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1 Setting the Legal and Policy Framework

Stage 1:
Setting the Legal & Policy Framework

Setting the Legal and Policy Framework refers to the need for a country to formulate clear policies and strategies that both attract FDI and benefit the country.

Government Policies and Strategies Legislative and Regulatory Frameworks Sector-Wide Analyses
2 Pre-Negotiation

Stage 2:
Pre-Negotiation Stage

The Pre-Negotiation Stage refers to the period during which a government identifies a particular project or investment and conducts feasibility studies and impact assessments.

Feasibility Studies Impact Assessments Tender Process and Financial Structure
3 Contract Negotiation

Stage 3:
Contract Negotiation Stage

The Contract Negotiation Stage refers to the actual negotiation of investment contracts between a government and an investor.

Prepare for the Negotiation Assemble a Negotiation Team Develop a Negotiation Position Contract Negotiation
4 Contract Implementation and Monitoring

Stage 4:
Implementation & Monitoring Stage

The Implementation and Monitoring of the Investment Stage refers to the period during which an investment project is developed and operated pursuant to the terms of the investment contract.

Monitoring Implementation Grievance Mechanisms

Roadmap

Monitoring of the Investment

Content of this page:

For the government to effectively monitor compliance, it should:

  1. Map out the government and investor obligations in the contract and relevant legislation; and
  2. Identify contacts in the relevant ministries and government agencies that will be responsible for  ensuring the government complies with its contractual obligations and the investor carries out its operations in accordance with its contractual obligations and the standards it has agreed to meet. This should also include ensuring that the efforts of each government department involved in monitoring the investment are coordinated and inter-linked to maximize the government’s ability to oversee the investment.

In relation to the extractive industries sector, the World Bank Group’s contract monitoring roadmap details the steps and actions that need to be carried out to effectively monitor the implementation and operation of extractive industry investments.

Key Tools At This Stage

 

Useful Resources

Transparency

Implementing EITI for Impact: A Handbook for Policymakers and Stakeholders Go to resource

  • Sector:  Extractive Industries
  • Source:  World Bank

This particular guide is aimed at policymakers, industry, and civil society members who wish to implement the EITI standard. It details what types of regulations must be implemented to become a candidate for the EITI and to comply and remain EITI-compliant.

Available in English, French, and Spanish.

NRGI Guide to the EITI Standard Go to resource

The guide is an online, interactive reference that allows users to explore the opportunities in the EITI Standard in seven policy areas. These areas are based on the extractive industries decision chain and reflect some of the governance challenges most frequently raised by stakeholders. The guide also covers two process areas: civil society participation and multi-stakeholder group governance.

The Extractive Industries Sector : Essentials for Economists, Public Finance Professionals, and Policy Makers Go to resource

  • Date:  2015
  • Sector:  Extractive Industries
  • Source: 

The extractive industries (EI) sector occupies an outsize space in the economies of many developing countries. Economists, public finance professionals, and policy makers working in such countries are frequently confronted with issues that require an in-depth understanding of the sector. The objective of this volume is to provide a concise overview of EI-related topics these professionals are likely to encounter. T

he volume provides an overview of issues central to EI economics; discusses key components of the sector’s governance, policy, and institutional frameworks; and identifies the public sector’s EI-related financing obligations. Its discussion of EI economics covers the valuation of subsoil assets, the economic interpretation of ore, and the structure of energy and mineral markets. The volume maps the responsibilities of relevant government entities and outlines the characteristics of the EI sector’s legal and regulatory frameworks. Specific key functions of the sector are briefly discussed, as are the financial structures that underpin environmental and social safeguards; investment of public revenues generated from oil, gas, or minerals; as well as extractive-based economic diversification.

The authors hope that decision makers in ministries of finance, international organizations, and other relevant entities will find the study useful to their understanding and analysis of the EI sector.

The Extractive Industries Sector : Essentials for Economists, Public Finance Professionals, and Policy Makers Go to resource

  • Date:  2015
  • Sector:  Extractive Industries
  • Source: 

