September 30, 2022

To: Investors holding shares in MUFG Bank, Sumitomo Mitsui Banking Corporation, orMizuho Bank

Call for Engagement to Urge Banks to Take Measures to Stop the Flow of Funds
to the Myanmar Military
Dear investors,
We are civil society organizations that make policy proposals urging Japanese companies to give
appropriate consideration to the environment, social impacts, and human rights in their overseas
business operations. Today we are sending this call for engagement to you as one of 160 major
investors in three major Japanese banks (MUFG Bank, Sumitomo Mitsui Banking Corporation, andMizuho Bank) that are investing or lending to projects that may benefit the Myanmar military or holdshares in Japanese companies that may be complicit in human rights violations in Myanmar, asindicated in the tables below.
Since the Myanmar military attempted a coup d'etat in February 2021, we have pointed out that theJapanese companies investing in projects in Myanmar may be complicit in human rights violations by
the Myanmar military through business operations benefiting the military. Through letters of requestsand meetings, we have also asked these companies to act in accordance with their human rights
policies and international standards. There is strong concern that if these business operations continue
or are conducted as planned, they will be a source of funds for the Myanmar military, thereby
facilitating repression by the military such as murder of citizens, unlawful arrest, arbitrary detention,
sexual violence, forced disappearance, and torture.
The three major Japanese banks invest in or lend to the projects listed in Table 1. In their human rights
policies, the financial groups that oversee each of the banks (Mitsubishi UFJ Financial Group, Mitsui
Sumitomo Financial Group, and Mizuho Financial Group) state that they will follow international
human rights standards and avoid being complicit in human rights violations. Further, Mitsubishi
states that it urges clients to respect human rights; Sumitomo states that it strives to address negative
human rights impacts associated with its business activities; and Mizuho states that it strives toperform adequate due diligence to prevent or mitigate adverse human rights impacts associated withits business operations, using leverage where appropriate. In light of these human rights policies, thethree banks must take measures as indicated below.

Table 1: Measures required of banks regarding projects that may benefit theMyanmar military
Project name, investors (percentage of shares),and banks involved

Possible flow of funds to themilitary

Measuresbanks

Thilawa Special Economic
Development Project (*2)

- Possibility of partial flow ofdividends to the military, due to
10% joint funding by the- Continued suspension ofdividend payments

Zone(SEZ)

requested1ofOperator:
MyanmarJapan
Thilawa
Development (100%)・Japanese private companies (39%)- Sumitomo Corporation (32.2%)- Marubeni Corporation (32.2%)- Mitsubishi Corporation (32.2%)- MUFG Bank (1.13%)- Sumitomo Mitsui BankingCorporation(1.13%)- Mizuho Bank (1.13%)
・Japan International Cooperation Agency (JICA)(10%)
・Myanmar Thilawa SEZ Holdings (41%)
・Thilawa SEZ Management Committee (10%)
In addition, MUFG Bank, Sumitomo Mitsui
Banking Corporation, and Mizuho Bank aremajor shareholders of Sumitomo Corporation,Marubeni Corporation, and Mitsubishi
Corporation
Y Complex Project (*3)
Operator: Y Complex Company Limited (100%)・Public and private investment from Japan(80%)- Tokyo Tatemono- Fujita (Subsidiary of Daiwa HouseIndustry)- Japan Overseas Infrastructure
Investment Corporation for Transportand Urban Development (JOIN)・Yangon Techcnial and Trading (YTT)(20%)
Sumitomo Mitsui Banking Corporation andMizuho Bank are co-financing a loan for theproject with Japan Bank for International
Cooperation

Thilawa SEZ Management
Committee (Myanmargovernment). Dividend
payments were suspended as ofFebruary 2022, but it is unclear
when they will resume.
- The military has already taken
control of Thilawa SEZ
Management Committee (thechairperson was arrested anddetained after the attempted
coup, and a new chairperson
was subsequently appointed bythe military), and military
involvement in the entire
project may increase- The project subleases land
owned by the military to buildand operate commercial
facilities, offices, and a hotel.
The lessor is "Colonel Aung Min
Thein (Officer No. Army 17642),
Vice Quarter Master General,
Office of the Quarter Master
General, Commander-in-Chief(Army)." Land lease paymentsof about 2 million USD per year
are to be paid to the Office ofthe Quarter Master General,
which may flow to the military.
In December 2021, US, UK andCanada imposed sanctions on
the Office of the Quarter
Master General.

