Summary of contract

• Negotiation, representation, and other relevant context

  The parties to this agreement are the Stk’emlúpsemc of the Secwepemc Nation, represented by the Tk’emlúps Indian band and the Skeetchestn Indian band (the communities), and the Queen in right of British Columbia represented by the Minister of Energy, Mines and Petroleum Resources, and the Minister of Forests and Range and Minister Responsible for Integrated Land Management Bureau (the government). New Gold proposed to develop the New Afton Mine Project, which is within the traditional territory of the communities (Recitals A and B). The project is located at the site of the historical Afton Mine near Kamloops and includes its associated infrastructure as well as all other activities related to the exploration, planning, permitting, construction, maintenance and operation of the project and its infrastructure and facilities. The project does not include: (i) any expansion or change to the infrastructure and facilities that would be considered “material” or would require a significant amendment to the permit issued to New Gold or (ii) any extraordinary, unforeseen environmental emergency resulting from the project that may have a potentially significant adverse effect on the communities’ Aboriginal Rights (Art. 1). The government and the communities intend to use the agreement to demonstrate leadership and respect for one another’s interests, while developing a successful long-term working relationship intended to address fundamental concerns of the communities (Recital C). The communities and the government acknowledge their shared commitment to strengthening their governmental relationships and to focusing their efforts to close the socio-economic and cultural gaps between Aboriginal and non-Aboriginal peoples through enhanced collaboration, effective working partnerships and mutual respect, recognition and accountability (Recital D). The government and the communities entered into a mining and minerals agreement, which established a government-to-government process on mining activities, including the establishment of a mines and minerals joint resources committee, information-sharing principles and a consultation and accommodation approach for mining activity within the communities’ territory (Recital F). The communities and New Gold have developed a benefits agreement in relation to the project, which should not be limited or its value diminished by the agreement between the communities and the government (Recital G). The purposes of the agreement are to: (i) confirm the understandings reached between the government and the communities in relation to how the government will meet its legal obligations to consult with and to accommodate the communities in relation to the project; and (ii) share resource revenue received from the project by the government with the communities, so that the communities are able to pursue activities that enhance the social, economic and cultural well-being of their members (Art. 2). The communities acknowledge that they have obtained, or had the opportunity to obtain, advice of their own financial, legal, tax and other professional advisers with respect to the agreement (Art. 5.1(b)). The communities agree to release and forever discharge the government from all actions, causes of actions, claims, proceedings, debts, duties, demands, interest, fines, costs, expenses and compensation of any amount, nature and kind relating to consultation, accommodation and infringement of any of the communities’ Aboriginal rights arising from any government actions in relation to the project (Arts. 6.4-6.5). Appendices 1 and 2 contain a copy of the resolutions made by the Skeetchestn Council and the Tk’emlúps Council approving the agreement and giving authority to the chiefs on behalf of the members of the communities to enter into this agreement. The communities completed their discussion and review of the final draft of the agreement before the agreement was formally adopted (Appendices 1, 2).

• Governance, implementation, dispute resolution

  If any proposed government actions relating to the project may impact on the communities’ Aboriginal rights, the government will engage and consult with the communities through Mines and Minerals Joint Resources Committee and other government entities in order to identify potential appropriate mitigation or accommodation measures. These measures will not include any additional financial or economic components (Art. 6.1(a)). The consultation process consists of the government: (i) providing the community with advance written notice of the proposed government action and relevant information about it; (ii) granting the communities reasonable time to prepare their views on the proposed action; (iii) giving the communities a reasonable opportunity to present their views as to potential adverse impacts and how these impacts could be mitigated, minimized or otherwise accommodated (other than by compensation); (iv) undertaking a full and fair consideration of any views presented by the communities; and (v) providing the community notification of the decision taken and how the views presented by the communities were taken into account (Art 6.1(b)). If the government fails to make a payment to the communities, except if a failure to pay is a result of a dispute in relation to the payment amount, and the government does not remedy the failure to pay within 180 days after the community gives the government notice of the failure to pay, the communities may terminate the agreement. If there is a dispute about the proper amount of payment, either the government or the communities may give the other party notice. Upon receiving notice, the government and the communities will seek to resolve the dispute. Until the dispute is finally resolved by an agreement or the final decision of a court or an arbitrator, the government is considered to be in compliance with its obligations to make payments under the agreement (Art. 6.9). If there is a dispute, the government or the communities may give written notice of the dispute to the other party (Art. 11.3). Within 10 working days of providing notice, the communities and the government will meet and attempt to resolve the dispute through unassisted collaborative negotiation. If the meeting fails to resolve the dispute, any party may refer the dispute to mediation. If the communities and the government are unable to resolve a dispute through mediation, the communities and the government may agree to refer the dispute to an arbitrator for resolution. The decision of the arbitrator will be binding on the parties for the term of the agreement. The mediation and arbitration processes and all related proceedings will be and will remain confidential (Art. 11.4). The communities and the government may choose to resolve a dispute through other means (Art. 11.5). The communities, upon request by the government, will cooperate and provide their support in contesting or resolving any action or proceeding against the government by any member of the communities or any other Aboriginal group, seeking a legal claim for economic benefits or compensation in relation to the project (Art. 6.7). The agreement does not create any partnership, joint venture or employment relationship between the communities and the government (Art. 4). The communities cannot assign the agreement without the previous written consent of the government (Art. 7). If the communities or the government are not in compliance with its obligations, the complying party may terminate this agreement by giving the other party 30 days advance written notice of the intent and the reasons for terminating the agreement (Art. 9.3).