The extractive industries (EI) sector occupies an outsize space in the economies of many developing countries. Economists, public finance professionals, and policy makers working in such countries are frequently confronted with issues that require an in-depth understanding of the sector. The objective of this volume is to provide a concise overview of EI-related topics these professionals are likely to encounter. The volume provides an overview of issues central to EI economics; discusses key components of the sector’s governance, policy, and institutional frameworks; and identifies the public sector’s EI-related financing obligations. Its discussion of EI economics covers the valuation of subsoil assets, the economic interpretation of ore, and the structure of energy and mineral markets. The volume maps the responsibilities of relevant government entities and outlines the characteristics of the EI sector’s legal and regulatory frameworks. Specific key functions of the sector are briefly discussed, as are the financial structures that underpin environmental and social safeguards; investment of public revenues generated from oil, gas, or minerals; as well as extractive-based economic diversification. The authors hope that decision makers in ministries of finance, international organizations, and other relevant entities will find the study useful to their understanding and analysis of the EI sector.The extractive industries (EI) sector occupies an outsize space in the economies of many developing countries. Economists, public finance professionals, and policy makers working in such countries are frequently confronted with issues that require an in-depth understanding of the sector. The objective of this volume is to provide a concise overview of EI-related topics these professionals are likely to encounter. The volume provides an overview of issues central to EI economics; discusses key components of the sector’s governance, policy, and institutional frameworks; and identifies the public sector’s EI-related financing obligations. Its discussion of EI economics covers the valuation of subsoil assets, the economic interpretation of ore, and the structure of energy and mineral markets. The volume maps the responsibilities of relevant government entities and outlines the characteristics of the EI sector’s legal and regulatory frameworks. Specific key functions of the sector are briefly discussed, as are the financial structures that underpin environmental and social safeguards; investment of public revenues generated from oil, gas, or minerals; as well as extractive-based economic diversification. The authors hope that decision makers in ministries of finance, international organizations, and other relevant entities will find the study useful to their understanding and analysis of the EI sector.

Monitoring

A Good Deal Better? Uganda's Secret Oil Contracts (Plus Economic Model) Explained Go to resource

  • Date:  2014
  • Sector:  Extractive Industries, Oil & Gas
  • Source:  Global Witness

Global Witness has analysed and made public two “production sharing agreements” signed by the Ugandan Government and international oil companies in February 2012. They determine what share of oil revenues the Government of Uganda will get and almost every aspect of its relationship with the oil companies. This is the first time this information has been made public.

Their analysis shows that the Ugandan Government has succeeded in negotiating a better financial deal in these contracts compared with older contracts – for which it should be congratulated. But there are some significant weaknesses that still need to be addressed. The contracts lack some important human rights and environmental safeguards. This is of particular concern given the unique habitats of the oil region in Uganda which sits on the border with the Democratic Republic of Congo and the Nile River.

To see how Uganda’s oil money will be shared and evaluate the new contracts against the old contracts see the Revenue Infographic. You can also download Global Witness' open source Economic Model, the first of its kind, which can be updated when new information becomes available or adapted for other countries’ contracts. A guide is also available here.

Biodiversity Management Handbook Go to resource

  • Date:  2007
  • Sector:  Extractive Industries, Mining
  • Source:  CommDev

Handbook on how to manage and maintain biodiversity standards in mining operations. This handbook outlines the key principles and procedures now recognized as leading practice
for assessing biodiversity values, namely:

  • identifying any primary, secondary or cumulative impacts on biodiversity values
  • minimizing and managing these impacts
  • restoring conservation values
  • managing conservation values on a sustainable basis.

Contract Monitoring Roadmap Go to resource

A step-by-step guide to understanding how to monitor a contract in the extractive industries, including tools, resources and case studies for each step. It leads the reader through the process of choosing a monitoring goal, establishing the monitoring mechanism, collecting and analyzing data, and finally publicizing and using data to ensure contract implementation.

The roadmap is also available in French.

Enforcing the Rules: Conclusions and Recommendations Go to resource

A report that aims at helping government and civil society actors understand the challenges and good practices associated with effective oversight and enforcement in the mining industry.

To monitor, mining obligations must first be identified, but they are not always obvious.

FAO: Responsible Governance of Tenure and the Law– A Guide for Lawyers and Other Legal Service Providers Go to resource

The FAO Governance of Tenure Technical Guides are part of FAO’s initiative to help develop capacities to improve tenure governance and thereby assist countries in applying the Voluntary Guidelines on the Responsible Governance of Tenure of Land, Fisheries and Forests in the Context of National Food Security. The FAO Governance of Tenure Technical Guides are prepared by technical specialists and can be used by a range of actors. They:

-Translate principles of the Guidelines into practical mechanisms, processes and actions;

-Give examples of good practice – what has worked, where, why and how;

-Provide useful tools for activities such as the design of policy and reform processes, for the design of investment projects and for guiding interventions. 

How To Improve Mining Tax Administration and Collection Frameworks Go to resource

  • Date:  2013
  • Sector:  Extractive Industries, Mining
  • Source:  World Bank

Governments of mineral-rich countries formulate and use a variety of financial instruments to collect a share of the revenue generated by mining companies. Instruments include the full range of taxes, fees, and charges that generally apply to all normal commercial operations. In addition to these measures, most governments use mineral royalties along with variations to the corporate taxation measures, customs duties, and value-added taxes that apply just to mining.

