Summary of contract

• Negotiation, representation, and other relevant context

  The agreement is between Alpha Logging & Wood Processing and the communities of Lofa Community Forest Development Committee (“the communities”). The Forestry Development Authority of Liberia is a witness to the agreement (page 1). The Forest Management Contract Area A covers the Salayea and Zorzor Districts in Lofa Country and was awarded to Alpha Logging & Wood Processing (page 3; Code of conduct, (3)). In preparing Forest Management Contract Area A, notice was given and surveys conducted in a portion of the communities to validate whether the area was suitable for commercial forest practices based on ecological, economic, and social considerations. As part of this survey, the communities were informed of the potential Forest Management Contract and that a social agreement was required. The government secured a statement on behalf of the communities that they would negotiate a social agreement in good faith with the winner of the competitive bid (page 4). Community members shall elect their representatives to the Community Forestry Development Committee (“CFDC”) which is responsible for representing the communities and negotiating the agreement on their behalf (Art. IV). The CFDC must consist of at least 10 members who are residents of the community which they represent and must not be employees of the government, a civil society organization or a non-governmental organization (Arts. IV(a) and (i)). Members must be freely and fairly elected and should reflect gender balance and provide a means for all residents that it represents including women, youths and elders, to have their views heard and considered (Arts. IV(b), IV(d)). The agreement should contain a code of conduct according to National regulations (page 9). The agreement is “legitimate” for 25 years and renegotiable after every 5 years (Code of conduct, (1)). The CFDC terminates 5 years following the execution of the agreement and if logging continues beyond this date, the communities will elect a new CFDC 1 month before the end of the 5 years to renegotiate a new social agreement. If the 5 years review meeting is held and everything remains fine, a new social agreement shall be negotiated and signed 2 months after the 5 years end (Code of conduct, (11)).

• Governance, implementation, dispute resolution

  Alpha Logging & Wood Processing and the communities will maintain lines of communication regarding implementing the agreement and will provide periodic updates (which should include information as to volume of logs removed to date) to the chairperson (Art. I(C)). Alpha Logging & Wood Processing will provide all necessary information that will be provided to the public to help monitor the agreement (Code of conduct, (15)). The Community Forestry Development Committee (“CFDC”) is to be supported by the Community Fund, at the rate of 10% of annual benefit delivery, to conduct participatory compliance monitoring of the delivery of benefits by Alpha Logging & Wood Processing to the community (Art. VI). Independent monitoring by CFDC Expert / Advisor will occur under an MOU and with a fee from the Community Fund of 5% of the annual benefit delivery (area and product base fees) (Art. VI). Alpha Logging & Wood Processing must hold quarterly meetings with the CFDC and the communities on the last Friday of the last month in each quarter for briefings, updates and grievances, and call other meetings whenever the need arises (page 6; Art. IV(g)). The parties will hold annual meetings with representatives of the CFDC, the government and Alpha Logging & Wood Processing to discuss the upcoming annual operating plan as well as to attempt to resolve any issues identified from the previous operating season (Art. 1 (D)). If there is any controversy under the agreement, the CFDC and Alpha Logging & Wood Processing will seek to resolve the matter with the assistance of the government (Art. IV). If there are still differences, local government officials (District Commissioner, Paramount Chiefs, Clan Chief, and Town Chief) will be neutral parties in a third-party mediation process, provided that their neutrality is proven. If not resolved by these steps, any claim relating to the agreement shall be exclusively settled by binding arbitration in accordance with the Commercial Arbitration Rules (Art. IV). The governing law is the law of Liberia (Art. IV). The parties may modify the agreement by mutual agreement and the government needs to attest to its completeness prior to any modifications going into effect (Art. 1 (B)). The agreement shall be binding on the parties, their heirs, administers, assigns and successors-in-office as though they were physically present when the agreement was signed (Code of conduct, (11)). If Alpha Logging & Wood Processing decides to sub-contract or assign any of its rights under the concession agreement subject to the agreement, it shall notify the CFDC and disclose the name of the assignee (Art. III, page 7).

