Case story

  • United Kingdom

OECD NCP UK - RAID vs. Oryx

Democratic Republic of Congo 2005

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Story

In October 2002, a United Nations Panel of Experts accused 85 OECD-based companies of violating the Guidelines for their direct or indirect roles in the illegal exploitation of natural resources in the Democratic Republic of Congo (DRC). Oryx was cited by the Panel due to its involvement in illicit diamond trading. The Panel alleged that there was a secret profit sharing agreement whereby Oryx and the Government of Zimbabwe were each to take 40 per cent of the net cash inflow from Sengamines, one of MIBA’s (the Congolese state-run diamond company) richest diamond concessions. In effect Oryx was being used as a front for Zimbabwean Defense Forces and its military company OSLEG. The Complainants stated that there was evidence that there were proposals made for a joint Zimbabwe-DRC company to be set up in Mauritius to disguise the continuing economic interests of ZDF in the DRC. According to the Complainants there is also evidence that Sengamines served as a front for illegal foreign exchange transactions using several routes into and out of the DRC.

Outcome

In July 2004, the UK NCP accepted the complaint; however, RAID was prohibited from taking part in the negotiation process for one year while the NCP engaged in extensive discussions with Oryx. Most of the complaint was rejected on the grounds that a UN Panel had resolved the issue. The NCP insisted RAID re-submit its complaint in April 2005. RAID was allowed to participate in the proceedings in April 2005, but under very restrictive and summary procedures. RAID was able to comment on the NCP’s draft statement, which was the only area in which the UK NCP followed the Guidelines’ complaint procedures. The majority of issues raised in the complaint were disallowed by the NCP on grounds that they had been “resolved” by Panel. OECD Watch reports that the UK NCP Final Statement was highly unsatisfactory for the Complainants and did not incorporate any of its recommendations.

References

OECD Watch case story page: http://oecdwatch.org/cases/Case_39

Contributor(s): This article was modified by Kyle (3), Nicolaclayre (3), and Ejfturnbull (1).