Outcomes and impact
Outcomes and impact
1.5 Work plan
Requirement:
Fully met
90
The Secretariat’s assessment is that Requirement 1.5 is fully met, as in the
previous Validation.
The objective of this requirement is to ensure that the annual planning for EITI
implementation supports implementation of national priorities for the
extractive industries while laying out realistic activities that are the outcome of
consultations with the broader government, industry and civil society
constituencies. The annual EITI work plan should be a key accountability
document for the MSG vis-à-vis broader constituencies. The Secretariat’s
assessment in light of stakeholder consultations is that this objective is
fulfilled. Objectives and activities for EITI implementation appear to reflect
national priorities and stakeholders’ interests.
MSG members participated in the work plan discussions, evaluation and
approvals, although other stakeholders beyond the MSG are not engaged via
a formal consultation process to review the work plan. Members of the
government constituency consulted stated that the actions in the work plan
are consistent with the long-term development plan of the Dominican
Republic, defined in the National Development Strategy. The civil society
constituency also mentioned the work plan alignment with the provisions of
the General Environmental Law (64-00) that governs subnational payments,
and the Escazú agreement, as the MSG agreed with the CSO recommendation
to have a specific objective related to environmental and social aspects
incorporated to the work plan.
All the EITI-DR work plans are published on the EITI website. The work plan
builds on a results-based approach with clear activities, expected outcomes,
key deliverables, budget and funding source. It is time-bound and indicates the responsible party. The Annual Progress Report (APR) 2021 presents an
update on the work plan activities, recommendations of previous reports and
Validation; while intersectoral commissions are planned in the 2023-2025
work plan to ensure quarterly monitoring.
The 2021-2022 work plan was jointly funded by the WB and the government.
The 2023-2024 work plan is being fully funded by the government, while
negotiations with development partners are still ongoing.
EITI Reports and APRs have been published annually, while some studies and
workshops were also conducted in the period under review. However,
according to the Outcomes and Impact template and consultations, the
general and municipal elections and the renewal of the MSG in 2020 affected
the frequency of MSG meetings, while the COVID-19 pandemic significantly
affected the implementation of the work plan activities in 2020 and 2021.
Moreover, the 2021-2022 work plan approval was delayed due to the
discussions around new activities suggested by CSOs. Financial and logistical
difficulties caused by the pandemic remained present in 2021, affecting the
completion of outreach and other activities.
The 2023-2024 work plan includes activities: (i) to strengthen the capacity of
civil society (ii) to systematise recommendations from the previous Validation,
EITI Reports and work plan to ensure quarterly follow-up on EITI DR activities;
(iii) to develop specific roadmaps to include non-metallic mining data and
gender issues in the EITI Report, and a roadmap to disseminate the
mechanisms used to determine the amounts transferred to FOMISAR for
distribution in compliance with the Law 64-00, and the use of resources at the
municipal level in the EITI Report; (iv) to update and implement actions
established in the Beneficial Ownership Roadmap; (v) to implement the EITIDR Strategic Communication and Dissemination Plan (vi) to support the
design of participatory mechanisms at the municipal level to discuss and
agree upon the allocation of sub-national payments; (vii) that emphasised the
commitment to environmental sustainability as required by civil society
constituency.
7.1 Public debate
Requirement:
Mostly met
60
The Secretariat’s assessment is that Requirement 7.1 is mostly met, which
represents backsliding from the previous Validation. These weaknesses are
due to delays in operationalizing the EITI-DR Strategic Communication and
Dissemination Plan.
The objective of this requirement is to enable evidence-based public debate
on extractive industry governance through active communication of relevant
data to key stakeholders in ways that are accessible and reflect stakeholders’
needs. The implementation of the EITI-DR Strategic Communication and
Dissemination Plan, focused on inciting public debate at the national and
local level, is still pending. During consultations, government representatives
confirmed the need to improve EITI dissemination and communication
activities in order to strengthen the impact of EITI implementation.
Additionally, based on the Outcomes and Impacts Template, communication
and dissemination activities that have been conducted to date have not considered inclusion and diversity issues based on the different needs of
different groups at the national and subnational levels. Based on available
evidence and stakeholder consultations, the Secretariat’s assessment is that
the objective is mostly fulfilled.
The EITI-DR Reports (full and summary reports) are published online in the
EITI-DR Transparency Portal in Spanish and have been printed and distributed
to the different ministries involved in the EITI, to the Congress of the
Dominican Republic, to universities and to research centres. The Executive
Summary of the Data Reconciliation Report for 2019-2020 is comprised of 5
pages, which summarises the main findings from the Reconciliation Report
and compares the shares of revenue streams by government entities and
companies for the period between 2017-2020.
