A case is being filed again a green body by one of the world’s largest palm oil producers after the producer’s sustainability certificate was suspended by the green body due to allegations that it had deforested Indonesian rainforests.

It had been served with a lawsuit by the Malaysian palm giant, IOI, confirmed the Roundtable for Sustainable Palm Oil (RSPO), a body set up by industry and NGOs to address environmental concerns about the commodity’s production.

Major buyers including Unilever, Mars, Kellogs and Nestle cut back on the palm oil they buy from the company after the IOI was suspended by the RSPO in early April after the allegations of wrongdoing.

Found in everything from margarine and biscuits to soap and shampoo, palm oil is the most widely-used vegetable oil. RSPO warned of a disruption to supplies of sustainable palm oil following the suspension as IOI owns Europe’s largest palm oil refinery and is a major global player in the business.

“The decision to challenge the RSPO board’s suspension decision is a difficult and painful one for us to take,” said Dato’ Lee Yeow Chor, IOI’s CEO while talking about the suit that was filed in Zurich, Switzerland. It is understood that IOI has claimed that the RSPO had no right to suspend its sustainability certification and that the company did no wrong.

It had been “unfairly affected” by the suspension even while the company was committed to the RSPO, Dato’ Lee said in a statement.

While allegations of deforestation in IOI concessions in Ketapang, West Kalimantan, were submitted in a formal complaint to the RSPO by a sustainability consultancy in 2015, the company has long been the target of environmentalists, who have previously accused it of felling forests and draining peatlands in Malaysian Borneo.

A conservation area in a PT Bumi Sawit Sejahtera (IOI subsidiary) palm oil concession in Ketapang, West Kalimantan have had forests cut and drainage canals cut through by the company, alleged environmental groups.

It is however not clear how much of business and the financial impact the suspension would have on the company. However “IOI has suffered commercial and reputational losses as a result of this injustice” is what was told to Datuk Darrel Webber, CEO of the RSPO by the palm oil producer.

Webber also reveals that he is concerned over “the amount of time and money that will be wasted in this process [defending the legal challenge]” and that “IOI prefers if this legal action is kept low profile.”

The roundtable is insured against such claims up to 10m Malaysian Ringgit (£1.72m), Darrel Webber says in the communications.

“No one should be surprised that IOI has chosen to bully its critics. The RSPO and its members must meet this intimidation head on by excluding IOI until it has cleaned up its act and repaired the forests and peatlands it has destroyed,” said Richard George, head of forests at Greenpeace UK.

Deforestation and slash-and-burn clearance methods that contributed to the huge forest fires across Indonesia last year have been linked to Malaysian and Indonesian companies even as they dominate the global palm oil production. The big palm oil producers to have adopted zero deforestation policies include companies like Wilmar International, Golden Agri Resources (GAR), Asian Agri and Cargill.

(Adapted from The Guardian)