The UK’s largest boatbuilder has been fined almost £360,000 for 11 breaches of the UK’s version of the EU Timber Regulation (UKTR). The historic ruling, the first for a breach of the UK’s new UKTR – introduced following Brexit- relates to huge volumes of Myanmar’ blood’ Teak used in luxury vessels’ decks, interiors and exteriors.
On Friday, Judge Jonathan Fuller KC from the Bournemouth Crown Court sentenced the UK-based Sunseeker, the country’s largest luxury yacht maker, to three charges under the UKTR. London-based Environmental Investigation Agency (EIA), responsible for uncovering the Teak back in 2018, hailed the outcome as a pivotal moment in the fight against the illicit trade of Burmese Teak.
“These sentences send a clear and unequivocal message to other luxury yacht manufacturers, both in the UK and around the world, that using blood teak from conflict-torn Myanmar is totally unacceptable and will cost them dearly in the end,” said Faith Doherty, EIA’s Forests Campaigner Leader. “As well as actually implementing the UK Timber Regulation, the amount of process and legal time within the judiciary reflects the importance of environmental crime and the impact this criminality has.”
In 2018, the EIA reported Sunseeker’s US distributors to the US Department of Justice after uncovering that illegally traded Teak, which was in breach of the EU Timber Regulation (EUTR), had entered the company’s supply chains. Wood Central understands that the US Lacey Act was also implicated, which, like the EUTR, bans the imports of goods in violation of foreign laws protecting or regulating plant species.
On 1st February 2021, a military coup in Myanmar brought a brutal junta to power. The regime relies heavily on exporting the country’s prized Teak, renowned for its water-resistant properties and highly sought after by yacht builders. The state-controlled Myanmar Timber Enterprise (MTS), which oversees all sales and exports of Teak, became central to these operations, with Wood Central reporting on a series of secret bank accounts allegedly used to facilitate teak trade through China and India.
Since 2020, EU member states have determined that adequate due diligence on the legal origin of Myanmar timber is impossible. They argued that this position violated the EUTR for all timber coming from Myanmar. Subsequently, the EU, UK, and US imposed sanctions on Myanmar and the MTS, thus making the importation of Teak from the country illegal under international trade regulations.
The list of Sunseeker charges includes:
- Failure to exercise due diligence as an operator when placing timber products on the market.
- Failure to maintain and evaluate a due diligence system for timber or timber products.
- Failure to comply with Article 5(1) of the Commission Implementing Regulation (EU) No 607/201 pertains to the operator’s record-keeping obligations.
During court proceedings, it was revealed that Sunseeker’s timber imports included teak from Myanmar, wenge from Africa, and European oak, which had a combined value of £60,000. However, whilst the boatbuilder was sentenced to 11 specific imports, the court heard evidence suggesting many more.
Judge Fuller noted that Sunseeker was aware of impending changes to timber import regulations after Brexit, which altered its status from ‘trader’ to ‘operator’ and left it in breach of the rules. He described the company’s failings as a “systemic failure”. After hearing mitigation and considering the firm’s early guilty pleas, the judge imposed a fine of £240,000, a confiscation order for just under £67,000, prosecution costs of £51,000, and a victim surcharge of £190.
“From 2014, EIA’s field investigations in Myanmar and subsequent complaints to the relevant enforcement authorities within the EU highlight how timber traders continue to break the law without consequences,” Ms Doherty. “This case changes that and should be used as the landmark for actually using these laws, with the appropriate penalties this crime deserves.”
Why Teak is used extensively in luxury boatbuilding
Teak is highly prized for its durability, water-repellent properties and elegant appearance. And with the best Teak on Earth found in Myanmar, the EIA supposes that it has been used in huge volumes to construct many of the world’s most famous vessels, including Jeff Bezos’s Oceanco.
A type of hardwood that is stronger and denser than softwood, like pine and Douglas-fir, teak can be cut and finished with hand tools. Slip-resistant, the low-maintenance wood can survive in wet areas. “Teak is derived from tropical climates and naturally resistant to mould and mildew…it won’t rot quickly like other woods, so it makes an incredibly durable boat deck.”
