Sembcorp concludes legal proceedings over China pollution offences, Latest Business News - The New Paper

Sembcorp concludes legal proceedings over China pollution offences

This article is more than 12 months old

Conglomerate Sembcorp Industries has concluded the multimillion-dollar legal proceedings it faced over pollution offences in China - a case that made headlines recently because of disclosure issues.

The firm said yesterday its joint venture wastewater treatment unit Sembcorp Nanjing Suiwu had received the final mediation document from the Chinese court.

Sembcorp holds a 95 per cent stake in the unit.

The legal proceedings consisted of a criminal case and a related civil case over illegal discharge of wastewater by Sembcorp Nanjing Suiwu.

Under Chinese court rules, the two cases were regarded and tried as one.

Sembcorp's share of the fines and cash settlement for both claims stands at $54 million - $10 million for the criminal case and a $44 million settlement for the civil claim.

It stated that these were fully provided for as of Sept 30 last year, with no further financial impact.

It has committed to new investments of $45 million over the next four years to develop projects and initiatives to support environmental protection in China, with a substantial portion of this earmarked for upgrading of facilities for the wastewater treatment business in Jiangsu.


The outcome of the case had not been disclosed right after the Chinese court dismissed Sembcorp Nanjing Suiwu's appeal last October, sparking criticism from some corporate governance watchers and a regulator's article on timely and adequate disclosures of significant litigation.

Sembcorp's latest announcement, with the joint venture named and other details, stands in stark contrast to its disclosures in mid-January 2018 and September 2018.

The company said it was in "many months of difficult and sensitive negotiations with the provincial prosecutors" over the civil claim.

Sembcorp Industries closed down 6.02 per cent at $2.03 on Friday. - THE STRAITS TIMES