Sembcorp's China unit concludes multimillion-dollar pollution-offence case

The firm said that they are not expecting further financial impact amidst the legal proceedings.

Sembcorp Nanjing SUIWU (NSS), Sembcorp’s 95%-owned joint venture wastewater treatment firm in China, has ended its legal proceedings over pollution offences and paid over $54m in fines and settlements, according to an SGX filing.

The legal proceedings consisted of a criminal case and a co-related civil case, where the total amount comprises the $10m fine for the criminal case and a $44m settlement for the civil claim. Both were fully provided for as of 30 September 2019.

Sembcorp said that there is no further financial impact arising from the conclusion of legal proceedings.

“After NSS and the prosecutors in China finally reached agreement on the settlement terms for the civil claim at the end of December 2019, the judicial process in China required publication of those terms for a 30-day period. During this period, members of the public and public interest groups in China may provide feedback on those terms. Any adverse public feedback could have resulted in negotiations being reopened on the settlement terms and such terms being amended to the detriment of NSS,” Sembcorp said in a statement.

Following internal investigations and on the evidence of the prosecutors, NSS has terminated the employment of those individuals found guilty, whilst assuring that necessary steps to strengthen internal controls and processes in NSS and in the Group’s other water and wastewater treatment plants in China have already been undertaken.

They added that they will commit new investments worth approximately $45m over the next four years to develop projects and initiatives to support environmental protection in China.