This sourcebook focuses on mineral royalties and on other taxation measures that are specific to mining activities, with particular emphasis on imposts of common application in most developing countries, which may create challenges in their administration. The legislative framework establishing these taxes in developing countries that are experiencing an accelerated pace of resource development is in most cases relatively modern and largely adequate, but the supporting administrative capability, procedures, and systems have tended to lag behind.

This sourcebook presents a practical overview of how to analyze and improve the administrative frameworks and systems for mineral royalties and other taxes specific to mining.

This sourcebook provides a structured approach to help the ministries of finance and mines analyze and improve their effectiveness and efficiency in handling common issues and challenges; avoid duplication of effort; and overcome the organizational, structural, and resourcing difficulties generally encountered in the administration of various elements of mining regimes.

Available in Arabic, Chinese, English, French, Spanish, and Russian

How to Scrutinise a Production Sharing Agreement Go to resource

  • Date:  2012
  • Sector:  Extractive Industries, Oil & Gas
  • Source:  IIED

The guide discusses the provisions of a particular type of oil and gas contract, the Production Sharing Agreement (PSA). While the guide is aimed at a general civil society readership, it draws particularly on experience from Kazakhstan. Its purpose is to give an accessible account of some key characteristics of PSAs, with a focus on revenue issues, and to suggest action points for civil society organisations involved with monitoring extractive industries. Indeed, in recent years the management of extractive industry revenues has become of growing concern to public opinion in resource-rich states.

Implementing EITI for Impact: A Handbook for Policymakers and Stakeholders Go to resource

  • Sector:  Extractive Industries
  • Source:  World Bank

This particular guide is aimed at policymakers, industry, and civil society members who wish to implement the EITI standard. It details what types of regulations must be implemented to become a candidate for the EITI and to comply and remain EITI-compliant.

Available in English, French, and Spanish.

Land Matrix Global Observatory Go to resource

The Land Matrix is a global and independent land monitoring initiative. Its goal is to facilitate an open development community of citizens, researchers, policy-makers, and technology specialists to promote transparency and accountability in decisions over land and investment.

NRGI- Enforcing the Rules Go to resource

Enforcing the Rules: Government and Citizen Oversight of Mining, examines the gaps in effective monitoring of mining obligations, identifies good practices and proposes practical avenues for improvement. 

In many countries rich in minerals, mining deals between industry and government have failed to deliver the benefits citizens expect—not only because of bad contracts but also because governments and civil society fail to effectively monitor and enforce company compliance with the terms of good contracts.

Recent years have brought significant improvements in industry and government transparency, national mining laws and contracts, but monitoring remains the only way to determine whether the deals struck with companies reflect what is being implemented on the ground. Many developing countries with weak regulatory systems lack the capacity or political will to ensure that company obligations are enforced. The result can be losses of billions of dollars to tax evasion and fraud, and harm to workers, the environment and social peace.

Public-Private Partnerships Reference Guide: Version 2.0 Go to resource

The PPP Reference Guide is a comprehensive resource for PPP practitioners worldwide, drawing from global approaches and experiences.

The PPP Reference Guide seeks to provide advice on what PPP practitioners should know, rather than provide advice on what to do. The Guide sets out the main topics, looks at the key issues that must be addressed, and provides some of the most important references that PPP practitioners can turn to for answers and to enhance their own knowledge and understanding.

The website is also available in French and Spanish, but the document is only available in english.

It is structured into separate sections that focus on three main areas:

  1. What are PPPs, when might they be used and what are the advantages and disadvantages relative to public provision;
  2. What kind of policy, legal and institutional frameworks should be put into place to help improve their effectiveness; and
  3. What are the ways in which PPP projects can be developed and implemented.

A diverse range of case studies and institutional solutions, from all parts of the world, are presented in the PPP Reference Guide.

Social and Environmental Sustainability of Agriculture and Rural Development Investments: A Monitoring and Evaluation Toolkit Go to resource

The purpose of this toolkit is to provide practical guidance in the monitoring and evaluation of the environmental and social sustainability of Agricultural and Rural Development programs and projects.

The website is available in Arabic, Chinese, English, French, Russian, and Spanish, but the document is only available in English. 

