Summary of contract

• Negotiation, representation, and other relevant context

  This provisional memorandum of understanding between the Jarbo communities of Nemiah, Piddy and Nyabo in the Garraway Administrative District (the Communities), and Golden Veroleum Inc., outlines the social and economic benefits offered by Golden Veroleum to the Communities, as well as the process of engagement for future assignments of land for oil palm development. The Communities have invited Golden Veroleum to develop land in their community areas for planting and facilities, together with a community oil palm program. The parties through participatory mapping have identified and shall further identify the land for the development of oil palm by Golden Veroleum, as well as the land to establish a community oil palm program with the support of Golden Veroleum. The Communities have determined or will furthermore determine to their considered satisfaction that the land identification for oil palm still leaves the necessary amount of land for other needs (Preamble). Confirming the participative mapping and the Free, Prior and Informed Consent engagement process undertaken by the parties, the community signs the development map, and affirms that it may wish to enter into future negotiations for transfer of additional lands (Art. I). The final memorandum of understanding will include the same terms and any changes mutually agreed by the parties (Art. J).

• Governance, implementation, dispute resolution

  The agreement shall be registered through the Liberian Legal system and become binding upon the parties (Preamble). Golden Verlorum will make the payments to the Communities through the Community Development Fund. The Community Development Fund will be established during the first year of field planting and will be governed by representatives from the Communities and Golden Verlorum. The Community Development Fund will be used to pay for infrastructure and facilities prudently selected and planned, and payments will be repeated every year. Golden Veroleum will carry out the needs and planning survey with the Communities and this will be repeated from time to time to guide planning (Appendix C). Golden Veroleum states that it follows a process to ensure that the community gives its Free, Prior and Informed Consent, and as part of this, the Communities and Golden Veroleum signed a Free, Prior and Informed Consent - FPIC- engagement agreement. The FPIC engagement process will be an ongoing process subject to community desire and willingness to offer additional areas for development (Appendix F). The Communities commit to actively engage in monitoring and evaluating the activities of Golden Veroleum regarding this project (Appendix G). The grievances and complaints of the Communities’ members can be made to Golden Veroleum or to the Communities’ representatives. After receiving the complaint, a field investigation should be carried out by the parties and the complainant. Then, a meeting with all the parties and the complainant should be called to agree on actions to address the complaint. The complainant should have the right to say “yes” or “not” to the proposed actions. In case of disagreement, the complainant will be asked to go to court if she so wishes. In court, Golden Veroleum and the community representative will team together against the complainant (Art. H and Appendix H). Appendix I is a statement of acknowledgment and acceptance of land grant by the Communities to Golden Veroleum, and it states that the consent of the Communities is free and informed.

• Fiscal obligations: content

  Golden Veroleum will provide US$ 5 per each hectare of developed land, on an annual basis, to the Community Development Fund for infrastructure and facilities benefiting the communities (Art. C). Gold Veroleum will pay 1/2% of annual sales of oil palm products into an oil palm development fund and the proceeds will be used to support and promote community and smallholder oil palm developments additional to the community oil palm (Appendix D). Golden Veroleum will grant US$ 100,000 university scholarships to qualified employees’ children for agricultural studies (Appendix B).

• Community development obligations: Local content

  Golden Veroleum agrees to provide preference for jobs, training, business opportunities, promotion, scholarships, contracting and supply entrepreneurship, to qualified citizens of a good reputation within the Communities (Art. A, Appendix A). Golden Veroleum will provide preference to the Communities for technical training for advancement to qualified jobs and management. Golden Veroleum will provide preference to the Communities for trainee Cadetships towards management jobs. Golden Veroleum will provide adult literacy and numeracy education for workers and the Communities (Appendix A, C). Golden Veroleum will provide business opportunities to Communities’ entrepreneurs and will consider the Community for industrial development of an oil palm factory mill. Golden Veroleum will provide opportunities and preference to local business and entrepreneurs, beginning with offering market areas in Golden Veroleum farms for trades such as construction, lumber and carpentry works, brick making, poultry farming and all types of services and trade activities (Art. C, Appendix C). Golden Veroleum agrees to provide timely wages, salaries, free housing, free health care, free education and schooling to employees’ children in accordance with Appendix B (Art. B). Golden Veroleum will pay wages and salaries that meet the Liberian laws, as well as the terms of any collective bargaining agreement with the unionized workers. Golden Veroleum provides to its employees a 50kg bag of rice monthly per employee, annual paid vacation, maternity leave, bereavement payment and national social security contributions. Golden Veroleum will provide to Community citizens who become employees: on-the-job, head gang, international secondment (e.g. learning modern mill engineering methods), supervisor and vocational training. Golden Veroleum wishes to create and build management and technical support capabilities deriving from the Communities (Appendix B). Golden Veroleum will offer employment based on the stage of the plantation’s development. The Community Oil Palm might provide 20% of field jobs when fully implemented. Golden Veroleum will give job preference to the Communities and will offer jobs according to the land size offered by the community (Art. E).