- Elimination of influence by
the military overdecision-making in SEZ
operations- Withdrawal from project if
benefiting the military cannot
be avoided- If Y Complex Company
Limited is not able towithdraw from contractual
obligations under which rent
payments are made to theOffice of the Quarter MasterGeneral, urge theparticipating companies to
responsibly disengage fromthe project in such a way that
assets are not transferred to
the Office of the Quarter
Master General- If the above is not done,cancel the loan for theproject

Further, while the three banks are not directly investing in or lending to the projects listed in Table 2,
they have responsibility as major investors in the companies participating in the projects. The threebanks should adhere to their human rights policies, and take the following actions to avoid facilitating
human rights violations by the Myanmar military.
Table 2: Projects that may facilitate human rights violations by the Myanmar military
Project name, investors
shares), and banks involved(percentageofYetagun Gas Project (*4)
・Petronas Carigali (40.9%)
・Myanma Oil and Gas Enterprise (MOGE)(20.5%)
・PTT Exploration and Production (PTTEP)(19.3%)
・Nippon Oil Exploration (19.3%)- JX Nippon Oil & Gas Exploration
Corporation (which is 100% subsidiaryof ENEOS) (40%)- Mitsubishi Corporation (10%)

Possibility of facilitating humanrights violations by theMyanmar military

Measures required of banks- The military is already ineffective control of relevant
government ministries, Central
Bank of Myanmar, and theMyanma Oil and Gas Enterprise(MOGE), and it is not possible
to reliably prevent revenue
payments, including profits
from MOGE’s investment innatural gas fields andtransportation pipelines, frombeing used by the Myanmar- Urge Japanese companies to
responsibly withdraw fromthe project, including by
providing funds fordecommissioning in such away that the funds do not
flow to the military.
- Urge Japanese companies tostop all payments to entities
controlled by the military andkeep the funds in escrow2

- Japan's Minister of Economy, Tradeand Industry (50%)
MUFG Bank, Sumitomo Mitsui Banking
Corporation, and Mizuho Bank are major
shareholders of ENEOS and Mitsubishi
Corporation

Telecommunications business with Myanma
Posts and Telecommunications (MPT) (*5)
・Joint operator with MPT: KDDI Summit GlobalMyanmar (KSGM)- KDDI- Sumitomo Corporation
MUFG Bank, Sumitomo Mitsui Banking
Corporation, and Mizuho Bank are major
shareholders of KDDI and SumitomoCorporationmilitary. (The EU imposed
sanctions on MOGE in February2022.)

accounts until
democratization is realized.

- By May 2022, all project
partners except for MOGE
announced plans to withdraw
from the project, but funds
related to withdrawal anddecommissioning of the field
may flow to the militarythrough MOGE.
- MPT has installed aninterception system thatprovides the Myanmar military
and the police under theircontrol with capabilities toundertake direct surveillance of
MPT users. This violates theprivacy of more than 27 million
customers and exposes them torisk of further human rights
violation.
- MPT also implements junta
orders to shutdown the internet
and to block media and activist
websites, violating freedom ofexpression.
- Profits from the joint
telecommunications operation
may flow to the militarythrough MPT which iscontrolled by the military.

- Urge Japanese companies to
conduct thorough humanrights due diligence to assess
how MPT's infrastructure,
assets of joint operators, or
profit from the joint operation
is being used for grave humanrights violations.
- Urge Japanese companies totake measures to ensure thatprofit from the joint operation
does not flow to the military
and that MPT does notcontribute to negative humanrights impacts.
- If the above is not done,cancel applicable loans for theproject.

