Handbook on Peace Agreement Draft Language
Natural Resource Ownership & Management
Introductory Notes
In a peace process, issues of natural resource ownership and management are crucial, particularly in post-conflict areas where the exploitation of natural resources like land, water, minerals, and forests have been driving factors for conflict. Addressing these issues in a peace agreement can help ensure fair access to resources, equitable economic opportunities, and sustainable development, which contribute to putting an end to conflicts and contribute to long-term stability and conflict prevention.
Definitions
Natural resources: Renewable and non-renewable materials or substances that provide essential resources and/or are economically viable to a region, such as water, minerals, oil, gas, and natural vegetation.
Goals of Natural Resource Ownership and Management
The goal of addressing natural resource ownership and management in a peace process is to ensure that resources contribute to long-term stability, equitable economic development, and sustainable peace rather than triggering renewed conflict. Natural resource ownership and management may serve to:
- Prevent Future Conflict Over Resources: Effective natural resource ownership and management can reduce competition and tensions thus preventing the reignition of a conflict.
- Promote Economic Equity: Fair and transparent distribution of economic benefits from natural resources can support local communities and the broader society, preventing the concentration of wealth among elites or former combatants and fostering inclusive economic growth.
- Promote Sustainable Management: Responsible and forward-thinking resource management can help secure essential resources for future generations while preventing ecological issues that might destabilize the region.
Why Include This Chapter
The inclusion of a Natural Resources Ownership and Management Chapter in a peace agreement may serve to:
- Define clear ownership rights and fair access among communities or states;
- Set up fair and transparent revenue-sharing mechanisms;
- Identify and promote sustainable practices that prevent environmental damage and resource depletion;
- Commit state institutions to practice equitable governance and sustainable development.
Core Issues Addressed
Most peace agreements address the following core issues in a Chapter on Natural Resources Ownership and Management:
- Ownership and Rights: This section discusses who has legal rights to natural resources.
- State, Regional, or Shared Ownership: specifies which persons or entities own or have legal rights in respect of natural resources.
- Definition of Ownership Rights: ensures that parties share a mutual understanding of the scope of ownership rights or how they are to be determined.
- Status of Pre-Existing Ownership Arrangements or Rights: specifies how the terms of the peace agreement interact with prior ownership arrangements and pre-existing property rights.
- Specific Protections for Indigenous or Community Rights: establishes specific commitments regarding indigenous, traditional, or other community rights in respect of natural resources.
- Resource Revenue Sharing: This section establishes mechanisms to equitably distribute resource income between central governments and local communities, especially where resources are located in specific regions.
- Division of Revenue: provides options for how to divide revenue between entities, including central and regional governments, and other local entities.
- Future Planning and Other Revenue Funds: establishes funds for specified uses, including for the agreement’s implementation, and to prepare for economic events and future generations.
- Sustainable Management and Environmental Protections: This section focuses on measures to regulate extraction, enforce environmental standards, and ensure sustainable practices to prevent resource depletion.
- General Commitments to Sustainable Management and Environmental Protection: establishes broad commitments reflecting the parties’ shared interest in sustainable management and environmental protection.
- Implementation of Commitments to Sustainable Management and Environmental Protection: provides options for mechanisms to specifically implement the parties’ broad commitments to sustainable management and environmental protection so they may be enforced.
- Local Involvement and Governance Structures: This section discusses structures that promote transparency and give locals a stake in the success of the peace process. This includes designing legislation to synchronize processes, designing processes to harmonize the work of central government entities, and delineating the roles and responsibilities of each level of governance.
- Natural Resource Governance: provides options for the allocation of authority over natural resources.
- Management Goals: outlines the specific objectives that natural resource managing authorities may seek to achieve.
- Consultation Rights: establishes mechanisms to help ensure all relevant voices are heard in the decision making process of natural resource governance.
- Adoption of Legislation: establishes an explicit commitment to adopt implementing legislation as peace agreements are not always self-executing.
- Dispute Resolution: creates a specific mechanism for resolving disputes that arise out of the management of natural resources.
Ownership and Rights
State, Regional, or Shared Ownership
Note to Drafters: Parties may choose to agree that some or all natural resources may be owned by the state, one or more regional entities, or by multiple entities in a shared ownership structure. Where the parties’ agreement relates only to certain natural resources and not to others, it is helpful to specify to which resources their agreement applies and to include specific identifying details of those resources, such as geographic location(s) and boundaries.