Some events were organised to promote public debate on EITI-DR and
extractive industry governance, although there is a need to improve EITI
dissemination in general and expand the debate on transparency at the
community level to ensure that outreach events are effective, as stated by
government and civil society representatives during consultation. These
events can be divided in three groups: participation of high-level officials, such
as the Minister of Energy and Mines, highlighting the relevance of the EITI in
the Dominican Republic; workshops for specific audiences (journalists); and
the participation of MSG members in a panel organised by Opening
Extractives and the EITI International Secretariat. Government stakeholders
consulted also noted that the training sessions for journalists aimed to help
them understand technical aspects of government involvement in the
extractive sector, including training sessions specifically oriented toward the
EITI Standard and the Dominican Republic’s compliance. In the previous
Validation, the MSG was encouraged to create a communication strategy
focused on inciting public debate at the national and local level. The 2021-
2022 and 2023-2024 work plans focus on one specific objective: to
strengthen public understanding of extractive sector governance by ensuring
that information and participation mechanisms are in accordance with key
audiences. Within this objective, the EITI-DR Strategic Communication and
Dissemination Plan is being updated by a working group formed in 2022,
which will include a simplified version of the EITI Standard; meetings in
municipalities and universities to provide spaces for debate on extractive
industry issues; publication of training material; citizen training on the
objectives of the EITI Standard; dissemination of the EITI-DR Reports;
informative conferences; and dissemination in radio, TV programs and other
media. Considering the approval of the 2021-2022 work plan was postponed
until September 2021, in addition to the COVID-19 pandemic and postpandemic challenges, some work plan activities are still behind schedule,
including those related to the communication strategy.
7.2 Data accessibility and open data
Requirement:
Mostly met
60
The Secretariat’s assessment is that Requirement 7.2 is mostly met given
that not all data in EITI Reports has been published in open format. The objective of this requirement is to enable the broader use and analysis of
information on the extractive industries, through the publication of
information in open data and interoperable formats. The Dominican Republic
is assessed as having made significant progress on this requirement, which
was not required in the previous assessment conducted under the 2016 EITI
Standard. An open data policy has been adopted by EITI-DR and summary
data files have been completed and published in open format on the EITI-DR
website since 2015, but there is still room to improve as EITI Reports have
only been published in PDF to date, and the tables therein have not yet been
published in open format. Mining production and mineral export data are
available on the EITI-DR website in open format but there is also room for
improvement as this information is not up to date. Based on stakeholder
consultations and available evidence, the Secretariat considers the objective
to be mostly fulfilled.
The MSG agreed, through Act No. 19 of 2016, that the National Standard on
Information and Communication Technologies (NORTIC A3) would govern the
EITI-DR policy on access, publication, and use of EITI-DR data.
The EITI-DR has published summary data reports for its EITI Reports for fiscal
years 2015, 2016, 2017, 2018, 2019 and 2020 in open (.xls) format, in
Spanish, on the EITI-DR website. Journalists and some government members
noted they have been using and analysing EITI data available on the EITI
Portal.
The following data is available on the EITI-DR website in open (.xls) format:
Exploration concessions (from 2013 to 2018); Exploitation concessions (from
1958 to 2017); Mining production (production volume, minerals, 2003-2017);
Production of metallic minerals (companies, volume and value of production,
from 2003 to 2017); Mineral Exports (exporter, regime, volume, value,
destination and tariff, 2010-2018).
There is a need to keep the EITI Portal up-to-date as the data listed above was
last updated in October 2018. During consultations, development partners
also highlighted the need to maintain up-to-date data on the EITI-DR website,
while the use of infographics would be recommended to improve accessibility
of EITI data.
In the previous Validation, it was recommended for EITI-DR to undertake
capacity building efforts to support the use of EITI data, especially with civil
society organizations, media and legislators. The Feasibility Study for EITI
Systematic Disclosures Dominican Republic was published in March 2022,
which included a roadmap and recommendations on the future of systematic
disclosures in the country. The EITI International Secretariat, with the support
of USAID, hired a consultant that will support the systematic disclosure efforts
of several implementing countries, including the Dominican Republic, and
EITI-DR is considering the possibility of adapting and replicating the online
data collection platform used by EITI Colombia. The national secretariat is
seeking funding to implement this online data collection platform.
7.3 Follow up on recommendations
Requirement:
Fully met
90
The Secretariat’s assessment is that Requirement 7.3 is fully met, as in the
previous Validation.
The objective of this requirement is to ensure that EITI implementation is a
continuous learning process that contributes to policy making, based on the
MSG regularly considering findings and recommendations from the
EITI process and acting on those recommendations it deems are priorities.
The MSG has taken some steps to act upon lessons learned, to investigate
and address some issues in EITI reporting by incorporating new activities into
the EITI work plan to strengthen the governance of extractive industries and
improve monitoring and evaluation of the EITI implementation in the country.
Follow-up on recommendations is presented in the 2019-2020 EITI Report
and APR. Based on available evidence and stakeholder consultations, the
Secretariat considers the objective to be fully met.