• Fiscal obligations: content

  Alpha Logging & Wood Processing must pay to the communities land rental fees, cubic meter fees and educational support funds (Code of conduct, (9)). Alpha Logging & Wood Processing will pay US$ 1.50 for each cubic meter of timber cut to the Community Forestry Development Committee (“CFDC”) upon commencing operations apart from payment of 30% land rental (US$ 2.50 per hectare) to the community benefit sharing scheme (Art. III, page 7). Alpha Logging & Wood Processing will provide annual educational support of US$ 13,000 (US$ 6,500 per semester) payable in July and January every year (Art. III, page 7). The CFDC shall receive 10% of the annual revenue to the communities (area and production base fees) as compensation, which shall be distributed based on positions (Art. IV(e)). 10% of the area-base fee will be paid directly by the National Benefit Sharing Trust Board every month but the 10% of the production based fee compensation shall be received at the end of the year (Art. IV(f)).

• Community development obligations: Local content

  Alpha Logging & Wood Processing will provide in-kind benefits, such as jobs, to the communities (Code of conduct, (12)). Alpha Logging & Wood Processing agrees to provide first preference for skilled and unskilled employment and middle manager job opportunities for communities members which shall be done through the Community Forestry Development Committee (“CFDC”) as well as on the job training (Art. III, pages 6-7). Alpha Logging & Wood Processing also agrees to employ 1 community liaison officer to monitor all field activities of Alpha Logging & Wood Processing and who will report monthly to the communities (Art. III, page 7).

• Community development obligations: Infrastructure and social services

  Alpha Logging & Wood Processing will provide in-kind benefits to the communities, such as buildings and roads (Code of Conduct, (12)). Alpha Logging & Wood Processing will build workers’ camps to house employees and their families, comprising at least 1 bedroom apartments made with concrete. Alpha Logging & Wood Processing will construct 5 latrines and 10 hand pumps (Art. III, pages 5, 7). Alpha Logging & Wood Processing will also build and operate (a) an elementary school in line with the standard of the Ministry of Education Action Plan within the workers camp, and (b) a clinic in line with the standards of the Ministry of Health Action Plan within the workers camp (Art. III, pages 5-6). Alpha Logging & Wood Processing will maintain existing roads and construct new roads and bridges and all bridges must be made with concrete (Art. III, pages 6).

• Community development obligations: Other

  Alpha Logging & Wood Processing agrees to (a) provide technical support in carrying on community development projects, (b) provide transportation during emergency situations and major development activities, and (c) have a functional office at all times in the operational area (Art. III, page 7). Upon the request of the community, Alpha Logging & Wood Processing agrees to provide logs and timber products including sawn wood to the communities for community development/project only (Art. III, page 6).

• Environmental and social protection

  Alpha Logging & Wood Processing agrees to stop effects on traditional practices such as taboo day, sacred sites, and the range of taboo animals/plants, medicinal plant sites, hunting grounds, and non-timber forest products sites (Art. III, pages 5). Alpha Logging & Wood Processing agrees that its operations protect and maintain existing water collection points and not to damage existing cash/food crops (Art. III, pages 5). Alpha Logging & Wood Processing and its operations will not cause any physical damage or otherwise interfere with any existing farms or crops including infringing upon farm land, binding access to or from the farm, or making harvesting more difficult in any way (Code of Conduct, (8)). If Alpha Logging & Wood Processing complies with the communities customary laws regarding traditional practices described in the agreement, the communities will not interfere with Alpha Logging & Wood Processing’s logging activities and the communities must inform Alpha Logging & Wood Processing in advance about traditional activities that may affect Alpha Logging & Wood Processing’s operation (Code of conduct, (18)). The communities will not be prevented from harvesting all non-timber forest products from within the contract area (Code of conduct, (19)).

• Reference to investor-state contract

  The communities were informed of the potential Forest Management Contract (between the government and Alpha Logging & Wood Processing) and that a social agreement was required by Liberian regulations (page 4). The government will ensure that the operations of Alpha Logging & Wood Processing are in compliance with the Forest Management Contract (page 11).

• Other noteworthy clauses

  This agreement shall serve as a binding contract (Art. VII). The Community Forestry Development Committee (“CFDC”) and local authorities shall ensure that no chain sawing and farming are allowed in the contract area (Art. IV(j)). The communities will encourage low land agriculture development to avoid the expansion of subsistence agriculture activities within the contract area and agree to avoid establishing new farms within the high forest or causing fires in the high forest (Code of conduct, (4) and (5)). The communities agree not to carry on any commercial pit sawing in the contract area and will not undertake activities that will cause damage to Alpha Logging & Wood Processing’s operations (Code of conduct, (6) and (7)). The community agrees not to force anybody to join their traditional society unless that person violates that society law and Alpha Logging & Wood Processing will be informed of the violation and the punishment (Code of conduct, (18)).