Deal #1999

Location #1

Spatial accuracy level
Administrative region
Location
Yaligimba, Democratic Republic of the Congo

Target country
Congo, Dem. Rep.
Comment on location
30,199 hectares. Yaligimba is made up of two estates (Nord and Sud) consisting of 46 concessions

Location #2

Spatial accuracy level
Administrative region
Location
Boteka, Democratic Republic of the Congo

Target country
Congo, Dem. Rep.
Comment on location
13,542 hectares. Boteka consists of 31 concessions

Location #3

Spatial accuracy level
Administrative region
Location
Lokutu, Democratic Republic of the Congo

Target country
Congo, Dem. Rep.
Comment on location
63,560 hectares. Lokutu is made up of three estates (Lokutu, Mosite and Lokumete) consisting of eight concessions

Land area

Intended size (in ha)
101455.0
Size under contract (leased or purchased area, in ha)
[2009] 101455
Size in operation (production, in ha)
[2012] 17854
[2015] 24907
[2016] 30000
Comment on land area
3 plantations. 55000ha available for planting. Feronia acquired these plantations by buying 76% of Plantations et Huileries du Congo (PHC, registered in DR Congo). Feronia purchased these shares from Unilever. Another report states that the company has 107 000ha. One report states that Feronia is starting to plant even in the fishponds owned by the communities.

Intention of investment

Intention of investment
Biofuels, Food crops, Agriculture unspecified
Comment on intention of investment
Palm Oil and Palm Kernel Oil

Nature of the deal

Nature of the deal
Lease
Comment on nature of the deal
The leases on the various concessions (80 in total) expire at different times (between 2017 and 2030), all are based on a 25 year revolving lease. Renewal fees range from $1000-2000 per lot. One report states that the company is unable to prove its land rights.

Negotiation status

Negotiation status
[2009] Concluded (Contract signed)
Comment on negotiation status
Feronia acquired these plantations by buying 76% of Plantations et Huileries du Congo (PHC, registered in DR Congo). Feronia purchased these shares from Unilever. The land sold by Unilever was overvalued by $6.7 million. Feronia Inc has accumulated losses since the deal. However, directors and managers of Feronia Inc. continue to get paid large amounts. The losses of Feronia Inc are absorbed by the DRC government, being shareholders of the project as well as the continuing finance received from multilateral banks and development finance institutions. One data source states Feronia took the plantations over in 2008.

Implementation status

Implementation status
[2009] In operation (production)
Comment on implementation status
Started as PHC in 1911. Plantations suffered neglect (abandonment) from Unilever in the early 2000's. Bought from Unilever in 2009. Environmental and Social Impact assessment to be carried out in 2015 due to the community protests.

Purchase price

Comment on purchase price
Bought the operations from Unilever for $3 854 551

Leasing fees

Comment on leasing fees
Feronia Inc. refuses to pay revenue taxes, claiming it qualifies for the tax holiday offered by the DRC government.

Contract farming

Contract farming
No

Contract #1

Duration of the agreement (in years)
25

Number of domestic jobs created

Jobs created (domestic)
Yes
Current number of jobs (domestic)
[2010] 3639
[2015] 3500
[2016] 3800
Current number of daily/seasonal workers (domestic)
[2016] 4000
Comment on jobs created (domestic)
Congo’s second-biggest employer, with 3,800 permanent staff and at least 4,000 temporary workers (2016). The workers are paid badly- with payslips ranging from $1.17 (below minimum wage) -$2.22 per day. In 2014, the company entered into negotiations with the four trade unions that represent the workers to update the terms and conditions of the employees for the first time since the mid-1980's. This resulted in an increase in average wages of 70%, increased t c.$4/day. As well as wages, employees receive overtime, maternity pay, holiday pay, end of service pay, bonuses and assistance towards school fees as well as free housing and healthcare for themselves and their families. By 2016 all workers will receive at least a basic salary at minimum wage level. The company often pays its workers late. In conjunction, if workers do not reach their daily targets they do not get paid- some at the Lokutu plantation even hire others as porters, or get their families to help them complete their daily tasks. Workers at the plantations complain of housing in severe disrepair, wages just over a dollar a day for intense field labor and a lack of proper medical care in the rural region. Following the publication of the social infrastructure at the plantations the company is assessing and redesigning the social infrastructure. Community leaders state that communities members are only hired as casual laborers and the last time that a community member was a manager was in 1964 (under Unilever). Civil society organizations from the Lokutu area have documented numerous other labor abuses, such as the lack of contracts between the company and most workers, safety issues with pesticides and the violation of mandatory work hours.