The 2019-2020 EITI Report contains a specific section to present
recommendations and follow-up from previous Validation Reports.
Furthermore, the MSG prepared a template to monitor the status of the
recommendations made in previous Validations, including those related to
previous Reconciliation Reports. This template was published in the Annual
Progress Report 2021 EITI-DR, which is reviewed, discussed, and approved by
the MSG, and presented in the Outcomes and Impact template. It was noted
that some activities are still ongoing. This template does not present a
timeline or list the entities responsible for implementation, while there is also
room to improve the description of the status of completion of these activities.
The 2023-2024 work plan includes the need to design a monitoring and
evaluation plan for EITI-DR activities that will include Intersectoral Monitoring
Commissions by specific objectives to ensure quarterly follow-up (Activity
1.5.1), while systematizing recommendations from previous Validations, EITI
Reports and work plans (Activity 1.5.2).
In the previous Validation, it was recommended that the Dominican Republic
take steps to put into practice the lessons learned with a view to
strengthening the impact of EITI implementation on the governance of natural
resources. In this sense, the 2021/2022 and 2023/2024 work plans contain
a set of actions to strengthen the governance of extractive industries,
including roadmaps for the inclusion of non-metallic mining data and gender
in future EITI Reports, roadmaps for Systematic Disclosures and for disclosing
the mechanisms used to determine the amounts transferred to FOMISAR for
distribution in compliance with Law 64-00, while identifying other priorities for
EITI implementation in the country. Considering the approval of the 2021-
2022 work plan was postponed until September 2021, added to the COVID19 pandemic and post-pandemic challenges, most of these activities are still
behind schedule.
Based on the information in the Outcomes and Impact file and along with
consultation meetings with the national secretariat and industry constituency,
the MSG had its contribution to the development of extractive sector policies
limited to the discussions around subnational payments while advancing discussions on beneficial ownership within the scope of the EITI Report and in
ongoing reform efforts to the National Mining Law that will be discussed in
Congress. A representative from the industry constituency highlighted that the
government is still not actively and systematically using the MSG as a platform
for dialogue on reforms in the mining sector. A reform to the National Mining
Law is being discussed at the Ministry level, while a representative from the
industry constituency informed that they are following the discussions through
the press. Government stakeholders consulted confirmed that debates
around mining reform remain at the Congressional level but that there will be
a call for public views of this reform law.
7.4 Review of outcomes and impact of implementation
Requirement:
Fully met
90
The Secretariat’s assessment is that Requirement 7.4 is fully met, which is an
improvement on the previous Validation.
The objective of this requirement is to ensure regular public monitoring and
evaluation of implementation, including evaluation of whether the EITI is
delivering on its objectives, with a view to ensuring the EITI’s own public
accountability. Annual Progress Reports (APR) have been prepared and
approved by the MSG since 2016, while a workshop was organised in 2019 to
further discuss the impacts of the EITI in the Dominican Republic. Beyond this
workshop, the MSG is also planning to conduct a broader impact study in
response to a corrective action from the previous Validation. Based on
available evidence and stakeholder consultations, the Secretariat considers
the objective to be fulfilled.
On 11 April 2019, a workshop for the MSG was organised to discuss and
document the opinions of the three constituencies on the impacts of the EITI
in the Dominican Republic. A final report with the reflections of the MSG was
submitted for approval at the MSG’s 23 May 2019 meeting. The MSG has not
yet commissioned a planned study on the outcomes and impact of the EITI to
continue to respond to a specific corrective action related to Requirement 7.4
in the previous Validation. This study will complement the 2019 workshop but
there is not a clear timeline when this study will begin.
The MSG approved the 2021 Annual Progress Report (APR) in February 2023.
The APR includes a summary of the activities carried out during the completed
year, the actions to comply with the requirements of the EITI Standard, a
follow-up to the recommendations emanating from the EITI Reports, including
Validation, and the execution of the work plan. The MSG had a chance to
contribute to the APR, by reviewing and sharing comments to its draft version.
However, the 2021 APR does not assess efforts to strengthen the impact of
EITI implementation on natural resource governance.
Effectiveness and sustainability indicators
1
Stakeholder engagement
Multi-stakeholder oversight
1.1 Government engagement
Requirement:
Fully met
90
The Secretariat’s assessment is that Requirement 1.1 is fully met, as in the
previous Validation.
The objective of this requirement is to ensure a full, active and effective
government lead for EITI implementation, both in terms of high-level political
leadership and operational engagement, as a means of facilitating all aspects
of EITI implementation. Based on stakeholder consultations and available
documentation, the Secretariat’s assessment is that the objective has been
fulfilled. The EITI implementation is a presidential aim while the government is
represented on the MSG at a senior level. Government representatives are
fully, actively and effectively engaged in the EITI process, having participated
actively in the MSG’s meetings and technical working groups. Alternate
representatives attended most of the meetings in 2019 and 2020, while there was improvement in 2021 and 2022 when full members attended most
meetings, including the Vice Minister of Mines.
