U.S. Bans Palm Oil Imports From Malaysian FGV Over Forced Labor Issues

The United States (U.S.) government put a ban on a Malaysian palm oil producing company, FGV Holdings (FGV) over the issues of forced labor and violation of workers’ rights. The U.S. Customs and Border Protection (CBP) agency said on Wednesday, September 30, 2020, that it has banned imports of palm oil from the Malaysian company following an investigation into allegations of forced labor and other rights violation issues.

Over the last few years, several rights activists and groups have asked the US government to look into the issues of rights violations involved in FGV and other oil suppliers based in Malaysia and Indonesia. The two countries are the two world’s biggest producers of palm oil but the industry is cutting facing accusations for deforestation as well as the destruction of natural habitats.

Ban of Oil Imports from FGV

FGV, one of the world’s leading exporter of crude palm oil, has been facing allegations over the last few years from right groups related to issues such as forced child labor and human rights abuses of its workers. The US agency started an investigation after it received several complaints from rights groups and, as a result of the investigation, it has banned oil imports from the company. CBP said in a statement that it found after a year-long investigation that FGV had been indulging in various malicious practices adding that the ban would come into effect immediately.

Brenda Smith, the Executive Assistant Commissioner of CBP’s trade office, stated, “The use of forced labor in the production of such a ubiquitous product allows companies to profit from the abuse of vulnerable workers.” She further insisted, “I can’t be more specific at this point but I would suggest that U.S. importers doing business with palm oil producers take a look at their supply chain and ask a lot of questions around the labor practices.”

More Forced Labor Cases

As Reuters reported, some 337,000 workers or about 84% of palm plantation workers in Malaysia are migrants from countries including Indonesia, India, and Bangladesh. Several workers are reported to have experienced abuse such as deception, physical and sexual violence, intimidation and threats, and retention of identity documents.

In April, an Anti-trafficking group had already submitted a petition to CBP against another Malaysian palm oil producer, Sime Darby Plantation, over the same issues. With this new development, Smith said that the U.S. consumer goods giant Procter & Gamble, which has a joint venture with FGV, should take the ban “seriously” if it is an importer of its palm oil products.