• Community development obligations: Infrastructure and social services

  Golden Veroleum will construct and rehabilitate roads and bridges and will provide citizens with access to Golden Veroleum schools, universities and college scholarships, health care facilities, although priority will be given to employees and their dependants (Art. C and Appendix C). Golden Veroleum will provide preference to qualified students of the Communities to college and university scholarships (Appendix A). Golden Veroleum will build wells for communities where needed to avoid disturbance to clean water supply from the oil palm development. Wells will be equipped with hand pumps in towns with over 150 citizens. (Appendix C). Golden Veroleum will provide the children of the citizens who become employees free schooling, including payment to the teachers, school maintenance and study items. Golden Veroleum will build schools from kindergarten through high school in its farm townships. Golden Veroleum will provide employees and their dependants health care and medical treatment free-of-charge. Golden Veroleum will construct clinics and will pay the health care staff and the equipment. Golden Veroleum will provide free-of-charge housing within the developed area for full-time employees and their dependants and the housing will have free electric power, piped water and toilets. The Golden Veroleum farm townships will have marketplace, a house of worship and sports field. These buildings are normally built during year 2-3 of a new Golden Veroleum farm area (Appendix B). The Communities will have access to schools but priority will be given to the employees’ dependants. Golden Veroleum will provide the Communities access to its health care and medical facilities subject to availability and minimum at cost but priority will be given to the employees’ dependants (Appendix C).

• Community development obligations: Other

  Golden Veroleum will support the Communities in the construction of a community-owned oil palm project and will provide training, supply seedling, tools and fertilizers at cost and free of import duties (Art. D, Appendix D). Golden Veroleum will guarantee to purchase the fruits at regulated and transparent prices (Appendix D). Golden Veroleum can give to qualified staff a subsidized motorcycle without down payment (Appendix B). Appendix E includes schedules for some of the benefits established in the agreement. The Communities and Golden Veroleum have identified through participatory mapping a minimum of 2915 acres of land for the development of oil palm by Golden Veroleum and additional 583 acres (Nemiah 279.8, and Piddy/Nyanbo 303.2) as may be required for the use of the Community with support from Golden Verlorum to establish a Community oil palm program; the contributing acres for the two communities are Nemiah 1,399 acres and Piddy and Nyanbo 1,516 acres (Preamble).

• Environmental and social protection

  Golden Veroleum shall identify with the participation of the Communities the protected areas such as cemeteries, shrines, sacred forest, and old towns that the communities wish to preserve and other agreed cultural or economic sites identified as important to the communities’ well being. Golden Veroleum will clearly enclave/avoid damage to those sites. The parties acknowledge that given the history of Liberia it is possible that these sites may be difficult to identify, so the Communities commit to address and resolve internally any such mistakes in the identification of the sites before discussing with Golden Veroleum. Golden Veroleum and individual farmers of the Communities will carry out a field survey and crop count before any agreement to convert active farms to Golden Veroleum farms. If there is an agreement to convert a farm, compensation will be at a rate set by the Government or other rates that may be agreed, and the compensation will be made in open forum with witnesses. The decision to convert a farm is final and binding on Golden Veroleum and the farmer. Golden Verlorum will adhere to the environmental protection and management law of Liberia, the new forestry reform law or any other law or regulation of the environmental agency, the forestry development authority and the principles of the roundtable on sustainable palm oil (Appendix F).

• Reference to investor-state contract

  The Republic of Liberia granted to Golden Veroleum a 65-year agricultural concession for oil palm cultivation and the production and sale of palm oil products (Preamble).

• Other noteworthy clauses

  Golden Veroleum commits to not pursue resettlement of the Communities from their villages or towns (Art. F). The Communities commit to: a partnership and mutual collaboration with Golden Veroleum, to allow Golden Veroleum safe and undisturbed use of the land, to participate in activities that protect high conservation values and high carbon stock sites, to help maintain the quality of the water bodies, to collaborate with Golden Veroleum to stop illicit drug sale within concessioned areas, to assist protect the investment and protect wildlife (Art. G, Appendix G).