Suriname has made meaningful progress in implementing the 2016 EITI Standard.

Board decision

The EITI Board agreed the following:

Following the conclusion of Suriname’s Validation, the EITI Board agrees that Suriname has made meaningful progress overall in implementing the 2016 EITI Standard.

The Board highlights the work of the Multi-Stakeholder Group (MSG) and the Government of Suriname in improving the availability and accessibility of data from the extractive sector. The EITI Reports have publicly disclosed data that is not systematically disclosed on government or company websites, related to key areas of the extractive industries such as the applicable legal framework and production and export values.

Moreover, the EITI has helped to contribute to the dialogue in the country, by bringing together stakeholders operating in the extractives sector and creating a space for discussion. In this sense, the Board commends the civil society constituency for its full and active engagement in EITI implementation, while noting the room for improvement related to the government and industry constituencies’ engagement in the process.

The EITI’s impact in Suriname has been limited and focused on compliance with the EITI Standard, rather than on key areas for the government’s policy on the extractive sector. Public debate based on EITI data has been limited, and not necessarily used for informing discussions on reforms. The EITI process could improve systematic disclosures by government and companies, strengthening the extractives’ governance in Suriname, which represent a priority sector for the country.

Suriname’s MSG should align the EITI process with topics of national and local relevance. Its work has been process-oriented to date, it would benefit from including different objectives related to the national priorities for the extractive sector, such as improving transparency in the artisanal and small-scale mining sector, contributing to debate on the potential resumption of bauxite mining, and enhancing investor confidence in the oil and gas sector.

The Board urges Suriname to ensure comprehensive and reliable disclosures related to contract and license management, license registers, contract disclosure, beneficial ownership transparency and overview of Grassalco functioning as a state-owned enterprise. Suriname is required to guarantee timely reporting and disclosures, demonstrating that all material payments and revenues are comprehensively disclosed, as well as social, environmental and quasi-fiscal expenditures when applicable.

The Board has determined that Suriname will have until 1 April 2023 before its next Validation to carry out corrective actions related to government engagement (Requirement 1.1), industry engagement (Requirement 1.2), MSG oversight (Requirement 1.4), work plan (Requirement 1.5), contract and license allocations (Requirement 2.2), register of licenses (Requirement 2.3), contracts (Requirement 2.4), beneficial ownership (Requirement 2.5), state participation (Requirement 2.6), comprehensive disclosure of taxes and revenues (Requirement 4.1), sale of the state’s share of production or other revenues collected in kind (Requirement 4.2), transactions related to state‑owned enterprises (Requirement 4.5), data quality and assurance (Requirement 4.9), social expenditures (Requirement 6.1), quasi-fiscal expenditures (Requirement 6.2), contribution of the extractive sector to the economy (Requirement 6.3), public debate (Requirement 7.1), data accessibility (Requirement 7.3) and review of outcomes and impacts of EITI implementation (Requirement 7.4). ). The next Validation of Suriname will be conducted according to the revised Validation model approved by the Board in October 2020. Failure to demonstrate progress in the next Validation will result in temporary suspension in accordance with Article 6 of the EITI Standard. In accordance with the EITI Standard, Suriname’s MSG may request an extension of this timeframe or request that Validation commences earlier than scheduled.

