The influence of the logging industry on the politics and laws of host countries should not be underestimated, particularly with regard to obtaining licences to log and to forest policy more generally. There is often a mutually beneficial relationship between logging companies and political elites, involving the acquisition of large private wealth for both parties through bribery, corruption and transfer pricing, at the expense of public benefit through lost revenues and royalty payments and at the expense of social, environmental and indigenous communities' rights.
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Transnational logging companies, including Malaysian-based ones, often operate abroad through numerous private, locally-registered companies or as subcontractors to national concession holders. In this way, not only are each company's financial details difficult to track, but the actual links between operations (both nationally and internationally) are also obscured. On paper, for example, the licence holders may appear to be separate entities. These practices have enabled companies to dominate the forestry sector of a country, for instance Papua New Guinea, or to circumvent maximum concession holding limits, such as those in Cameroon.