The Extractive Industries Sector : Essentials for Economists, Public Finance Professionals, and Policy Makers Go to resource

  • Date:  2015
  • Sector:  Extractive Industries
  • Source: 

The extractive industries (EI) sector occupies an outsize space in the economies of many developing countries. Economists, public finance professionals, and policy makers working in such countries are frequently confronted with issues that require an in-depth understanding of the sector. The objective of this volume is to provide a concise overview of EI-related topics these professionals are likely to encounter. The volume provides an overview of issues central to EI economics; discusses key components of the sector’s governance, policy, and institutional frameworks; and identifies the public sector’s EI-related financing obligations. Its discussion of EI economics covers the valuation of subsoil assets, the economic interpretation of ore, and the structure of energy and mineral markets. The volume maps the responsibilities of relevant government entities and outlines the characteristics of the EI sector’s legal and regulatory frameworks. Specific key functions of the sector are briefly discussed, as are the financial structures that underpin environmental and social safeguards; investment of public revenues generated from oil, gas, or minerals; as well as extractive-based economic diversification. The authors hope that decision makers in ministries of finance, international organizations, and other relevant entities will find the study useful to their understanding and analysis of the EI sector.The extractive industries (EI) sector occupies an outsize space in the economies of many developing countries. Economists, public finance professionals, and policy makers working in such countries are frequently confronted with issues that require an in-depth understanding of the sector. The objective of this volume is to provide a concise overview of EI-related topics these professionals are likely to encounter. The volume provides an overview of issues central to EI economics; discusses key components of the sector’s governance, policy, and institutional frameworks; and identifies the public sector’s EI-related financing obligations. Its discussion of EI economics covers the valuation of subsoil assets, the economic interpretation of ore, and the structure of energy and mineral markets. The volume maps the responsibilities of relevant government entities and outlines the characteristics of the EI sector’s legal and regulatory frameworks. Specific key functions of the sector are briefly discussed, as are the financial structures that underpin environmental and social safeguards; investment of public revenues generated from oil, gas, or minerals; as well as extractive-based economic diversification. The authors hope that decision makers in ministries of finance, international organizations, and other relevant entities will find the study useful to their understanding and analysis of the EI sector.

The Extractive Industries Sector : Essentials for Economists, Public Finance Professionals, and Policy Makers Go to resource

  • Date:  2015
  • Sector:  Extractive Industries
  • Source: 

The extractive industries (EI) sector occupies an outsize space in the economies of many developing countries. Economists, public finance professionals, and policy makers working in such countries are frequently confronted with issues that require an in-depth understanding of the sector. The objective of this volume is to provide a concise overview of EI-related topics these professionals are likely to encounter. T

he volume provides an overview of issues central to EI economics; discusses key components of the sector’s governance, policy, and institutional frameworks; and identifies the public sector’s EI-related financing obligations. Its discussion of EI economics covers the valuation of subsoil assets, the economic interpretation of ore, and the structure of energy and mineral markets. The volume maps the responsibilities of relevant government entities and outlines the characteristics of the EI sector’s legal and regulatory frameworks. Specific key functions of the sector are briefly discussed, as are the financial structures that underpin environmental and social safeguards; investment of public revenues generated from oil, gas, or minerals; as well as extractive-based economic diversification.

The authors hope that decision makers in ministries of finance, international organizations, and other relevant entities will find the study useful to their understanding and analysis of the EI sector.

Toolkit for Public-Private Partnerships in Roads and Highways Go to resource

  • Date:  2009
  • Sector:  Infrastructure
  • Source:  PPIAF

Assists transport sector policy makers in low- and middle-income countries in implementing procedures to promote private sector participation and financing in the development of their road and highway sector.

Towards Sustainable Decommissioning and Closure of Oil Fields and Mines: A Toolkit to Assist Government Agencies Go to resource

  • Sector:  Extractive Industries, Mining, Oil & Gas
  • Source:  World Bank

This toolkit is designed to increase the level of awareness on decommissioning and closure issues. It serves as guidance to government authorities, institutions and regulatory agencies, in natural-resource rich, developing countries, seeking to establish or improve closure and decommissioning programs for the extractives sectors.

Voluntary Guidelines on the Responsible Governance of Tenure of Land, Fisheries and Forests in the Context of National Food Security Go to resource

A reference and guide to improve the governance of tenure of land, fisheries and forests with the overarching goal of achieving food security for all and to support the progressive realization of the right to adequate food in the context of national food security.

Impact Assessments

Biodiversity Management Handbook Go to resource

  • Date:  2007
  • Sector:  Extractive Industries, Mining
  • Source:  CommDev

Handbook on how to manage and maintain biodiversity standards in mining operations. This handbook outlines the key principles and procedures now recognized as leading practice
for assessing biodiversity values, namely:

  • identifying any primary, secondary or cumulative impacts on biodiversity values
  • minimizing and managing these impacts
  • restoring conservation values
  • managing conservation values on a sustainable basis.

FAO Investment Centre Environmental Impact Guidelines Go to resource

Guidelines that provide an overview of how to conduct environmental impact assessments of agriculture and sector-related investments.

Guidebook for Evaluating Mining Project EIAs Go to resource

The guidebook will help governments, public interest lawyers, grassroots advocates, and community members understand mining EIAs, identify flaws in mining project plans, and explore ways that mining companies can reduce the public health hazards associated with mining.