How Côte d’Ivoire is strengthening mining regulatory framework

As mining investment continues to increase across the region, many West African countries have introduced regulations to ensure that mining operators take into account the needs of local communities and the potential impact on the environment.

The UEMOA community mining code was adopted in 2003 with the aim of protecting these interests. In 2014 Côte d’Ivoire introduced its own mining code to ensure that mining operators within the country respect the local environment, and the new law replaced a previous regulation implemented in 1995.

In the years since, there have been calls from governments, businesses and communities to reform and update these regulations. In particular, there has been controversy surrounding provisions in Côte d’Ivoire’s mining code for mining companies to compensate local communities. Potential updates to the UEMOA code are also likely to impact miners operating in the country.

Local Focus

Relations between mining companies and local communities have sometimes been fractious in Côte d’Ivoire, like many other mining countries. Mining has a direct impact on local agriculture by taking up land, and can affect the health and well-being of local communities if sustainable methods are not used. A lack of rehabilitation plans or requirements can also leave mining sites uninhabitable for many years after production has ceased. At the same time, unregulated mining, particularly among artisanal and small-scale miners (ASMs), can bring with it a range of issues, from worker exploitation to criminality.

The 2014 mining code sought to create a mechanism for addressing these issues via the establishment of mining local development committees. These entities operate as representatives of the local community and negotiate arrangements with mining companies. The latter are now required to produce a community development plan before commencing operations. The plan is funded by the mining company, on an annual basis, with details of the fund set out in its original mining permission application. The 2014 code also requires that mining companies give priority to qualified Ivorian firms over foreign contractors and offer training to local businesses. Additionally, the mining company must have a rehabilitation plan for mine sites post-production, and must establish a fund at the start of operations to pay for environmental repair over the course of a given mine’s lifetime.

In an effort to enforce compliance of the code and prevent illegal mining activities, the government created the Brigade for the Repression of Mining Code Offences in 2018. This has been extremely successful, shutting down 222 illegal mines in 2019 alone.

Calls for Reform

The moves enshrined in the code were broadly welcomed by mining communities, companies and environmentalists, but interpretation of its requirements has been an issue. This has led to legal claims and counter-claims, particularly over the levels of compensation that should be paid by mining companies to local communities. A system of special committees set up by the Supreme Court to deal with these disputes has faced difficulties in impacting court actions at a lower level in the judicial chain. At the same time, ambiguity over the legal status of the code – particularly regarding tax law – has also led to litigation. As a result, there have been calls for the code to be updated to better deal with these issues.

Regional Changes

At the same time, there have been efforts to update the UEMOA mining code. An updated community mining code was approved by the eight UEMOA member states in 2019, though it has not yet been ratified by the individual countries. The draft code includes provisions covering transfer pricing and tax-base erosion, local content policies, community development and related funding, and environmental management. As miners in Côte d’Ivoire have long argued for more transparent ways to establish foreign currency accounts and repatriate profits, they will be watching these moves closely in the year to come.