Mitsubishi UFJ Financial Group, Mitsui Sumitomo Financial Group, and Mizuho Financial Group all
have human rights policies. They have also publicly stated that they support and would implement
international human rights standards such as the UN Global Compact and the UN Guiding Principles
on Business and Human Rights.
Accordingly, we request that you promptly engage with the banks to take the "measures required ofbanks" shown in Table 1. If the three banks do not take measures even after your engagement, wewould like you to consider divestment. Please refer to the documents attached for information on thegrave human rights abuses by the Myanmar military amounting to international crimes.
We would very much appreciate it if you would reply to the contact address listed below byNovember 1, 2022 to share your course of action for addressing this request and any other views you
may have on the matter.
Sincerely,

Yuka Kiguchi
Executive Director, Mekong Watch

3Kanna Mitsuta
Executive Director, Friends of the Earth Japan
Yadanar Maung
Spokesperson, Justice For Myanmar
Koji Sugihara
Representative, Network Against Japan Arms Trade (NAJAT)
Tomokazu Matsumoto
President, ayus:Network of Buddhists Volunteers on International Cooperation
Takaki Imai
President, Japan International Volunteer Center (JVC)
Contact:
Mekong Watch
3F Aoki Bldg., Taito 1-12-11,
Taito-ku, Tokyo 110-0016 Japan
Phone: +81-3-3832-5034
Email: contact@mekongwatch.org
Attachments:- Background on the Situation in Myanmar------Notes(*1)
Mitsubishi UFJ Financial Group "Policies and Guidelines"
https://www.mufg.jp/english/csr/policy/index.html
Sumitomo Mitsui Financial Group "Respect for Human Rights"
https://www.smfg.co.jp/english/sustainability/group_sustainability/forrights/
Mizuho Financial Group "Human Rights Policy"
https://www.mizuhogroup.com/sustainability/human-rights/respect(*2)
Sumitomo Corporation, "Presentation of Myanmar Japan Thilawa Development Ltd.(MJTD)" (March 14,2018)https://www.sumitomocorp.com/-/media/Files/hq/ir/explain/business/en/20180314MJTD_ENG.pdf?la=en
News article in Japanese that mentions the detention of the SEZ Management Committee chairperson
https://www.nikkei.com/article/DGXZQOUC176F30X10C21A6000000/(*3)
JBIC press release, "Loan for Mixed Use Development Project by Japanese Company in Myanmar"(December 18, 2018)https://www.jbic.go.jp/en/information/press/press-2018/1218-011714.html
Justice for Myanmar "Land Lease Payments Tie Japanese Gov and Investors to Myanmar's Military" (March24, 2021)
https://www.justiceformyanmar.org/stories/land-lease-payments-tie-japanese-gov-and-investors-to-myanmarsmilitary(*4)
JX Nippon Oil & Gas Exploration Corporation page on Myanmar
https://www.nex.jx-group.co.jp/english/project/southeast_asia/myanmar.html
Mekong Watch briefing paper, "Yetagun: The Japanese Government’s Involvement in Natural Gas
Development in Myanmar” (September 15, 2021)
http://www.mekongwatch.org/PDF/Yetagun_BP_Eng.pdf(*5)
Press release by KDDI Corporation and Sumitomo Corporation, "Entering the Telecommunications Business4

in the Republic of the Union of Myanmar" (July 16, 2014)
https://news.kddi.com/kddi/corporate/english/newsrelease/2014/07/16/502.html
Joint letter from NGOs, "KDDI Group and Sumitomo Corporation: Do not facilitate human rights abuses by
Burma’s illegitimate regime" (October 18, 2021)
http://www.mekongwatch.org/PDF/rq_20211018_Eng.pdf