There have been regular statements of commitments to the EITI from senior
government officials throughout this period. The hosting of the national
secretariat within MEM has helped to embed the EITI process within the
government system and has facilitated information sharing, but there is still
room from improvement in terms of increasing the EITI’s impact on reforms.
The national secretariat has three members on its staff (one administrative
assistant, one EITI Officer and the National Coordinator).
In 2020 there was a change of government in the Dominican Republic that
necessitated an update of the MSG members from most government entities,
except for the Ministry of Finance, as their representatives were ratified by
their Ministers in both government administrations. A formal communication
was shared via email with the MSG when there was a change in the
government constituency. The EITI implementation is a Presidential aim, for
both past and new government administrations, which demonstrates the
government’s commitment to transparency. EITI progress is reported to the
President every month.
The government is represented at a senior level. The MSG is chaired since
August 2020 by Mr. Antonio Almonte, Minister of Energy and Mines. Mr.
Gustavo Mejía Ricart, the Director of Foreign Affairs at MEM, is the National
Coordinator for the EITI-DR. The Vice Minister of Mines, Mr. Miguel Díaz is an
active member in the MSG meeting, while the Vice Minister of Social
Development in the Ministry of the Presidency, Ms. Betty Soto has been
represented by her alternate. Considering that the government awarded their
first oil and gas exploration license in 2019, there is an opportunity to invite
the vice minister of hydrocarbons to join the MSG and have the MSG engaged
with ongoing reforms in the oil and gas sector in the Dominican Republic.
MEM has already shared an invitation letter with the new Ministry of
Environment and Natural Resources to participate in the MSG meetings, as
recommended in previous Validation. The government has taken steps to
overcome some barriers to EITI implementation by allocating resources to
strengthen civil society participation and mediating conflicts between civil
society and industry.
The government has also provided leadership in technical discussions about
EITI implementation and legal reforms, including discussions to advance on
beneficial ownership disclosure within the scope of the EITI Report and
discussions on reforms to the mining law. Stakeholder consultations and
documentation suggest that high-level engagement has been strong in the
period under review, and the national secretariat is providing effective support
to the MSG.
The government funds the operations of the national secretariat, while EITI
implementation was co-funded by the government and the World Bank until
April 2022. From May 2022 onwards, it has been fully funded by the
government. The funding provided to EITI implementation seems to be adequate although some work plan activities are still behind schedule due to
the COVID-19 pandemic and post-pandemic challenges.
MEM has resources allocated to the implementation of the EITI within its
annual budget allocation, having an Administrative Manager of the Executive
Secretariat EITI-DR under the Directorate of Foreign Affairs.
EITI information is shared and discussed among government representatives
at the MSG, while engagement with the broader constituency beyond the MSG
appears to be limited. Based on stakeholder consultations, some government
representatives have used EITI information in different forums related to
transparency, while it was noted that outreach and dissemination of EITI data
by government also occurs.
1.2 Company engagement
Requirement:
Fully met
90
The Secretariat’s assessment is that Requirement 1.2 is fully met, as in the
previous Validation.
The objective of this requirement is to ensure that extractive companies
are fully, actively, and effectively engaged in the EITI, both in terms of
disclosures and participation in the work of the multi-stakeholder group, and
that the government ensures an enabling environment for this. Based on
stakeholder consultations and available documentation, the Secretariat’s
assessment is that the objective has been fulfilled. Industry representatives
are fully, actively and effectively engaged in the EITI process. Attendance to
the MSG’s meetings has varied among full member representatives from 35%
to 100% between 2019 and 2022, with a noted trend of increased
attendance in the past two years. Industry representatives also actively
participate in technical working groups.
There is an enabling environment for industry participation and the
fundamental rights of industry representatives engaged in the EITI are
respected. There are no obstacles to company participation in the EITI
process. An industry representative consulted stated that the MSG could be
more involved in discussions involving reforms to the mining law. Through the
MSG, the company constituency has contributed to the development of
extractive sector policies limited to the discussions around subnational
payments while advancing discussions on beneficial ownership within the
scope of the EITI Report.
Industry participation is organised via individual company participation and
through the Chamber of Mining and Oil (CAMIPE), which has 31 member
companies, and includes the main companies with metal mining exploration
and exploitation activity in the Dominican Republic. CAMIPE has played an
active role since the country began preparations for the EITI application
process.
