13/12/ 2005  Kota Kinabalu (Sabah  Daily Express)  - Palm oil industry players in Sabah were on Monday urged to convert their existing licence to the new ones issued by the Malaysian Palm Oil Board (MPOB) by next year.

Director of Licensing and Enforcement, Adzmi Hassan, said the exercise is urgent and necessary to ensure the Malaysian palm oil industry is geared towards good quality products as well as safe for human consumption.

He said the players could do so by applying for the new licence before their current licence expires.

"The main thrust of the MPOB's new subsidiary regulations focuses on quality control.

"So, in one whole year (2006), we will make sure that licensees convert their existing licences to the new one under the new subsidiary regulations," he said after presenting a briefing about the new regulations at Promenade Hotel.

Adzmi said the new regulations came about following the world's demands for stricter control of palm oil products.

Previously, he said licensing on palm oil was not given classification and there was only one category of licence.

As an example, he said in the case of Sell and Move Palm Oil licence, under the new regulations, the definition of palm oil has been classified into five categories, namely, crude palm oil (CPO), processed palm oil, crude palm kernel oil, processed palm kernel oil and slush palm oil.

Under the old regulations, he said an operator could produce any product from palm oil "But now we are building credibility elements into our regulations because the world now wants credibility," he stressed.

He said countries such as the US are very security conscious that they want to know the source of a palm oil product.

According to him, some of the requirements might be difficult to digest but added Malaysia has to follow what the world wants since 90 per cent of its palm oil is marketed outside the country.

Although Malaysia's major palm oil importers are China and India, it is also sold in other parts of the world such as Europe and Japan.

Adzmi said under the previous licence, the dealers could be involved in lower end products, namely the slush and also the higher end product, which is processed palm oil.

Hence, he said if the dealer is allowed to produce the two types of oil, there's a possibility that they could mix the products.

"So, now we separate that. If you want to become a dealer in just to Purchase, Sell and Move palm oil, we might not give you Sell and Move slush oil," he said.

He said this is how the MPOB controls food security by imposing conditions on licences.

Therefore, when the players apply for conversion of their existing licence, he said they now might have to apply for five other different licences as stipulated under the new subsidiary regulations.

He said non-licence operators would be dragged to court where the magistrate will decide to compound or penalise the offender up to RM250,000 or a three-year jail term.

So far, Adzmi said there has been no serious cases in Malaysia regarding this but added the MPOB has adopted preventive measures.

Palm oil, he said, is huge business, contributing about RM30 billion annually to the national economy.

Last year, he said Malaysia recorded RM30.4 billion from the palm oil sector, of which Sabah, being the largest palm oil producer in the country, contributed 30 per cent.

According to him, there were four subsidiary regulations that have been drafted to replace the existing regulations namely:

* Malaysian Palm Oil Board Regulations (Licensing) 2005
* Malaysian Palm Oil Board Regulations (Quality) 2005
* Malaysian Palm Oil Board Regulations (Contract Registration) 2005
* Malaysian Palm Oil Board Regulations (Offence Compounding) 2005

The objective, he said, was to bring a more effective and comprehensive impact to be in line with the development of the palm oil industry at international level, particularly where food safety and food security are concerned.

Adzmi said the new subsidiary regulations had taken into account control and monitoring steps to achieve a high level of palm oil production quality by ensuring quality practice elements are being employed to assure the quality of the entire palm oil production network.

Therefore, he said it is pertinent that the players in the industry such as in mill, refinery, estate and smallholders understand the objective of the enforcement of the new regulations and replace their existing licences to the new one after they have expired.

Also present was MPOB Regional Chief for Sabah, Muslim Imam Amat Samsudin.