All natural resources are the property of the state. The [central government / specified entity of central government] shall exercise all rights of ownership and control over its natural resources for the benefit of the people of [the state].
All natural resources are the property of the state. For extractive natural resources, including [specified extractive resource(s)], the [central government / specified organ of central government] shall grant concessions for a specified time period, and in all cases shall ensure adequate revenue for the benefit of the people of [the state].
[Specified region / regional government] shall own [all natural resources / specified natural resources] [in a specified geographic region]. The [regional government / recognized leadership of specified region] shall exercise all rights of ownership and control over [all natural resources / specified natural resources] for the benefit of the people of the [region / state / other specified group].
The Parties recognize and guarantee [tribal land ownership rights, historical rights to land, traditional or customary livestock routes, and access to water]. The Parties agree that [recognized leadership] [of specified community or indigenous group] shall [own / exercise specified rights] in respect of [specified natural resource] in [specified geographic area].
[Specified entities sharing ownership] shall [jointly / jointly and severally] own [all natural resources / specified natural resources]. [Specified entities sharing ownership] shall [each have / share equally] [all / specified] rights of ownership and control over [all natural resources / specified natural resources].
Definition of Ownership Rights
Note to Drafters: To avoid ambiguity, parties to peace agreements may choose to specify expressly what rights of ownership include or how such rights are to be determined.
Rights of ownership include all rights related to the development, use, exploitation, disposition, transfer, and sale of [all natural resources / specified natural resources].
Rights of ownership refers to all rights associated with ownership of property as set out in the applicable domestic law of [state].
Status of Pre-Existing Ownership Arrangements or Rights
Note to Drafters: When specifying ownership rights in a peace agreement, parties may choose to expressly address the status of any relevant pre-existing agreements or other arrangements regarding ownership of natural resources. For instance, to limit the risk of overlapping rights, parties may agree to terminate or nullify prior ownership arrangements between themselves. But where third parties to the peace agreement have pre-existing ownership rights in natural resources it is important for the parties to carefully consider the implications of their agreement in order to avoid any infringement of such rights.
The Parties agree that any and all prior arrangements regarding ownership and control over [all natural resources / specified natural resources] shall be [null and void / immediately terminated], subject only to the [specified pre-existing rights] of the [specified third party].
The Parties recognize the [ownership or other specified] rights of [specified third party] in respect of [specified natural resources].
Specific Protections for Indigenous or Community Rights
Note to Drafters: Parties to a peace agreement may wish to include specific provisions regarding indigenous, traditional, or other community rights in respect of natural resources, especially considering that natural resources are often essential sources of subsistence for indigenous groups. Provisions such as these may help ensure these rights are respected and protected.
The [central / regional] government shall, within [specified timeframe], [introduce / adopt / enact] legislative or administrative measures to recognize and protect indigenous rights in respect of [all natural resources / specified natural resources].
No [party / specified group(s) of persons] shall be deprived of any traditional or historical [ownership or other specified] rights in respect of [all natural resources / specified natural resources] without consultation and [fair / full] compensation [in accordance with international and / or domestic legal standards].
[Specified group / specified community] shall have the right to give or withhold consent to any project related to natural resource development, use, or exploitation that may affect them or their territories. For these purposes, [specified group’s / specified community’s] territories, shall include [specified geographic area].
The [residents in specified geographic area] shall have preferential rights over the development, use, exploitation, or exploration of natural resources respecting existing rights on the development, use, exploitation, or exploration of [all natural resources / specified natural resources].
Resource Revenue Sharing
Note to Drafters: The development, use, exploitation, and sale of natural resources generate revenue. Revenue in this context refers to income for the state through taxation, royalties, and other duties. When addressing rights in respect of natural resources in a peace agreement, parties commonly also include provisions addressing how revenues derived from those resources will be allocated. In particular, express provisions on resource revenue sharing help set expectations and can reduce the risk that one party is later dissatisfied. Revenue derived from natural resources can also provide a source of funds that may be used for specified public purposes, including the peace agreement’s implementation or for the benefit of future generations.
Division of Revenue
Note to Drafters: Parties to a peace agreement may choose to divide natural resource revenue in different ways, depending on the specific factual context.
