2013 Trafficking in Persons Report
Tier 2

Palau is a destination country for women subjected to sex trafficking and for women and men subjected to forced labor. Palau’s foreign population—the majority of which are from the Philippines, China, and the Republic of Korea—is estimated to comprise nearly one-fifth of the county’s population of 17,400. Filipino, Chinese, and Korean men and women pay thousands of dollars in recruitment fees and willingly migrate to Palau for jobs in domestic service, agriculture, restaurants, or construction; upon arrival, they are forced to work in conditions substantially different from what was presented in contracts or recruitment offers. Women from China and the Philippines migrate to Palau expecting to work as waitresses or clerks, but are subsequently forced into prostitution in karaoke bars and massage parlors; prime perpetrators of illegal recruitment are from the Philippines, who recruit for karaoke bars and massage parlors operated by Taiwanese nationals. Recent reports indicate that some Indonesian men who voluntarily migrate to Palau for work on fishing boats face fraudulent recruitment, altered working conditions, and withholding of salaries. Noncitizens are by law excluded from the benefits of the minimum wage law, and regulations make it extremely difficult for foreign workers to change employers once they arrive in Palau, increasing their vulnerability to involuntary servitude and debt bondage.

The Government of Palau does not fully comply with the minimum standards for the elimination of trafficking; however, it is making significant efforts to do so. During the year, the government prosecuted and convicted a Palauan senator for human trafficking, but relied on a labor law statute—a far lesser offense—that does not reflect the serious nature of the human trafficking offense allegedly committed. The government also initiated two investigations involving foreign women masseuses and a locally hired U.S. government employee. The government, however, still lacks an adequate understanding of trafficking and how its law can be applied to identify trafficking victims and investigate and prosecute trafficking offenders.

Recommendations for Palau: Establish formal procedures for front-line officers to identify and refer trafficking victims to protective services; continue efforts to proactively investigate, prosecute, and punish trafficking offenders; continue publicly to highlight the issue and to recognize and condemn incidences of trafficking; increase resources devoted to address anti-trafficking efforts; develop a national plan of action to combat human trafficking; continue to make vigorous efforts to combat corruption by officials involved in regulating the immigration and employment of foreign workers; monitor employment agents recruiting foreign men and women for work in Palau for compliance with existing labor laws to prevent their facilitation of trafficking; continue to develop and implement anti-trafficking information and education campaigns; and accede to the 2000 UN TIP Protocol.


The Government of Palau demonstrated modest anti-trafficking law enforcement efforts during the year. Palau’s Anti-Smuggling and Trafficking Act of 2005 prohibits all forms of trafficking in persons and prescribes sufficiently stringent penalties for these offenses, ranging from 10 to 50 years’ imprisonment and fines of up to $500,000; these are commensurate with penalties prescribed for other serious crimes, such as rape. Instead of using this more serious statute, prosecutors sometimes bring charges under the less serious labor violations. For example, in June 2012, the government convicted a Palauan senator, in a case that involved nine alleged trafficking victims, using a labor law violation of unlawful wage deductions and penalties, which led to an imposed sentence of only 90 days’ imprisonment—less than the punishment prescribed under the 2005 trafficking law. The government reported investigating two additional suspected trafficking cases involving foreign masseuses who were serving tourists, prominent politicians, and businessmen, and another involving a locally hired U.S. government employee.

The Attorney General’s office and members of the Department of Public Safety provided administrative support for a law enforcement training co-hosted by the Guam Attorney General’s office, which included a session on anti-trafficking. However, the government did not train officers to proactively identify and assist victims or to identify victims among vulnerable populations, such as foreign workers or foreign women in prostitution. The government did not report any new investigations or prosecutions of government employees for alleged complicity in trafficking-related offenses during the reporting year, though it did continue its efforts in the labor case against the senator that began in 2011.


The Government of Palau made modest efforts to identify and protect victims of trafficking during the reporting period. The government did not provide shelter or other services for trafficking victims, though it sustained partnerships with local churches to offer shelter, food, and housing to potential trafficking victims. The Department of Labor assisted six alleged trafficking victims in finding new employment. The government reported that while it did not have a policy of identifying and referring trafficking victims to legal services, the Attorney General’s Office has increased its efforts to encourage victims’ participation in investigations and prosecutions by holding counseling sessions to address victims’ trauma and by reducing their fear of reprisals from traffickers. The government facilitated the departure of victims from Palau, but also offered work permits to alleged victims of trafficking who remained in the country.


The Government of Palau sustained its previous efforts to prevent new incidents of human trafficking during the reporting period. The Department of Labor and the Attorney General’s office developed a brochure that informs foreign workers of their rights and provided them with a contact number to report any misconduct. The closure of the Philippines embassy in July 2012 stymied the adoption of a Philippine-Palau memorandum of understanding to address the use of illegal recruiters. The government has yet to develop a national action plan against trafficking in persons and has not designated sufficient resources for anti-trafficking purposes. The government signed an extradition agreement with Taiwan authorities in December 2012 to strengthen cooperation on crime prevention and judicial mutual assistance. The government made no discernible effort to address the demand for commercial sex acts or the demand for forced labor during the reporting period. Palau is not a party to the 2000 UN TIP Protocol.