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Background on the Situation in Myanmar
In Myanmar, the military has committed gross human rights violations over the past severaldecades.<<1>> Some of the violations committed against civilians in ethnic minority regions aredeemed to amount to international crimes.<<2>> Since the coup d'etat on February 1, 2021, manycitizens have expressed opposition to the resumption of military rule. However, the military has
responded with violence, and 2,262 people have been killed and 12,219 were detained as ofSeptember 1, 2022.<<3>> In July 2021, the Independent Investigative Mechanism on Myanmar(IIMM) set up by the UN Human Rights Council found that security forces including the military
have “committed serious international crimes” since the coup, such as murders, persecution, arbitrary
detentions, sexual assaults, forced disappearances, and torture.<<4>> According to the IIMM, thesecrimes may amount to crimes against humanity.
Even before the coup, armed conflict had continued for decades in ethnic minority regions, and many
civilians have become victims of forced labor, forced relocation, sexual violence, extrajudicial killingcommitted by the military as part of its clearance operations against ethnic armedorganizations.<<5>> At times such operations are carried out to pursue development projects. <<6>>
During construction of a pipeline from the Yadana natural gas field to Thailand, the military set up
outposts along the pipeline route and subjected local ethnic communities to forced relocation, forcedlabor, looting, rape, and summary executions.<<7>> Several years later, a pipeline from the Yetagun
field was laid along the same route.
In 2017, the military attacked villages of Rohingya Muslims in Rakhine State and committed killings,
rapes, arbitrary arrests, and mass arson of civilian homes. The independent international fact-finding
mission on Myanmar (IIFFMM) established by the UN Human Rights Council found that during thisoperation the military committed crimes against humanity as well as violations of international
humanitarian law amounting to war crimes.<<8>> Further, Gambia filed a case at the International
Court of Justice against Myanmar for alleged genocide committed during these attacks, and the case isongoing. After the coup, armed conflict in ethnic minority regions have continued, intensified, orreignited.<<9>>According to the UN High Commissioner for Refugees, as of August 2022, there arean estimated 897,000 internally displaced people in Myanmar due to conflict and unrest since thecoup.<<10>>
The military has built its own network of companies to finance its activities. In its 2019
report,<<11>> the IIFFMM detailed how the military utilized its business relationships with its
holding companies and foreign corporations to support its operations against ethnic minorities.
Further, because “the revenues the military earns from domestic and foreign business deals
substantially enhances its ability to carry out gross violations of human rights,” the IIFFMM
recommended that “no business enterprise active in Myanmar or trading with or investing inbusinesses in Myanmar should enter into or remain in a business relationship of any kind with thesecurity forces of Myanmar, in particular the Tatmadaw, or any enterprise owned or controlled bythem”.<<12>> Some of the more than 400 Japanese companies conducting business in Myanmar may
well be contributing to human rights violations through the military’s network of businesses.

1 See,e.g.,Written updates of the Office of the United Nations High Commissioner for Human Rights(UNHCHR) on the situation of human rights in Myanmar, September 16, 2021, p.2.
2 Ibid.

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3 Assistance Association for Political Prisoners, Daily Briefing in Relation to the Military Coup, September 1,2022.
4 Report of the Independent Investigative Mechanism for Myanmar, July 5, 2021, p.9.
5 See, e.g., Shan Human Rights Foundation & Shan Women’s Action Network, License to Rape: The Burmese
military regime’s use of sexual violence in the ongoing war in Shan State, May 2002); Shan Human Rights
Foundation, Dispossessed: Forced Relocation and Extrajudicial Killings in Shan State, April 1998.
6 See, e.g., EarthRights International, Total Denial Continues: Earth Rights Abuses Along the Yadana andYetagun Pipelines in Burma (2000); Karenni Development Research Group, Dammed by Burma’s Generals:
The Karenni Experience with Hydropower Development From Lawpita to the Salween, 2006.
7 EarthRightsInternational, supra note 6.
8 Report of the independent international fact-finding mission on Myanmar, September 17, 2018, p. 374, 376.
9 UNHCHR, supra note <1> p.9,11.
10 UNHCR, Myanmar Emergency Update as of 1 August 2022.
11 Independent International Fact-Finding Mission on Myanmar, Economic interests of the Myanmar military,
August 5, 2019.
12 Ibid., p.66.

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