Bit of light reading for those intrested:
ASSESSMENT OF CORRUPTION RISKS IN THE AWARDING OF MINING RIGHTS IN THE DEMOCRATIC REPUBLIC OF THE CONGO
Congolese League Against Corruption (LICOCO) Kinshasa, 2017
5.1 Requesting mining titles via the mining cadastre.
This process concerns both the exploration licence and the operating licence.
Access to mineral exploration is free for any eligible person, whereas the granting of a Mining Permit is, by law, subject to only one condition: demonstration of minimum financial capacity.
The Exploration Permit is a real, fixed, exclusive, transferable and assignable right in accordance with the provisions of the present code.11
An application must be made to the Mining Cadastre for the renewal or partial or total transformation of the Exploration Permit.
The extension of the Exploration Permit to substances other than those for which it is awarded also requires an application to the Mining Cadastre.
Only holders of an Exploration Permit who can prove, following exploration works, the existence of an economically viable deposit and demonstrate a sufficient financial capacity to carry out the development, construction and operation of the mine can commence mining operations.
They must also present a plan for the rehabilitation of the site upon its closure.
The applicant for an Exploitation Permit submits at the same time as his application to the Mining Registry: (i) an Environmental Impact Study (EIE) and (ii) a Project Environmental Management Plan (PGEP).
Thus, in Figures 1, 2, 3 and 4 in the appendices, we have mapped the process of granting an Exploration Permit and an Operating Permit, both as it should happen in theory and as it does in reality. (see attached)
Using the legal process map and the map of actual practice in awarding exploration and operating permits by means of application to the
Mining Cadastre, we have identified the following vulnerabilities (Fig. 5 and 6):
5.1.1 Vulnerabilities in the awarding of Exploration and Operating Permits
The severe lack of means to motivate the staff and the functioning of the Mining Cadastre, the Directorate of Mines and the Directorate for the Protection of the Mining Environment.
In the absence of a salary level commensurate with the level of expertise and the scope of work incumbent on the agents and experts of the Mining Cadastre and the Mining Administration, their vulnerability to the temptation of corruption and exposure to undue favours to facilitate the awarding of mining rights are undeniable, resulting in non-transparent and discretionary treatment in the management of the access
phases of the mining sector.
The dependency of certain institutions, created by the Mining Code for its administration, on advances of funds from applicants to resolve their cases or on being paid by applicants to travel to site inspections.
During the validation workshop held in Kinshasa on 14 June 2017, an expert from the Directorate for the Protection of the Mining Environment explained that the Permanent Inter-ministerial Committee which assesses Environmental Plans for Exploration and Operating Permits can only hold its meetings to evaluate these plans if the applicant pays for them, due to the lack of resources available to government institutions. The site visits of the experts of these organisations must be supported by the title holders of the areas to be inspected.
The limits of declaratory systems with a posteriori verification for structures with almost no operating resources.
The declarative system under which the DRC’s mining sector operates requires the mining administration to have adequate means to ensure the verificationof declarations made by mining operators. In the absence of these means, verification becomes aservice sold by administrative officials without any objective basis.
There is an inability of the state services to carry out their tasks, in whole or in part. This inability is attributed to a lack of capacity (staff, training andlogistical support) to monitor and evaluate the work done in the concessions covered by the operating permits (PWC).
The extent of the discretionary rights of the Minister of Mines in awarding, refusing to award, renewing and refusing to renew mining rights.
The Mining Code gives broad discretionary powers to the Minister of Mines to award mining titles. Discretionary powers are often quite broad and opaque, and this increases the risk of arbitrary decisions, especially if they are not accompanied by accountability mechanisms.
Manual processing of certain phases of cadastral review of applications for mining rights.
Close attention must be paid to basic cadastral information concerning the chronological sequence of applications in order to ensure that the first come,first served principle is respected. In practice, it isnoted that during the processing of applications for mining permits and titles, depending on the offers made by the mining companies to the agents, several manipulations can occur to distort the “first come, first served” principle. Mining Cadastre officials also receive instructions from their superiors on how to proceed with certain files.
In theory, Congolese state-owned companies are subject to the same rules as other mining companies. They have to comply with the 2002 Mining Code and, since their transformation, also with the applicable commercial and bankruptcy laws. In practice, however, Gécamines and the other state-owned companies have an ambivalent status in the mining sector throughout the value chain, sometimes taking over the role of the state, sometimes operating as ordinary mining companies. Because of this ambivalent status, they become a parallel system of governance that is difficult to control and hold to account.12 The 2002 Mining Code clearly sets out the procedures to be followed in the management of titles and permits. However, the state-owned companies that still hold most of the mining titles for commercially viable and profitable deposits sign many joint venture agreements under particularly opaque conditions, thus weakening the competition provisions of the Mining Code. (Revenue Watch Institute).
From section 2
4. What is the risk of political interference in the process of awarding and transferring mining rights?
The extent of the discretionary rights of the Minister of Mines in awarding, refusing to award, renewing and refusing to renew mining rights.
Evidence to support assessment of probability
1. The involvement of political authorities in the mining sector and their collusion with mining operators are regularly reported in the media.
