Kirin Should Sever Military Firm Ties: Japanese Beverage Giant Should Release Investigation Report

(Tokyo, January 8, 2021) – Japan-based Kirin Holdings Company, Ltd. should publish its investigation report on the military-owned Myanmar Economic Holdings Ltd. (MEHL) and swiftly cut ties with the company, Human Rights Watch said today. Kirin announced the conclusion of an investigation by Deloitte Tohmatsu Financial Advisory LLC on January 7, 2021, but declined to publish the report for confidentiality reasons.

“Kirin should regain some trust of consumers, investors, and rights groups by releasing the details of its investigation into the operations of its Myanmar military business partner,” said Phil Robertson, deputy Asia director at Human Rights Watch. “Kirin’s business association with MEHL raises serious human rights concerns that need urgent action, not further obfuscation behind an investigation whose results are kept secret.”

In its January 7 statement, Kirin said the investigation by Deloitte was “inconclusive as a result of Deloitte being unable to access sufficient information required to make a definitive determination.” Kirin said the investigation aimed to determine the “destination of proceeds received by” MEHL from Myanmar Brewery Ltd. (MBL) and Mandalay Brewery Ltd. (MDL), and that it would provide a “further update” on its business activities in Myanmar by the end of April.

Kirin owns a majority stake in Myanmar Brewery Ltd. and Mandalay Brewery Ltd. in partnership with the military-owned-and-operated MEHL. In 2015, Kirin bought 55 percent of Myanmar Brewery Ltd., 4 percent of which it later transferred to the military-owned firm. In 2017, Kirin acquired 51 percent of Mandalay Brewery Ltd. in a separate joint venture with the firm.

Myanmar’s armed forces, the Tatmadaw, have been responsible over many years for numerous grave violations of human rights and war crimes against the country’s ethnic minority populations. These abuses culminated in the August 2017 campaign of ethnic cleansing against the ethnic Rohingya population in Rakhine State, including killings, sexual violence, and forced removal. Human Rights Watch found that Myanmar’s security forces committed crimes against humanity and genocidal acts in those 2017 operations against the Rohingya.

In Rakhine State, the military and police keep an estimated 600,000 Rohingya confined to camps and villages without freedom of movement, cut off from access to adequate food, health care, education, and livelihoods. Approximately 130,000 of them have been held since 2012 in open-air detention camps. Human Rights Watch found that the squalid and oppressive conditions imposed on the Rohingya amount to the crimes against humanity of persecution, apartheid, and severe deprivation of liberty.

A United Nations-backed Fact-Finding Mission on Myanmar reported in 2018 that atrocities committed by Myanmar’s armed forces “rise to the level of both war crimes and crimes against humanity.” In a September 2019 report, the panel concluded that “any foreign business activity” involving Myanmar’s military and its conglomerates Myanmar Economic Holdings Ltd. and Myanmar Economic Corporation pose “a high risk of contributing to or being linked to, violations of human rights law and international humanitarian law. At a minimum, these foreign companies are contributing to supporting the Tatmadaw’s financial capacity.”

The Fact-Finding Mission advocated the “financial isolation” of the military to deter violations of international human rights and humanitarian law.

On November 11, 2020, Kirin announced a suspension of “all dividend payments” from the Myanmar Brewery Ltd. and Mandalay Brewery Ltd. joint ventures with MEHL “in view of a significant lack of visibility regarding the future business environment” and pending “the ongoing assessment into the destination of proceeds from MBL and MDL and the spread of Covid-19 in Myanmar.”

On May 22, Human Rights Watch and three other nongovernmental organizations wrote to Kirin to urge the company to terminate its partnership with the military conglomerate. After initiating an investigation on June 6 by Deloitte into the operations of MEHL, Kirin responded in a June 12 letter that “It is wholly unacceptable to Kirin that any proceeds from the joint-venture with the MEHL could be used for military purposes.” Amnesty International, in September, published a report detailing links between MEHL and the Myanmar military.

Kirin Group’s Human Rights Policy states that the company will respect international human rights law instruments, including the United Nations Guiding Principles on Business and Human Rights. This means that Kirin should “avoid causing or contributing to adverse human rights impacts through their own activities, and address such impacts when they occur,” and “seek to prevent or mitigate adverse human rights impacts that are directly linked to their operations, products or services by their business relationships, even if they have not contributed to those impacts.”

“It’s been more than a year since the UN Fact-Finding Mission strongly advised foreign companies to cut their ties with the Myanmar military, yet Kirin is still dragging its feet with what should be a clear decision,” Robertson said. “Kirin should realize that the longer their involvement with the Myanmar armed forces, the greater their risk of complicity in military abuses, further tarnishing the company’s human rights record.”


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