roc draft report on initial data collection and stakeholder … · 2019. 12. 12. · 2 validation...

[email protected]+4722200800Fax+4722830802 AddressEITIInternationalSecretariat,Ruseløkkveien26,0251Oslo,Norway

ValidationoftheRepublicofCongo

Reportoninitialdatacollection

andstakeholderconsultation

EITIInternationalSecretariat 27September2017

2ValidationoftheRepublicoftheCongo:Reportoninitialdatacollectionandstakeholderconsultation


Abbreviations

AfDB AfricanDevelopmentBankAMD AfricaMiningDevelopmentAOGC AfricaOilandGasCorporationARAP AgencedeRégulationdel’AvalPétrolierBEAC BanquedesÉtatsd’AfriqueCentraleBO BeneficialownershipBpd BarrelsPerDayCIT CorporateIncomeTaxCNOOC ChinaNationalOffshoreOilCorporationCORAF CongolaisedeRaffinageCSOs CivilSocietyOrganisationsDGID DirectionGénéraledesImpôtsetdesDomainesDGDDI DirectionGénéraledesDouanesetdesDroitsIndirectsDGH DirectionGénéraledesHydrocarburesDGT DirectionGénéraleduTrésorDRN DirectiondesRessourcesNaturellesEITI ExtractiveIndustriesTransparencyInitiativeEU EuropeanUnionGDP GrossDomesticProductGFS GovernmentFinanceStatisticsGiZ DeutscheGesellschaftfürInternationaleZusammenarbeitIMF InternationalMonetaryFundMACC MinesAurifèresetCarrièresduCongoMDTF TheWorldBank'sMulti-DonorTrustFundMEFDD Ministèredel’EconomieForestièreetduDéveloppementDurableMFBPP MinistryofFinance,BudgetandPublicPortfolioMSG Multi-StakeholderGroupNGO Non-GovernmentalOrganisationPEP PoliticallyExposedPersonPSC Production-SharingContractPWYP PublishWhatYouPayROC RepublicofCongoSADEMI SociétéAfricainepourleDéveloppementMinierScf StandardcubicfeetSNPC SociétéNationaledesPétrolesduCongoSOCOMIP SociétécongolaisedesMinesetdesPotassesSOREMI SociétédeRecherchesetd’ExploitationMinièresSPM SociétédesPotassesetdesMinesSTPITIE SecrétariatTechniquePermanentdel’ITIETFP TechnicalandFinancialPartnersToR TermsofReferenceUNDP UnitedNationsDevelopmentProgrammeUSD UnitedStatesDollarVAT ValueAddedTax

3

ValidationoftheRepublicoftheCongo:Reportoninitialdatacollectionandstakeholderconsultation


Abbreviations.........................................................................................................................................2

ExecutiveSummary................................................................................................................................5

Introduction.........................................................................................................................................12

PartI–MSGOversight.........................................................................................................................171.OversightoftheEITIprocess.........................................................................................................17GovernmentengagementintheEITIprocess(#1.1)..........................................................................17IndustryengagementintheEITIprocess(#1.2).................................................................................20CivilsocietyengagementintheEITIprocess(#1.3)...........................................................................22MSGgovernanceandfunctioning(#1.4)...........................................................................................29Workplan(#1.5)................................................................................................................................33

PartII–EITIDisclosures........................................................................................................................382. Awardofcontractsandlicenses................................................................................................38Legalframework(#2.1).....................................................................................................................38Licenseallocations(#2.2)..................................................................................................................40Licenseregisters(#2.3).....................................................................................................................44Contractdisclosures(#2.4)................................................................................................................48Beneficialownershipdisclosure(#2.5)..............................................................................................49Stateparticipation(#2.6)..................................................................................................................513. Monitoringandproduction.......................................................................................................60Overviewoftheextractivesector,includingexplorationactivities(#3.1)..........................................60Productiondata(#3.2)......................................................................................................................61Exportdata(#3.3).............................................................................................................................624.Revenuecollection........................................................................................................................65Materiality(#4.1)..............................................................................................................................65In-kindrevenues(#4.2).....................................................................................................................70Barterandinfrastructuretransactions(#4.3)....................................................................................74Transportrevenues(#4.4).................................................................................................................76TransactionsbetweenSOEsandgovernment(#4.5)..........................................................................77Subnationaldirectpayments(#4.6)..................................................................................................79Levelofdisaggregation(#4.7)...........................................................................................................80Datatimeliness(#4.8).......................................................................................................................80Dataquality(#4.9)............................................................................................................................814. Revenuemanagementanddistribution....................................................................................94Distributionofrevenues(#5.1).........................................................................................................94Sub-nationaltransfers(#5.2)............................................................................................................96Additionalinformationonrevenuemanagementandexpenditures(#5.3).......................................985. Socialandeconomicspending.................................................................................................101Socialexpenditures(#6.1)...............................................................................................................101SOEquasifiscalexpenditures(#6.2)................................................................................................103Contributionoftheextractivesectortotheeconomy(#6.3)...........................................................105

PartIII–OutcomesandImpact..........................................................................................................1106. OutcomesandImpact.............................................................................................................110Publicdebate(#7.1)........................................................................................................................110



DataAccessibility(#7.2)..................................................................................................................111LessonsLearnedandfollow-uponrecommendations(#7.3)...........................................................111Outcomesandimpactofimplementation(#7.4).............................................................................1137. Impactanalysis.......................................................................................................................117

Annexes.............................................................................................................................................119

Indexoffiguresandtables

Figure1–initialassessmentcard.................................................................................................................10Table1–Summaryinitialassessmenttable:MSGoversight.......................................................................36Table2-Summaryinitialassessmenttable:Awardofcontractsandlicenses.............................................57Table3-Summaryinitialassessmenttable:Monitoringandproduction....................................................64Table4-Summaryinitialassessmenttable:Revenuecollection..................................................................90Table5-Summaryinitialassessmenttable:Revenuemanagementanddistribution................................99Table6-Summaryinitialassessmenttable:Socialandeconomicspending..............................................108Table7-Summaryinitialassessmenttable:Outcomesandimpact..........................................................115

5

ValidationoftheRepublicoftheCongo:ReportoninitialdatacollectionandstakeholderconsultationExecutiveSummary


ExecutiveSummary

ThegovernmentoftheRepublicofCongo(ROC)committedtoimplementtheEITIon9June2004inanofficialcommuniqué(RépubliqueduCongo,2004).ThegovernmentconductedbroadconsultationswithallstakeholdersinSeptember2005andissuedDecree2006-626ofOctober2006establishingtheMSG.ThefirstworkplanwasagreedbytheMSGinDecember2007andCongobecameaCandidatecountryimplementingtheEITIinFebruary2008(EITIBoard,2008).

On25October2016,theBoardagreedthattheROC’sValidationunderthe2016EITIStandardwouldcommenceon1April2017(EITIBoard,2016).ThisreportpresentsthefindingsandinitialassessmentoftheInternationalSecretariat’sdatagatheringandstakeholderconsultations.TheInternationalSecretariathasfollowedtheValidationProcedures1andappliedtheValidationGuide2inassessingtheROC’sprogresswiththeEITIStandard.WhiletheassessmenthasnotyetbeenreviewedbytheMSGorbeenqualityassured,theSecretariat’spreliminaryassessmentisthatCongohasmadesatisfactoryprogresson12EITIRequirements,and15requirementsoftheEITIStandardhavenotbeenfullyaddressedintheROC.Tenoftheseareunmetwithmeaningfulprogress,while,fourareunmetwithinadequateprogressandonerequirementisassessedasunmetwithnoprogress.Oneunmetrequirement(1.3)isalsoa“safeguardrequirement”asperEITIRequirement8.3c.Therecommendationsandsuggestedcorrectiveactionsidentifiedthroughthisprocessrelateinparticulartothecomprehensivenessofreportingbybothgovernmentandindustryaswellasstate-ownedenterprises,includingquasi-fiscalexpenditures,financialrelationswithgovernmentandlevelofstateownershipanddataqualityandassurance.

Overallconclusions

TheROCpresentsahighlyrelevantcaseforEITIimplementation.Thecountryishighlyreliantoncrudeoil,accountingforroughly70%ofgovernmentrevenues,55%ofGDPand80%ofexportsin2014.

AkeystrengthoftheROC’sEITIimplementationhasbeenitspioneeringdisclosuresrelatedtosalesofthestate’sin-kindoilrevenues.BeyondtheEITIreporting,quarterlyreconciliationsofsalesofthestate’sin-kindrevenuesbythenationaloilcompany,SNPC,andremittancestothenationalTreasurybyanindependentauditfirm,KPMG,representedimportantwork.TheMinistryofFinanceandtheEITINationalSecretariatpublishedthesereportsontheirwebsitesinaccordancewithEITIRequirementsonoilsalesbySOEs.However,asstakeholdersbegantousecargo-levelsalesdataintheirresearchandadvocacy,particularlyin2015withthepublicationofaSwissNGO’sreportonallegedirregularitiesinthemanagementofSNPC’sdomesticmarketallocationstothestate-ownedrefinery,thegovernmentappearstohavediscontinuedsomeofthesedisclosures(BerneDeclaration,2015).Allquarterlyoilsalesreport,previouslyavailablefor2012and2013,weretakendownfromtheMinistryofFinanceandEITICongo

1https://beta.eiti.org/document/validation-procedures2https://beta.eiti.org/document/validation-guide



websites.

WhilethegovernmentlastrenewedtheMSG’slegalmandatethroughdecreein2012,theexpiryofmembers’termlimitsattheendof2015meansthattheEITI’soversightbodylackedaclearlegalmandateastheROC’sValidationcommencedon1April2017.WeakrepresentationandcoordinationlinksbetweenMSGmembersandtheirrespectiveconstituenciesmakenewnominationsforMSGmembers,throughanopenandtransparentprocesses,evermoreurgent.ArenewedmembershipoftheMSG,empoweredbyMinisterialDecree,isneededtostrengthenthebody’soversightofformulationandimplementationoftheEITIworkplan,EITIreportingandthenationalsecretariat.

TheEITIStandard’srequirementsarealmostallkeenlypertinenttotheROC’schallengesandongoingreforms.Requirementsrelatedtolicensemanagementarerelevantinlightofthecountry’shistoryofopaquelicenseallocationsandtransfers.Provisionsrelatedtoclarifyingthefinancialrelationsbetweenthegovernmentandstate-ownedenterprisesoperatingintheoilandgassector,includingquasi-fiscalexpenditures,areimportanttoaddressingpublicdemandsforinformationaboutSNPCanditssubsidiaries.Therequirementsrelatedtobarterandinfrastructureprovisionmayberelevanttooil-backedinfrastructureprojectslikethoseundertheframeworkagreementwiththePeople’sRepublicofChina.TheROCcouldalsobeusingtheEITItoclarifyregulatoryambiguities,suchasthenon-operationalsubnationaltransfersofoilandgasroyalties.

WhiletheROCisintheprocessofimplementingreformsrangingfrommodernisingitscadastralmanagementsystemtostrengtheningitsrevenuemanagementsystemandre-enforcingoversightofstate-ownedenterprisesthroughtheMinistryofFinance’srecently-establishedDepartmentofPublicPortfolio,itdoesnotappeartohaveusedtheEITItoitsfullpotential.Thecountry’sdecadeofEITIreportinghashighlightedchallengesinthemanagementoftheextractiveindustries,buthasnotactedasaneffectivediagnostictooltosupportreforms.

