Singapore to use ‘every legal and regulatory lever’ against companies linked to haze: Shanmugam

[SINGAPORE] Vowing to use “every legal and regulatory lever” at Singapore’s disposal in confronting companies linked to the region’s choking haze, Senior Minister K Shanmugam on Oct 19 warned recalcitrant firms not to underestimate the government’s determination to take action.

Government agencies are considering legal, regulatory and economic measures to exert pressure on these companies where it matters, including on their bottom lines, access to financing and standing with investors, he said.

Existing laws will be changed or new laws introduced - on an urgent basis - to ensure further cooperation, Shanmugam said, adding that the authorities will continue pursuing the matter even after the haze has cleared up. Speaking to reporters during a visit to Woodlands Checkpoint, he said: “Some companies may try to deny responsibility. They may think that it is hard to get evidence, and that they may think that they can escape scrutiny. But they should not underestimate the Singapore government’s determination to act.” He noted that companies cannot claim to be environmentally responsible, while refusing to subject themselves to scrutiny. “They cannot greenwash their behaviour. They should also be under no illusion that they can simply wait for the haze to clear and return to business as usual.”

Shanmugam, who is Coordinating Minister for National Security and Minister for Home Affairs, also had strong words for Singapore-listed companies who were found to have ties to burning plantations in Indonesia. “Companies cannot play hide and seek with different corporate structures. Nor should they hope that because the evidence and actions are in Indonesia, they can escape responsibility in Singapore,” he said. His remarks come after the NEA issued legal notices to seven firms linked to the haze. The seven firms – Bumi Andalas Permai, Bumi Mekar Hijau, Paramitra Mulia Langgeng, Sumatera Alam Anugerah, Sebangun Bumi Andalas Wood Industries, Hutan Lestari Raya and Bangkanesia – manage pulpwood plantations.

Checks by The Straits Times found that four had Singapore links.

Bumi Andalas Permai, Bumi Mekar Hijau and Sebangun Bumi Andalas Wood Industries are suppliers for Asia Pulp and Paper, which maintains a Singapore presence. These three firms received similar notices from NEA during the 2015 haze crisis, and their cases remain open.

Meanwhile, Paramitra Mulia Langgeng is a subsidiary of the Sungai Budi Group, which is led by Singapore permanent resident Oey Widarto. The conglomerate’s vice-chairman, Santoso Winata, is also a Singapore PR. On Oct 19, NEA said it was issuing notices to three more companies: Buana Megatama Jaya – an Asia Pulp and Paper supplier, Mananjung Hayak and Baratama Putra Perkasa. Noting that investigations show Asia Pulp and Paper buys from three companies that have received notices from NEA, Shanmugam said: “We will drill into this further. He also cited Singapore Exchange-listed First Resources, which said in an Oct 16 statement that some fires originated from outside its boundaries, before spreading into areas under its management. Some fires became too large and fast-moving to contain despite its firefighting efforts, it said.

In a strongly-worded critique, Shanmugam said: “Such statements, no matter how well drafted, are not good enough.” The government will ask for the full facts, consider all evidence fairly and act based on the facts, he said. Shanmugam said the Singapore Exchange (SGX) has queried seven Singapore-listed firms about their operations and potential ties to the haze: Golden Agri Resources, Bumitama Agri, First Resources, Wilmar, Kencana Agri, Indofood Agri and TSH Resources.

Turning to banks that have lent monies to companies that could be linked to the fires, he said the banks will have to consider risks arising from environment and legal issues.

The Monetary Authority of Singapore, which regulates banks, will “obviously have supervisory jurisdiction over the banks to make sure that they manage their risks properly”, the minister added. “We will also examine whether the companies that are said to be linked to the haze are in any way enjoying benefits in Singapore,” said Shanmugam, citing examples such as government grants and incentives. Because such benefits are dependent on lawful and responsible conduct, he said there is a need to examine whether these firms still meet those standards. Asked about whether these actions could have diplomatic implications for ties between Singapore and Indonesia, Shanmugam said it is in both countries’ interest to deal with the companies responsible. Inaction is not the Singapore approach, he said, stressing that “there will be no Singapore” if lawmakers think in that manner. “We do not think there should be any bilateral issues. The Indonesian public is suffering as well, and it is in Indonesia’s interest as much as ours to deal with the companies that are causing these problems,” he said.

Shanmugam also expressed appreciation for Indonesian President Prabowo Subianto and his administration’s efforts in trying to solve the haze problem. On Singapore’s strategy to take companies linked to the haze to task, Shanmugam noted that the Homefront Crisis Ministerial Committee (HCMC) which he chairs is looking into issues arising from the haze situation, which includes dealing with these companies. He reiterated that Singapore will look beyond individual companies involved, or hold land on concessions, but instead target the larger corporations who are behind these firms. At the same time, it will also explore a wider range of punitive measures that will impact these companies’ interests both in Singapore and abroad, while maintaining pressure on the responsible parties even after the haze passes. “We want to make clear that the companies cannot simply wait things out.” THE STRAITS TIMES