The Public Prosecution Service imposes fines on two companies and sentences their directors to community punishment orders due to illegal imports of timber from Myanmar
The Public Prosecution Service (OM) accuses three actual directors of the companies DMPT, Mercura and Fairwind, varying in ages from 56 to 67 years, for offering high-quality teakwood in the market and thus violating the European Timber Regulation. Also, the Public Prosecution Service will be prosecuting two of the three companies (DMPT and Mercura) for this offence. According to the Public Prosecution Service, the companies and suspects did not meet the required principles of due diligence to prevent the illegally harvested wood from entering the market. In total, more than 178 cubic metres of teakwood valued at more than €2.5 million was imported. Today, the Public Prosecution Service in Amsterdam imposed a fine of €100,000 – of which €50,000 is conditional – on the companies concerned and demanded a 240-hour community punishment order for the suspects.
In 2018, the Netherlands Food and Consumer Product Safety Authority (NVWA) imposed an order for incremental penalty payments on one of the companies, because it did not comply with the due diligence system. Due to the political situation in Myanmar, it is virtually impossible to comply with the principle of the due diligence system when importing teakwood from that country. This is the point of view of the Expert Group, a group of experts who advises the European Commission on policy.
Working method of the companies concerned
According to the Public Prosecution Service, the companies and actual directors imported the teakwood into the European Union (EU) through a company specially set up in the Czech Republic, to avoid monitoring by the Netherlands. In total, it concerns 7 batches of imported teakwood. The company DMPT B.V. travelled to Myanmar to choose the teakwood planks that had to be transported to Europe and the company Mercura Trade & Services Europe B.V. took care of shipping. There is a suspicion that the third company involved, Fairwind Trading sro, served as an administrative front to circumvent any monitoring by the Netherlands Food and Consumer Product Safety Authority. At the court session it emerged that the suspects set up this scheme to allow imports of teakwood from Myanmar due to the specific qualities of this wood. By definition, this wood is ideally suited and sought-after in the top-end yacht-building industry because of the wood’s specific qualities. These actions took place between January 2018 and 3 December 2019.
Illegal logging threatens biodiversity and undermines sustainable forest management
As stated in the public prosecutor's demand: “Forests offer a broad variety of environmental, economic and social benefits that are essential to mankind, such as maintaining biodiversity and ecosystem functions and protecting the climate system. As a result of the growing demand for timber products worldwide and the institutional and governance deficiencies that are typical for the forest sector in a number of timber-producing countries, illegal logging and the associated trade have become matters of ever greater concern. Illegal logging is a pervasive problem of major international concern. It poses a major threat to forests as it contributes to the process of deforestation and forest degradation, which is responsible for 20% of global CO2 emissions. Illegal logging threatens biodiversity and undermines sustainable forest management and development, including the commercial viability of market operators acting in accordance with applicable legislation. It also contributes to desertification and soil erosion, and can exacerbate extreme weather conditions and flooding. Moreover, illegal logging also has social, political and economic implications that often undermine progress towards good governance, and threaten the livelihood of local forest-dependent communities. It can also be linked to armed conflicts.”
The public prosecutor therefore takes the view that a prison sentence of six months is an appropriate punishment, but in this specific situation chooses to demand a 240-hour community punishment order. The adaptation of the demand in this case lies in the time that the investigation has taken since the it was initiated and the personal circumstances of all suspects.
The approach to illegal logging
Based on the approach to and combating efforts of environmental crime, in the coming years the Public Prosecution Service will make more effort with the investigation and criminal prosecution when it comes to illegal timber. The starting point is to prevent deforestation and the ever-increasing pressure on the environment. This is part of the public prosecution’s consideration in stepping up prosecutions in future.
Illegal logging threatens the forests and deforestation leads to climate problems and the exploitation of local residents. Illegal trade in timber also paves the way for a system of subversive crime, not only in countries where it is being harvested, but here too. To counter this, timber traders must demonstrate that they have exercised due diligence in purchasing and importing the wood. This due diligence requirement complies with the European Timber Regulation. If they do not do so, the government acts or they are prosecuted under criminal law.
About the European Timber Regulation
The European Timber Regulation has been in force since March 2013. Market operators must provide guarantees of the legal origin of their products by applying a due diligence system. More information can be found at: https://www.nvwa.nl/onderwerpen/import-van-hout-en-houtproducten-flegt/europese-houtverordening.