There are five companies with metal mining exploitation activity in the
Dominican Republic, among which four are part of the MSG (Barrick PVDC,
Falconbridge Dominicana, CORMIDOM and DOVEMCO). The other MSG
members from industry constituency are CAMIPE, ADOCEM (Dominican Association of Portland Cement Producers), and Industrial Geotechnical
Service. EITI information is shared by CAMIPE through a mailing list for
member companies only, which include all companies with material payments
to the government. Engagement with the broader constituency beyond the
Chamber appears to be limited, as there is no formal process for this
cooperation beyond the MSG group. However, it was noted that the sector is
relatively small in the Dominican Republic, and the most significant metal
mining companies are already part of the MSG. Engagement with non-metallic
mining companies is challenging as the sector is not organised but these
companies were not considered to be making material payments. Company
representatives provide data for EITI reporting, but there is room to improve
as they do not appear to be actively driving the EITI process or using EITI data,
beyond the dissemination of the EITI Portal. An industry representative
expressed some concerns about eventual misuse of EITI data that could
undermine disclosure. More active and coordinated engagement by
companies could help to ensure that EITI implementation responds to
companies’ objectives, including local development issues and improvements
in public understanding of the importance of the mining sector in the
Dominican Republic. Industry should also continue their engagement to
overcome challenges related to disclosures of beneficial ownership
information.
1.3 Civil society engagement
Requirement:
Fully met
90
The Secretariat’s assessment is that Requirement 1.3 is fully met, as in the
previous Validation.
The objective of this requirement is to ensure that civil society is fully, actively
and effectively engaged in the EITI process, and that there is an enabling
environment for this. The active participation of civil society in the EITI process
is key to ensuring that the transparency created by the EITI can lead to greater
accountability and improved governance of oil, gas and mineral resources.
The provisions related to civil society engagement seek to establish conditions
that permit this to occur over time. The Secretariat’s assessment is that the
objective is fulfilled.
International assessments of the broader civic space in the Dominican
Republic have remained steady in the period 2019-2023, with Freedom
House’s Freedom in the World assessment remaining level with 67/100
points in 2019 and 68/100 points in 2022, with an assessment of ‘partly
free’. Civicus’ assessment likewise rates the Dominican Republic’s civic
freedoms as ‘Narrowed’ with a score of 78/100 and the U.S. Department of
State’s Country Reports on Human Rights Practices from 2019-2023 found
that freedom of expression was generally respected, though there were some
instances of press intimidation. Consulted members of civil society did not
think that there were legal or regulatory limitations to the civic space.
Expression: There does not appear to have been significant changes in the
enabling environment for civic expression since the previous Validation in
2019. Of note, Dominican Republic’s Constitutional Court struck down
portions of a law that criminalised dissemination of negative messages in 2019, which was praised by press freedom advocates. Civil society
representatives can speak freely in public about the EITI process and issues
pertinent to natural resource governance, both during MSG meetings and
during public events, such as the webinar held to discuss the negative impact
of gold mining operations in Argentina, the Dominican Republic, and Papua
New Guinea on 19 October 2022. This webinar brought together stakeholders
from different countries and illustrated civil society’s freedom of expression
both within the Dominican Republic and abroad. During consultations, civil
society representatives confirmed their freedom of expression within the EITI
and during public events and in the media and did not cite any instances of
self-censorship of the existence of topics considered too sensitive to discuss
in public.
Operation: While civil society stakeholders confirmed their freedom of
operation they cautioned that, in general, civil society faces funding shortfalls,
though the government does not prevent access to funding, either domestic
or foreign. Likewise, there are no legal or administrative restrictions
concerning registration of CSOs or concerning issues preventing CSOs from
holding meetings related to the EITI process.
Association: Despite capacity constraints, civil society representatives can
communicate and cooperate with each other regarding the EITI process and
natural resource governance. Consultations confirmed freedom of association
for all stakeholders in the Dominican Republic and civil society
representatives noted that they were able to associate with organisations on
the MSG and those outside the MSG structure. Civil society stakeholders
commented that they were in contact with the workers unions of Barrick Gold
and FALCONDO, among others, and that protests and marches were attended
by CSOs within and outside the MSG. The Secretariat is not aware of any
cases of the authorities restricting civil society from organising public events
related to extractive sector governance.
Engagement: Civil society is represented in the EITI process through Espacio
Nacional por la Transparencia de la Industria Extractive (ENTRE), which serves
as an umbrella organisation for civil society groups and includes a
subcommittee, Comité Nuevo Renacer (CNR), that operates on behalf of
ENTRE in affected communities. Attendance records for MSG meetings, held
virtually and in-person, indicate that CSO representatives or their alternates
attended MSG meetings regularly. Letters between CSOs and government
officials that were included as evidence in this Validation note that many
company publications relevant to affected communities were only published
in English, which represented a technical capacity constraint to the effective
engagement of host communities.
