Amid international pressure and losing one of its forest management certificates, Malaysian timber group Samling has withdrawn its defamation lawsuit against nonprofit environmental group Save Rivers.
The first hearing, delayed four times since the suit was filed two years ago, was meant to be held yesterday at the Miri High Court in Sarawak, Malaysian Borneo.
It was cancelled after a last-minute settlement, said environmental and Indigenous rights organisations The Borneo Project and Bruno Manser Fonds in a joint press release.
Samling originally sought RM5 million (US$1.07 million) in damages and an injunction against Save Rivers due to articles on Save Rivers’ website, which alleged that Samling had failed to adequately consult local communities in their management of the Generai Forest Management Unit (FMU) in Sarawak.
However, both parties have reached an amicable resolution, according to a joint statement by both Samling and Save Rivers.
“Both parties to the suit agree that the welfare of the local community remains their priority.”
“Samling welcomes constructive comments and feedback from the local community and will be glad to engage with all relevant stakeholders for the betterment of the local community,” the statement read.
Certificate connected to MTCC withdrawn
The settlement of the defamation suit comes after months of increasing pressure against the company.
Late last week, it was revealed that the Malaysian Timber Certification Council – connected to PEFC, had withdrawn a forest management certificate awarded to Samling to manage 117,941 hectares of protected forest in Ravenscourt, located in Sarawak’s interior Lawas district.
Samling had renewed the licence since 1985, with the latest licence issued until 2025. However, auditor and certifying body Sirim found that Samling failed to provide corrective action for several standards violations found during a 2021 recertification audit.
According to the audit, “Samling had not adequately consulted local communities in the Ravenscourt unit.”
In addition, “it did not inform them of conflict resolution procedures, and did not provide the communities with reports and information, among other standards violations.”
It also mentioned the omission of indigenous Penan villages, the absence of community use zones on Samling’s maps and the lack of Penan representatives on representative committees.
FSC investigation into Samling could continue into 2024
It comes as a unit of the Sarawak timber giant, Samling, is being investigated by the Forest Stewardship Council (FSC) after the Bonn-based organisation accepted the complaint filed by five ENGO groups last October that there was “sufficient evidence” regarding the violation of FSC policies.
In data recently obtained by Wood Central from Global Forest Watch, deforestation rates in Sarawak have declined by 300% after introducing anti-deforestation, peatland and exploitation commitments in the early 2010s.
The FSC prob follows complaints from ENGOs, including the Gerenai Community Rights Action Committee (GCRAC), Bruno Manser Fonds, The Borneo Project, KERUAN and SAVE Rivers.
They provided Wood Central with a statement following the announcement.
The alleged activities occurred between 2017 and 2022 in Sarawak, Malaysia.
The allegations have been made against entities of Samling Global Limited that are not FSC-certified but are connected to two chains of custody certificate holders belonging to the Samling group.
Due to the chain of custody certificate holders’ indirect involvement in the alleged unacceptable activities defined in FSC’s Policy for Association, FSC has decided to accept the complaint and open a Policy for Association case against Samling Global Limited.
The Allegations
The allegations were made by five ENGOs which allege that the company failed to consult Indigenous communities in and around two concessional forests and had further logged in areas that were part of Indigenous land.
One of the groups involved, SAVE RIVERS, published seven articles about the alleged behaviour on their website.
In 2021, US-based Mongabay reported that the Samling Group filed a $1.18b ($1.6b in Australian dollars) defamation suit against SAVE Rivers, arguing that it intended to “humiliate, degrade and disparage” its two companies and put them under “baseless, unjustified and unwarranted scrutiny by the world at large” that harmed its business, without detailing specific losses.
The allegations led to the Malaysian Timber Certification Council (which manages the PEFC scheme in Malaysia) launching an investigation into the conduct of the state-owned Samling.
According to a Mongabay article published in May 2021, the MTCC enlisted independent experts to oversee the certification of two forest-management units (FMUs). These units include the 117,941-hectare Ravenscourt unit located in Sarawak’s Limbang division and the 148,305-hectare Gerenai FMU in the Miri division, which comprises the area nearly half the size of Bali.
The Response from Samling
On April 19, 2023, Samling issued a statement responding to the allegations. In the report, “accusations have constantly been made without any basis and proper fact-checking made with Samling.”
It also states that “the certification process itself has been completed to the satisfaction of the Malaysian Timber Certification Council (“MTCC” ‘). MTCC, as the certification body, was satisfied that the certification process complied with the Malaysian Timber Certification Scheme (“MTCS”) when issuing the certificate to Samling.”
Accordingly, the decision was made by the organisation to pursue the $1.1b defamation case after a settlement could not be reached with SAVE RIVERS after medication between the organisation could not bring about a resolution.
It also denied allegations from ENGOs that the legal suit is a Strategic Lawsuit Against Public Participation (‘SLAPP’) as alleged by ENGO Bruno Manser Fonds (“BMF”).
Implications for the global plywood and furniture markets
As requested by the parties involved in the complaint, the potential disassociation resulting from the investigation could significantly impact the worldwide supply of plywood, engineered wood and furniture products.
Samling, a major corporation in Malaysia, employs 5,000 individuals and manages over 1.2 million hectares of forest land, as well as 190,250 hectares of forest plantations.
Listed on the Forest 500, the company has been a significant player in the global plywood market since 1998 and has partnered with the Malaysian Government to establish Sarawick tree plantations.
Additionally, Samling has collaborated with Masonite International Corporation, a US-based company that produces and markets door facings and doors, as well as Japanese firms Daiken Corporation and Itochu Corporation.
Samling holds dual certification to PEFC and FSC standards and recently began producing engineered flooring solutions from their Sarawak plantations in 2021.