[number]% of revenue derived from current [and future] development, use, exploitation, or sale of [all natural resources / specified natural resources] in [specified state / specified area] shall be allocated directly to the [specified government / other entity] [to support regional development], with the remaining [number]% allocated to the [specified government or other entity]. This allocation shall be reviewed every [number of] years to ensure it meets evolving needs.
All revenue derived from the development, use, exploitation, or sale of the natural resources located within its lawfully recognized borders is the property of the [state / specified region / regional government]. The [central government / specified central government leadership] shall provide equalization payments to balance revenue of each [regional] government to ensure all [regional] governments are able to provide comparable levels of public services to their populations.
[number]% of revenue derived from the development, use, exploitation, or sale of [all natural resources / specified natural resources] shall be used for priority sectors including [education, health, social services, environment, urban development, etc.], [number]% for the [producing region], [number]% for [future development], and [number]% reserve for use at the discretion of the [central government / regional government].
The [government / specified leadership] of [region / specified local community] in which [specified natural resources] are [produced / located] shall have the right to negotiate and be granted the negotiated share of revenue generated therefrom.
A Joint Resource Revenue Fund (the “Fund”) shall be established into which all revenues derived from the development, use, exploitation, or sale of [all natural resources / specified natural resources] in [specified region] shall be deposited. The Fund shall be established within [number of] [days / months] from the [execution / entry into force] of this Agreement and shall be established at [designated financial institution]. Disbursements from the Fund will be jointly managed by representatives from the [central / regional] government and [specified local government / other entity], ensuring an equitable allocation for [central government / regional government / specified local government or leadership] [development / other specified] priorities.
Future Planning and Other Revenue Funds
Note to Drafters: Parties to peace agreements may also choose to establish funds into which they can deposit some or all of the revenue generated by natural resources for specified purposes. These funds may serve different purposes, depending on the interests of the parties. For example, the parties may establish a fund to support the implementation of the peace agreement, for measures supporting future generations, to insulate the state from natural resource price fluctuations, or for another specified purpose.
[number% / number amount] of the revenue from the development, use, exploitation, or sale of [all natural resources / specified natural resources] shall be used for the implementation of this Agreement for a period of [number] years, with the option of extension subject to the [majority decision] of [number entity.]
The Parties agree that a [name] Fund (the “[Name] Fund”) shall be established to set aside revenue for the benefit of future generations. [number]% of the revenue derived from the development, use, exploitation, or sale of [all natural resources / specified natural resources] will be deposited into the [Name] Fund. After [number of] years, the [state / state entity] can withdraw [number]% per year, provided that [specified representative authority] confirms that any funds withdrawn will be used for the benefit of future generations.
The Parties agree that the [name] Fund shall be established to provide price stabilization in the event of a material decrease in the price of [all natural resources / specified natural resources]. [number]% of revenue from [all natural resources / specified natural resources] will be added to the [name] Fund on [date] annually. When the price of [all natural resources / specified natural resources] drops below [specified level / reference level], the [central] government may draw on the Fund to offset losses caused by the drop in price.
The Parties agree that [name] Fund shall be established to provide for [specified purpose]. The Fund shall be established once national [specified natural resource(s)] production reaches [specified level] per [day / month / year]. This allocation to the Fund shall be reviewed every [number of] years to ensure it meets evolving needs.
Sustainable Management and Environmental Protections
General Commitments to Sustainable Management and Environmental Protection
Note to Drafters: Over-exploitation of natural resources harms the environment and impacts the well-being of the population. Parties to peace agreements may therefore choose to include provisions addressing the sustainable management of natural resources and related environmental protection. These provisions may take different forms but generally reflect the parties’ commitment to sustainable resource management and exploitation practices, including through the application of recognized environmental standards. By including an express provision or provisions to this effect, parties affirm the importance of sustainable management of natural resources to the State’s future development and to its people. Peace agreements most commonly include broad or general commitments to sustainable management of natural resources and to environmental protections.
The [central government / parties / regional entities] agree[s] to regulate the development, management, use, exploitation, and sale of natural resources in order to prevent expedited resource depletion and to limit environmental damage.
The [central government / parties / regional entities] agree[s] to adhere to international best practices for sustainable management of natural resources: (1) to ensure [all natural resources / specified natural resources] are developed, managed, used, and exploited in such a way as to protect the environment [and to promote the human right to a clean, healthy and sustainable environment]; and (2) to conserve [all natural resources / specified natural resources] for [future generations / the benefit of the people of the state / other specified group].