WhiletodatetheMSGhasundertakenneitherstrategicdiscussionslinkingtheEITItonationalprioritiesfortheextractivesectornoroverseenthetechnicaldetailofreporting,EITICongohasanopportunitytochanneloneofthekeyareasofpublicdebate,overthemanagementofoilandgasrevenues,whileensuringthereliabilityofpublicly-availabledataonitsoilandgasindustry.TheROCalsohasachancetoleadindevelopinginternationalbestpracticeinthereportingofstate-ownedoilsalesbyparticipatingintheEITI’stargetedeffortattransparencyincommoditytrading,partlymodelledontheROC’sownoilsalesreportingupto2013.

Recommendations

WhilethefollowingreportincludesrecommendationsforspecificimprovementstheMSGmaywishtoconsiderimplementing,thefollowingisalistofstrategicrecommendationsthatcouldhelptheRepublicofCongomakeevengreateruseoftheEITIasaninstrumenttosupportreforms.

• InaccordancewithRequirement1.3,theGovernmentofCongoshouldensurethatthereisanenablingenvironmentforcivilsocietyparticipation,andensurethattherightsofcivilsocietysubstantivelyengagedintheEITI,includingbutnotrestrictedtomembersofthemulti-stakeholdergroup,arerespected.



• InaccordancewithEITIRequirement1.4,thegovernmentshouldrenewthemembershipoftheMSGinlinewithstatutorydocuments.EITICongoshouldreviewformaliseandpublishitsperdiempolicyandsetareasonableamountinlinewithnationalpractices.TheMSGshouldensureitsTORareinaccordancewithRequirement1.4,publiclyaccessible,andimplementedinpractice.

• Tostrengthenimplementation,EITICongomaywishtoensurethatthefiscalframework,therolesandresponsibilitiesofkeygovernmententitiesandcurrentorrecentreformsinthemining,oilandgassectorsareclearlydescribedinfutureEITIreporting.EITICongomaywishtoconsiderwhethertheEITICongowebsitecouldprovideaplatformforupdatedinformationonthelegalenvironmentandfiscalframework.

• InaccordancewithEITIRequirement2.2,EITICongoshouldclearlydefinethenumberofmining,oilandgaslicensesawardedandtransferredintheyear(s)underreview,describethestatutoryallocationandawardprocedures,includingspecifictechnicalandfinancialcriteria,andhighlightanynon-trivialdeviationsinpractice.Inaddition,EITICongomaywishtocommentontheefficiencyofthecurrentlicenseallocationandtransfersystemasameansofclarifyingproceduresandcurbingnon-trivialdeviations.

• EITICongoisrequiredtomaintainapubliclyavailableregisterorcadastresystem(s)withtimelyandcomprehensiveinformationinaccordancewithEITIRequirement2.3.EITICongoshouldensurethatfutureEITIReportsprovidethedatesofapplicationandexpiry,commodity(ies)coveredandcoordinatesforallmining,oilandgaslicensesheldbymaterialcompanies.

• Tofurtherstrengthenimplementationandprepareforfulldisclosureofbeneficialownershipby2020,itisrecommendedthatEITICongoconsiderspilotingbeneficialownershipreportingintheforthcomingEITIReportinordertoincreaseawarenessofbeneficialownershiptransparencyandpilotbeneficialownershipdefinitionsandthresholds.EITIReportsmustdocumentthegovernment’spolicyandmulti-stakeholdergroup’sdiscussionondisclosureofbeneficialownership.EITICongomayalsowishtoconductbroaderoutreachtothecompaniesontheobjectivesofbeneficialownershiptransparency,aswellasholdconversationswithgovernmentagenciesonhowtomakesuchdisclosuresmandatory.

• InaccordancewithEITIRequirement2.6,EITICongoshouldensurethatfutureEITIReportsclarifytherulesandpracticesgoverningfinancialrelationsbetweenextractivesSOEsandthegovernment,thelevelofandtermsassociatedwithstateequityparticipationinthesectoraswellasacomprehensiveoverviewofloansandguaranteesextendedbythestateorSOEstoextractivescompaniesintheyearunderreview.EITICongomaywishtoconsidertheextenttowhichimplementationofArticle15oftheMarch2017TransparencyLawwouldsupportprogressinmeetingaspectsofRequirement2.6.

• Tostrengthenimplementation,EITICongomaywishtoensurethatthedescriptionoftheextractiveindustriesinfutureEITIReportsincludesaclearoverviewofsignificantexplorationactivitiesintheyearunderreview.

• InaccordancewithEITIRequirement3.2,EITICongoshouldensurethatfutureEITIReportsprovideproductionvolumesandvaluesforallmineralsproducedintheROCintheyear(s)underreview.EITICongomayalsowishtoconsidertheextenttowhichsuchinformationcouldberegularlydisclosedongovernmentwebsitesasameansofcomplyingwithprovisionsrequiringpublicationofmoregranularproductiondatainArticle66oftheMarch2017TransparencyLaw.

• Tostrengthenimplementation,EITICongomaywishtoensurethatfutureEITIReportsprovideexportvolumesandvaluesforallcommoditiesexportedintheyear(s)underreview,includingartisanal-minedcommoditieslikegold.



• Tostrengthenimplementation,EITICongomaywishtoensurethatthematerialitythresholdforselectingcompaniesinfutureEITIReportsensuresthatallpaymentsthatcouldaffectthecomprehensivenessofEITIreportingbeincludedinthescopeofreconciliation.TheMSGisinvitedtoconsiderwhethersettingaquantitativematerialitythresholdforselectingcompanieswouldensuretheseaimsaremet.

• InaccordancewithEITIRequirement4.2,EITICongoshouldensurethatfutureEITIReportspresentinformationonthesaleofthestate’sin-kindrevenuesdisaggregatedbybuyer.ThegovernmentisencouragedtoreinstatethepracticeofpublishingtheMinistryofFinance’squarterlyoilsalesreportstoensuretimeliercompliancewithArticle16oftheMarch2017TransparencyLawandwithRequirement4.2oftheEITIStandard.

• InaccordancewithEITIRequirement4.3,EITICongoshouldassesstheexistenceofanybarterarrangementsorinfrastructureprovisionsduringthescopingphaseforitsnextEITIReporttoensurethatreportingoftheimplementationofsuchagreementsprovidesalevelofdetailandtransparencycommensuratewiththedisclosureandreconciliationofotherpaymentsandrevenuesstreams.TheMSG,togetherwiththeIA,shouldgainafullunderstandingofthetermsoftherelevantagreementsandcontracts,thepartiesinvolved,theresourceswhichhavebeenpledgedbythestate,thevalueofthebalancingbenefitstream(e.g.infrastructureworks),andthematerialityoftheseagreementsrelativetoconventionalcontracts.

• Tostrengthenimplementation,EITICongomaywishtoundertakeoutreachtoSOCOTRAMwithaviewtoengagingitinEITIimplementation.GiventhesignificantpublicdebatesurroundingtheMaritimeTax,theMSGcouldconsiderincludingSOCOTRAMinthescopeofreporting,furtheraddingtotheEITI’simpactonpublicdebate.

• InaccordancewithEITIRequirement4.5,EITICongoshouldundertakeacomprehensiveassessmentoftransactionsbetweenSOEs(SNPCanditssubsidiaries)andoilandgascompanies,aswellasbetweenSNPC’ssubsidiariesandgovernmentinitsscopingoffutureEITIReports.AllSOEscollectingmaterialrevenuesormakingmaterialpaymentstogovernmentshouldbeincludedinfutureEITIreporting.

• Tofurtherstrengthenimplementation,theMSGmaywishtoconsidertheextenttowhichimplementationoftheMarch2017TransparencyLawwouldenableittomakeprogressinimplementingproject-levelEITIreportingaheadofthedeadlineforallEITIReportscoveringfiscalperiodsendingonorafter31December2018,agreedbytheEITIBoardatits36thmeetinginBogotá.

• Tostrengthenimplementation,EITICongomaywishtoconsidertheextenttowhichitcanleverageimplementationofArticle63oftheMarch2017TransparencyLawtoensuretimelierdisclosureofdatarequiredundertheEITIStandardthroughroutinegovernmentandcompanysystems.

• InaccordancewithEITIRequirement4.9,EITICongoshouldensurethatsummarydatatablesforallEITIReportsarepreparedinatimelymannerinlinewithrequirementsoftheBoard-approvedIA’sToR.TheMSGandtheIAareencouragedtoprovideamoredetailedaccountofauditandassurancepracticesofmaterialcompaniesandgovernmententities,includingSOEswithaviewtoformulatingrecommendationsthatstrengthengovernmentandcompanyauditandassurancesystems.Theymayalsowishtorevisitthequalityassurancerequestedfromgovernmententitiesincludedinthescopeofreporting.



• InaccordancewithEITIRequirement5.1,EITICongoshouldworkwiththeIAinpreparingthenextEITIReporttoclearlytraceanymining,oilandgasrevenuesthatarenotrecordedinthenationalbudgetandprovideanexplanationofthedetailedallocationoftheseoff-budgetrevenues.

• Tostrengthenimplementation,EITICongoisencouragedtoassessthematerialityofsubnationaltransfers,providethespecificformulaforcalculatingsubnationaltransfersofextractivesrevenuestoindividuallocalgovernments,discloseanymaterialsubnationaltransfersintheyear(s)underreviewandhighlightanydiscrepanciesbetweenthetransferamountcalculatedinaccordancewiththerelevantrevenue-sharingformulaandtheactualamountthatwastransferredbetweenthecentralgovernmentandeachrelevantsubnationalentity.

• Tostrengthenimplementation,EITICongocouldconsiderincludingadditionalinformationonextractivesrevenuesearmarkedforspecificpurposesaswellasonthebudget-makingandauditingprocessforgovernmentaccountsinfutureEITIReports.

• InaccordancewithEITIRequirement6.1,EITICongoshouldsystematicallycategorisetypesofmandatorysocialexpendituresmandatedbylaworcontractandensurethatreportingofmandatorysocialexpendituresinfutureEITIReportsbedisaggregatedbetweencashandin-kindexpenditures,bytypeofpaymentandbeneficiary,clarifyingthenameandfunctionofanynon-government(third-party)beneficiariesofmandatorysocialexpenditures.TheMSGmayalsowishtoconsiderthefeasibilityofreconcilingmandatorysocialexpenditures.

• InaccordancewithEITIRequirement6.2,EITICongoshouldundertakeacomprehensivereviewofallexpendituresundertakenbyextractivesSOEs(andtheirsubsidiaries)thatcouldbeconsideredquasi-fiscal.TheMSGshoulddevelopareportingprocesswithaviewtoachievingaleveloftransparencycommensuratewithotherpaymentsandrevenuestreams,andshouldincludeSOEsubsidiariesandjointventures.

• InaccordancewithEITIRequirement6.3,EITICongoshouldensurefutureEITIReportincludeemploymentfiguresforthemining,oilandgassectors.TheMSGmayalsowishtoworkwiththeMinistryofFinance,thenationalstatisticsagency(CNSEE),customsandtheMinistryofLabourandSocialSecuritytoensurethatreportingofkeyinformationrequiredbytheEITIStandardontheextractiveindustries’shareofGDP,revenuesandexportsisembeddedinroutinegovernmentdisclosures.

• ToimproveaccessibilityofEITIdisclosure,andinaccordancewithEITIRequirement7.1,EITICongoshouldresumeitsdisseminationactivitiesofallEITIdisclosures,includingtheEITIReports,theKPMGReportsandotherusefulmaterialsthatcancontributetoapublicdebateontheEITICongowebsite.

