Free Prior Informed Consent: Is it Required and What s the Standard?

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1 Free Prior Informed Consent: Is it Required and What s the Standard? Kevin O Callaghan & Dani Bryant Canadian Institute of Mining, Metallurgy and Petroleum Convention May 13, 2014

2 Overview 1. Introduction The Basics 2. FPIC a history International Norms 3. FPIC & Financing IFC Performance Standards 4. Domestic Law Example Canadian Domestic Law

3 Engagement Continuum Communication Consultation Consent

4 FPIC Definition Free no coercion, intimidation or manipulation Prior Consent has been sought sufficiently in advance of any authorization Informed Sufficient information is provided of the project, purpose, duration, location, and impacts Consent

5 FPIC - Introduction Free Prior Informed Consent (FPIC) Must Obtain FPIC OR Consult with Goal of Obtaining FPIC The development of the concept of FPIC draws a clear distinction between the two concepts

6 FPIC - Introduction When proof of consent required reflects the FPIC Compromise between: Indigenous Rights to Self-determination AND State Sovereignty

7 FPIC History United Nations Declaration on the Granting of Independence to Colonial Countries and Peoples (1960) "All peoples have the right to self-determination; by virtue of that right all people freely determine their political status and freely pursue their economic, social and cultural development." Reflected in 1966 two major UN Covenants: International Covenant on Civil and Political Rights International Covenant on Economic, Social and Cultural Rights

8 FPIC History Indigenous and Tribal Peoples Convention, 1989 (ILO 169) Article 6 1. In applying the provisions of this Convention, governments shall: (a) consult the peoples concerned, through appropriate procedures and in particular through their representative institutions, whenever consideration is being given to legislative or administrative measures which may affect them directly; [ ] 2. The consultations carried out in application of this Convention shall be undertaken, in good faith and in a form appropriate to the circumstances, with the objective of achieving agreement or consent to the proposed measure.

9 FPIC History Indigenous and Tribal Peoples Convention, 1989 (ILO 169) Article Where the relocation of these peoples is considered necessary as an exceptional measure, such relocation shall take place only with their free and informed consent. Where their consent cannot be obtained, such relocation shall take place only following appropriate procedures established by national laws and regulations, including public inquiries where appropriate, which provide the opportunity for effective representation of the peoples concerned. 3. Whenever possible, these peoples shall have the right to return to their traditional lands, as soon as the grounds for relocation cease to exist. [ ]

10 FPIC History Indigenous and Tribal Peoples Convention, 1989 (ILO 169) Article Where the relocation of these peoples is considered necessary as an exceptional measure, such relocation shall take place only with their free and informed consent. Where their consent cannot be obtained, such relocation shall take place only following appropriate procedures established by national laws and regulations, including public inquiries where appropriate, which provide the opportunity for effective representation of the peoples concerned. 3. Whenever possible, these peoples shall have the right to return to their traditional lands, as soon as the grounds for relocation cease to exist. [ ]

11 FPIC History United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) Adopted by General Assembly Resolution 61/295 on September 13, 2007 Against: Canada, US, Australia, NZ (all have since endorsed) Set of principles relating to the rights and freedoms of indigenous people.

12 FPIC History United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) Article 10 Indigenous peoples shall not be forcibly removed from their lands or territories. No relocation shall take place without the free, prior and informed consent of the indigenous peoples concerned and after agreement on just and fair compensation and, where possible, with the option of return. (emphasis added)

13 FPIC History United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) Article 19 States shall consult and cooperate in good faith with the indigenous peoples concerned through their own representative institutions in order to obtain their free, prior and informed consent before adopting and implementing legislative or administrative measures that may affect them.

14 FPIC History United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) Article States shall consult and cooperate in good faith with the indigenous peoples concerned through their own representative institutions in order to obtain their free and informed consent prior to the approval of any project affecting their lands or territories and other resources, particularly in connection with the development, utilization or exploitation of mineral, water or other resources.

15 FPIC & Financing International Finance Corporation (IFC) One of 5 agencies of the World Bank Provides loans and equity to stimulate private sector investment in developing countries Largest global development institution focused on the private sector in developing countries Performance Standards: requirements for receiving and maintaining IFC support version updated to 2012 version key change from free, prior and informed consultation (FPICons) to consent in specific circumstances(fpic)

16 FPIC & Financing Equator Principles a credit risk management framework for determining, assessing and managing environmental and social risk in project finance transactions based on IFC Performance Standards adopted voluntarily by: 78 financial institutions in 34 countries including the big five Canadian banks applied where project capital costs exceed US$10 million Covenant in loan documents requiring that abide by the Equator Principles

17 IFC: Consultation Performance Standard 1 (PS 1) Social and Envir. Assessment and Management Paragraph 29: Disclosure Obligation - Proponents to communicate relevant information to affected communities and other stakeholders Paragraph 30: Consultation Affected Community: adverse impacts from a project Paragraph 31: Informed Consultation and Participation Significant adverse impacts on Affected Communities Informed participation: Sharing of development benefits and opportunities Implementation issues

18 IFC: Indigenous FPIC IFC - Performance Standard 7 (PS 7) Paragraph 12 FPIC will be established through good faith negotiation between the client and the Affected Communities of Indigenous Peoples. The client will document: (i) the mutually accepted process between the client and Affected Communities of Indigenous Peoples, and (ii) evidence of agreement between the parties as the outcome of the negotiations. FPIC does not necessarily require unanimity and may be achieved even when individuals or groups within the community explicitly disagree.

