Summary of contract

• Negotiation, representation, and other relevant context

  The purpose of the Trust Fund is to provide assistance to eradicate poverty through sustainable education, health, livelihood and basic infrastructure projects in the community most affected by the gold and copper mining operations (preamble). Through this agreement, the Vilabouly District Development Trust Fund and MMG-LXML Company agree on the rules for the use of the Trust Fund and establish guidelines to the Trust Fund Board for the annual planning approval (Art. B).

• Governance, implementation, dispute resolution

  The projects to be financed through the Development Trust Fund must be approved at the annual meeting. The projects cannot start until the formal documents are approved by the Community Relations Department and Vilabouly District (Art. C2). Projects costing US $50,000 or more must be put out to tender, advertised through a public announcement, and a minimum of three closed bids should be received in a competitive bidding process. Projects costing less than US $50,000 will be negotiated informally with at least three local contractors. Representatives of MMG-LXML and Vilabouly District will be on the committee reviewing the bid (Art. C3). The Trust Fund will have inspection and monitoring teams that will report periodically on the progress of the projects. A technical officer will establish a monitoring checklist in consultation with MMG-LXML and will report to the Trust Fund secretary unit after each monitoring visit (Art. 4). Milestone annual payments for larger projects will be made annually after satisfied technical inspection by the team made up of representatives of Vilabouly District, MMG-LXML and, contractors. After each project is completed, it will be handed over to the Village Authorities for its usage and maintenance (Art. 5). All payments will be made after satisfactory completion of the final project report (Art. 7). Debt is permitted for large projects but it should not exceed 100% of the annual Trust Fund amount and will generally be kept below US $250,000. If the mining operation is going to close, MMG-LXML should inform the Vilabouly District 1.5-2 years in advance (Art. 10).

• Fiscal obligations: content

  The administration budget will be US $15,000 to be used by the Vilabouly District for training and staff development, supporting work at the grass-root level, purchases of up to US $2,000 of office supplies, and the bank’s monthly fee (Art. 8). The project maintenance budget will be US $30,000 to be used for maintenance of infrastructure under the responsibility of the Vilabouly District (Art. 9).

• Community development obligations: Infrastructure and social services

  The purpose of the Trust Fund is to provide assistance to eradicate poverty through sustainable education, health, livelihood and basic infrastructure projects in the community most affected by the gold and copper mining operations (preamble). Priority will be given to the projects that meet poverty alleviation or eradication targets, especially projects benefiting women and children as well as projects that strengthen the capacity of the authorities to deliver basic community services (Art. C).

• Reference to investor-state contract

  The Development Trust Fund Charter makes reference to the investor-state contract (as amended) between the Government of Laos and Oxiana Resource Laos Limited (Preamble).