Solomon Islands’ unprecedented illegal logging operations

By Alfred Sasako

A special investigation by Island Sun has revealed that Commissioner of Forests, Reeves Moveni, may have broken the law by granting licences to at least nine new logging companies in violation of Legal Notice (LN) 114.

Our investigation has also uncovered logging companies owned by foreigners are using Solomon Islanders as fronts, particularly women, to circumvent or bypass the law in getting their businesses registered in Solomon Islands.

According to our investigation the companies that Commissioner Moveni has granted Export Permits, Approved TA, ALP and so on to in breach of LN 114 are:

Fairtrade Company Ltd, SMC Trading Ltd, Trijam Enterprises Ltd, Focus Lumber Enterprises Ltd, MSL Export & Impact Ltd, Linear Perspective Ltd, FR Resources Ltd, S.L.H Timber Cooperation and Richfield Timber Ltd.

These companies have exported a combined volume of almost 136,000m3 of timber in the one and half-year period to date, Island Sun investigation has uncovered.

Logging industry’s self-regulatory organisation, the Solomon Forest Association (SFA) which was established to “strongly advocate and implement legal and sustainable logging practices”, has confirmed it is aware of the Commissioner’s action and is very concerned.

“We are concerned and are addressing the matter (as) the current situation and trends point to a very bleak future for the Solomon Islands logging industry,” an SFA spokesman told Island Sun.

Clause 9 of Legal Note LN 114 stipulates “…the consent or approval of the Commissioner is required in respect of any agreement relating to the conduct or management of the licensee’s tree felling and related operations, the Commissioner shall not give such consent or approval unless he is satisfied that the party to such agreement responsible for so conduct or management IS a Solomon Forest Association (SFA) member,” our investigation has shown.

It is understood that the membership requirement of SFA led to the on-going moratorium on new logging licences.

“One of the most basic requirements for a logging company to conduct their operations in Solomon Islands is for them to be a “member in good standing” of the SFA. The SFA has a strict checklist of criteria compliance for its members. This is mandatory in order to prevent illegal practices, oversaturation and unsustainable logging,” the spokesman said.

Nine logging companies which failed to meet the requirements of LN 114 are exporting logs. The table below shows the names and volume of logs being exported since last year, Island Sun has uncovered.

There could be others.

Item       Name of Company            2017 Export in M3             2018 Export in M3

1               Fairtrade Company Ltd                   11,450  19,670

2               SMC Trading Ltd                 5,640     1,720

3               Trijam Enterprises Ltd   26,660  28,900

4               Focus Lumber Enterprises Ltd   8,985     5,780

5               MSL Export & Import Ltd                 1,400     –

6               Linear Perspective Ltd  11,830  –

7               FR Resources Ltd               –                 4,075

8               S.L.H. Timber Co-operation          2,110     –

9               Richfield Timber Ltd        7,670     –

Island Sun was unable to speak to Commissioner Moveni or any of the companies that are allegedly operating illegally in Solomon Islands.

The Commissioner’s action is said to have raised many questions too about the involvement of government institutions such as the Central Bank of Solomon Islands (CBSI), the Customs Division of the Ministry of Finance and Treasury, Company Haus as well as others, including the Pan Oceania Bank (POB), the official bank of the logging industry in Solomon Islands.

It would seem that these institutions, by allowing timber and or log exports by these rogue operators, have not been well aware of the provisions of Legal Notice 114.

SFA is understood to have informed the POB management in writing, advising it of the names of its registered members, implying that non-members should never have been entertained.

“SFA is concerned that non-members continue to be involved in harvesting and exporting of logs with no regard to the provisions in LN 114.

“The companies belonging to indigenous Solomon Islanders that are used, operated or managed by foreigners cannot satisfy SFA criteria with regards to their source of funds, and source of logging equipment, etc.

“As such, these companies are operating illegally, and may be considered to be engaged in money laundering, due to the unexplained and questionable nature of the source of initial funding – often millions of dollars – transferred into their accounts to pay for import duties and other expenses.

“Commissioner of Forests simply should not be granting these non-member companies any approval to operate. By doing so raises the question, “Is it due to incompetence or illicit collusion that the Commissioner of Forests has allowed non-members of SFA to carry out illegal logging?”

The SFA spokesman said more questions arise as to exactly how an illegal company can bypass so many supposed safeguards that are currently in place, such as;

• Under the Moratorium on registering new companies, no company with logging cited as a business activity can be registered. Under such a Moratorium, the established member companies of the SFA should account for all the operational logging companies in Solomon Islands. This is not the case. Thus, is Company Haus really adhering to this Moratorium?
• For any company to operate, a fundamental requirement is a bank account. Currently, Pan Oceanic Bank is the only bank handling any logging business, and as such, one must wonder whether POB is properly monitoring its customers’ source of funds, the legality of these funds, and whether or not the customers are a certified member of the SFA.
• Did Customs properly vet the company’s background before issuing the TIN? Did Customs also check on the ownership of the logging equipment being imported?
• Is the Commissioner of Forests failing in his duties and responsibilities as stated under LN 114, where he holds the authority to issue required approvals without which NO logging activities can commence and continue to operate?

Under the law, the Commissioner of Forests is vested with powers to approve and grant the following:-

4.1           Approval and Issuance of Felling Licence.

4.2           Approval of Technology, Marketing & Logging Agreement between Licensee and Contractor.

4.3           Issuance of Letter to POB to provide Forestry Performance Bond.

4.4           Approval of Annual Harvesting Plan.

4.5           Approval of Export Permit.

4.6           Issuing of the Certificate of Origin for logs exported.

“Without the aforementioned approvals from the Commissioner of Forests, NO logging activities can be carried out, as it will be illegal. The presence of illegal logging in Solomon Islands indicates that the Commissioner has failed in his duties,” the spokesman said.

Perhaps, JANUS should investigate Forestry for evidence of collusion and corruption.