• Tostrengthenimplementation,theMSGmaywishtoconsidercommissioninganindependentimpactevaluationstudytobetterdocumenttheextenttowhichEITICongohascontributedinchangingbehaviourandimprovingthemanagementoftheextractivesectorforthebenefitofallcitizens.



Figure1–initialassessmentcard

EITIRequirements LEVELOFPROGRESS

Noprog

ress

Ina

dequ

ate

Meaning

ful

Satisfactory

Beyon

d

Categories Requirements

MSGoversight

Governmentengagement(#1.1) Industryengagement(#1.2) Civilsocietyengagement(#1.3) MSGgovernance(#1.4) Workplan(#1.5)

Licensesandcontracts

Legalframework(#2.1) Licenseallocations(#2.2) Licenseregister(#2.3) Policyoncontractdisclosure(#2.4) Beneficialownership(#2.5) Stateparticipation(#2.6)

Monitoringproduction

Explorationdata(#3.1) Productiondata(#3.2) Exportdata(#3.3)

Revenuecollection

Comprehensiveness(#4.1) In-kindrevenues(#4.2) Barteragreements(#4.3) Transportationrevenues(#4.4) SOEtransactions(#4.5) Directsubnationalpayments(#4.6) Disaggregation(#4.7) Datatimeliness(#4.8) Dataquality(#4.9)

RevenueallocationDistributionofrevenues(#5.1) Subnationaltransfers(#5.2) Revenuemanagementandexpenditures(#5.3)

Socio-economiccontribution

Mandatorysocialexpenditures(#6.1.) SOEquasi-fiscalexpenditures(#6.2) Economiccontribution(#6.3)

Outcomesandimpact

Publicdebate(#7.1) Dataaccessibility(#7.2) Followuponrecommendations(#7.3) Outcomesandimpactofimplementation(#7.4)

Legendtotheassessmentcard



Noprogress.Thecountryhasmadenoprogressinaddressingtherequirement.Thebroaderobjectiveoftherequirementisinnowayfulfilled.

Inadequateprogress.Thecountryhasmadeinadequateprogressinmeetingtherequirement.Significantelementsoftherequirementareoutstandingandthebroaderobjectiveoftherequirementisfarfrombeingfulfilled.

Meaningfulprogress.Thecountryhasmadeprogressinmeetingtherequirement.Significantelementsoftherequirementarebeingimplementedandthebroaderobjectiveoftherequirementisbeingfulfilled.

Satisfactoryprogress.ThecountryiscompliantwiththeEITIrequirement.

Beyond.Thecountryhasgonebeyondtherequirement.

Thisrequirementisonlyencouragedorrecommendedandshouldnotbetakenintoaccountinassessingcompliance.

TheMSGhasdemonstratedthatthisrequirementisnotapplicableinthecountry.

12



Introduction

Briefrecapofthesign-upphase

TheRepublicofCongo(ROC)wasanearlyadopteroftheEITI.On9June2004,theGovernmentofCongoformallyannounceditscommitmenttoEITIimplementationanofficialcommuniqué(RépubliqueduCongo,2004).AnofficialletterfromtheMinisterofEconomy,FinanceandBudgettotheManagingDirectoroftheIMFon10June2004confirmedthiscommitment.However,progresswasslowatthisearlystageofEITIimplementation(CAC75,2012),mostlyduetothedifficultrelationshipbetweenthegovernmentandcivilsocietygroups.ThegovernmentconductedbroadconsultationswithallstakeholdersinSeptember2005andissuedDecree2006-626ofOctober2006establishingtheMSG.ThefirstworkplanwasagreedbytheMSGinDecember2007andCongobecameacandidatecountryimplementingtheEITIinFebruary2008(EITIBoard,2008).

Objectivesforimplementationandoverallprogressinimplementingtheworkplan

The2017EITIworkplansincludesobjectivesinlinewithnationalprioritiesandadetailedlistofactivitiesforeachobjective.Foreachactivity,theworkplanincludesexpectedresults,indicatorsofprogress,capacityconstraints,risksandthetimeframeforimplementation.Annualprogressreportsshowthelevelofprogresswiththeimplementationofactivitiessetoutinthepreviousworkplans.Forexample,only44%oftheplannedactivitieswerecompletedontimein2015.The2017workplanincludesthefollowingobjectives:

• ConsolidatethefunctioningoftheEITIImplementingbodies(ExecutiveCommitteeandPermanentTechnicalSecretariat),includingrevisitinganddevelopingworkingdocumentsandprocedures;

• Improvestakeholders’knowledgeintheextractiveindustriesprocess,theaccountingandtaxpracticesoftheextractiveindustriesattheinternationallevel;

• Contributetothedevelopmentofabetterinstitutionalframeworkandtheestablishmentofabetterdatamanagementsystemfortheextractivesector;

• StrengthenthequalityofthedatapublishedintheEITIreportsandabetterexternalperceptionoftheimageoftheEITIprocessintheCongo;

• EncourageabroadinvolvementofthepopulationsintheimplementationoftheEITIandagoodknowledgeofitsissuesthroughcommunicationandawareness-raisingactivities;

• OrganizeadvocacyactionstomobilizefinancialresourcesforEITIimplementation.

HistoryofEITIReporting

TheROChaspublishedEITIReportscovering11fiscalperiodsfrom2004to2014.ThescopeandqualityofEITIreportinghasimprovedgraduallyovertime.Thenumberofreportingcompanieshaveincreasedfrom4to25andthelatestreportincludesunilateraldisclosurefromthegovernmententitiesonrevenuescollectedfromtheforestrysector.Ghelber&Gourdon,alawfirmbasedinParis,preparedtheROC’sfirst

13ValidationoftheRepublicofCongo:Reportoninitialdatacollectionandstakeholderconsultation


twoEITIReportscovering2004-2006and2007-2009.3MooreStephenspreparedEITIReportscovering2010and2011andFairLinksproducedthelastthreereportscovering2012to2014.InadditiontotheEITIReports,KPMGpreparesquarterlyreportsonthesaleofcrudeoilbythenationaloilcompanySNPC,aspartofanagreementwiththeIMF,since2004.ThesereportsbecamepartofEITIreportingandwerebrieflymadepublicfollowingtheadoptionthe2013EITIStandard,butarenolongeraccessibletothepublic.

Summaryofengagementbygovernment,civilsocietyandindustry

TheMSGincludesrepresentativesfromeachconstituency,buttheprocessbywhicheachconstituencynominatedtheirrepresentativesremainsunclear.TheMSGisstatutorilyledbytheMinisterofEconomy,FinanceandBudgetCalixteGanongo,withtwovicepresidentsfromindustryandcivilsociety.ThroughregularparticipationinMSGmeetings,fundingforEITIimplementationandreportingbygovernmentagencies,theGovernmentofROChasdemonstratedthatitisfully,activelyandeffectivelyengagedintheEITIprocess.Companiesaresimilarlyengagedataseniorlevel.SeniorindustryrepresentativesfromChevron,ENI,TotalandPerencotravelregularlyfromPointeNoiretoBrazzavilletoattendMSGmeetings.Despitethedifficultenvironment,civilsocietyareparticularlyengagedintheEITIprocessandplayaleadingroleintheconceptionandimplementationoftheEITIprocess.RepresentativesfromthecivilsocietyconstituencyattendMSGmeetingsregularly,conductanalysisofEITIReports,producecommunicationmaterialsandorganisepubliceventstoinformcitizensonissuesrelatedtothegovernanceoftheextractiveindustries.

Keyfeaturesoftheextractiveindustry

TheROCholdssub-SaharanAfrica’sfifth-largestprovenoilreserves,at1.6bnbarrelsofcrudeoil(BP,2016).Thecountryalsoholdsabundantreservesofbetween1.7tnand2.6tncubicmetresofnaturalgas,over2bnmetrictonsofironoreand,endowedwithforestscoveringthreefifthsofitsterritory,aforestrysectorthataccountsfor10%ofnon-oilGDPandXAF100bnayearinexports(AfricanDevelopmentBank,2016).TheROCalsoholdsdepositsofcoal,potash,uranium,magnesium,manganese,diamonds,silver,platinum,zinc,limestoneandkaolin(USGeologicalSurvey,2015).

TheROC’seconomyremainsdependentoncrudeoil,whichaccountedfor55%ofGDP,80%ofexportsand22%ofgovernmentrevenuesin2016(LazardAssetManagement,2017).Thecountryhasrankedassub-SaharanAfrica’sfourth-largestoilproducerinthepastdecade.Thecountry’soilproductiontrendedupwardsfrom247kbpdin2005to314kbpdin2010,beforedippingto277kbpdin2015beforereboundingto308kbpdin2016(BP,2016)(EIA,2017).Asaresultofdeclininginternationaloilpriceshowever,theROCwentfromrunningaconsistentfiscalsurplusaveraging14%ofGDPin2005-2015toafiscaldeficitof12.6%ofGDPin2016(Reuters,2013)(LazardAssetManagement,2017).

Thestructureoftheoilandgasindustryhasevolvedsincethefirstcommercialdevelopmentsinthe1970s.MostoftheROC’soilandgasarenowproducedfromoffshorefields,whilemostofitsnaturalgasisflaredduetolackofgasaggregatinginfrastructure(USGeologicalSurvey,2015).Thestartofproduction

3https://eiti.org/republic-of-congo#eiti-reports-and-other-key-documents



atthedeep-waterMohoBilondooilfieldin2008markedtheshiftintheROC’soilproductionprofiletowardsthedeep-wateroffshore,generatinga24%year-on-yearriseinnationaloilproductionin2009(BanqueMondiale,2012).France’sTotalandItaly’sENIarethetwolargestinternationaloilcompaniesoperatingintheROC,accountingforthreequartersoftotaloilproduction(EIA,2017).TheROCexportscrudeoilmainlytotheUnitedStates,EuropeandChina(LazardAssetManagement,2017).WhileENIhasdevelopedtwogas-firedpowerplants,some85%oftheROC’snaturalgasproductionisre-injectedintooil-producingwells,ventedorflared(EIA,2017).

Whileoilproductionhastrendeddownwardsinceits2010peak,analystsincludingtheIMFforecastoilproductiontorisesignificantly,toabove300kbpd,withtheopeningofseveralnewprojectsfrom2017onwards.Total’sMohoNorthprojectandENI’sNeneMarine2projectstartedproducingin2016,whileENI’sLitchendjiliprojectaimstodevelopfurthernaturalgassuppliesfortheCôte-Matèvegas-firedpowerplant(LazardAssetManagement,2017)(ArgusDirect,2016).Chevron’sLianziproject,aunitisedfieldbetweenAngolaandtheROC,alsostartedproducinginlate2015(Chevron,2015).TheAfDBhasquotedestimatesthatROC’scurrentprovenoilreservesaresufficienttoensureproductionfor40yearsatcurrentlevels(AfricanDevelopmentBank,2016).