Access to public decision-making: CSOs engaged in the EITI undertake
advocacy activities related to extractive sector governance and civic space,
including on the allocation of subnational transfers, lack of public disclosure
of companies’ audited financial statements and of beneficial ownership
information and on the environmental impact of mining activities. Civil society members consulted pointed out that these issues were highlighted in the
previous Validation and remain outstanding. These stakeholders stressed the
need to recognise that issues highlighted in previous Validations that are not
acted upon tend to compound and become worse and some representatives
consulted did not consider that their position on certain matters of importance
was taken into consideration. These stakeholders noted that there is an
imbalance in access to information between civil society operating in the
capital and those located in communities hosting extractive activities, where
the latter is not aware of industry and government decisions in a timely
manner. These delays inhibit the response of those in affected communities.
Concerning environmental impact, CSOs stressed that in locations such as
Cotuí, historic and ongoing mining activities have led to undrinkable water and
health problems. From correspondence between CSOs and government
officials, provided by CSOs for this Validation, it appears that CSOs did not
consider themselves to be adequately consulted or part of the decisionmaking process when it came to the expansion of the Barrick Gold mine or
consultations on the size and location of tailings dams. In its response to the
draft assessment, industry stakeholders provided media documentation
showing consultations with local communities before the expansion of the
Barrick Gold mine. These stakeholders noted that environmental impact
assessments and social and economic evaluations were carried out in
anticipation of this project and provided copies of these assessments, which
indicated an improvement in water quality since Barrick’s mining operations
began. These disagreements between industry and civil society appear to be
ongoing and indicate tensions between members of these two constituencies.
1.4 MSG governance
Requirement:
Fully met
90
The Secretariat’s assessment is that Requirement 1.4 is fully met, as in the
previous Validation. Documentation and stakeholder consultations suggest
that the MSG is functioning effectively, although there is room to further
improve the regularity of MSG meetings and the diversity of representation.
The objective of this requirement is to ensure that there is an independent
MSG that can exercise active and meaningful oversight of all aspects of EITI
implementation that balances the three main constituencies’ (government,
industry and civil society) interests in a consensual manner. As a precondition
for achieving this objective, the MSG must include adequate representation
of key stakeholders appointed on the basis of open, fair and transparent
constituency procedures, make decisions in an inclusive manner and report to
wider constituencies. The Secretariat’s assessment is that the objective is
fulfilled.
The MSG is elected for a period of two years, with the possibility of being
reappointed, although some members have not been replaced since 2016, as
a deviation from the ToR for the MSG. A principal and an alternate member
are chosen, and their work is honorary, with no practice of per diems. Since
2016 the MSG has been renewed three times, in 2018, 2020 and 2023
(partially). The Secretariat’s assessment is that stakeholders are adequately
represented on the MSG, although there is room to further improve the diversity of representation by engaging non-metallic industries, the nascent oil
and gas sector and local CSOs that are not yet part of MSG.
Industry participation is organised through the Chamber of Mining and Oil
(CAMIPE), and the MSG representatives are elected in an open and
transparent manner through a publicly accessible invitation for CAPIME’s
general assembly. A general assembly still needs to be convened to formalise
the nomination process for the period 2023-2025. There has been no change
in industry representation since 2016, which can be explained by the limited
size of the sector in the country, although the major companies are full
members of the MSG. During consultations, a member from the industry
constituency signalled their intention to continue to extend the invitation to
the CAMIPE’s general assembly to all extractive companies. EITI information is
shared by CAMIPE through a mailing list that includes only member
companies, which restricts its representativeness of the broader industry
constituency.
Civil society participation is organised through the National Space for the
Transparency of the Extractive Industry (ENTRE), which also shares EITI
information to the broader civil society constituency. An open call for
nomination for the period 2023-2025 was published by ENTRE. Three new
civil society organizations were incorporated into the MSG as full members for
the period 2020-2022, while the other five organizations have remained in
the MSG since 2016, rotating their mandates as full and alternate members
for the period 2023-2025. A government stakeholder consulted noted that
there is room to improve civil society representation in the MSG to include
local organizations from areas directly affected by the extractive sector.
Development partners consulted noted that the implementation of the EITI is
a process that requires technical expertise, which local CSOs often lack, which
explains their lack of inclusion in the MSG. It appears that the
recommendation from the previous Validation to support capacity-building of
CSOs outside the MSG to ensure continuity and broad representation has
been, and continues to be, acted upon. Stakeholders from the industry and
government constituencies consulted also reiterated the need to include MSG
members in this capacity-building effort to ensure that all constituencies
remain updated on changes to the EITI Standard.
For most of the period under review, the MSG operated in accordance with the
TOR for the EITI-DR National Commission (MSG) established in 2015, and
ratified in 2016 by Decree No. 248-16, with evidence of deviations in the
frequency of MSG meetings and in the period of representation in the MSG.
