KUALA LUMPUR (Jan 28): Sime Darby Plantation Bhd (SDP) has said it looks forward to cooperating with the US Customs and Border Protection (CBP) and demonstrating its full compliance with US import regulations.

This comes after the CBP issued a notice of finding which determined that certain SDP palm oil products were produced using convict, forced or indentured labour according to a report by Thompson Hine SmartTrade on Thursday (Jan 27).

The notice of finding took effect on Friday (Jan 28), which will see SDP's palm oil products seized by port directors and forfeiture proceedings commenced against its products.

According to SDP, the finding was primarily aimed at its Malaysian operations.

SDP also requested a trade suspension of its securities at midday noon break on Friday, after obtaining approval from Bursa Malaysia.

In a statement on Friday, SDP's group managing director Mohamad Helmy Othman Basha said that since it was issued a Withhold Release Order (WRO) by the CBP on Dec 16, 2020, the group has fully cooperated with the CBP.

"In response to these allegations (Dec 16, 2020), the company had appointed an independent ethical trade consultancy to undertake a full-scale, independent, assessment spanning its facilities across Malaysia.

"This work was delayed by the government-mandated Covid-19 restrictions across Malaysia, but is now close to completion.

"We look forward to cooperating with the CBP and to demonstrating our full compliance with US import regulations," Mohamad Helmy said.

Meanwhile, SDP expressed disappointment at the CBP's findings ahead of the publication of its independent report commissioned in response to the forced labour claims that prompted the WRO.

"Through the in-depth, onsite work done by the independent consultant, SDP is confident this report will demonstrate that the company has internal controls and systems in place to support its workers and ensure their well-being," the statement wrote.

To recap, the CBP issued a WRO on palm oil, including all crude palm oil and palm kernel oil and derivative products, made wholly or in part with palm oil traceable to SDP on Dec 16, 2020.

The US authorities had established that there was reasonable evidence to demonstrate SDP harvested the fruits and produced the palm oil using forced labour.

Kindly be advised that at the request of SDP, trading of the company's shares has been suspended with effect from 12.01pm on Friday, Jan 28, 2022, pending an announcement.

"Accordingly, trading in structured warrants relating to Sime Darby Plantation has also been suspended at the same time," SDP said.

Prior to the plantation group's trade suspension, SDP shares gained three sen or 0.79% to RM3.83, valuing it RM26.5 billion.