Thegovernment’sStrategicDocumentforPovertyReductionaimstodiversifytheeconomy,focusingamongstothersontheminingandforestrysectors(BanqueMondiale,2012),leveragingoilrevenuesforinvestmentinenergyandtransportinfrastructure.MajorinfrastructureplansincludeupgradestotheexistingrailandroadcorridorbetweenPointeNoireandBrazzaville,specialeconomiczonesanddomesticprocessingcentresforthecountry’snaturalresources(AfricanDevelopmentBank,2016).WhiletheROChasdrawninpartonthepastdecade’sfiscalreservestofundambitiousinfrastructureprojects,ChinahasalsoemergedastheROC’ssingle-largestexternalcreditor,accountingforUSD2.6bnoftheROC’sestimatedUSD5bninexternaldebt(LazardAssetManagement,2017)(AllAfrica,2016).YetstructuralchangeshavebeenlimitedinthepasttwodecadesaccordingtotheAfDB,whichnotesthatwhiletheoilandgassectorhasgeneratedspill-overeffectsinmetalindustries,drilling,seismicexplorationandotherservices,ithashadamorelimitedimpactonothersectorslikeagriculture(AfricanDevelopmentBank,2016).

Mininghasemergedasakeyfocusforthegovernment’seconomicdiversificationefforts.TheROCwasreinstatedtotheKimberlyProcessin2007,afterasuspensionin2004,withsignificantdiamondexportsresumingsincethen(Goldman,2014).Thegovernmentexpectstoattractinvestmenttodevelopthecountry’ssizablereservesofpotashinMengo,polymetalsinBoko-SonghoandironoreinNabeba,Zanaga,AvimaandMayoko(BanqueMondiale,2012).Twoprojectshavealreadybeenapprovedbygovernmentandratifiedbyparliament.Thefirst,anironoreproject,wasawardedtoSouthAfrica’sDMC-Exxaroandisexpectedtostartproducing7mmetrictonsayearfrom2017.ThesecondprojectwasawardedtoAustralia’sSundanceResourcesfortheNabebairon-oremineandincludedassociatedrailandportinfrastructureupgrades.However,duetolowerinternationalironorepricesandchallengesinraisingfinancing,theproject,originallyexpectedtoproduce35mmetrictonsannuallyfrom2015,hassincebeendelayed.ResponsibilityforconstructionoftherailandportinfrastructurehasbeentransferredtotheGovernmentofCameroonandtalkshaveopenedwithChinaEximBankforpossiblefunding(LazardAssetManagement,2017)(TheSydneyMorningHerald,2015).TheROCranks177of190intheWorldBank’s2016EaseofDoingBusinessIndex(WorldBank,2017).



ExplanationoftheValidationprocess

ValidationisanessentialfeatureoftheEITIimplementationprocess.ItisintendedtoprovideallstakeholderswithanimpartialassessmentofwhetherEITIimplementationinacountryisconsistentwiththeprovisionsoftheEITIStandard.ItalsoaddressestheimpactoftheEITI,theimplementationofactivitiesencouragedbytheEITIStandard,lessonslearntinEITIimplementation,aswellasanyconcernsstakeholdershaveexpressedandrecommendationsforfutureimplementationoftheEITI.TheValidationprocessisoutlinedinchapter4oftheEITIStandard4.Ithasfourphases:

1. PreparationforValidationbythemulti-stakeholdergroup(MSG)2. InitialdatacollectionandstakeholderconsultationundertakenbytheEITIInternational

Secretariat.3. IndependentqualityassurancebyanindependentValidatorwhoreportsdirectlytheEITIBoard4. Boardreview.

TheValidationGuideprovidesdetailedguidanceonassessingEITIRequirements,andmoredetailedValidationprocedures,includingastandardisedprocedurefordatacollectionandstakeholderconsultationbytheEITIInternationalSecretariatandstandardisedtermsofreferencefortheValidator.

TheValidationGuideincludesaprovisionthat:“WheretheMSGwishesthatvalidationpaysparticularattentiontoassessingcertainobjectivesoractivitiesinaccordancewiththeMSGworkplan,theseshouldbeoutlinedupontherequestoftheMSG”.TheEITICongoMSGdidnotrequestanyissuesforparticularconsideration.

InaccordancewiththeValidationprocedures,theInternationalSecretariat’sworkontheinitialdatacollectionandstakeholderconsultationwasconductedinthreephases:

1.DeskReview

Priortovisitingthecountry,theSecretariatconductedadetaileddeskreviewoftheavailabledocumentationrelatingtothecountry’scompliancewiththeEITIStandard,includingbutnotlimitedto:

• TheEITIworkplanandotherplanningdocumentssuchasbudgetsandcommunicationplans;• Themulti-stakeholdergroup’sTermsofReference,andminutesfrommulti-stakeholdergroup

meetings;• EITIReports,andsupplementaryinformationsuchassummaryreportsandscopingstudies;• Communicationmaterials;• Annualprogressreports;and• AnyotherinformationofrelevancetoValidationavailableonlineorprovidedbytheEITICongo

Secretariat.

InaccordancewiththeValidationprocedures,theSecretariathasnottakenintoaccountactions

4Seealsohttps://eiti.org/validation.



undertakenafterthecommencementofValidation.

2.Countryvisit

Acountryvisittookplaceon7-12May2017.AllmeetingstookplaceinBrazzavilleandPointeNoire,RepublicofCongo.Thesecretariatmetwiththemulti-stakeholdergroupanditsmembers,theIndependentAdministratorandotherkeystakeholders,includingstakeholdergroupsthatarerepresentedon,butnotdirectlyparticipatingin,themulti-stakeholdergroup.InadditiontomeetingwiththeMSGasagroup,theSecretariatmetwithitsconstituentparts(government,companiesandcivilsociety)eitherindividuallyorinconstituencygroups,withappropriateprotocolstoensurethatstakeholdersareabletofreelyexpresstheirviewsandthatrequestsforconfidentiallyarerespected.ThelistofstakeholdersconsultedinoutlinedinAnnexD.

3.Reportingonprogressagainstrequirements

ThisreportprovidestheInternationalSecretariatinitialassessmentofprogressagainstrequirementsinaccordancewiththeValidationGuide.Itdoesnotincludeanoverallassessmentofcompliance.

TheInternationalSecretariat’steamcomprised:BadyBaldé,RegionalDirectorforFrancophonecountries,SamBartlett,TechnicalDirector,AlexGordy,ValidationManager,EddieRichDeputyHeadoftheInternationalSecretariatandDyvekeRogan,PolicyDirector.BadyBaldéandAlexGordyconductedstakeholderconsultationandpreparedthedraftinitialassessment.SamBartlett,EddieRichandDyvekeRoganprovidedqualityassurance.

17



PartI–MSGOversight

1.OversightoftheEITIprocess

1.1Overview

ThissectionrelatestostakeholderengagementandtheenvironmentforimplementationofEITIincountry,thegovernanceandfunctioningofthemulti-stakeholdergroup(MSG),andtheEITIworkplan.

1.2Assessment

GovernmentengagementintheEITIprocess(#1.1)

Documentationofprogress

Publicstatement:TheGovernmentoftheRepublicoftheCongo(ROC)announceditscommitmenttoadheretotheEITIPrincipleson9June2004(RépubliqueduCongo,2004).TheMinisterofEconomy,FinanceandBudgetGilbertOndongowrotealettertotheManagingDirectoroftheIMFon10June2004toconfirmthisdecision.However,duetoadifficultrelationshipbetweenthegovernmentandcivilsocietygroups,progresswasslowatthisearlystageoftheEITIprocessintheROC(CAC75,2012).ROCbecamecandidatecountryimplementingtheEITIinFebruary2008(EITIBoard,2008).MrPierreOba,MinisterofMiningandGeologywrotetotheEITIBoardinMarch2011requestingtherenewaloftheROC’scandidatestatus.TheMinisteralsodeclaredattheEITIGlobalconferenceinParison3March2011thatthepoliticalandfinancialcommitmentoftheGovernmentoftheROCtosupportandsustaintheimplementationoftheEITI“remainsunwavering”(MrPierreOba,2011).FollowingtheROC’ssuccessfulValidationundertheEITIRules,PresidentSassouN’Guessohighlightedhiscountry’scompliancewiththeEITIRulesinatelevisedspeechinAugust2013(PrésidentdelaRépublique,2013).

TheROChostedthe29thEITIBoardmeetinginBrazzaville,from13-15April2015.PresidentSassouN'GuessometwithClareShort,ChairoftheEITIBoard,on15April2015andreiteratedhisgovernment’scommitmenttoimprovingtransparencyandaccountability(TéléCongo,2015).PresidentSassouN’GuessohighlightedEITIimplementationasamajorachievementduringthepresidentialcampaignin2016.TheGovernmentofROCalsohostedaregionalmeetingofEITINationalCoordinatorsinOctober2016,whereMinisterofCommunicationandMediaThierryLézinMoungalladeliveredopeningremarksonbehalfofMinisterofFinanceCalixteNGanongo,whocouldnotattend(ITIE-Congo,2016).

Seniorlead:TheGovernmentofROCfirstissuedPresidentialDecree2006-626on11October2006,whichestablishedamulti-stakeholderExecutiveCommitteetaskedwiththemandateofimplementingtheEITI.PresidentialDecree2006-627of11October2006createdanadvisorycommitteetotheMSG.BothcommitteeswerechairedbytheMinisterofEconomy,FinanceandBudget.InadditiontotheMinisterofEconomy,FinanceandBudget,PresidentialDecreen°2007-403of30August2007appointedHydrocarbonAdvisortotheMinisterofFinanceFlorentMichelOkokoastheMSG’sExecutiveChairtomanageday-to-dayimplementationoftheEITI.Thisinstitutionalset-upwasrenewedthrough



PresidentialDecree2012-940of20August2012,whichexpandedtheMSG’smandateandcreatedanationalsecretariat,managedbytheMSG’sExecutiveChair.AsEITINationalCoordinatorOkokorepresentedEITIimplementingcountriesinCentralAfricaontheEITIBoardfrom2007to2016.FormerDirectorofPetroleumTaxationattheGeneralDirectorateofTaxesSéraphinNdionwasappointedPermanentSecretaryoftheEITINationalSecretariatinApril2013(Notedeservice024/MEFPPPI-CABof5April2013).

Activeengagement:PresidentialDecree2007-403of30August2007andsubsequentamendmentsnominatedhigh-levelgovernmentofficialstoparticipateintheMSG.TheMSGisstatutorilyledbytheMinisterofEconomy,FinanceandBudget,withtwovicepresidentsfromindustryandcivilsociety.Inpractice,itistheadvisortotheMinister,MrMichelOkoko,whochairstheMSG.AMinisterialDecision(ArreteN°611MEFPPPI-CABof4December2012)renewedtheMSG’smembership,whichincludedsevenhigh-levelrepresentativesfromgovernmentagenciesandtworepresentativesfromthenationaloilcompany(SNPC).TheMinistryofEconomy,FinanceandBudget(MEFB),theMinistryofHydrocarbonandMinistryofMiningandGeology(MMG)areallrepresentedatahigh-levelintheMSG.AttendanceatMSGmeetingsshowsthatthegovernmentisgenerallywellrepresentedatahighlevelontheMSG,butthatparticipationinpracticeremainsrelativelyweakcomparedtootherconstituencies(seeRequirement1.4).GovernmentrepresentativesfromtheministriesoffinanceandhydrocarbonparticipatemoreregularlythanrepresentativesfromtheMinistryofMine.Forexample,theMMGrepresentativeontheMSGdidnotattendasinglemeetinginthe2013-2015period.

TheGovernmentofROCprovidedfundingforallEITIactivitiesin2014(USD1.4m)and2015(USD800000).TheprojectedcostisreportedintheworkplanandtheactualbudgetisreportedintheAnnualprogressreport(APR)everyyear.