Documentation and stakeholder consultations suggest that the MSG is
functioning effectively. The MSG oversees the production of EITI Reports,
approves ToRs for the IA, work plans and other documents and follows up on
recommendations. MSG meetings are convened sufficiently in advance and
documents are circulated with sufficient advance notice. Stakeholder
consultations suggest that the national secretariat provides the MSG with effective support, while MSG members can speak freely and raise issues for
discussion at meetings.
The minutes available on the EITI-DR website indicate that the MSG met
consistently in 2019, while some gaps longer than two months were observed
in 2020, 2021 and 2022. All consulted stakeholders conceded that there had
been a slow-down in the MSG's work during and post-COVID-19, although the
migration to online activities partially mitigated this impact. This slow-down is
offset by recent improvements linked to MSG engagement in discussions
around subnational payments and beneficial ownership within the scope of
the EITI Report. There is a need to improve the regularity of the MSG meetings
to at least every two months.
The direct participation and leadership of the Minister was required in some
situations to mediate conflict between civil society and industry related to
environmental issues. Despite the challenges imposed by the different points
of view between industry and civil society representatives on topics related to
subnational payments, BOT, and the delay of having non-metallic companies
incorporated into EITI, all the decisions reached by the MSG to date have
been made with a sufficient quorum, prioritizing consensus. According to
government stakeholders, the MSG has taken all decisions by consensus
since its inception, aside from a single decision taken by simple-majority vote.
Other government institutions were invited to participate in the MSG meetings
and MEM is currently liaising with the new Ministry of Environment and
Natural Resources, as encouraged in the previous Validation, while the work
of the technical support committee is still pending.
Transparency
Overview of the extractive industries
3.1 Exploration data
Requirement:
Fully met
90
The Secretariat’s assessment is that Requirement 3.1 is fully met, as in the
previous Validation. Stakeholders consulted did not express concerns on
progress towards the objective of this requirement in the mining, oil and gas
sectors. The Secretariat’s view is that the objective of ensuring public access
to an overview of the extractive sector in the country and its potential,
including recent, ongoing and planned significant exploration activities has
been fulfilled.
The 2019-2020 EITI Report discloses information about significant
exploration activities, an overview of the extractive industries, major mineral
deposits and hydrocarbon potential areas. For the mining sector, information
about national mineral availability, and mineral resources available by region
is systematically disclosed. An overview of exploration activities for this sector
is also included. For the hydrocarbon sector, an overview of exploration
activities is available in the EITI Report and through the National Hydrocarbon
Database. The report includes reference to Apache Corporation, the only
active oil and gas company in the country. As of 2021, the company was in
the process of conducting seismic and environmental studies and prospective
oil and gas explorations are expected to continue in the future. For the
mining sector, an overview of the main active mining companies can be found in the EITI Report. A list of updated exploration licenses is publicly disclosed
through the government’s website on mining. Some information about the
three potential mineral reserves (reservas fiscales) can be found in the
mining cadastre and in the EITI Report, including the legal framework and
geographic coordinates. The Report does not include information about
artisanal and small-scale mining potentials. Stakeholders consulted
mentioned that ASM exploration estimates do not exists, and that this
information is not material and only encouraged by the EITI Standard.
6.3 Contribution of the extractive sector to the economy
Requirement:
Fully met
90
The Secretariat's assessment is that Dominican Republic has fully met
Requirement 6.3, as in the previous Validation.
The objective of this requirement is to ensure a public understanding of the
extractive industries’ contribution to the national economy and the level of
natural resource dependency in the economy. Government stakeholders
consulted considered the objective to be met given continuous governmental
efforts to disseminate information to journalists and the public at large,
though they acknowledged that EITI reporting is sometimes used in place of
full systematic disclosure on government websites. In its response to the draft
assessment, the MSG noted that government entities involved in the EITI
provide links on their respective websites that direct the public to the EITI-DR
website. While there is a gap in disclosure of gender-disaggregated
employment data for the overall mining and quarrying sector, the MSG
explains that there is not reliable data on gender disaggregation available in
the Dominican Republic and the International Secretariat does not consider
this gap to be material. Material mining companies voluntarily reported
gender-disaggregated employment data, thus the International the Secretariat
considers the objective to be fulfilled.
The government discloses information on the contribution of the extractive
industries to the economy through systematic disclosure as well as through
EITI reporting. EITI reporting for this Validation has covered economic
contribution for fiscal years 2019 and 2020. EITI reporting provides
references to systematic disclosures of the extractive industries’ contribution
to GDP, and the contribution of the extractive sector to government revenues
is provided through EITI reporting with data provided from government
entities. Government representatives consulted confirmed that the extractive
sector’s contribution to government revenues was clearly described through
the Central Bank website. Export figures and investment figures are provided
and are clearly sourced. Figures provided in EITI reporting are generally given
in absolute terms but relative terms can easily be calculated. Total
employment figures are provided for the extractives sector but gender
breakdowns are only available for material companies participating in EITI
reporting. The 2020 EITI Report clarifies that aggregate government
employment figures for the extractives sector are generally grouped together
with other industries and these data were disaggregated especially for the
EITI reporting. Further breakdowns of employment by occupational status are
not available. The 2020 EITI Report did not include references or estimates to
an ASM sector, which according to a third-party report from 2014 is predominantly an informal activity, but did note that employment figures may
be undercounted due to a lack of official registration of some workers in the
extractive sector. It does not appear that there are more recent third-party
reports on ASM and informal sector activities, though it does appear that such
activities are present in the mining of semi-precious larimar, amber and gold
deposits. An overview of the location of mining, oil and gas activities is
available on government websites and through the 2020 EITI Report.