Corrective actions and strategic recommendations

1. In accordance with Requirement 1.1, the government must be fully, actively and effectively engaged in the EITI process. The government should guarantee the participation of senior government representatives in MSG meetings assuring the government engagement is consistent across all government departments. The government is required to mobilise resources for EITI implementation entrenching EITI funding in government budgeting to ensure the sustainability of EITI implementation over the long term, to address the staffing and capacities challenges faced so far, and to guarantee the autonomy of Suriname EITI (EITI-SR). To further strengthen implementation of Requirement 1.1, the government is encouraged to embed the EITI in their national policies and make used of the data disclosed through the process. The government is also encouraged to ensure that government representatives on the MSG attend meetings regularly.
2. In accordance with Requirement 1.2, the industry should demonstrate that it is fully, actively and effectively engaged in the EITI process. Companies should review their engagement and work further in EITI implementation, ensuring that the objectives and activities of the process correspond to the priorities of wider industry constituency. Companies should also formalize and document their constituency coordination mechanisms and guarantee regular attendance at MSG meetings. To strengthen implementation of Requirement 1.2, the industry constituency of the MSG in Suriname is encouraged facilitate the publication of Beneficial Ownership information, as well as routine disclosures of data.
3. In accordance with Requirement 1.4, the MSG should ensure that the procedures for nominating its representatives are adequately codified and documented, and that there are established mechanisms for liaising with their broader constituencies, which are followed in practice. The MSG should ensure that deviations from their ToRs are recorded and transparent, and adequately and publicly codified. The MSG should ensure that its lack of per diem practice is publicly clarified. The MSG should guarantee there is sufficient advance notice of meetings and timely circulation of documents prior to their debate and proposed adoption, and that written records of its discussions and decisions are adequately kept through Minutes. Government and company constituencies are to ensure that their representatives’ attendance at MSG meetings is consistent and of sufficiently high level to allow the MSG to take decisions and follow up on them. To strengthen implementation of Requirement 1.4, the MSG is encouraged to re-orient its focus from the EITI reporting process to reforms in extractive sector governance. The MSG is encouraged to make use of the subcommittees (Article 3.2 of the MSG’s ToRs) and invite key government institutions that regulate the extractive sector such as the Central Bank to participate closely in EITI debate.
4. In accordance with Requirement 1.5, the MSG is required to agree on an updated, revised and fully costed work plan which reflects wide stakeholders’ priorities for the extractive sector, and is organized through specific and measurable activities. The work plan should address the scope of EITI disclosures and follows-up of recommendations, as well as focus on issues like contract transparency and implementation of project level reporting. The MSG should ensure consultation on the work plan beyond MSG members. The MSG is encouraged to consider whether the EITI process could contribute in addressing broader issues related to the extractive activities in Suriname, such as free and informed prior consent for the mining projects.
5. In accordance with Requirement 2.2, Suriname should ensure that comprehensive information about the recipients of mining, oil and gas licenses awarded and transferred in the year(s) under review are publicly accessible, alongside a description of the actual allocation and transfer process including the roles of relevant government entities and  technical and financial criteria assessed (and weightings if applicable), and any non-trivial deviations from statutory procedures in practice. Where licenses are awarded through a bidding process, the government is required to disclose the list of applicants and the bid criteria. Suriname may also wish to comment on the efficiency of the current license allocation and transfer system as a means of clarifying procedures and curbing non-trivial deviations.
6. In accordance with Requirement 2.3, Suriname should maintain a publicly available register or cadastre system with timely and comprehensive information on all mining, oil and gas licenses including license-holder name, dates of application, award and expiry, commodity(ies) covered and coordinates. The MSG should work with the MONR, GMD and Staatsolie to ensure all license information listed in Requirement 2.3.b is available for all extractives’ licenses active in the period under review.
7. To meet the Requirement 2.4, Suriname must document the government’s policy on disclosure of contracts and licenses that govern the exploration and exploitation of oil, gas and minerals. This should include relevant legal provisions, actual disclosure practices and any reforms that are planned or underway. An overview of the contracts and licenses that are publicly available should be disclosed in the public domain and include a reference or link to the location where these are published. Suriname is encouraged to publish PSCs currently in force with relevant annexes, and to undertake a review of published mining and oil contracts ensuring that the published contracts are available in a centralized website which should be regularly updated. In accordance with Requirement 2.4.a, Suriname is required to disclose any contracts and licenses that are granted, entered into or amended from 1 January 2021
8. In accordance with Requirement 2.5 and the Board-agreed framework for assessing progress, Suriname is required to disclose the beneficial owners of all companies holding or applying for extractive licenses by 31 December 2021. To achieve this target, the following measures are recommended:
   1. Suriname is requested to agree an appropriate definition for the terms “beneficial owner” and “politically exposed person”.
   2. Suriname is expected to request all companies holding oil, gas and mining licenses to disclose BO information and provide adequate assurances for data reliability. The government is encouraged to establish a public register of beneficial owners which could be integrated into the Trade Register managed by the SCCI.
   3. Suriname is encouraged to require all applicants of oil, gas and mining licenses to disclose their beneficial owners at the application stage. An assessment of the comprehensiveness and reliability of this information should be integrated into the licensing procedures followed by the MONR and Staatsolie.
   4. Suriname is encouraged to agree priorities for BO disclosures and, based on these priorities, plan efforts to obtain this data. For example, Suriname may prioritise disclosures by certain types of companies holding a certain type of license or producing a certain commodity due to risks related to corruption or tax evasion. These priorities should guide outreach efforts to companies and provide them guidance.
