more than 300,000 migrants, who are mainly from Bangladesh, India, Indonesia, Myanmar and Nepal, according to the Reuters news agency. 

Reacting to the news, Sime Darby said it spent the past two years reviewing, revising and upgrading protocols for recruiting and managing its workforce. 

“It took us more than 500,000 man-hours to undertake our reviews and to revise what we already had in place. To ensure change is embraced and entrenched, we also put in place key enablers to empower our workers. Such safeguards must be in place to protect those who are vulnerable,” the company said in a statement.

Last February, Sime Darby set aside U.S. $20 million to compensate migrant workers who were forced to pay recruiters to find jobs. Because of these high fees, workers often become beholden to their employers, and in extreme cases workers are held in debt bondage.

Andy Hall, a noted labor rights activist, told BenarNews two years ago that the CBP would expect recruitment fees to be reimbursed to migrant workers in palm oil and rubber industries, because debt bondage is a major factor in the agency’s decision making.

“Sime Darby Plantation has significantly improved its management and protection of migrant workers partly as a result of the U.S. trade enforcement action,” Hall told BenarNews on Friday. 

“But of course, the situation across its operations, the palm oil industry and Malaysia as a whole remains one of high risk that has to be continually monitored and managed given the background situation.”