PromptedbytheMSG,thegovernmenthasappointed“EITIfocalpoints”inkeygovernmentagenciesinmid-2015.5InJuly2015,theTreasury,TaxDepartment(DGI),Customs(DGD)andtheMEFBeachappointedtwotothreehigh-levelofficialstoserveasEITIfocalpointsintheirrespectiveagencies.Thesefocalpoints’mandatesappearlimitedtodisclosingfiguresforEITIreportingandimplementationofEITIrecommendationsintheirrespectiveagencies,ratherthanabroadercoordinationrole.

AccordingtominutesofMSGmeetingsandannualprogressreports,aparliamentarycommitteerequestedthatEITIReportsbepublishednolaterthan30Septembereachyeartoensurethatinformationongovernmentrevenuesfortheprecedingfiscalperiodwereavailableinatimelymannerasasourceofindependently-verifiedinformationtosupportparliament’sannualbudgetdeliberations.Thispracticewasfollowedin2013and2014butnotinsubsequentyears,duetodelaysinthepublicationoftheEITIReports.

FollowingtheMSG’sleadindraftingatransparencybillandlobbyingparliamentforitsadoption,PresidentSassouN’GuessosignedintolawtheTransparencyCodeon9March2017(Republique,2017).TheTransparencyCodetranslatesmanyEITIrequirementsintolawandexpandstheEITI’sreachintoothersectorsincludingforestry.KeyEITIRequirements,suchascontracttransparency,SOEreporting,

5DesignationlettersfromDGI,DGT,DGDIofJulyandAugust2015.



beneficialownershipdisclosure,publicationofproductiondata,auditandreconciliationofgovernmentrevenues,transparencyofresourceallocationandextra-budgetaryspending,project-levelreportingandopendataareallcoveredintheTransparencyLaw,amajorachievementforEITICongo,andthelaw’simplementationwouldembedtransparencyingovernmentmanagementoftheextractiveindustries.

Stakeholderviews

GovernmentrepresentativesconfirmedthattheGovernmentoftheROCiscommittedtotheEITIataveryhigh-level,includingfromPresidentDenisSassouNguessowhomentionstheEITIregularlyinhisspeeches.StakeholdersnotedthatPresidentSassouNguessoreferredtotheEITIregularlyinpublicspeechesduringthe2016presidentialelectioncampaign.Severalministersandseniorgovernmentofficialsconsultedconfirmedthegovernment’scommitmenttoEITI,includingexpandingitsscopetotheforestrysector.Aseniorgovernmentofficialhighlightedthegovernment’sunilateraldisclosuresontheforestrysectorasanexampleofthegovernment’scommitmenttoexpandtheEITI’sscopetoareasrelevanttonationalprioritiesandhighlightedhighexpectationsfortheEITIasatooltoimprovecitizens’understandingoftheforestrysector’seconomiccontribution.SeveralseniorgovernmentofficialsexpressedhopethattheEITIwouldhelpraiseawarenessofkeygovernanceissues,particularlyintheforestrysector.AnotherseniorgovernmentofficialwhohadfollowedEITIimplementationoverthepastdecadenotedthattheROC’sEITIimplementationremainedahighpriorityforthegovernment.TheMSGChairexplainedthattheGovernmentwoulddowhateverittooktocomplywiththeEITIStandard.High-levelSOEofficialsalsonotedtheircommitmenttocomplywiththeEITIStandardandhighlightedtheirregularparticipationinMSGmeetings.SeveralgovernmentrepresentativesexplainedthatgovernmentofficialsandfocalpointswereinstructedtocomplywiththeEITIStandardthroughEITIReporting.

CivilsocietyrepresentativesconfirmedthattheGovernmentofROCiscommittedtoEITIimplementationataveryhigh-level,butactivistscautionedthatthishigh-levelpoliticalcommitmentwasnotalwaystranslatedintogovernmentpolicyaslocalgovernmentofficialsandsecurityforceswereoftenunawareofhowthisgovernmentcommitmenttranslatedintopractice.Civilsocietyrepresentativesconfirmedthattheyhadreceivedsupportfromhigh-levelgovernmentofficialstoresolvebottlenecksanddisagreementswithlocalauthoritiesduringEITIdisseminationandoutreachcampaigns.Withoutprovidingspecificdates,civilsocietyrepresentativeshighlightedseveralinstanceswheretheyreceivedsupportfromtheMEFBtoundertakedisseminationactivitiesthathadbeenpreviouslyblockedbylocalauthorities,whowereunawareofthegovernmentcommitmenttogivespaceforcivilsocietyaspartofEITIimplementation.ActivistsstatedthataslongastheyexplicitlystatedthattheiractivitiesfellwithintheEITI’sremit,theywereallowedtoundertakethoseactivitiesasaresultofthegovernment’shigh-levelcommitment.CivilsocietyMSGmembersconfirmedthatMinisterOndongochairedtwoMSGmeetingsin2013and2014andthatMinisterNganogometthemtwicesincehisappointmentinApril2016.

AllstakeholdersmetconfirmedthatEITINationalCoordinatorMichelOkokohastheauthorityandthefreedomtocoordinateEITI-relatedactivitiesbetweenvariousgovernmentagencies,companiesandcivilsociety.However,manystakeholdershighlightedOkoko’slimitedcapacitiestomobilizeresourcesforEITIimplementationandhisinabilitytodiversifythesourceoffundingfortheEITI,whichremainshighlydependentongovernmentfunding.

GovernmentofficialsalsohighlightedlettersfromtheMinisterofEconomy,FinanceandBudgettotherelevantlineministriesrequestingtheimplementationofrecommendationsfrompreviousEITIReports



asexamplesofgovernmentcommitment.TheseletterswereissuedintheJune-August2015period.In2013,MinisterofYouthAnatoleCollinetMakossoparticipatedinapublicdebatewithstudentsontheEITIandthedatafromtheEITI2012report.

InitialassessmentTheInternationalSecretariat’sinitialassessmentisthattheROChasmadesatisfactoryprogressinmeetingthisrequirement.ThegovernmenthasreiterateditscommitmenttotheEITIonmultipleoccasionsandaseniorgovernmentofficialhasbeenappointedtoleadEITIimplementation,activelyparticipatinginEITIdeliberations.ThroughregularparticipationinMSGmeetings,fundingforEITIimplementationandreportingbygovernmentagencies,theGovernmentofROChasdemonstratedthatitisfully,activelyandeffectivelyengagedintheEITIprocess.ThereisalsoevidencethatgovernmentofficialsandtheNationalAssemblyhaveusedEITIdatatopromotepublicdebateandmonitorgovernmentrevenuesandexpendituresinthenationalbudget,butthispracticehastendedtobead-hoc,ratherthanformalisedasacleargovernmentpolicy.Thegovernmenthasalsotakenstepstoresolvebottleneckssuchasadministrativebarriersfordisseminationactivitiesatthelocallevel,butlocalauthorities’lackofawarenessoftheEITIremainsaconcern.

Tostrengthenimplementation,theGovernmentofROCisencouragedtoconductoutreacheffortstolocalauthoritiesandlineMinistries,toraiseawarenessontheEITIPrinciplesandthegovernment’sengagementinimplementation.

IndustryengagementintheEITIprocess(#1.2)

Documentationofprogress

Activeengagement:Mining,oilandgascompanies’representativesparticipateregularlyinMSGmeetingsandmostcompaniesparticipatefullyintheEITIreportingprocess.FollowingtheappointmentoftheCEOofENICongoasVice-PresidentoftheMSGbypresidentialdecree(Decreen°2012-1123of25October2012),sevenindustryrepresentativeswerealsoappointedforthree-yearterms,renewableonce,inDecember2012.Ministerialdecision611MEFPPPI-CABof4December2012appointedseniorindustryrepresentativesfromfiveoilandgascompanies6andtwominingcompanies.7AnalysisofMSGmeetingminutesshowsthatcompaniesconsistentlyattendmeetingsandappearactivelyengagedintheEITIprocess,withtheaverageparticipationratefortheeightindustryMSGmembersslightlyabove50%fortheperiod2013-2015(seeAnnexA).Theseattendanceratesshowevenmoresignificantcommitmentwhenitisconsideredthatmanyoilandgasexecutives,includingfromChevron,ENI,TotalandPerenco,arerequiredtotravelfromPointeNoiretoBrazzavilletoattendMSGmeetingsanddosoregularly.ArepresentativefromGlencoresubsidiaryMPDCongoattendsMSGmeetingsonbehalfoftheFederationofMiningCompanies,whichincludeseightminingcompaniesoperatinginthecountry.MinisterialDecision611MEFPPPI-CABalsoappointedtworepresentativesfromthestate-ownedoilcompanySNPC,whoparticipateregularlyinMSGmeetings.AlthoughtheSOE’srepresentativesconsiderthemselvespartoftheindustryconstituency,inpracticeSNPCappearsclosertoothergovernmentagenciesrepresentedintheMSGintheviewsexpressedontheMSG.Theindustryconstituencydoesnotappeartohaveagreed

6TotalCongo,Chevron,Congorep,Maurel&PromCongoandMurphyWestAfricaLtd.7CongoMiningandMPDCongo.



acodeofconductorotherToRtostructureitsengagementinEITIimplementationandinstitutionaliseMSGmembers’responsibilitiestothebroaderconstituencyofcompanies.

ThenumberofreportingcompaniesintheROC’sEITIReportshasincreasedovertheyears,albeitsomewhatinconsistently,fromfourin2004-2006to14in2007-2009,15in2010,17in2011,21in2012,25in2013and21in2014.8Inthe2014EITIReport,eightofthe24materialoilandgascompaniesdidnotparticipateinEITIreporting,althoughthreeofthesewerenotactivein2014,alongsidefiveoftenmaterialminingcompaniesthatalsodidnotreport.

Enablingenvironment:TheredonotappeartobeanylegalorregulatoryobstaclestoEITIreportingintheROCandthegovernmenthasenactedlegalreformstofacilitateEITIimplementation.Article2oftherevisedHydrocarbonsCodeenactedin2016requiresalloilandgascompaniestocomplywiththeROC’slawsandinternationalcommitmentslinkedtoimprovingthesector’sgovernanceandtransparency(RépubliqueduCongo,2016).TheMarch2017TransparencyCodetranslateskeyEITIRequirementsintonationallegislation,includingcontracttransparency,SOEreporting,beneficialownershipdisclosure,publicationofproductiondata,auditandreconciliationofgovernmentrevenues,transparencyofresourceallocationandextra-budgetaryspending,project-levelreportingandopendata.Insomeareas,thelawgoesbeyondtheminimumEITIRequirementsbymandatingreportingofproductiondisaggregatedbyprojectandindividualoilfield.Finally,ongoingrevisionstotheMiningCodeareexpectedtorefertotransparencyandgovernanceprovisionsinasimilarwaytothe2016HydrocarbonsCode.