Operating company

Comment on investment chain
Feronia acquired these plantations by buying 76% of Plantations et Huileries du Congo (PHC, registered in DR Congo). Feronia purchased these shares from Unilever. The company which purchased these shares was Feronia JCA Ltd, a Cayman Islands subsidiary of Feronia Inc. DRC passed a new Law on the Funadmaental Principles of Agriculture (loi portant principes fondamentaux relatifs à l’agriculture) on June 24, 2012 that states, under Article 16, that land can only be attributed to companies that are majority owned by national investors. Company plans to list on the British stock exchange in 2018. Mafuta Investment Holdings fund and Kuramo Capital have injected $ 17.5 million into the capital- October 2017 (% share unknown as yet). By 2018, Feronia-PHC had received at least 118 million US dollars, including 49 million in loans approved by German, Belgian and Dutch development banks in 2015. "They approved the loans despite NGO reports and statements from community leaders in all three plantation areas who had drawn their attention to the illegitimate and possibly illegal nature of the concession contracts as well as the appalling working conditions for labourers on the plantations and the many broken promises to communities affected by the plantation concessions." A complaint was submitted through the DEG complaints mechanism. On January 7th, 2018 it determined that the complaint was admissible under the criteria of the Independent Complaints Mechanism Policy, and the case is under review. In June 2019 Golden Oil Holdings Limited ("GOHL"), a wholly owned Mauritius special purpose vehicle subsidiary of African Agriculture Fund L.L.C. ("AAF”) announces that it has acquired common shares representing approximately 13.55%.

 

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Data source #1

Data source type
Research Paper / Policy Report
File
Date
2010-01-01
Comment on data source
Oil palm in Africa:Past, present and future scenarios by Ricardo Carrere, World Rainforest Movement, 2010

Data source #2

Data source type
Media report
File
Comment on data source
Company Overview of Plantations et Huileries du Congo s.a.r.l.

Data source #3

Data source type
Media report
File
Date
2017-10-09
Comment on data source
RD Congo : Kuramo Capital et Kalaa Mpinga injectent 17,5 millions $ dans le capital de la firme d’agrobusiness Feronia

Data source #4

Data source type
Company sources
File

Data source #5

Data source type
Media report
File
Date
2016-07-26
Comment on data source
Map for Environment- Feronia Inc. - Plantations et Huileries du Congo

Data source #6

Data source type
Company sources
File

Data source #7

Data source type
Other (Please specify in comment field)
File
Comment on data source
Funding document- PLANTATIONS ET HUILERIES DU CONGO SA

Data source #8

Data source type
Research Paper / Policy Report
File
Date
2015-06-02
Comment on data source
Grain- Agro Colonialism in the Congo

Data source #9

Data source type
Media report
File
Date
2015-10-15
Comment on data source
Farmland Grab -- Democratic Republic of Congo: “We need justice to be made"

Data source #10

Data source type
Company sources
File
Comment on data source
Feronia Website

Data source #11

Data source type
Media report
File
Date
2017-09-15
Comment on data source
Bloomberg-One Hundred Years Later, Reviving a ‘Jewel’ Deep in the Jungle

Data source #12

Data source type
Research Paper / Policy Report
File
Comment on data source
European Development Finance Institutions and land grabs. The need for further independent scrutiny

Data source #13

Data source type
Media report
File
Date
2017-10-09
Comment on data source
CENTOSEI ANNI DI SFRUTTAMENTO

Data source #14

Data source type
Media report
File
Date
2016-11-16
Comment on data source
RDC : Bernabé Kikaya Bin Karubi et le groupe canadien Feronia répondent aux accusations d’ONG

Data source #15

Data source type
Research Paper / Policy Report
File
Comment on data source
Feronia Inc.- UNA DESNUDA DIOSA, May 2015

Data source #16

Data source type
Media report
File
Date
2015-12-04
Comment on data source
Farmland Grab- Golden Oil Holdings Limited subsidiary of African Agriculture Fund, L.L.C. early warning of agreement to acquire securities of Feronia Inc.