The [central government / parties / regional entities] agree[s] that [all natural resources / specified natural resources] must be developed, managed, used, and exploited consistent with all current and future environmental standards applicable to [central] government.
The [central government / parties / regional entities] agree[s] that [all natural resources / specified natural resources] must be developed, managed, used, and exploited consistent with [specified international environmental protection standard(s) / agreements / resolutions, whether binding or non-binding on the State, e.g., United Nations Framework Convention on Climate Change, the Kyoto Protocol, and the Paris Agreement].
The [central government / parties / regional entities] recognize[s] and affirm[s] the human right to a clean, healthy, and sustainable environment. The [central government / parties / regional entities] agree[s] that [all natural resources / specified natural resources] must be developed, managed, used, and exploited consistent with such right, and with all current and future human rights standards applicable to [central government / parties / regional entities].
The [central government / parties / regional entities] agree[s] to promote and support the private sector’s participation in the protection and management of [all natural resources / specified natural resources] and to encourage sustainable development, management, use, and exploitation of [those / that] resource[s].
Implementation of Commitments to Sustainable Management and Environmental Protection
Note to Drafters: Where the parties have included commitments related to sustainable management of natural resources and environmental protection, it may be helpful to specify how those commitments are to be implemented. Provisions specifically addressing the implementation of such commitments, ensure that these commitments are made concrete and ultimately may be enforced. Broad environmental commitments are commonly implemented in domestic legislation or through regulation introduced by a designated authority. These provisions are closely related to more general provisions regarding management and local governance, which also provide an alternative to the language below.
The [central / regional] government will, within [specified timeframe], [introduce / adopt / enact] legislation necessary to implement the [parties’] commitments to sustainable management and environmental protection of [all natural resources / specified natural resources] reflected in this Agreement.
The [central / regional] government shall be responsible for regulating the development, management, use, exploitation, and sale of [all natural resources / specified natural resources] in order to guarantee their sustainable development, conservation, restoration, or replacement. The [central / regional] government shall delegate this responsibility to a [specified entity], which shall have the power to introduce [relevant regulations / other specified enforcement rules] to implement the [parties’] commitments to sustainable management and environmental protection of [all natural resources / specified natural resources] reflected in this Agreement. The [specified entity] shall also have the power to sanction any non-compliance with its [regulations / rules], including to order any remedy.
The Parties agree to establish a [means / mechanism] to ensure the implementation and enforcement of sustainable practices related to the management, use, and exploitation of [all natural resources / specified natural resources].
Local Involvement and Governance Structures
Natural Resource Governance
Note to Drafters: Allocation of authority for natural resource governance is a key issue as it determines how decisions about natural resources are made and how different stakeholders participate in the decision making process. Depending on the circumstances, authority for governance can be made at the central or regional level or can be shared or independent. Shared or independent governance may be preferable where tension exists between local stakeholders and the regional or central government. In addition, peace agreements can specify different governance arrangements for different natural resources.
The [central] government has the exclusive authority to make laws and decisions relating to the management, planning, and development of [all natural resources / specified natural resources], including their development, use, exploitation, or sale. The [central] government agrees to adopt, in cooperation with the [regional] government and [the local community / specified community], the measures necessary for the good use and administration of [all natural resources / specified natural resources], within [specified timeframe].
The Parties agree that the [regional] [government / specified leadership] has the exclusive authority to make laws and decisions relating to the management, planning, and development of [all natural resources / specified natural resources], including regarding exploration, extraction or exploitation, sale, development, and conservation. The [regional] [government / specified leadership] agrees to adopt, in cooperation with the [central] government and the communities, the measures necessary for the good use and administration of [all natural resources / specified natural resources], within [specified timeframe].
The Parties agree to the establishment of a Joint Authority (the “Joint Authority”), within [specified timeframe], for management, planning, and development of [all natural resources / specified natural resources]. The Joint Authority shall consist of [specified central government representative(s) and specified regional government representative(s)]. The Joint Authority shall have the power to [adopt] the measures necessary for the good use and administration of [all natural resources / specified natural resources].