StakeholderviewsTherewasbroadconsensusintheMSGthatcompaniesareengagedintheEITIprocess,includinginreportingaswellasfundingawarenessraisinganddisseminationofthe2013EITIReport.However,civilsocietyrepresentativespointedoutthatcompanies’commitmenttotheEITIprocessdeclinedconsiderablyin2015.TheynotedseveralcasesofMSGmeetingsnotbeingquorateduetoinsufficientrepresentationfrommining,oilandgascompanies,albeitwithoutprovidingspecificmeetingdates.CompanyrepresentativesrecognisedthattheirparticipationintheEITIprocessin2017wassignificantlylowerthanin2013,butexplainedthisbyseveralreasons,includingcost-cuttingmeasuresduetodecliningoilprices,poorpreparationofMSGmeetingswithagendasandworkingdocumentsdisseminatedwithinsufficientadvancenotice,andtenseMSGdiscussionsbetweencivilsocietyandgovernmentrepresentativesonissuesthatwerenotseentoconcerncompanies.SeveralindustrystakeholdersnotedthattheyfoundthepreparationandchairingofMSGmeetingsinadequate.Ontheissueofcost-cutting,anindustryrepresentativenotedthattheyhadsuggestedconductingMSGmeetingsbyteleconference,butthatthishadnotyetbeentried.Civilsocietyrepresentativesalsoarguedthatcompanies’commitmentwasweakerasaresultoftheMSG’spoorinternalgovernance.AgovernmentrepresentativenotedthatcompaniesdidnotprovidefundingtoEITIimplementationbecausetheydidnotagreewiththeMSG’sopaqueperdiempolicythatwasseenasexcessivelygeneroustocivilsociety.RepresentativesfrombothindustryandcivilsocietyconstituencieshighlightedthatMSGmeetingminuteswerenotregularlykeptandcirculatedandconsideredthattheirconcernswereoftenignoredbytheMSG

8SeetheROC’sEITIsummarydatatableshere:https://drive.google.com/drive/folders/0B9Bl74fkjArzWm1pUzB1Y1J2ZjQ



Chair(seeRequirement1.4).

InitialassessmentTheInternationalSecretariat’sinitialassessmentisthattheROChasmadesatisfactoryprogressinmeetingthisrequirement.Seniorindustryrepresentatives,particularlyinoilandgas,travelregularlyfromPointeNoiretoBrazzavilletoattendMSGmeetings,althoughtherecentweakeningofindustryengagementwithmorejuniorproxiessenttoMSGmeetingsisaconcern.CompaniesparticipatebothinEITIreportingandindisseminationandoutreachactivities.IndustryrepresentativeshaveconsideredprovidingfundingtotheEITI,althoughhavedecidedagainstduetoconcernsovertheEITI-Congo’sinternalgovernancechallenges.ThereappearstobeanenablinglegalandregulatoryenvironmentforcompanyparticipationinEITIimplementation,includingreporting,andcompaniesappearfully,activelyandeffectivelyengaged.

Tostrengthenimplementation,theMSGshouldconsiderholdingteleconferencesinadditiontoinpersonmeetingstofacilitateremoteparticipationbycompanies(andcivilsocietyrepresentatives)basedinPointeNoire.TheindustryconstituencymayalsowishtoconsideragreeingacodeofconductorotherToRtostructureitsparticipationinEITIimplementationandinstitutionaliseMSGmembers’feedbackmechanismstothebroaderconstituency.

CivilsocietyengagementintheEITIprocess(#1.3)

DocumentationofprogressTheearlyphaseofEITIimplementationintheROC(2004-2007)wascharacterisedbymultiplearrestsandintimidationofthepioneeringcivilsocietyactivistswhoadvocatedforEITIimplementation(CAC75,2012).MrMounzeoandMrBriceMakosso,bothmembersofthePWYPcoalition,werearrestedonmultipleoccasionsin2006onchargesofdefamationagainstPresidentSassouNguesso,fraudandmisappropriationoffunds,althoughallchargesweresubsequentlydroppedforlackofevidence.InternationalCivilsocietyarguedthattheirarrestwaslinkedtotheirstandagainstcorruptionintheROC’soilrevenues(Globalwitness,2006).

Acompromisewasreachedin2007andallowedforthecreationofamulti-stakeholdergroup.ThiscompromisecarvedoutacontrolledspaceforcivilsocietytoundertakeactivitiesdirectlyrelatedtoEITIimplementation.Basedonthiscompromise,theROCachievedEITICandidatestatusinFebruary20089andEITICompliancestatusundertheEITIRulesin2012.Morebroadly,evidencesuggeststhatthespaceforcivilsocietytooperateintheROCdeterioratedrapidlyintheperiodleadinguptothe2015referendumtoamendtheconstitution.TheConstitutionwasamendedin2015toremoveageandterm-limitrestrictionsonpresidentialcandidates,allowingPresidentSassouNguessotorunforathirdtermin2016.

NGOsoperatinginROCaremostlyconcentratedinBrazzavilleandPointeNoire.Amappingofnon-stateactorsbytheEuropeanUnionin2013estimatesthatabout350NGOswereactiveinhumanrightsandgovernanceissues(Gaudion,2013).ThestudyfoundthatfewNGOshadsufficientcapacitiestodevelop,

9https://eiti.org/document/4th-board-meeting



manageandimplementprojectsandmobilisefunding.TheeightNGOsrepresentedintheMSGareamongthefewthatarewell-organisedandhavethecapacitiestoraisefundsfortheiractivities.

Eightcivilsocietyrepresentativeswereappointedforthree-yeartermsontheMSG,renewableonce,byMinisterialDecision611MEFPPPI-CAB.ThefollowingNGOswererepresentedintheMSG:

• TheCoalitionforPeaceandHumanRights(RPDH)10,• TheJusticeandPeaceCommissionoftheCatholicChurch11;• TheNIOSIfoundation12;• SupportandCapacityBuildingPartnership(Centred'échangesdepartenariat,d'appuietde

renforcementdescapacités);• TheCoordinationCommitteeofNGOsoftheCongo(ComitédeliaisondesONGduCongo);• TheNationalmovementfortheorganizationoftransparentelections(Mouvementnationalpour

l'organisationdesélectionstransparentes);• TheFederationofyouthandindividualitiesoftheCongo(Fédérationnationaledesjeunesseset

individualitésduCongo);andTheActionforgovernanceandcommunitydevelopment(Actionpourlagouvernanceetledéveloppementcommunautaire).

Expression:The2015Constitutionguaranteesfreedomofspeechandofthepress,withArticle25stating:

“everycitizenhastherighttoexpressandtofreelydisseminatehisopinionthroughspeech,writing,theimageorbyanyothermeansofcommunication.Freedomofinformationandcommunicationisguaranteed.Itisexercisedincompliancewiththelaw.Censorshipisprohibited.Accesstosourcesofinformationisfreeandprotectedundertheconditionsdeterminedbylaw”(JournalOfficieldelaRepubliqueduCongo,2015).

Yetithasbeenwidelyreportedthatthegovernment’srespectforsuchfreedomsislimitedinpractice.Forexample,FreedomHouserankedtheROC’spressfreedomas“partiallyfree”fortheperiodunderreview2013to2016(FreedomHouse,2017).Otherindependentorganisations,suchastheMoIbrahimFoundation,andReportersWithoutBordershighlightthepracticeofcensorshipandlimitstofreedomofexpressionforcivilsocietythathavebecomecommonevenifnotcodifiedinofficialstatepolicy(ReportersWithoutBorders,2017)(MoIbrahimFoundation,2016).Forexample,internetandtextmessagingserviceswerecutincertainareasofthecountryinthedaysleadinguptotheconstitutionalreferendumin2015(BBC,2015).RadioFranceInternationale’ssignalwasalsoblockedfortwodays.Internetconnectionswerealsobrieflysuspended.Theserestrictionsappearselectiveandspecificallytargetingcertainmediaorganisationsthataredeemedtoocriticaltotheregime.

Nonetheless,thereisextensiveevidenceofcivilsocietystatementsthatarecriticalofthegovernment’smanagementoftheoilandgassector,suchasthecampaignbylocalandinternationalCSOsontherefineryCORAF’ssaleofrefinedfueltoaprivateSwisstrader(Publiceye,2015)(PWYP-Congo,2015)(PWYP-Congo,2016).Althoughthereisevidencethatthegovernmentdiscontinuedthepublicationof

10http://www.rpdh-cg.org/rpdh11https://cecongo.org/spip.php?article13312https://pcpacongo.org/fondation-niosi/



quarterlySNPCoilsalesreportsasaresultofthisCSOcampaign,thereisnoevidenceofdirectreprisalsagainstindividualsinconnectiontothepublicationofthe2015reportintotheCORAF.

However,therearealsoseveralexamplesofinstancesofcensorship.Self-censorshipofcivilsocietyactiviststhataresubstantiallyinvolvedinEITIimplementationcannotberuledout,either.CivilsocietyactivistssubstantiallyengagedintheEITIbutnotrepresentedintheMSGcontinuetofaceintimidationsandsometimesarrestsinretaliationtopublicationofinformationonissuesthatareconsideredoff-limitbythegovernment.On15March2017,twoItalianjournalists,LucaChiancaandPaoloPalermo,whoworkedfortheItalianTVchannelRAI3,werearrestedinPointe-Noire,andheldforthreedaysbeforebeingexpelledfromthecountry(ReportersWithoutBorders,2017).AccordingtoReporterswithoutBoarders(RST)thetwojournalistswerearrestedbythepolicewhileinvestigatingallegationsofcorruptionsinvolvingPresidentSassouNguesso’srelativesactiveintheoilsector(ReportersWithoutBorders,2017).

WhilethesegeneralconstraintsonfreedomofexpressionhaveaffectedCSOs’publicexpressionsonsensitivetopicslikecrudeoilsales,thereisevidencefromMSGmeetingminutesandpressreleasesthatCSOMSGmembershavebroughtupsensitivetopicslikeSNPC’sfinancialrelations,theCORAFcrudeallocations,theChineseoil-for-infrastructureagreementduringMSGmeetingsandoutsidethosemeetings.

Operation:Article21oftheConstitutionstipulatesthattheStaterecognizesandguarantees,underconditionslaiddownbylaw,thefreedomofmovement,association,assembly,processionanddemonstration(JournalOfficieldelaRepubliqueduCongo,2015).The1901Frenchlaw13governingtheworkofassociationsisalsoclearaboutthefactthatNGOsactivitiesaregovernedbyadeclarativeregimeandtheiractivitiesarenotsubjecttopriorauthorizationtoconducttheiractivities,includingpublicassembly.Accordingly,civilsocietyorganisationsoperatefreelyandarenotrequiredtorequestpriorpermissionfromtheauthoritiestocarryouttheiractivities.However,NGOsarerequiredtoseekauthorizationfromtheMinistryofInteriorandDecentralizationorfromappropriatelocalofficials,fortheuseofpublicspacetoholdpublicproteststhatcouldbedeniedonthegroundof“preservingpublicorder”.

Theseincidenceshappenedinthewidercontextofaconstitutionalreferendumin2015andpresidentialelectioninApril2016.Intheperiodleadinguptothereferendum,publicprotestswereroutinelybanned.Onseveraloccasionsin2014,securityforcesviolentlydispersedgatherings,particularlyamongthepoliticalopposition,forallegedfailuretoobtainpriorauthorization(FreedomHouse,2017).AccordingtoFreedomHouse2015CountryReport,NGOsgenerallyoperatewithoutinterference,buttheycannotchallengetherulingelite(FreedomHouse,2015).CivilSocietyhasnotheldpublicprotestsonEITIrelatedissues,butcivilsocietyrepresentativesintheMSGhaveissuedpubliccallsforthereleaseofcivilsocietyactiviststhatwerenotMSGmembers.ForexamplePWYP-CongocalledforthereleaseofuniversityprofessorsandaNGOleaderin2014(PWYP-Congo,2014)(PWYPCongo,2015).