Data source #17

Data source type
Company sources
File
Comment on data source
Company response to Grain report-- can be found: http://www.farmlandgrab.org/post/view/25324-cdc-group-response-to-report-raises-concerns-about-land-grabs-inadequate-consultations-compensation-by-feronia-unilever-in-drc

Data source #18

Data source type
Research Paper / Policy Report
File
Date
2016-02-08
Comment on data source
Hallgarten & Company- Feronia

Data source #19

Data source type
Company sources
File
Comment on data source
Feronia- Management presentation, 2012

Data source #20

Data source type
Research Paper / Policy Report
File
Comment on data source
Canada and the global land rush: Analysis of Canadian involvement in large-scale agricultural land acquisition in the Southern Hemisphere, April 2013

Data source #21

Data source type
Media report
File
Date
2017-11-02
Comment on data source
Communiqué de RIAO-RDC: Menaces dans les exploitations de Feronia

Data source #22

Data source type
Research Paper / Policy Report
File
Comment on data source
Grain- Feeding the 1%, September 2014

Data source #23

Data source type
Research Paper / Policy Report
File
Date
2015-07-19
Comment on data source
L’Agence française de développement est accusée d’accaparement foncier en RDC, PAR FANNY PIGEAUD

Data source #24

Data source type
Research Paper / Policy Report
File
Comment on data source
WRM BulletinWorld Rainforest Movement Nro. 224 – May/June 2016. What is driving land grabbing? A critical overview across the Congo Basin region

Data source #25

Data source type
Company sources
File
Comment on data source
Consolidated Financial Statements, December 31, 2014 and 2013.

Data source #26

Data source type
Media report
File
Date
2014-11-21
Comment on data source
Farm Land Grab- Congo plantation improvement plan follows TRF investigation

Data source #27

Data source type
Media report
File
Date
2015-06-02
Comment on data source
Farmland grab- Agro-colonialism in the Congo: European and US development finance bankrolls a new round of agro-colonialism in the DRC

Data source #28

Data source type
Media report
File
Date
2017-04-13
Comment on data source
France 24- Rémy Rioux : "L'Afrique est la grande affaire de l'AFD"

Data source #29

Data source type
Media report
File
Date
2017-11-23
Comment on data source
Tshopo : accord entre PHC/Feronia et communautés locales sur les projets sociaux

Data source #30

Data source type
Media report
Publication title
Tshopo : accord entre PHC/Feronia et communautés locales sur les projets sociaux
Date
2017-11-23

Data source #31

Data source type
Media report
Publication title
Les nouvelles forces de gardiennage de Feronia harcellent les communautes locales en RDC
Date
2018-06-13
Comment on data source
Link to original source broken

Data source #32

Data source type
Media report
Publication title
The untold suffering of women living in and around Feronia’s industrial oil palm plantations in the DRC
Date
2018-09-26

Data source #33

Data source type
Other (Please specify in comment field)
File
Comment on data source
DEG complaint mechanism

Data source #34

Data source type
Media report
File
Publication title
Violent tensions at Feronia's oil palm plantations in the DR Congo
Date
2019-03-21

Data source #35

Data source type
Company sources
File
Publication title
FERONIA ANNOUNCES CLOSING OF FOURTH AND FINAL DRAWDOWN ON $49M TERM FACILITY
Date
2017-11-03

Data source #36

Data source type
Company sources
File
Publication title
Feronia Inc. Announces US$19.3 Million Private Placement and Related Debt Settlement
Date
2019-05-28

Data source #37

Data source type
Media report
Publication title
Golden Oil Holdings Limited Acquires Common Shares of Feronia Inc.
Date
2019-06-05

Data source #38

Data source type
Media report
File
Publication title
CDC Group plc and Straight KKM 2 Limited Acquire Common Shares of Feronia Inc.
Date
2019-05-31

Consultation of local community

Community consultation
Not consulted
Comment on consultation of local community
Community leaders say the land was taken from them illegally and that they never gave their consent for Feronia to operate there and did not agree to the negotiated terms. Community members wish to start the negotiation phase with the company. On March 8, 2015, over 60 customary chiefs and other community leaders gathered in the town of Mozité to call for the resolution of their longstanding grievances against Feronia. In late October/early November representatives from the company visited the local communities and heard their concerns.

How did the community react?

