Benefit sharing Many jurisdictions view natural resources and subsurface minerals as belonging to the State. However, the indigenous representatives interviewed held that for indigenous peoples, these resources belong to them. Government and companies should understand the true value of the investment being put in by the communities in terms of the land and minerals that they contribute to the mining project. If the community gives its consent, the people should receive a fair and reasonable share of the benefits from the mining operation commensurate to their contribution. The basis for computing the indigenous community’s share should be a valuation of what they stand to lose from the mining operation, e.g. land, soil fertility, water resources, forests, animals, plants, food, culture, etc. It should also factor in community claims over subsoil resources in their territories, as well as the potential risks they and future generations face as a result of these activities. The terms of benefit sharing should be negotiated and specified in the memorandum of agreement resulting from the FPIC process. Some indigenous representatives emphasized that negotiations must be conducted in their own language. “Sharing of benefits from mining projects has to be fair and just. The basis for computing the share of the community should be a valuation of everything lost, e.g. loss of culture, loss of fertility of the land, animals, plants, food, etc. The impact of the project is already the cost, which is the basis for computation of the investment of the indigenous peoples. ” Quote from Rukka Sombolinggi, Toraja, Indonesia There are various models of benefit sharing, and it is the right of the people to choose what form this will take. Benefit sharing as a component of a partnership with indigenous peoples must go beyond compensation for damages. Elements of it could include employment, education or infrastructure provision. Guaranteeing royalties to the community is a step in the right direction, but equity shares in the company or the mining project were regarded as constituting more constructive relationships. Mining companies as a matter of course implement community projects as part of their corporate social responsibility. The community should decide what kind of social projects will be implemented and prioritized. These projects should be separate from the community’s share in the benefits of mining operation. Indigenous representatives expressed concern that the implementation of these projects prior to obtaining consent serves to distort FPIC processes. Agreements and grievance mechanisms Indigenous representatives interviewed saw the need to ensure that respect for their customary rituals are made part of the legal requirements of the FPIC process. Rituals need to be performed and respected because they serve a deeper purpose in the people’s culture and spirituality. Performing a ritual is a sign of good faith on “FPIC has to be made the part of the community. Violating these rituals could be a basis for mandatory and this can only voiding or nullifying the agreement. be done if guidelines … are The signing of an agreement, be it in the form of a Memorandum of developed to regulate its Agreement or an Impact Benefit Agreement, between the company operationalization. This will and the community signifies the commitment of both parties to abide mean that the industry enters by the obligations they negotiated and agreed upon in the process into binding agreements with of FPIC. Agreements should be formal legal contracts with the force local communities and any of law. This means that any breach of the agreement would require breach of that agreement punitive action. will be tantamount to a All agreements should specify the grievance procedures and punitive action.” mechanisms of redress for any violation committed. It is the choice of Quote from Reinford the community what grievance mechanisms they want to put in place, Mwangonde of and to identify the recognized authority that will monitor and enforce Malawi, Africa the agreement. What is important is that the people have confidence in the system. It should be run by independent persons whom the 22 Making Free, Prior and Informed Consent a Reality

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