Withregardtoaccesstofunding,NGOsdependsmostlyonforeignfundingtohirestaffandimplement

13Loidu1erjuillet1901relativeaucontratd'associationhttps://www.legifrance.gouv.fr/affichTexte.do?cidTexte=LEGITEXT000006069570



theiractivities(EU,2014).WithanestimatedEUR20mallocatedtoCSOsintheROCinthe2007-2014period,theEuropeanUnionisthelargestcontributortocivilsocietyactivitiesintheROC(EU,2014).WhilecivilsocietydidnotfacelegaloradministrativerestrictionsonaccesstofundingtoconductEITIrelatedactivities,anNGObilladoptedbyparliamentin2016,butnotsignedintolawbythePresidentwouldsignificantlyrestrictthespaceforcivilsocietyandcriminalizetheiractivitiesunderthepretencethattheyhavereceivedfundingfromabroad(RPDH,2016).

DespitethesegeneralconstraintsonCSOs’operations,thereisnoevidencethatCSOshavefacedchallengesinattendingEITIactivitiesandthereisextensiveevidenceoftheirparticipationatMSGmeetingsandleadingEITIoutreachdisseminationevents.Onthecontrary,CSOMSGmembers’abilitytoparticipateinallEITIactivitiesappearstobeguaranteedbyhigh-levelpoliticalcommitmenttotheEITIanddoesnotseemtoextendtoactivitiesoutsidethenarrowly-definedscopeofEITIimplementation,suchaspublicprotestsoveroilandgasissues.

Association:CivilsocietyrepresentativesintheMSGcangenerallyseekinputandarenotrestrictedfromengagingotherCSOsthatarenotpartoftheMSG.ThroughPWYP-Congo,civilsocietyrepresentativesintheMSGareabletocoordinatetheiractivitiesandcirculatesinformationthroughmailinglistbuttherearenoevidencesthattheyhavesoughtinputfromcivilsocietyoutsidetheMSGonMSGdeliberations.Similarly,therearenoevidenceofrestrictionofformalorinformalcommunicationchannelsbetweencivilsocietyMSGmembersandthewidercivilsocietyconstituency.CivilsocietyMSGrepresentativeshavenotconductedoutreachactivitiestobroadercivilsocietytodiscussMSGrepresentation,butthisisnotduetogovernmentrestriction.

Engagement:Despitetheconstrainedgeneralenvironment,civilsocietyappearsparticularlyengagedintheEITIprocess.RepresentativesfromthecivilsocietyconstituencyattendMSGmeetingsregularly,conductanalysisofEITIReports,producecommunicationmaterialsandorganisepubliceventstoinformcitizensonissuesrelatedtothegovernanceoftheextractiveindustries.CivilsocietyrepresentativesintheMSGregularlyexpresstheirviewsrelatedtoEITIactivitiesandhighlighttheirconcerns.InAugust2015,PWYPCongowrotealettertotheMinisterofEconomy,FinanceandBudgetandissuedapressreleaseexpressingconcernsonthe“stagnationoftheEITIprocess”andcallingonthegovernmenttoresumepublicationofEITIReports,implementpastEITIrecommendationsandexplaintherelationshipofSNPC’ssubsidiaryCORAFandPhilia(PWYPCongo,2015).TherearenumerousexamplesofcivilsocietyusingEITIdata,includingPWYPCongo’sreviewofEITIReportsandthenationalbudget,publishingareportongovernmentexpenditureonpublichealthin2015(PWYPCongo,2015).Thisreportandsubsequentfollow-upreportswerewidelydisseminatedandformedthebasisofanadvocacycampaigntoimproveallocationofoilrevenuestobenefitthepoor(PWYP,2016).PWYPCongoalsopublishedastudyin2011thatfoundthatoilrevenuesdidnothaveapositiveimpactonthepoor(PWYPCongo,2011).

Accesstopublicdecision-making:CivilsocietyrepresentativesparticipateactivelyinMSGmeetingsandtheirviewsareconsideredbygovernmententitiesandtheindustry.TheleaderofthePWYP-CongocoalitionChristianMounzeowasappointedvicePresidentoftheMSGthroughPresidentialDecree2012-1123of25October2012.MrMounzeoandMrBriceMakossoareamongtheactivistswholedthecampaignforEITIimplementationinCongosinceitsinception.Theyhavebothplayedaleadingroleinpromotingtransparencyintheoilandgassectoratthenationalandinternationallevelthroughtheir



participationintheMSGinCongoandintheEITIInternationalBoard.MrMounzeoalsorepresentscivilsocietyinthegovernmentledanti-corruptionagency.

WhilecivilsocietyrepresentativesintheMSGgenerallyholddisseminationcampaignstopromotepublicdebate,withoutpriorauthorisation,therewasatleastonecaseofadministrativebarrierspreventingCSOsfromholdingmeetingsrelatedtotheEITIprocess.On26March2015,theRPDHissuedapressrelease14toreport“obstructions”bylocalauthoritiesintheDepartmentofBouenza.AccordingtotheRPDHpressrelease,itsdelegationtravelledtoNkayionThursday,19March2015foranEITIdisseminationcampaignandbudgetmonitoring,targetinglocaladministrativeofficials,NGOs,mediaandreligiousgroups.ThemayorofNkayi,Mr.MANDOUNOUMAGANGA,issueda“categoricalrefusal”toholdthemeetingonthegroundsthatthecontextwassensitiveanddidnotlenditselftoholdingsuchanevent.DespiteadirectappealfromtheChairoftheMSGtothemostseniorgovernmentofficialintheregion,theactivitywassimplycancelled.AsecondincidenceconcerningpublicassemblyofanEITIrelatedeventoccurredinMay2016.TheCatholicChurch’sCommissionJusticeandPeaceissuedinvitationletterstoaninternationalconferenceontransparencyinmining,oilandgasinAfricatobeheldinPointeNoire(CommissionDiocésaineJusticeetPaixPointeNoire,2016).TheCommissionJusticeandPeacerequestedapprovalofinvitationlettersforinternationalcivilsocietycomingfromabroadforthepurposeofobtainingvisastoattendtheconference.ThisrequestwasfirstdeniedbythelocalofficeoftheDirectionofSurveillanceoftheterritory(DST)butsubsequentlyapprovedfollowingtheMSGChair’sexpressrequest(CommissionDiocésaineJusticeetPaixPointeNoire,2016).

ThereisevidencethatCSOcaninfluencedecisionssuchasthepreparationandadoptionofthenewtransparencylaw,buttheircampaigningonissuescriticaltothegovernmenthasalsohadabacklashontransparencyandcausedtheoppositeoftheintendedeffect.Forexamples,followingthepublicationofareportbytheSwissNGOBerneDeclaration(nowPublicEye)onthefinancialrelationshipbetweenthedomesticrefineryCORAFandaprivateSwiss-basedoil-tradingcompanyPhilia(Publiceye,2015),PWYPCongocalledonSNPCforclarificationandpublicationoftheCORAF-Philiacontract(PWYP-Congo,2015).TheCORAFReportusedEITIdatatoshowthatCORAFhadnotpaidfortheroughly6mbarrelsofoil(worthUSD600m)suppliedbySNPCannuallyandhadrunupasignificantdebttotheTreasury,despiteCORAF’ssaleofoilproductstoPhilia(Publiceye,2015).CivilsocietyMSGmembers,PWYP-Congoinparticular,havecalledforajudicialinquiryintorevelationsofthePanamaPapers,inapressreleaseon21April2016(PWYP-Congo,2016).ThegovernmentabruptlyremovedthequarterlySNPCcrudeoilsalesreportsfromtheEITICongoandMEFBwebsitesimmediatelyafterthepublicationoftheCORAFreportandnoEITIReportwaspublishedin2015-2016untilthe2014EITIReportwasfinallyproducedinDecember2016.Nonethelesspublicationofthereportgeneratedsignificantcoverageintheinternationalmedia,evenifitscoverageinthelocalpresswaslimited.

Stakeholderviews

Stakeholderconsultations,drivenbytheindividualsthemselves,focusedprimarilyontheissuesoffreedomsofexpressionandassembly,seenasthemostsignificantchallengesforcivilsocietyintheROC.Stakeholdersdidnothighlightsignificantconcernsregardingassociation,engagementandaccessto

14RPDHPressreleaseof26March2015,http://www.rpdh-cg.org/news/2015/03/26/atteinte-aux-libertes-dassociation-et-de-reunion-au-congo-la-rpdh-interdite-de



decisionmakinginthecivilsocietyprotocol.

Extensiveconsultationsyieldedwidelycontrastingviewsregardingcivilsociety’sabilitytospeakfreelyonanyEITI-relatedissue.CivilsocietyMSGrepresentativesconsideredthattheycouldspeakfreelyinpublicabouttheEITIprocess,includingatMSGmeetings(consideredpublic),throughinterviewswithnationalandinternationalmedia,duringworkshops,conferencesanddisseminationcampaignsatthelocallevel–albeitwithinlimits.InterviewsanddebatesonradioandtelevisionwereroutinelycitedasCSOMSGmembers’preferredmodeofcommunication.CivilsocietyMSGmembersnotedthattheEITIactsasa“shield”ofprotectionthatallowedthemtoexpresscriticalviewsofthegovernment,providingmultipleexamplesofinterviewsonnationaltelevisionwheretheyhadusedEITIdatatocriticisemanagementoftheoilsector.Somecivilsocietyrepresentativesconsideredthattheircolleagueshadgonetoofarincriticisingthegovernmentinrecentinterviewsandtheywererelievedtoseethattheircolleagueshadnotfacedreprisalsfortheiractionsthusfar.

CivilsocietyMSGmembersdescribedanenvironmentoffearandtopicsthatareconsideredoff-limits,explainingthattheyhadtotreadcarefullyandexercisetheirjudgementontopicsthatcouldbeconsideredoff-limitsforthegovernment.Asanexample,civilsocietyMSGmembersexplainedthattheyhadissuedcallsforfurtherinvestigationafterthepublicationoftheCORAFreportbuthadreceivedthreatsandintimidationfromsecurityforces.Theyalsoconsideredthatlocalmedia’slackofcoverageoftheCORAFreportotherthantheofficialgovernmentrebuttal,whichwentontoaccuselocalCSOsof“hightreason”for“beingcomplicitwithforeignplotstooverthrowthegovernment”.Civilsocietyrepresentativesnotedthataccusationofhightreasonswasoftenusedbysecurityforcestodemonisetheirworkandexposethemtoprosecution.Despitethesechallenges,CSOMSGmembersagreedthatcivilsocietyenjoyedauniquespace,withintheEITIframework,toexpresstheirviews.

However,civilsocietybothonandofftheMSGconsideredthatactivistsoutsidetheMSGwerenotasluckyasthoseontheMSG,eventhoughtheiradvocacyonoilandgasissuesweresubstantiallyrelatedtoEITIissues.Forexamples,theleadauthorsoftheCORAFreportexplainedthattheydidnotfeelsafetotraveltotheROCfortheirinvestigationsforfearofreprisal.OneinternationalCSOthatattendedtheEITIBoardmeetinginBrazzavilleinApril2015statedthathehadtakenspecialsecurityprecautionsforthetripgivenhispastworkonoilandgasissuesintheROC.ThearrestofItalianjournalistsinvestigatingonsimilarissuesinPointeNoireinMarch2017washighlightedbyseveralinternationalandlocalCSOsasconfirmingthosefears.Civilsocietyactorsoutsidethecountryexplainedthatitwasdifficulttogatherinformationonallegationsofcorruptionsfromcivilsocietyactivistsinsidethecountry.Someactivistsexplainedthatgiventheenvironmentoffearandpolicebrutalities,theydidnotcontactstakeholdersinsidethecountrytoavoidincriminatingthembyassociationandexposinginnocentactiviststoreprisals.