19 IFC: Indigenous FPIC IFC - Performance Standard 7 (PS7) Paragraph 11 [T]he client will obtain FPIC of the Affected Communities of Indigenous Peoples in the circumstances described in paragraphs of this Performance Standard. FPIC applies to project design, implementation, and expected outcomes related to impacts affecting the communities of Indigenous Peoples.

20 IFC: Indigenous FPIC IFC - Performance Standard 7 (PS7) Paragraph 15 Relocation If such relocation is unavoidable the client will not proceed with the project unless FPIC has been obtained Paragraphs 16 & 17 Critical Cultural Heritage Where significant project impacts on critical cultural heritage are unavoidable, the client will obtain the FPIC of the Affected Communities of Indigenous Peoples.

21 IFC: Indigenous FPIC IFC - Performance Standard 7 (PS7) Paragraphs 13 and 14 Impacts on Lands If the client proposes to locate a project on, or commercially develop natural resources on lands traditionally owned by, or under the customary use of, Indigenous Peoples, and adverse impacts can be expected, the client will take the following steps: Lists consultation that must take place No mention of FPIC or consent

22 IFC: Summary Communication (PS1 para. 29) Requires communication of relevant information Documented Consultation (PS1 para. 30 &31) Requires consultation with affected communities Requires Informed Consultation and Participation Documented Consent (PS7) Consultation with a goal of Free Prior Informed Consent Actual Consent also required under certain circumstances Documented

23 Canadian Domestic Law Source of consultation or consent requirements: 1. Legislated or Regulatory 2. Constitutional Aboriginal Rights

24 Canadian Domestic Law Legislated Community & Indigenous Consultation: Permitting/Tenure evidence of consultation Environmental Assessment Acts CEAA - environmental effect includes: Health, socio-economic, physical and cultural heritage Use for traditional purposes by aboriginal persons Provincial EA Acts Consultation often not in the act, but in the regulatory document issued to guide the proponent environmental, economic, social, heritage or health effect No general legislated requirement for FPIC

25 Canadian Domestic Law Rare Regulatory Requirements for Consent: On Reserve (Indigenous Communities) Section 39 re consent to dispositions of reserve lands Nunavut (northern territory) Inuit owned lands - Inuit Impact Benefit Agreement Few specific requirements for FPIC

26 Canadian Domestic Law Constitutionally based Indigenous Consultation: Section 35 - Constitution Act, 1982 Recognizes and affirms existing aboriginal/ treaty rights Aboriginal peoples Canadian Indigenous peoples Reconciliation of pre-existing aboriginal societies and prior occupation with Crown sovereignty

27 Canadian Domestic Law Constitutionally based Indigenous Consultation: Supreme Court of Canada - Haida (SCC) Duty to consult: Crown conduct may adversely affect aboriginal rights Analysis to determine extent of consultation: Strength of the case & seriousness of the impact Consultation may lead to accommodation Accommodation may lead to agreements (no veto)

28 Canadian Domestic Law United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) Canadian Statement of Support (November 12, 2010) [T]he Declaration is a non-legally binding document that does not reflect customary international law nor change Canadian laws, In 2007, Canada place on record its concerns with various provisions of the Declaration, including [FPIC] We are now confident that Canada can interpret the principles expressed in the Declaration in a manner that is consistent with our Constitution and legal framework.

29 Canadian Domestic Law Reciprocal Duties: Government Crown Duty to consult belongs to the Crown First Nation Identify rights and potential adverse effects Industry Has the information & bears risk NO FPIC REQUIRED IN CONSULTATION PROCESS

30 Canadian Domestic Law FPIC may be required where Aboriginal Title proven in Court Delgammukw (SCC) on the far extreme of consultation spectrum, where title proven: Some cases may even require the full consent of an aboriginal nation, particularly when provinces enact hunting and fishing regulations in relation to aboriginal lands. But SCC also said: the development of mining, and hydroelectric power, can justify the infringement of aboriginal title. There is no proven title in Canada yet.

31 FPIC Emerging Requirement International Treaties and Norms: Compromise in recognition of state sovereignty Financial Obligations: Originally seemed to recognize the compromise Risk based Domestice Requirements: No general requirement for FPIC FPIC required in a few specific circumstances Consultation does not create obligation for FPIC (no veto)

32 Practical Realities Meeting Obligations for Consultation of Consent: Easiest way to demonstrate that consulted with goal of FPIC if have evidence of FPIC Value of a Social License CSR best practice leads to social licence Cannot develop, finance or operate extractive projects without: recognizing and managing community expectations and indigenous rights

33 Kevin O Callaghan kocallaghan@fasken.com

34 Disclaimer The information in this presentation is intended to provide general comments on legal issues. The information in this presentation is not intended to provide legal advice. Participants should seek out legal advice on issues specific to them before acting on any information provided in this presentation. We would be pleased to provide additional information on request Fasken Martineau DuMoulin LLP