Community reaction
Rejection
Comment on community reaction
The local community state that the land was illegally taken from them and reject the project. The communities claim that the title deeds for the land are falsified to represent Feronia as the legal owners. One report states that the community suffer from intimidation from the police if they protest against the project. The company response to intimidation is that the company has a whistleblower policy in place and is developing a community grievance mechanism. The community is fighting back, claiming their lands back. In October 2015, 12 leaders from communities affected by the plantations met in Kampala to discuss actions which can be taken in order to get their land back. NGO's and civil society organizations were also at the meeting. The leaders established a new alliance of communities affected by Feronia. on May 24 and 25, 2018, the Lokutu people protested vigorously against the recent cases of abuse committed by the new armed security company TANGANYIKA. peace agreements had been signed in August 2017. However, the PHC - FERONIA had unilaterally renounced the implementation of these agreements.

Presence of land conflicts

Presence of land conflicts
Yes
Comment on presence of land conflicts
Violence flared up again in March 2019 where community protested against the expansion of plantations onto their land and unpaid wages. Police were brought in and live bullets were flying around.

Displacement of people

Displacement of people
Yes
Number of people actually displaced
45000
Comment on displacement of people
The company prevents local people from raising livestock or farming within the company's concession, even on lands that the company has abandoned. Community members caught by company guards carrying just a few nuts fallen from the oil palms are fined or, in many cases, whipped, hand cuffed and taken to the nearest prison. One report states that the number of displaced villagers are 45000.

Negative impacts for local communities

Negative impacts for local communities
Socio-economic
Eviction
Displacement

Promised or received compensation

Promised compensation (e.g. for damages or resettlements)
Unilever originally promised to hand one plantation out of every three back to the community.
Received compensation (e.g. for damages or resettlements)
No compensation has been paid to date (2015). Communities are demanding that compensation occurs.

Promised benefits for local communities

Promised benefits for local communities
Health
Education
Roads
Comment on promised benefits for local communities
Feronia announced at the end of 2014 that it wanted to "engage with local communities in the development of new facilities meet their daily needs". To date the communities have not seen any of the stated benefits. US$3.6m has been ring-fenced to support the company to strengthen business standards and enhance community facilities -- this includes: refurbishment of the housing and sanitation available to workers; a road maintenance program to update the infrastructure on Feronia land that all local people can use; appointing new health & safety staff and community relations managers; undertaking a comprehensive study of the needs of workers and the local community; a new grievance procedure for workers and community; and land mapping to clearly mark out where the company's land extends. Community homes, schools, clinics and roads are in awful condition, and contrary to what Feronia maintains, no newinfrastructureorworker homes havebeen built. The company signed a specification with the customary chiefs of these territories of Tshopo on 22 November 2017 regarding their socio-economic projects.

Former land owner (not by constitution)

Comment on former land owner
Bought from Unilever in 2009 (paid $3854551).

Former land use

Former land use
Commercial (large-scale) agriculture

Former land cover

Former land cover
Cropland

Detailed crop, animal and mineral information

Crops area
Oil Palm

Use of produce

Has domestic use
Yes
Domestic use
100
Comment on use of produce
Almost all of the palm oil produced by Feronia is still sold to Marsavco- Marsavco was Unilever's consumer goods company which was sold to the Rawji family in 2002. One report states that the company exports the produce. Another report states that the company recently stopped selling to Marsavco, the communities are not clear what is happening to the produce. The 2014 annual statements states that 99.9% of the produce was sold to three customers. Palm oil is shipped by barge from the plantation to the customer's factory.

In country processing of produce

In country processing of produce
Yes
Comment on in country processing of produce
Oil palm for food, personal care products, cleaning products and cosmetics. The company has two oil mills and sells all crude palm oil to two refineries in Kinshasa, which they then sell on the domestic market.

Water extraction envisaged

Water extraction envisaged
Yes

Source of water extraction

Source of water extraction
Surface water (River)
Comment on source of water extraction
Congo River

Overall comment

Overall comment
Old plantation established in 1911 under Belgium colonial rule. Owned by Unilever. Sold to Feronia in 2009. US$3.6m has been ring-fenced to support the company to strengthen business standards and enhance community facilities -- this includes: refurbishment of the housing and sanitation available to workers; a road maintenance program to update the infrastructure on Feronia land that all local people can use; appointing new health & safety staff and community relations managers; undertaking a comprehensive study of the needs of workers and the local community; a new grievance procedure for workers and community; and land mapping to clearly mark out where the company's land extends. The community is affected by water pollution as a result of chemical spraying from the company. DEG financing amounts to USD 16.5 million. A complaint was submitted through the DEG complaints mechanism. On January 7th, 2018 it determined that the complaint was admissible under the criteria of the Independent Complaints Mechanism Policy, and the case is under review.

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