• Fiscal obligations: content

  The government only pays money to the community if the government earns a positive amount of money from the taxes, penalties and interest it charges the company or investor carrying out the project (the operator) (Art. 3.1(c)). If so, it will pay 37.5% of that amount to the communities. If the government has to refund more money than it earns from the operator, then 37.5% of this amount will be subtracted from future payments the government makes to the community (Art. 3.1(d)). The communities will establish a community corporation (SSN Corporation) and a payment account in the SSN Corporation’s name for the purpose of receiving monies payable to the communities under the agreement (Arts. 3.2(a)). The communities will hold all the shares of the SSN Corporation and will not dispose of any legal or beneficial interest in the shares of the corporation during the term of the agreement (Arts. 1, 5(f), 6.6)). If the operator is no longer responsible for making tax payments in relation to the project, with the result that the communities are not entitled to further payments under the agreement, the government will send the communities a notice of any outstanding overpayment amounts. The government may offset the overpayment amounts from any future amounts payable to the communities under any subsequent revenue-sharing agreements in relation to the project (Art. 3.1(d)). The communities acknowledge that the Mineral Tax Act revenues may fluctuate and any revenue-sharing payments from the government will vary over time (3.1(j)). The annual payments to be provided by the government are subject to there being sufficient available funds in an appropriation to enable it to make such payment; and the Treasury Board not having controlled or limited expenditure under any appropriation necessary to make the payment to the communities (Arts. 3.4(a)-(b)). The government has the right to require an audit of expenditures made by the communities from the payment account to ensure that all such expenditures were made for appropriate purposes under this agreement. This right will be exercised at the government’s discretion and paid for by the communities (Art. 6.3). The communities acknowledge that the agreement resolves any past or future claims associated with the project with respect to capacity funding, third-party studies or payments or other compensation or disbursements of any kind, including claims related to consultation activities, as well as issues related to revenue generation, including revenue-sharing and economic benefits (Art. 6.2(b)-(c)). If the SSN Corporation is terminated, the communities agree to distribute the money in the payment account on an equitable basis as agreed between the communities (Art. 9.5). The communities will use the annual payments from the government to pursue activities that will help enhance and improve the communities’ social, cultural and economic well-being, including the communities’ governance capacity, or held for implementing such objectives in future years, regardless of whether the agreement is terminated beforehand (Art. 6.2(d)-(f)). By 24/08/2010, the communities will prepare a statement of the community priorities identifying community initiatives, goals and specific outcomes that the communities intend to fund over the next 3 years. Within 90 days of the receipt of the annual payment, the communities will update the statement of community priorities to show how the funds have helped achieve the goals and specific outcomes; and within 90 days of receipt of each annual payment, the communities will provide the government a report identifying all expenditures made from the payment accounts since the date of the last report (Art. 6.3).

• Transparency or confidentiality

  The communities must keep confidential information marked as “confidential” by the government, including payment statements and information relating to tax payments (Art. 3.3(a)). The government must obtain a release and consent from the operator in order to share with the communities potentially confidential information obtained under the Mineral Tax Act, for the purposes of providing financial statements and making annual payments to the communities (Art. 3.3(b)). The communities will publish the statements of community priorities and the government reports on the internet or make them available to the public by other reasonable means (Art. 6.3(e)).