Any of our business? Human Rights and the UK private sector - Human Rights Joint Committee Contents

Annex "A"



  Afrimex is a UK-registered company which operates in eastern DRC through the Congolese registered companies Societe Kotecha and SOCOMI,[410] both based in Bukavu. In February 2007, Global Witness filed a complaint against Afrimex for breaches of the OECD Guidelines for Multinational Enterprises, in connection with its trade in minerals during the war in the Democratic Republic of Congo (DRC) from 1998.[411] The UK Government's National Contact Point (NCP) for the OECD Guidelines investigated the case and, in August 2008, published its final statement, upholding the majority of Global Witness's allegations. It concluded that Afrimex had failed to ensure that its trading activities did not support armed conflict and forced labour. A significant part of its conclusions rested upon the fact that Afrimex had not exercised sufficient "due diligence" to its supply chain, and that some of its suppliers—which included the comptoirs Muyeye and Olive—made payments to rebel groups (at that time, the RCD-Goma), thus contributing to the conflict.[412]

The NCP made a number of recommendations to Afrimex, relating, among other things, to the formulation, implementation and periodic review of a corporate responsibility policy which should take into account the human rights impact of the company's activities. By February 2009, the NCP had not received any information from Afrimex about the implementation of its recommendations.

  Even after the OECD complaint was submitted in 2007, Global Witness gathered information that confirmed that Afrimex continued to trade in minerals from eastern DRC, albeit on a smaller scale than it had during the earlier years of the war. Furthermore, one of its suppliers in 2007 and 2008 was Muyeye, named by the UN Group of Experts as buying minerals produced by the rebel group FDLR (Forces d

mocratiques pour la lib

ration du Rwanda), responsible for grave human rights abuses. Congolese government statistics list Afrimex as having imported 382.5 tonnes of cassiterite from Goma and 1,102.5 tonnes of cassiterite and 112.5 tonnes of wolframite from the comptoirs Muyeye and Bakulikira in South Kivu in 2007.[413] A sample of monthly reports for 2008 from the Congolese Government's Centre for Evaluation, Expertise and Certification (CEEC) show Afrimex as having imported 22.5 tonnes of cassiterite from Muyeye on 27 May 2008 and 45 tonnes from Bakulikira and 90 tonnes from Muyeye in June 2008.[414] Afrimex's mineral supplier and associated company SOCOMI, is listed as an officially licensed comptoir for cassiterite in South Kivu, having paid its licence fee of US $9,000 for 2008.[415] Several other sources interviewed by Global Witness in mid 2008 confirmed that SOCOMI and Societe Kotecha were still operating and handling minerals.[416]

  In January 2009, Global Witness wrote to Afrimex asking, among other things, for an update on the company's progress in implementing the NCP's recommendations.[417] In March 2009, Afrimex replied to the NCP, copying Global Witness, stating that it had stopped trading in minerals and that its last shipment left the DRC in or around the first week of September 2008.[418] This claim remains unsubstantiated by Global Witness and the UK Government.

  Global Witness refers the Committee to paragraphs 21-27 of our submission.


  The December 2008 Final Report of the UN Group of Experts establishes links between THAISARCO and the comptoir Panju (based in eastern DRC), which has close links with the rebel group FDLR. Panju is one of the top five exporters of cassiterite, coltan and wolframite from South Kivu, according to 2007 Congolese Government statistics. The UN Group of Experts identified Panju as one of the comptoirs in Bukavu directly complicit in pre-financing negociants, who in turn work closely with FDLR. The Group further states that Panju was aware "that certain mines they buy from are controlled by FDLR" and that this was common knowledge within the mineral houses in South Kivu. The Final Report states that "the Group has also obtained documents showing that all of Panju's minerals purchases were sold to the Thailand Smelting and Refining Company" (THAISARCO).

  In 2002, AMC were included in a list of companies considered by the previous UN Panel of Experts to be in violation of the OECD Guidelines.

  DRC Government export records obtained by Global Witness confirm that THAISARCO purchased over 2,000 tonnes of cassiterite, coltan and wolframite from Panju in 2007. In December 2008, Global Witness wrote to THAISARCO and its UK-registered parent company AMC inquiring about their trade with the DRC and their "due diligence" policies. In their replies, THAISARCO and AMC attempted to create a distance between their trade and the situation in eastern DRC by stating that they do not operate "directly" in the DRC. THAISARCO also claimed that "most parties and commentators appear to be in agreement that the continued trade in minerals from DRC is fundamental to the well being of the artisanal mining communities " and concluded: "In summary, we believe we are providing a very valuable service to the DRC economy although we recognise that improvements in the visibility of the supply chain are both desirable and necessary."

  AMC PLC's Annual Report 2007 and Accounts state that the company's tin smelter is based in Thailand and operated by the Thailand Smelting and Refining Company, aka THAISARCO. It refers to THAISARCO as a "principal subsidiary and operating unit" of AMC PLC, and states that AMC PLC owns 75.25% of THAISARCO.

  Company registration information and details relating to AMCO Investments Limited, Amalgamated Metal Corporation PLC, Amalgamated Metal Investment Holdings Limited, and British Amalgamated Metal Investments Ltd and their directors are publicly available and provide an explanation of the companies' corporate structure and shows how several of these entities share the same directors.

  Global Witness refers the Committee to paragraphs 28-32 of our submission.