   5. It is recommended that Suriname considers using the EITI’s model BO declaration form to ensure that disclosures are published in open data format, comparable and easy to analyse.
   6. Suriname may also wish to expand BO disclosures to other segments of the upstream extractive value chain, for instance through collection and disclosure of BO information from extractive-sector service providers to improve the public debate.
9. In accordance with Requirement 2.6.a, Suriname should ensure that a comprehensive overview of Grassalco is publicly disclosed, including an explanation of the prevailing rules and practices related to Grassalco’ retained earnings, reinvestment and third-party funding. The government should also ensure annual disclosure of a comprehensive account of any loans or loan guarantees extended by the state or Grassalco to mining, oil, and gas companies in line with Requirement 2.6.b. The terms of Staatsolie’s participation in the Merian Gold Mine should be comprehensively disclosed. Suriname is required to clarify whether NV1 is a government- owned corporation, and whether it is a material state -owned enterprise.
10. In accordance with Requirement 4.1, Suriname should demonstrate that all material payments and revenues are comprehensively disclosed by government entities and extractive companies. In addition, Suriname should guarantee that any material omissions should be disclosed, and the non-reporting entities named. Suriname must assess whether gold exporters should be considered as material companies ahead of future EITI reporting.
11. In accordance with Requirement 4.2, the MSG should agree whether the sale of the state’s share of production or other revenues collected in kind is material. Suriname is required to disclose the volumes sold and revenues received, disaggregated by individual company and to levels commensurate with the reporting of other payments and revenue streams. Reporting could also break down disclosures by the type of product, price, market and sale volume. The MSG is encouraged to task the IA with reconciling the volumes sold and revenues received by including the buying companies in the reporting process.
12. In accordance with Requirement 4.5, Suriname must ensure that the EITI reporting process comprehensively includes material payments to SOEs from oil, gas and mining companies, and transfers between SOEs and other government agencies. In particular, Suriname should ensure that all material dividends collected by SOEs such as Staatsolie from extractive companies such as Surgold JV be comprehensively and reliably disclosed.
13. In accordance with Requirement 4.9, Suriname should ensure that future EITI Reports include a clear assessment of the IA on the comprehensiveness and data reliability. The MSG must clearly agree what assurances should be provided by the MOF, and later assess the compliance with the assurance agreed. The MSG is encouraged to document the audit policy and practice of the MOF.
14. In accordance with Requirement 6.1, Suriname should ensure that a clear definition of any mandatory social expenditures mandated by law or contract is publicly provided and assess the materiality of such expenditures in the period under review. Suriname may wish to consider the extent to which disclosure of PSCs would be necessary to provide a comprehensive overview of all mandatory social expenditures in the oil sector. Suriname should ensure that public disclosure of mandatory social expenditures be disaggregated by type of payment (distinguishing cash and in-kind) and beneficiary, clarifying the name and function of any non-government (third-party) beneficiaries of mandatory social expenditures.
15. In accordance with Requirement 6.2, Suriname should undertake a comprehensive review of all expenditures undertaken by extractives SOEs that could be considered quasi-fiscal expenditures. Suriname should develop a reporting process for quasi-fiscal expenditures with a view to achieving a level of transparency commensurate with other payments and revenue streams.
16. In accordance with Requirement 6.3, Suriname should disclose employment in the extractive industries in absolute terms and as a percentage of the total employment. Given the importance of artisanal mining for Suriname’s economy, Suriname should also provide estimates of informal extractive activities, including artisanal and small-scale mining, in future EITI reporting.
17. In accordance with Requirement 7.1, Suriname should ensure that EITI reports are comprehensible, actively promoted, publicly accessible and contribute to public debate. Suriname should ensure timely communication of EITI data and findings, as well as effective outreach to key stakeholders. Outreach events should be undertaken to spread awareness of and facilitate dialogue about EITI disclosures across the country. EITI-SR should adopt an open data policy and ensure that EITI data is available in open format. To strengthen implementation, the MSG may wish to consider linking a clear EITI-SR communications strategy more closely to the work plan and tailoring key messages to sector priorities rather than to EITI implementation more broadly. Suriname is encouraged to explore creative ways to strengthen the EITI’s contribution to public debate and engage with the communities in the hinterland where extractive activities take place. It is recommended that Suriname updates the EITI-SR website
18. In accordance with Requirement 7.3, Suriname is required to take steps to act upon lessons learnt with a view to strengthen the impact of EITI implementation on natural resource governance. In particular, Suriname should consider improving its procedures to analyse and follow-up on the recommendations resulting from EITI reporting making use of tools established in its own ToRs such as the subcommittees.
19. In accordance with Requirement 7.4, Suriname is required to review the outcomes and impact of EITI implementation on natural resource governance. Suriname should ensure that all stakeholders are able to participate in the production of the annual progress report and review the impact of EITI implementation. Stakeholders beyond the MSG should be able to provide feedback on the EITI process and have their views reflected in the annual progress report. The MSG should ensure that an assessment of progress with achieving the objectives set out in its work plan is carried out, including the impact and outcomes of the stated objectives. The MSG may wish to also ensure that the APR, the MSG’s action plan and any other management tools are used to feed into the annual work plans.

Background

Suriname joined the EITI in May 2017. The Validation of Suriname was scheduled to commence on 24 November 2019. The Board did not approve Suriname’s extension request on 13 February 2020 and agreed that the Validation would commence on 13 February 2020, taking account of all information published up to that date. Due to the Covid-19 outbreak, the EITI Board extended the period for data collection until 1 September 2020.

In accordance with the Validation procedures, an initial assessment [English] was prepared by the International Secretariat. The draft Validation report [English] was submitted to the MSG for comments on 12 February 2021. The MSG’s comments [English] were received on 5 March 2021. The Independent Validator reviewed the comments and responded to the MSG, before finalising the Validation report [English].