CivilsocietyMSGmembersconfirmedthepracticeofself-censorship,whichproveddifficulttodocumentinpractice.MSGmembersagreedthatthereweretopicsonthemanagementoftheoilsectorthatwereconsideredoff-limits.Severalcivilsocietyrepresentativesnotedthattheycouldcriticisethegovernmentattheirownriskandperil.Despitetheclimateoffear,severalCSOMSGmembersconsideredthattheyroutinelytestedthelimitsofgovernmentcensorshipbyopenlycallingforinvestigationofallegationsofcorruptionsattheCORAFrefinery,widelyconsideredasensitiveissue.Industryrepresentativesnotedthattheywouldrefrainfromcriticizingthegovernmentorgivingtheimpressionofpointingfingers,butconsideredcivilsocietytobeoutspokenonEITI-relatedissues.Thelackofaformalgovernmentpolicy



definingalistof“sensitiveissues”wasseenbyseveralcivilsocietyrepresentativesascreatingfertilegroundforself-censorship.CivilsocietyMSGmembersconfirmedthattheiranalysesofEITIReportsweregenerallynotmadepublic.Forexample,civilsocietyMSGmembershadpreparedananalysisofthe2014EITIReportfollowingitspublication,highlightingsomeweaknesses,butthisanalysiswasnotpubliclyaccessibleanditscirculationwaslimitedtoMSGmembersandsecretariatstaff.SeveralCSOMSGmembersstatedthatgovernmentMSGmembersroutinelyblockedpublicationofdocumentssuchascivilsociety’sanalysisofEITIReportsthattheyconsideredtobeinternaldocuments.However,MSGmembersinsistedthatcivilsocietyhadtheabilitytodisseminatethemainfindingofthe2014EITIReportthroughinterviewswithlocalandinternationalprintandbroadcastmedia.

CivilsocietyactivistsoutsidetheMSG,butsubstantiallyengagedinEITInotedthattheyfacedstrictrestrictionsoncertainissues,giventhatanydirectcriticismofthePresidentorhisfamilywasimmediatelyassimilatedwithsubversiveactivities,withunpredictablereprisals.ManycivilsocietystakeholdersexpressedsignificantconcernsaboutnewNGOlegislationadoptedintheNationalAssemblyin2016,thatwouldcriminalisesomecivilsocietyactivitiesandimposerestrictiononaccesstoforeignfunding.ThePWYPCongocoalitionissuedadetailedanalysisofthebill,butitwasunclearwhethertheirconcernshadbeenaddressedasthefinalbill,adoptedinparliamentbutnotyetpublicgiventhatitwasstillawaitingthePresident’ssignature(PWYP-Congo,2016).Thebill’sstatusremainsuncleardespiteextensivestakeholderconsultations.SomecivilsocietystakeholdersexpressedthefearthatthebillcouldbesignedintolawbythePresidentatanymomentandthatthegovernmentcouldbewaitingfortheoutcomesofEITIValidationbeforeenactinganysuchlegislation.OthersgovernmentandcivilsocietystakeholdersconsideredthatthebillhadbeensubstantiallyamendedpriortoitsadoptionbytheNationalAssembly.ItwasnotpossiblefortheInternationalSecretariattoverifytheseclaimsaboutthestatusofthedraftlawonNGOsdespiteextensiveconsultations.SeveralCSOsdidnothaveconfidenceinthejudicialsystemandconsideredthattheycouldnotchallengetheNGOlawincourtevenifitdemonstrablyviolatedtheirconstitutionalrights.CivilsocietyoutsidetheMSGalsoexplainedthatthecompromiseestablishedasafebutlimitedspaceinwhichcivilsocietycouldoperate.IndependentNGOsareunderpressurefromthegovernmenttotoetheofficiallineorremainwithintheboundariesallowedfortheEITI.ManyinternationalstakeholdersoutsidethecountryarguedthatcivilsocietyactivistsinROCroutinelypracticeself-censorshiptoavoidreprisalsfromthegovernment.TheyarguedthattopicscoveredbycivilsocietyactivitieswithintheframeworkoftheEITI,arelimitedtoadvocacycampaignsformoretransparencyanddisseminationcampaignsofEITIreportstolocalcommunitiestoavoidmoresensitivetopicsatthecentrallevel.Accordingtothisview,civilsocietyactivistsobserveunwrittenbutstrictlyenforcedrulesbythedomesticsecurityservice,theDirectionGénéraledelaSurveillanceduTerritoire(DGST),toremainwithintheboundariesoftheEITI.ManystakeholdersoutsidetheMSGalsovoicedconcernsthatthispracticecontinuedaftertheadoptionofthenewEITIStandardin2013,includingtheCivilSocietyProtocolthatcallsfortheprotectionofthefundamentalrightsofcivilsocietyrepresentativeswhoaresubstantivelyinvolvedintheEITIprocess,includingbutnotlimitedtoMSGmembers.

InitialassessmentTheInternationalSecretariat’sinitialassessmentisthattheROChasmademeaningfulprogressinmeetingthisrequirement.ThegovernmenthasestablishedasafespaceinwhichcivilsocietyMSGrepresentativescanoperate,expressthemselvesfreelyandcontributetopublicdebate.However,thiscontrolledspaceforcivilsocietyisnarrowlydefinedtoMSGmembersandexcludesimportantactorssubstantiallyengagedintheEITIprocesswhoareroutinelyexposedtointimidation,reprisalandcensorship.Inaccordancewiththeassessmentframeworkoutlinedinthecivilsocietyprotocol,



provisionsrelatedtocivilsocietyparticipationareassessedeachinturn.

Expression:WhilecivilsocietyrepresentativesontheMSGcanexpressthemselvesfreelyontopicsdeemed“linked”totheEITI,activistsoutsidetheMSGwhopromotetransparencyandaccountabilityareroutinelyexposedtoreprisals.Therearealsocredibleallegationsofintimidationandreprisalsforcivilsocietyactorsandself-censorshipisaconcern.TheInternationalSecretariatconcludesthatcivilsocietyorganisationscannotfreelyexpresstheirviewsrelatedtonaturalresourcegovernanceandthepracticeofcensorshipandself-censorshipisinviolationofthecivilsocietyprotocol2.1,andrequirements1.3(d),1.3(e)(i),1.3(e)(iv).

Operation:TheInternationalSecretariatconcludesthatcivilsocietycanoperateeffectivelyinthecontextoftheEITI.

Association:TheInternationalSecretariatdidnotfindanyviolationsofthecivilsocietyprotocolwithregardtofreedomofassociation.

Engagement:TheInternationalSecretariatconcludesthatcivilsocietyactorsareadequatelyengagedintheEITIprocessandcanpromotepublicdebatewithintheboundariesallowedbytheGovernment.

Accesstopublicdecision-making:Therewerereportsofcurbsonfreedomofassemblyinrelationtopublicdebatethatwereovercomethroughinterventionfromseniorgovernmentofficials.SeveralCSOMSGmembersreportedtwoEITI-relatedeventsorganisedbycivilsocietythatwerefirsttemporarilybarredbythesecurityforcesandlocalgovernmentofficials,butsubsequentlyauthorisedbythegovernmentaftertheinterventionofhigh-levelgovernmentofficialsincludingtheMSGChair.TheInternationalSecretariatconcludesthatcivilsocietyrepresentativeshaveaccesstopublicdecision-makingandtheirviewsareconsideredbydecisionmakersandtheindustry.

InaccordancewithRequirement1.3,theGovernmentofCongoshouldensurethatthereisanenablingenvironmentforcivilsocietyparticipation,andensurethattherightsofcivilsocietysubstantivelyengagedintheEITI,includingbutnotrestrictedtomembersofthemulti-stakeholdergroup,arerespected.

MSGgovernanceandfunctioning(#1.4)

DocumentationofprogressMSGcompositionandmembership:PresidentialDecreeno.2012-940of20August2012establishedtheinstitutionalframeworkforEITIimplementationintheROC,withamulti-stakeholderExecutiveCommitteeandatechnicalpermanentsecretariat.Priortothis,EITIimplementationwasoverseenbyaconsultativecommitteecreatedinSeptember2007.TheExecutiveCommitteeisledbytwochairsfromthegovernmentandtwovicechairsrepresentingcivilsocietyandcompaniesrespectively.Inadditiontoitsfour-personleadershipbureau,theEITIExecutiveCommitteeiscomposedof21membersevenlydividedbetweenthethreeconstituencies(CongoActuel,2017).Tworepresentativesofthestate-ownedSNPC,whichispartofboththegovernmentandindustryconstituencies,bringingthetotalnumberofMSGmembersto27.MSGmembersareappointedforathree-yearmandaterenewableonce,inlinewithMinisterialDecree611MEFPPPI-CABof4December2012.ThemostrecentMinisterialDecision



designatingMSGmemberswasissuedinDecember2012andtheMSGhasnotbeenrenewedsince.DespitetheexpirationoftheirmandateinDecember2015,thesameMSGmemberscontinuetotakepartintheMSGinpractice.

Civilsocietyrepresentation:TheprocessforappointingandrenewingcivilsocietyrepresentativesisnotcodifiedanywhereotherthanthePresidentialDecreeandMinisterialDecisionappointingthem.CivilsocietyrepresentativescomefromspecialisedNGOsandcoalitionsrepresentingmultipleNGOssuchasPWYP,CommissionJusticeandPeacefromtheCatholicChurch,FoundationNIOSI,theNationalFederationofYouthandtheNationalMovementforTransparentElections.ChristianMounzeofromPWYPisavice-ChairoftheMSG(seeRequirement1.3).

Industryrepresentation:Similartothecivilsocietyconstituency,theprocessforappointingandrenewingcompanies’representativesisnotcodifiedanywhereotherthanthePresidentialDecreeandMinisterialDecisionappointingthem.MSGmembersrepresentingtheindustryincludeonerepresentativeeachfromChevronOverseasLtd,Congorep,CongoMining,Glencore,Maurel&PromCongo,MurphyWesAfricaLtd.InpracticeapresentativefromENICongoandTotaltaketurnastheviceChairoftheMSG.

Governmentrepresentation:PresidentialDecree2012-1123of25October2012reappointedtheMinisterofEconomy,Finance,Planning,StateInvestmentsandIntegrationGilbertOndongoastheMSGChairandFlorentMichelOkokoastheMSG’sExecutiveChair.MinisterofEconomy,FinanceandBudgetCalixteGanongotookoverasChairoftheMSGfollowinghisappointmenton30April2016.Inpractice,MSGmeetingsarechairedbyExecutiveChairOkoko,whoalsomanagestheNationalSecretariatandoverseesday-to-dayimplementation.EITIimplementationintheCongohasbeenentirelyfundedbythegovernment.TheMinisterofFinanceGilbertOndongoconfirmedthenominationofsevenrepresentativesfromthegovernment,includingtwogovernmentofficialsfromtheMinistryofFinance,twofromtheMinistryofHydrocarbon,twofromtheMinistryofMinesandGeologyandonerepresentativeoftheministryforindustrialdevelopmentandpromotionoftheprivatesector,throughMinisterialCircular611MEFPPPI-CABof4December2012.

Termsofreference:PresidentialDecree2012-940of20August2012thatestablishedtheExecutiveCommitteealsoactsasitsToR.TheExecutiveCommitteehasthemand

roc draft report on initial data collection and stakeholder … · 2019. 12. 12. · 2 validation...

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