Probability: Score 5/5
Source: Dialogue, 2016, n° 4,
http://www.congoforum.be/upldocs/ (Consulted 7 March 2017)
2. Appointments to leadership positions in the Mining Cadastre are made by the government, which appoints executives loyal to it. Regardless of qualifications, declared or undeclared political affiliation is a dominant factor in appointments to leadership positions at CAMI.
Source: Kuediasala, Faustin. 2007. “Congo-Kinshasa: Under the impetus of Copirep, experts examine the new organisation chart of the Mining Cadastre”. Journal Le Potentiel.
3. There are reports from international organisations that attest to the involvement of political authorities in the management of mining assets in the DRC.
Source: Final report of the group of experts on illegal extraction of natural resources and other forms of wealth in the Democratic Republic of the Congo (S/2002/1146).
4. Political interference is practised by executive political authorities in the process of awarding mining rights in order to protect their own interests or those of their relatives. It often involves pressure on CAMI officials to grant rights to beneficiaries of mining rights even if the required conditions are not met.
Source: Governance of the mining sector and development issues in the DRC, Doctoral thesis 2010.
Evidence to support assessment of impact
1. Governance of the mining sector in the DRC needs substantial improvement, particularly in the areas of state ownership of capital, information dissemination, transparency of revenue flows, conflicts of interest and traceability of mining products.
Impact: Score 5/5
Source: Good governance in the mining sector as a growth factor, World Bank, 2008.
2. Since 2010, a number of offshore companies associated with DAN GERTLER, an Israeli businessman and friend of Congolese President Joseph KABILA, have secretly bought shares in several mines from the State, at a cost far below commercial estimates of their value. The mines were sold without an open bidding process and limited details were only published long after the assets were sold.
Source: Mining contracts and corruption in the DRC: GLENCORE must explain itself, Global Witness 2012.
3. Extremely profitable contracts are being concluded in the Congo by secretive offshore companies and multinationals; these contracts bring in peanuts to the Congolese Government and we are deeply concerned that the Congolese people are being deprived of billions of dollars.
Source: Daniel BALINT-KURTI, Janvier 2014G, Global Witness.
4. In addition, rather than conforming to their legally defined power, inspectors of the mining cadastre are subject to influences from all sides. It thus appears that the mining cadastre does not exercise the full extent of its legally recognized powers to decide such disputes. The highest bidding investors end up triumphing and snatch up the mining titles already allocated. These tensions can be felt on the ground. Local populations are manipulated to the benefit of one or other investor who appears to embody their wishes
Source: Adolphe KILOMBA SUMAILI : Legal protection of foreign investors by the new DRC mining code: case of the city of KAMITUGA, 2015.
Description of Impact
Political interference in the awarding and renewal of mining rights and the transfer and sale of mining assets deprives the Congolese Government of the financial means it sorely needs to ensure the well-being of its population. A series of complex arrangements between the DRC’s political elite and multinationals in the change of ownership of mining rights benefits a small number of people at the expense of the rest of the population
5. What is the risk that applications submitted will be deliberately mishandled?
Manual processing of certain phases of cadastral review of applications for mining rights can lead to attitudes that contradict the principles governing the process of awarding mining rights.
Evidence to support assessment of probability
1. Through the adoption of computerised cadastral systems, mining countries have been able to strengthen their institutional capacity, reduce application processing times and reduce errors (such as overlap between adjacent permits), and thus improve the security of ownership of their holders. These improvements have had the added benefit of improving transparency, reducing corruption and eliminating discretionary aspects in the implementation of legal and regulatory regimes.
Probability: Score 3/5
Source: Promoting transparent access to mineral resources and Mining Cadastres, World Bank, 2015
2. Close attention must be paid to basic cadastral information concerning the chronological sequence of applications in order to ensure that the first come, first served principle is respected. The system should have different levels of permission for users to access data
Source: Promoting transparent access to mineral resources and Mining Cadastres, World Bank, 2015.
3. Computerised cadastral tools are management tools to support administrative management by facilitating accurate access to required cadastral information, facilitating the processing of applications, monitoring of deadlines and processes related to cadastral procedures.
Source: Promoting transparent access to mineral resources and Mining Cadastres, World Bank, 2015.
Evidence to support assessment of impact
1. In the absence of computerisation of all phases of the awarding of a mining right, the manual handling of files by Cadastral officials can lead to preferential treatment for an applicant who has filed their application file to the detriment of another who has filed theirs earlier.
Impact: Score 5/5
Source: Interview with an expert of the Chamber of Mines, private sector. Kinshasa, 18 April 2017.
2. The lack of transparency in the acquisition of mining permits and titles had led to the suspension of the attribution of research permits to allow the technical services to assess the compliance of current research permit holders with their obligations in order to sanction non-compliant holders.
Source: Speech of the Minister of Mines, Mining Conference, Goma 2014
3. With serious geodetic and cartographic limitations, the DRC Mining Cadastre has difficulty in accurately delineating permits on maps, which often leads to cadastral conflicts
Source: Promoting transparent access to mineral resources and Mining Cadastres, World Bank, 2015.
Description of Impact
The manual processing of certain phases of cadastral review of applications for mining rights can lead to bias in the first come, first served procedure or in the availability of the desired area
It goes on and on but I felt the above to be some of the relavant info atm.
