IOI Pelita Background

The dispute started in 1997 when the Long Teran Kanan community filed a court case claiming their Native Customary Rights (NCR) over a portion of the land granted to a joint venture between Rinwood Oil Palm Plantation and Pelita (Sarawak State Authority responsible for land custody and development) under a Provisional Lease agreement. In 2006, while the case was still in court, IOI purchased Rinwood's shares in the joint venture with Pelita and formed IOI Pelita Plantation. 

In 2010, Grassroots, a local NGO, on behalf of the Long Teran Kanan community, lodged a complaint against IOI Pelita at the RSPO. Due to the inability of the company and communities to resolve their issues directly, the case was handed over, in 2013, to the RSPO Dispute Settlement Facility. However, no significant progress was achieved. In the same year, the Court of Appeal reversed an earlier discussion by the High Court of Sarawak and decided that the LTKA community has no Native Customary Rights to the land under their claim.

In 2015, stakeholders tried to resolve the case through a state-led approach, with the Regent of Miri acting as a mediator. However, this effort did not succeed either. In order to make the resolution process more inclusive, a decision was made at that time to expand it beyond the LTKA community and include all local communities, representing 4 ethnic groups and having their own internal disputes.

In 2016, the case reverted to the Complaints Panel (CP) of the RSPO.

In 2017, a renewed effort was made to resolve the conflict, this time the decision was made that IOI would lead the process while the CP would provide guidance and monitor the implementation. 

In 2018, IOI and Grassroots went on several joint visits to the affected communities to gather input for a new Resolution Plan. In mid-2018, IOI,Grassroots and the CP came up with the Resolution Plan which embedded and strongly reflected the RSPO P&Cs, including FPIC.

The Resolution Plan follows a 3-stage approach:

  1. building communities' capacity, awareness and governance,
  2. claims identification and validation, mainly through community participatory mapping, and 
  3. negotiations for fair and lasting resolution of the conflict.

Subsequently, Grassroots decided to drop its status as a complainant and instead take on a more active role of a lead advisor. IOI established a dedicated team, which, with Grassroots' advice and the CP's guidance, has been engaging main stakeholders (communities, local authorities, NGOs) and implementing the Resolution Plan since June 2018.

The Resolution Plan was implemented in the course of the next 4 years and resulted in IOI Pelita and all eight communities involved in the dispute signing a Final Settlement Agreement on 30th May 2022 in front of the Sarawak State Government representatives, RSPO, and other stakeholders. In the Final Settlement Agreement IOI Pelita agreed to excising 4,615 ha of land from its Provisional Lease and Sarawak State Government agreed to declare this land as Native Communal Reserve for the exclusive use of the eight communities.
Further and more detailed information can be found in the subsequent sections of this webpage.