Amnesty investigation links brewer Kirin to Myanmar military crimes

One of the world’s largest brewers, Kirin – whose subsidiaries include San Miguel and craft beers brewed in the US and UK – has been linked to crimes committed by the Myanmar military following an Amnesty International investigation.

Kirin is partnered with a Myanmar-based conglomerate with interests in mining, beer, tobacco, garment manufacturing and banking, whose shareholders include military units directly implicated in serious human rights crimes against Rohingya people, analysis by the human rights group found.

Kirin told Amnesty it was “deeply troubled” by the findings and has launched an investigation.

Roughly one-third of all the shares of Myanmar Economic Holdings Ltd (MEHL) are owned by military units, among them combat divisions, claims Amnesty in a report published on Thursday. Leaked shareholder records seen by Amnesty show that around £12bn in dividend payments was transferred over a 20-year period to military units after the conglomerate was founded by the country’s then military regime in 1990.

“This is not a case of MEHL unwittingly financing human rights violations – its entire board is composed of high-level military figures,” said Mark Dummett, head of business, security and human rights at Amnesty.

The shareholder report lists high-ranking officers, such as the current commander-in-chief, Senior General Min Aung Hlaing and the commander-in-chief (army), Vice-Senior General Soe Win, as shareholders. The UN confirmed in 2019 that these two individuals were part of the “patron group” overseeing MEHL, says Amnesty. The UN has called for Min Aung Hlaing, who oversaw the military crackdown against the Rohingya minority in 2017, to be investigated and prosecuted for genocide, crimes against humanity and war crimes.

Corporate crime investigator and report author Montse Ferrer said she was surprised that whole military units were involved. “What’s so shocking is that the shareholders include so many military units, including frontline combat battalions and divisions implicated in war crimes and other human rights violations. MEHL pays these units regular dividends. How they then use the money, we do not know, but since it is going to military units – not just a commander or general – these payments are likely going to operational costs.”

Amnesty based its findings on two documents. The first is a filing lodged by MEHL with Myanmar’s Directorate of Investment and Company Administration (DICA) in January this year, which states that MEHL is owned by 381,636 individual shareholders, who are all serving or retired military personnel, and 1,803 “institutional” shareholders, consisting of “regional commands, divisions, battalions, troops, war veteran associations”.

Related: UN urges worldwide withdrawal of support for Myanmar military

The second document is a copy of a confidential MEHL shareholder report from financial year 2010-11. As well as providing information on the identities of MEHL’s shareholders, it documents the annual dividend payments that shareholders received between 1990 and 2011.

The shareholder report was shared with Amnesty by Justice for Myanmar, an activist group that campaigns for justice and accountability for the people of Myanmar.

Shareholders included battalions that Amnesty has linked to crimes against humanity against the Rohingya in Rakhine state, as well as war crimes in Kachin and northern Shan state, the report says.

The majority of subsidiaries of MEHL operate in Myanmar alone, Amnesty says. But the investigation draws attention to joint ventures with two companies – Kirin and the South Korean steel giant Posco, which provides steel for the car, construction and shipbuilding industries – which it says have a far wider reach as their products are consumed globally.

In a response to Amnesty, Kirin said: “[A]head of deciding to invest in Myanmar, MEHL reassured Kirin that it operates as a pension fund for military personnel and is not involved in any military activity. It was on this basis that Kirin agreed to enter into the joint ventures, and as a safeguard, we incorporated a condition in the joint venture agreement that none of the proceeds from the joint venture business would be used for military purposes.

“[W]e have retained Deloitte to conduct an assessment of MEHL’s financial and governance structures to ascertain whether proceeds from the joint ventures with MEHL may have been used for military purposes and to ensure that the review is thorough, independent and adheres to international business and human rights standards.”

In a statement to Amnesty, Posco said it took the concerns raised in the report very seriously.

“To ensure that no past dividend payments [have] been used for purposes that are contrary to the protection of human rights in Myanmar, we made a formal written request to MEHL to confirm that the dividend payments in the past were used for MEHL’s original business objectives and we are currently waiting for MEHL’s official response.”

Amnesty is calling on the Myanmar government to dismantle MEHL and turn it into a state- or civilian-owned entity.