The United States banned imports of palm oil from Malaysian company FGV Holdings after the US Customs and Border Protection Agency investigated CBP.
FGV, one of the world’s largest producers of crude palm oil, and several other suppliers of oil, which is used in everything from food and cosmetics to biodiesel, have long been the subject of legal group allegations of labor and human rights violations.
In response, FGV said: “It is fully committed to respect for human rights and compliance with labor standards.”
The US agency said the ban came as a result of a year-long investigation that uncovered signs of forced labor, such as abuse of the vulnerable, deception, physical and sexual violence, intimidation and threats, and ID retention.
The investigation also raised concerns that forced child labor may be used in FGV’s production processes, CBP said in a statement, adding that the ban would take effect immediately.
“The use of forced labor in the manufacture of such a ubiquitous product enables companies to capitalize on the abuse of vulnerable workers,” said Brenda Smith, executive assistant commissioner of the CBP Commerce Bureau.
Indonesia and Malaysia are the two largest producers of palm oil, and the industry has also been blamed for deforestation and natural habitat destruction.
Smith said CBP had received allegations related to the broader palm oil industry and asked U.S. importers to investigate their suppliers’ labor practices.
“I can’t be more specific at this point, but I would suggest that US importers who do business with palm oil producers take a look at their supply chain and ask lots of questions about labor practices,” she said.
In a statement to Al Jazeera, FGV said it had “taken concrete steps” in recent years to improve its labor practices.
The company said that its migrant workers, mainly from Indonesia and India, will be informed of the conditions of their employment, the scope of their work, and their rights and obligations before they leave their home countries and after they arrive in Malaysia.
It also said it pays its workers “at least the minimum wage” under Malaysian law and has spent 350 million Malaysian ringgits ($ 84.4 million) over the past three years improving housing facilities for plantation workers.
The FGV also denied having kept their workers’ passports, adding that they installed 32,350 security boxes for their workers to keep their documents in.
CBP’s Smith said US 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.
Procter & Gamble did not immediately respond to Reuters news agency for requests for comment.
The CBP ban comes after rights groups last year urged US authorities to investigate the FGV over concerns about forced labor and human trafficking on their plantations.
About 80 percent of the palm plantation workers in Malaysia, or about 337,000 workers, are migrants from countries such as Indonesia, India and Bangladesh.
Anti-trafficking group Liberty Shared filed a petition with CBP in April against another Malaysian palm oil producer, Sime Darby Plantation, for alleged abuse of labor.
The company announced in July that it had asked the rights group for more information and that it would quickly fix any violations after a thorough investigation.