To end the haze problem, both penalties and cooperation are needed

Simon Tay and Chua Chin Wei Today Online 21 Feb 14;

The Singapore Government’s move this week to penalise companies that cause haze is timely, given that fires are currently burning in Riau and Kalimantan. But the proposed laws are more than a symbol or knee-jerk reaction.

The draft Transboundary Haze Pollution Bill, if passed, will allow criminal charges as well as civilian claims for damages to be brought before a court in Singapore — even if the fires occur elsewhere. The Republic has usually punished actions overseas only for severe crimes, such as corrupt acts or illegal sex with minors.

Applying Singapore law to the haze can be an important pillar in the effort to address the region’s recurring environmental problem.

Last year, the haze reached record highs in Singapore and parts of Malaysia. There was frustration that monitoring and enforcement against fires remain difficult in Indonesian provinces.

When regional ministers for the environment met, differences also emerged about releasing maps that could identify the culprits. Several retorted that a number of the implicated companies are headquartered in Singapore or Malaysia.

The Bill shows that the Singapore Government is willing to take action where it can.

WHAT THE BILL CAN AND CAN’T DO

Responsibility is placed on any entity not to cause or contribute to haze pollution in Singapore, whether directly or through companies that it manages. An individual company officer can also be held personally responsible.

Since proving what happens abroad is difficult, presumptions are introduced to allow reliance on satellite imagery, meteorological information and maps. Presumptions allow the court to assume that a fact is correct until proven otherwise.

A company can defend itself by proving the fires were caused by natural disaster or by parties not under its direction. Showing that concession maps are wrong can also rebut the presumption. This will incentivise companies to be more transparent about their land holdings and practices.

Consultations are being held on the Bill before its finalisation and details may be debated. Some may fairly ask, for example, whether the fines proposed are sufficient. While the upper limit of S$450,000 may seem significant to some, palm oil and other commodity companies implicated in the haze are often billion-dollar enterprises.

One thing should be clear, however: No matter how tough the law, this alone is no silver bullet.

COOPERATION REMAINS KEY

Cooperation — and not only penalties — remains the key. Even as the Singapore Government takes this step forward, it must continue to work more closely with Indonesian officials and key corporations. The ongoing fires show that challenges remain, but some signs are positive.

At a recent conference in Indonesia for the palm oil industry, all three Indonesian ministers for Agriculture, Forestry and the Environment called for compliance with no-burn policies. National efforts are being made to conserve forests and biodiversity, and reduce climate-change gases and the haze, which impacts their own citizens living closest to the fires.

Based on our recent visits to Indonesia, we have reason to hope that some in the country will welcome the proposed Singaporean laws as complementary measures.

We also observe that a number of companies are moving towards sustainability. Unilever, one of the largest purchasers of palm oil, for example, has declared its commitment to buy only from sustainable sources.

There are also banks that finance trade and investment in the palm oil sector which evaluate loans based on sustainability and reputational risk.

Such good examples, however, remain a minority. Palm oil and other plantations continue to expand in scale across Indonesia as an important driver for trade revenue and rural employment.

This is why a constructive dialogue is needed to level the playing field for those who have moved towards sustainability. Showcasing the positive examples, in tandem with the proposed penalties under the Bill, can help move more of the players in the industry and supply chain.

Otherwise, as expansions continue, future haze episodes may be even worse than the severe one experienced in June last year. It is significant to have laws and penalties proposed by Singapore to punish those who cause haze. But the very best outcome will be to prevent future incidents of severe haze.

For prevention to have even a chance, a mix of both coercion and cooperation is needed.

ABOUT THE AUTHORS:

Simon Tay is Chairman and Chua Chin Wei a Deputy Director of the Singapore Institute of International Affairs. The SIIA is convening the first Singapore dialogue on Sustainable World Resources in May to bring together policy makers, business leaders and non-government experts.