29 June 2005

Liberia: Review C'ttee Wants All Forest Concessions Cancelled

Report reaching this paper says the Forest Concession Review Committee has recommended the cancellation of all forest concessions in the country on grounds that none of the relevant companies has complied with the rule of law, acceptable business standard nor the minimum requirements.

In its report, the Committee said that there are extensive issues of non-compliance in the forest sector relative to fiscal obligations, legal status and implementation procedures of contracts.

According to the report that is expected to be formally submitted to NTGL Chairman Charles G. Bryant, several logging companies including the Liberia Forest Development Corporation (LFDC), BIN-Liberia (BIN) Inc., Liberia Wood Management Company (LWMC), Liberia Logging & Wood Processing Corporation (LLWPC) and Liberia Timber & Plywood Company (LTPC) owe government over US$48 million in taxes.

Of this amount, the report said, LFDC which is the mother company of both the OTC and RTC, owes government US$28m, while LTPC owes US$12m and LMWC and LLWPC owe US$1m and US$2m respectively.

The report alleges that all concession holders have made multiple breaches of their respective contracts. It also says concessions have not been managed according to the rule of law for the last 15 years or more. Therefore, it suggested that to re-establish the rule of law in the forestry sector, all concessions should be cancelled and correct procedures followed henceforth.

"The Government is in breach of contract. The government has played a facilitating role in the decay of the application of the rule of law.

"Geographically concessions are overlapping and are not consistent with the metes and bounds identified in the concession agreements and management contracts.

"Many of the past concession holders are no longer in the country and did not maintain active business presence in Liberia. Technically, this as well constitutes a breach of contract as the concessions were not maintained by a certified business entity.

"Finally, this constitutes an opportunity for Liberia to re-establish the rule of law in the forestry sector and to reform the forestry policy that is guiding forest usage.

"Considering the state of affairs in the Liberian forest sector; lack of information concerning viability of standing forest value for harvest areas, volume availability, biological richness, lack of clear written legal grounds for managing concessions (regulations, finalized updated contract, etc.) and lack of mechanisms to ensure timely and consistent payments for tax billings as demonstrated by the finding of this committee," the committee's reports notes.

The committee added that Liberia has a clear and unique opportunity to re-define its forest policy and the objectives of its natural resources so as to address the needs of the citizenry.

"Furthermore, appropriate checks and balances need to be established in the forest sector to ensure that timber revenue is used to the benefit of the Liberian people and not used to fuel future conflict.

"The primary objective of the NTGL should be to restart a viable timber industry. Need to define sustainable levels of production through scientific methods, objective of taxes, and make money for concession holders.

"How much land can be harvested annually for a sustainable yield? How many concessions can this land support?

"Where should the first round of concessions be located in order to maintain the natural integrity of the forest eco-system in Liberia? The forest review committee demanded

The United Nations panel of exports has already endorsed the concession review report and has therefore called on the Liberian Government to implement the recommendations contained therein.

Meanwhile, when contacted on Monday, Cllr. Fred Cherue, chairman of the committee, he said the report is almost completed and will be presented to the Transitional Chairman shortly. According to him all members of the committee are on board. However, our source said the report is expected to be submitted to Chairman Bryanttoday at the Executive Mansion.

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