US ban on FGV palm oil will impact smallholders — RSPO

US ban on FGV palm oil will impact smallholders — RSPO
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KUALA LUMPUR (Oct 2): The Roundtable on Sustainable Palm Oil (RSPO) said today that it acknowledges the US Customs and Border Protection’s (CBP) Withhold Release Order on materials imported to the US from FGV Holdings Bhd, but expressed reservations about the impact of the order on smallholders and workers.

The RSPO said in a media statement that over 112,000 settler families, mainly Federal Land Development Authority (FELDA) settlers, rely on oil palm cultivation and FGV to support their livelihoods, and roughly two-thirds of FGV’s fresh fruit bunch (FFB) supply comes from FELDA smallholders.

The order by the CBP will not only punish those that have allegedly perpetrated human rights violations, but impact the ability to earn a living for those who are innocent, it said.

The RSPO also noted that it had zero tolerance for the practices described in the CBP press release and the Associated Press article, and while these are not new issues, this is precisely why the protection of human rights has been so deeply embedded in the RSPO Principles and Criteria (P&C) 2018.

Earlier this year, the RSPO suspended the certificate of FGV for violations at its Kilang Sawit Serting mill.

"We have ceased processing the certification of all other uncertified units until the directives as set out in the Complaints Panel’s decision dated Nov 28, 2018 are implemented fully," said the RSPO.

On the current status of FGV's certification as of Sept 30, 2020, it said on Jan 13, the RSPO Complaints Panel directed the suspension of P&C certification processes for all uncertified units of FGV, and for the secretariat to instruct the certification body to reimpose the suspension on FGV’s Kilang Sawit Serting mill for non-compliance with the Complaints Panel’s decision dated Nov 28, 2018.

"This matter is now in the post-complaints monitoring phase and remains under the purview of the Investigation and Monitoring Unit (IMU), with regular updates on FGV’s compliance furnished with the Complaints Panel," said the RSPO.

The RSPO also called on the US government and CBP to work with all relevant partners to conduct a full risk assessment of the impact any sanctions may have on these vulnerable populations, and to work jointly with the Malaysian government towards a positive outcome that allows both countries to meet their commitments to the UN Sustainable Development Goals. 

For this reason, the RSPO will uphold its existing sanctions on FGV and continue to work with the company to improve its ability to meet the RSPO's exacting standards on human and social protection.

RSPO chief executive officer (CEO)-designate Beverley Postma said: “Human rights violations remain one of the toughest challenges in commodity supply chains. We condemn the use of forced or child labour or any other form of modern slavery at any members' plantations — certified or uncertified.  

“We firmly believe that the RSPO P&C that our membership adopted in 2018 remains the best system to help eradicate these issues, and we are committed to supporting a process of continuous improvement. The mission of the RSPO is to transform markets to make sustainable palm oil the norm,” she added.

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Lam Jian Wyn