Sunseeker sentenced for importing Myanmar ‘blood’ teak
Sunseeker’s timber imports involved teak from Myanmar, wenge from Africa, and European oak.
In a landmark case in the UK courts, Sunseeker has been handed stiff penalties for using ‘blood’ teak imported from Myanmar on some of the vessels it builds.
Sunseeker International is based in Poole, Dorset, on the UK’s south coast. The firm, until recently owned by China’s Wanda real estate group, was purchased by Italy’s Orienta Capital Partners and US’s Lionheart Capital in October, ending months of speculation.
Sitting at Bournemouth Crown Court on Friday (22 November), Judge Jonathan Fuller KC imposed fines and costs totalling £358,760 for 11 specific imports.
Sunseeker had previously pleaded guilty to three charges under the UK Timber Regulation, which was understood to be the first prosecution under the legislation that replaced the EU Timber Regulation following Brexit. The charges were as follows:
- Failed to exercise due diligence as an operator when placing timber products on the market.
- Failed to maintain and evaluate the due diligence system when placing timber or timber products on the market.
- Failed to comply with article 5(1) of the Commission Implementing Regulation (EU) No 607/201 relating to record keeping by operator.
The court heard that Sunseeker’s timber imports involved teak from Myanmar, wenge from Africa, and European oak, which had a combined value of just over £60,000. The firm was sentenced based on 11 specific imports.
After hearing mitigation and taking into account the firm’s early guilty pleas to the charges, Judge Fuller fined Sunseeker £240k, made a confiscation order for just under £67,000 as well as prosecution costs of £51k and a victim surcharge £190.
The firm employs 2,000 people, making it one of the largest employers in Dorset. It builds about 150 vessels a year.
The London-based Environmental Investigation Agency (EIA) commented on the outcome as a “landmark moment in the fight against trade in illicit trade in 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,” says EIA Forests campaigner leader Faith Doherty.
“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.“
Since 2020, the common position among EU member state enforcement authorities has been that it is not possible to conduct adequate due diligence on the legal origin of Myanmar timber – meaning that any imports of timber from Myanmar have violated the EU Timber Regulation (EUTR).
On 1 February 2021, the military in Myanmar seized power in a coup, and the ruling junta has since been seeking to help support itself financially through exports of the country’s teak, which is sought-after by boatbuilders for its water-resistant properties.
The regime, including the state-controlled Myanmar Timber Enterprise, which oversees all sales and exports of teak, has since been on the receiving end of sanctions from the EU, UK and US, effectively making all imports of teak from Myanmar illegal.
Boatbuilders are increasingly adopting synthetic teak as an alternative to traditional timber, reducing dependence on real wood imports.
Article update: 26 November 2024
While Sunseeker did not respond to multiple requests for comment before this article was published, the firm issued a statement to MIN shortly after publication. The full statement is below:
“Sunseeker International Ltd (Sunseeker) confirms that, following an investigation by the UK’s Office for Product Safety and Standards (OPSS), it has been fined £358,000 (including costs and confiscation) for a failure to exercise due diligence and related offences, when placing timber or timber products on the UK market, contrary to the Timber and Timber Products (Placing on the Market) Regulations (UKTR).
“The unintended failure resulted from a change in legislation on 1 January 2021, following the United Kingdom’s exit from the European Union (EU) (Brexit). Although Sunseeker continued to use its existing EU-based supply chain and was undertaking the exact same commercial activity (namely, procuring timber/timber products from the EU) as it had done prior to 1 January 2021, the effect of Brexit was to impose additional due diligence obligations on Sunseeker whenever it procured timber or timber products from the EU, duplicating the due diligence obligations of its EU-based suppliers.
“The company fully co-operated with the OPSS throughout its investigation, accepted responsibility at an early stage and has taken decisive steps to rectify the issue, by implementing a robust timber procurement policy and a UKTR compliant due diligence process.
“The Sunseeker board regrets the company’s failure in meeting its responsibilities under the UKTR and underlines its ongoing commitment to compliance with laws and regulations.”
It is pretty outrageous, they have been punished for the lack of control in the EU. They should have been more sympathetic and not prosecuted them. A warning would have been more appropriate instead. I can’t see that kicking a manufacturing company benefits anyone. No doubt someone in the OPSS is feeling really pleased with themselves.
If they had procured the wood from Burma themselves then a prosecution would have been justified.