Development bank panel to proceed with complaint from DR Congo communities on palm oil project

January 15, 2019

The panel of the complaints mechanism for the German, Dutch and French development banks has ruled that a complaint submitted on 5 November 2018 by nine communities in the DR Congo is admissible. This means that the complaints mechanism will now begin a preliminary review process before initiating the mediation process requested by the communities to resolve their long-standing land conflict with Plantations et Huileries du Congo (PHC), a subsidiary of Canadian company, Feronia Inc.

As part of the international coalition of civil society organisations who has supported the demands of the communities, GLAN welcomes this decision. We see it as an important test case to assess the effectiveness of the complaints mechanisms set up by development banks and to strengthen the work we are doing on land rights and transnational litigation. The case is of particular relevance given the fact that it will be the first time that the complaints mechanism of the German, Dutch and French development banks will apply mediation, as opposed to a mere compliance review of the banks. In addition, the outcome of the mediation will be of interest for other communities around the world as it centres on human rights and land legacy issues which are a common source of conflicts surrounding investments in agribusiness.

The above mentioned national development banks are deeply invested in Feronia and its subsidiary PHC. They have a combined controlling interest in the shares of Feronia, with the UK's CDC alone holding over 30 percent. Representatives of the CDC and the African Agricultural Fund, which manages a fund backed by the French and other development banks, have five seats on Feronia's board of directors. Moreover, a consortium of development banks led by the German DEG, and including the Belgian BIO and Dutch FMO, which provided PHC with a $49 million loan facility, have tremendous leverage over the company due to the large outstanding debts that they are owed. Given this level of control that the development banks have over Feronia, this should ensure that the company will engage constructively in the mediation process.

So far, GLAN has been assisting with the drafting of the complaint and attended a meeting with Feronia Inc. in their London office along with a member of the German Parliament. Further contribution will be provided during the mediation process. The support to the DRC communities and the international network is part of GLAN’s activity on land rights and transnational litigation.
 

The decision from the complaints mechanism is available here: https://www.deginvest.de/%C3%9Cber-uns/Verantwortung/Beschwerdemanagement/Feronia/index-2.html


For more information about the complaint, please see: "DRC communities file complaint with German development bank to resolve century-old land conflict with palm oil company" (https://farmlandgrab.org/28543)

 

GLAN Contacts: Tomaso.ferrando@bristol.ac.uk; hayden.fairburn@gmail.com


The international coalition of civil society organisations includes:  

RIAO-RDC

FIAN Germany

urgewald

CCFD-Terre Solidaire

Afrika Europa Netwerk

CNCD-11.11.11

FIAN Belgium

SOS Faim

AEFJN-Belge

The Corner House

Global Legal Action Network

GRAIN

World Rainforest Movement

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© 2019 GLAN | Global Legal Action Network. Registered charity (No. 1167733) 

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