The villagers represented in the complaint - filed with the US National Contact Point (NCP) on Wednesday by NGOs the Community Legal Education Center of Cambodia (CLEC) and EarthRights International - say they were not properly compensated when their land was confiscated through economic land concessions in 2006.
American Sugar Refining (ASR) has not acted consistently with the OECD guidelines, says complaint
As a result, more than 200 farming families from the Sre Ambel district in Koh Kong Province have lost their livelihoods, claims EarthRights International, which specializes in protecting human rights and the environment, and corporate and government accountability.
“Families that once sustained themselves by farming diverse crops and raising cattle have been reduced to poverty and malnutrition.”
The villagers say American Sugar Refining has not acted consistently with the OECD guidelines because it should have exercised due diligence and used its leverage with business partners to address potentially negative human rights impacts.
Deal originally struck with Tate & Lyle sugar arm - which was then sold to ASR
Their problems began in 2006, when two Cambodian companies were formed to receive land concessions for a sugar plantation and factory in Koh Kong Province.
At the time, Cambodian businessman and senator Ly Yong Phat had a stake in the plantation along with Taiwanese food firm Ve Wong and Thai sugar manufacturer Khon Kaen Sugar Co Ltd (KSL).
Ly Yong Phat sold his stake in 2010, according to activist group the Clean Sugar Campaign, which says KSL now owns a 70% stake with the balanced owned by Vewong.
KSL struck a deal with Tate & Lyle’s European sugar arm to export all its Cambodian sugar from Koh Kong factory through Europe’s ‘Everything but Arms’ trade promotion scheme.
American Sugar Refining, which is best known for producing Domino Sugar, acquired Tate & Lyle’s European sugar operations in 2010, and inherited its exclusive contract to buy the sugar produced at Koh Kong.
Case being looked at in Thailand, Cambodia, the EU, and the US
However, the land in question was occupied by Chuuk, Chikor, and Trapeng Kendal villagers, who have well-documented possession rights under Cambodian law, claims EarthRights International.
The villagers have been trying to seek redress since 2007, EarthRights International campaigns director Paul Donowitz told FoodNavigator-USA.
He said: “The case was filed in Koh Kong Administrative Court 2007 and is ongoing; most recently this court referred the case to the Cadastral Commission and CLEC.”
As for the EU probe, he added: “This month, the European Parliament called on the European Commission to investigate the Cambodian government's practice of issuing economic and concessions, and to suspend EU trade benefits to Cambodian firms exporting sugar to Europe should human rights abuses be found.”
Well-documented serious and widespread human rights violations
Meanwhile, in a recent report to the UN Human Rights Council, special rapporteur for Cambodia Surya Subedi said he had found "well documented serious and widespread human rights violations associated with land concessions that need to be addressed and remedied”.
Finally, a subcommittee of the National Human Rights Commission of Thailand said in a July report that it had “a reasonable belief that human rights principles and instruments were breached in this case”.
The complaint to the US NCP has not been made public, added Donowitz: “Unfortunately, we cannot share the contents of the Specific Instance Complaint. We very much wish this was not the case; however the US NCP has made confidentiality a central tenant of its process.”
An epidemic of land-grabbing in Cambodia
The villagers are seeking the return of their land, the confiscation of which is “part of an epidemic of land-grabbing in Cambodia for large-scale agriculture plantations”, he claimed.
“This case is the first of its kind filed under the OECD guidelines for multinational enterprises against a company for activities in Cambodia.”
However, he acknowledged that the National Contact Point cannot order ASR to give the land back or compensate the villagers.
Because the OECD Guidelines are non-binding, the NCPs’ mandate is limited, he said: "The NCP cannot require a company to do anything. But it can mediate the dispute if both parties are willing."
The US NCP is located in the State Department’s Bureau of Economic and Business Affairs.
American Sugar Refining did not respond to requests for comment.