The Parties agree to the establishment of a [state commission] and a [regional commission] to manage, plan, and develop [all natural resources / specified natural resources], within [specified timeframe]. The [sate commission] and a [regional commission] established by this Agreement shall cooperate and coordinate their activities so as to use their resources efficiently and work together to enact the measures necessary for the good use and administration of [all natural resources / specified natural resources]. In cases of conflict between the determinations of the [state commission] and a [regional commission], which cannot be resolved by agreement, the matter shall be referred to [specified court or other tribunal] for adjudication.
The Parties agree that, within [specified timeframe], an independent commission shall be established to oversee the management, planning, and development of [all natural resources / specified natural resources], and its decision shall be by consensus. The commission shall be constituted by [X] [members of relevant stakeholders, i.e., central and / or regional government representatives, and industry experts]. The commission shall have the sole authority to address issues related to the management of [all natural resources / specified natural resources].
Management Goals of Natural Resource Authorities
Note to Drafters: Regardless of which system of governance is chosen, it is important to outline the management goals and priorities that the authority seeks to achieve.
The management of [all natural resources / specified natural resources] established pursuant to this Agreement shall have as its objectives: The proper management, development, and conservation of [natural resources] for the purpose of promoting the social and economic welfare of the community and a better environment; The promotion and coordination of the orderly and economic use and development of land and [natural resources]; Ecologically sustainable development; The protection of human rights, including the human right to a clean, healthy, and sustainable environment; The protection of cultural heritage; The protection, provision, and coordination of communication and utility services; The provision of land for public purposes; The provision and coordination of community services and facilities; The protection of the environment, including the protection and conservation of native animals and plants, threatened species, and ecological communities; The rehabilitation of degraded land and revegetation programs; The promotion of shared responsibility for environmental planning between the different levels of government in [relevant area, e.g., state, region]; The provision for public involvement and participation in environmental planning and assessment; The provision for consultation of all persons affected by the proposed development of land and [natural resources]; The provision for [full / fair] compensation [in accordance with international and / or domestic legal standards] for persons whose livelihood or property are affected by development decisions in respect of land and [natural resources].
Consultation Rights
Note to Drafters: Regardless of what system of governance is chosen, it is important to take into account the concerns of all interested parties. Ensuring that those who will be affected by natural resource management plans have an opportunity to be heard can contribute to maintaining peace.
The Parties agree to, within [specified timeframe], establish a mechanism to ensure that all those affected by the development of [all natural resources / specified natural resources] are consulted and their views taken into account in carrying out that development. Persons whose property or livelihood is adversely affected by the development of [all natural resources / specified natural resources] have a right to [fair / full] compensation [in accordance with international and/or domestic legal standards].
Adoption of Legislation
Note to Drafters: The commitments made in peace agreements regarding the issues addressed in this chapter are not always self-executing. Peace agreements therefore commonly include a broad but explicit commitment of the parties to adopt implementing legislation.
The [central / regional] government will, within [specified timeframe], [introduce / adopt / enact] legislation necessary to implement the commitments made in this Agreement [related to the development, management, use, exploitation, and sale of natural resources] and to regulate any other associated activities in accordance with this Agreement.
Dispute Resolution
Note to Drafters: Should certain natural resource management disputes arise, it can be helpful to include a provision regarding how those disputes will be resolved. Where governance is by commission, peace agreements commonly provide for arbitration or mediation in front of such commission. Where governance is by the central or regional government, disputes may be better addressed by courts with jurisdiction.
In the case of any dispute arising out of or related to the provisions in this [Agreement], the Parties agree to exert their best efforts to settle that dispute by way of negotiations. In the event the dispute cannot be resolved through negotiations within [agreed upon time period], the dispute shall be submitted to the [Joint Authority / commission]/[court of relevant jurisdiction] for resolution.
The Parties agree that any and all disputes arising out of or related to the provisions in this [Agreement] shall be submitted to the [Joint Authority / commission / court of relevant jurisdiction] for resolution.
Further Readings
- Colleen Devlin, Michaela Iveson, Eric Keels, Co-Managing Peace: Natural Resources, Agreement Design, and the Promotion of peace After War, One Earth Future Research & Secure Fisheries
- PILPG, Sudan Negotiation Briefing Book: Wealth Sharing
- United Nations Development Group, Natural Resource Management in Transition Settings
- PILPG, Peace Agreement Drafters’ Handbook
- Nicholas Haysom and Sean Kane, Negotiating Natural Resources for Peace: Ownership, Control and Wealth-Sharing, Centre for Humanitarian Dialogue