  Turkmenistan possesses the fourth largest gas reserves in the world, and in light of recent concerns over Russia's control of the European gas supply through Ukraine and Belarus, western Europe has recently turned to Turkmenistan as a potential new source of energy. Frameworks for European investment have been signed and steps toward exploration are moving rapidly: in November 2007, the UK Government signed a protocol of intention with the Turkmen Government and in May 2008, the European Union (EU) signed a memorandum of understanding with the Turkmen government regarding energy co-operation. In April 2009, the European Parliament agreed to sign an interim trade agreement with Turkmenistan despite little progress in terms of human rights which it had previously requested. Though the parliament called for "strict monitoring and regular reviews of developments in key areas of human rights," and for the agreement to be suspended "if there is evidence that the conditions are not being met," there is concern that these calls are being taken seriously. In addition, companies have not answered calls from NGOs as to how these issues will be addressed. Any energy deals struck with the Turkmen Government must address issues relating to human rights and have strict provisions governing cooperative engagement. Yet the EU looks set to engage with the Turkmen Government with no preconditions.

  Global Witness refers the Committee to paragraphs 33-34 of our submission.


  Anvil Mining stated that it had no option but to agree to supply air and ground transport to the Congolese military (FARDC) in response to rebel activity in Kilwa in October 2004; the Congolese troops were involved in the deaths of around 100 unarmed civilians. In investigating events, the UN Mission for the DRC (MONUC) and human rights NGOs documented incidents of summary executions, torture, illegal detention and looting by the Congolese forces. In 2006, the prosecutor at Katanga's Military Court in the DRC decided to indict three former expatriate employees of Anvil Mining Congo SARL for complicity in war crimes. Anvil Mining Congo SARL is a subsidiary of Canadian/Australian Anvil Mining Limited. The trial in the DRC began in December 2006. In June 2007 the military tribunal acquitted all defendants in the Kilwa trial. In reference to the trial, the acting UN High Commissioner for Human Rights, Louise Arbour, stated, "I am concerned at the court's conclusions that the events in Kilwa were the accidental results of fighting, despite the presence at the trial of substantial eye-witness testimony and material evidence pointing to the commission of serious and deliberate human rights violations." To date, no prosecution has been commenced in Canada or South Africa, the home states of the indicted employees, nor Australia. A holding company for Anvil is located in the UK.

  Global Witness refers the Committee to paragraphs 35-36 of our submission.


  Since the mid 1990s, Deutsche Bank has been the main banker for the Turkmen Government, widely regarded as one of the most corrupt and worst human rights abusing regimes in the world. Yet the bank has never properly answered questions regarding its commitments to upholding human rights in relation to these accounts. Though the accounts are nominally held by the Turkmen Central Bank, in actuality the autocratic president controls all money flows. This was most apparent under the now deceased former president, Saparmurat Niyazov, who maintained a US$3 billion fund (The Foreign Exchange Reserve Fund or FERF) at Deutsche Bank which he used to build his ubiquitous personality cult, replete with golden palaces and statues of himself. A former Turkmen Central Bank Chairman has gone on record to say that only Niyazov could access money from this fund. Meanwhile 75% of government spending was done off-budget from other funds at Deutsche Bank, making it one of the most fiscally opaque countries in the world. There were calls by civil society for all accounts at Deutsche Bank to be frozen after Niyazov's death in December 2006, when the rightful constitutional acting president arrested. A new president, Gurbanguly Berdymukhamedov, was elected in February 2007, yet questions remain concerning what happened to the money in the FERF and to the control of Turkmenistan's revenues in general. These concerns are such that the European Bank for Reconstruction and Development EBRD currently refuses to lend to the Turkmen government. Though Deutsche Bank has confirmed that it holds Turkmen government accounts it has refused to comment on how it ensures that these revenues are not used for corrupt ends or to curb the human rights of the Turkmen people. It cites its commitments to the UN Global Compact, but again, has refused dialogue on how its commitments are implemented in this case. The UN Global Compact has no mechanism to ensure whether companies are truly living up to its ideals.

  Deutsche Bank AG's UK Head Office is located at 1 Great Winchester Street, in London.

  Global Witness refers the Committee to paragraph 37-40 of our submission.

Gavin Hayman

Campaigns Director

May 2009

410   Afrimex's mineral comptoir. Back

411   See Global Witness, "Afrimex (UK)-DRC: Complaint to the UK National Contact Point under the Specific Instance Procedure of the OECD Guidelines for Multinational Enterprises", 20 February 2007. Back

412   Final statement by the UK National Contact Point for the OECD Guidelines for Multinational Enterprises: Afrimex (UK) Ltd, 28 August 2008; Department for Business Enterprise and Regulatory Reform (BERR) press release "Mineral trade helped fund rebels", 28 August 2008. Back

413   Rapport Annuel 2007, Division des Mines, North Kivu and South Kivu. Back

414   CEEC, Rapport mensuel d'activit
s, mois de mai 2008 et mois de juin 2008, Antenne de Bukavu, Sud-Kivu. 

415   Performances des comptoirs du Sud-Kivu en 2008, Division des Mines, South Kivu, 19 July 2008. Back

416   Global Witness interviews in Bukavu, 28 July and 3 August, and in Goma, 7 and 8 August 2008; report by a Uvira-based human rights organisation on illicit exploitation of minerals in the territoires of Uvira and Fizi, January-July 2008. For an explanation of the relationship between Afrimex, Soci
 Kotecha and SOCOMI, see Final statement by the UK National Contact Point for the OECD Guidelines for Multinational Enterprises: Afrimex (UK) Ltd, 28 August 2008. 

417   Global Witness letter to Afrimex, 6 February 2009. Back

418   E-mail from Ketan Kotecha, director of Afrimex, to Margaret Sutherland, NCP, copied to Global Witness, 2 March 2009. Back

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Prepared 16 December 2009