Legal and fiscal framework
2.1 Legal framework
Requirement:
Fully met
90
The Secretariat's assessment is the Dominican Republic has fully met
Requirement 2.1, as in the previous Validation.
The objective of this requirement is to ensure public understanding of all
aspects of the regulatory framework for the extractive industries, including the
legal framework, fiscal regime, roles of government entities and reforms. Based
on available disclosures, the Secretariat considers the objective to be fulfilled.
Government representatives consulted echoed the Secretariat’s view that the
objective has been fulfilled.
The 2020 EITI Report describes the legal, environmental and fiscal regime and
fiscal devolution for mining, oil and gas, including the roles of government
entities. Government websites provide the broader laws and regulations that
are summarised in the 2020 EITI Report. EITI reporting outlines ongoing and
planned reforms in the mining sector, in particular to Law 64-00 on the
Environment and Natural Resources. Lack of clarity around reform efforts in oil
and gas leaves room for further progress if Dominican Republic is to achieve
‘exceeded’ on Requirement 2.1. Government and civil society stakeholders
both stressed the need for further regulation of the non-metallic mining sector
and government representatives noted that this topic was being debated in the
context of reform of the Mining Law.
2.4 Contracts
Requirement:
Exceeded
100
The Secretariat's assessment is that Requirement 2.4 is exceeded.
The objective of this requirement is to ensure the public accessibility of all
licenses and contracts underpinning extractive activities (at least from 2021
onwards) as a basis for the public’s understanding of the contractual rights and
obligations of companies operating in the country’s extractive industries. The
Secretariat considers that the objective has been exceeded given that full
license and contract transparency is written into Dominican Republic’s
constitution and is fully complied with in practice.
The Dominican Republic EITI has documented relevant government policy on
license and contract disclosure for mining and hydrocarbons and mapped out
relevant laws and regulations. All contracts in the oil and gas sector and all
contracts and licenses in the mining sector, including annexes, amendments
and riders, have been systematically disclosed on the MEM website and are
well-summarised through EITI reporting. The MEM website provides
comprehensive lists of all active contracts and licenses in the mining, oil and
gas sectors, indicating which contracts and licenses have been published,
which is all of them. The 2020 EITI Report provides links to where these
contracts and licenses can be viewed in full on the mining and oil and gas
transparency portals. Contracts and licenses published before 1 January 2021
are also published in full.
6.4 Environmental impact
Not assessed
The Secretariat's assessment is that Requirement 6.4 is not assessed. The
Requirement was introduced in the 2019 Standard and was thus not assessed
in the previous Validation. The requirement is encouraged, and is thus only
assessed as exceeded, if fully implemented.
The objective of this requirement is to provide a basis for stakeholders to
assess the adequacy of the regulatory framework and monitoring efforts to
manage the environmental impact of extractive industries, and to assess
extractive companies’ adherence to environmental obligations. Government
stakeholders consulted reaffirmed the environmental regulatory framework
established by Law 64-00 and noted that these regulations are clearly
documented on the Ministry of Environment and Natural Resources website.
The Dominican Republic has made efforts to disclose an overview of relevant
legal provisions and administrative rules related to environmental management
and monitoring of extractive investments in the country but it has not yet used
EITI reporting to provide an annual diagnostic of practices in this regard.
Indeed, there does not appear to be a publicly accessible database of
environmental impact assessments, certification schemes or similar
documentation of environmental management in practice. It is not clear
whether environmental permitting, in practice, adheres to laws and regulations
or whether currently active mining and oil and gas companies are in compliance
with relevant legislation. Government representatives consulted noted that fees
and sanctions associated with environmental impact assessments are clearly
described on the Ministry of Environment and Natural Resources website. In
their response to the draft assessment, mining representatives noted that all
companies must carry out environmental impact assessments in order to carry
out operations. However, it does not appear that there is a database of active
environmental impact assessments held by extractive companies.
Civil society members consulted highlighted the lack of public access to
Environmental Impact Assessments and other environmental management
documentation stipulating terms related to environmental clean-up and the
closure of inactive mines as a key area of concern. These stakeholders
explained that the lack of public disclosure of these documents prohibits
effective community oversight of mining companies and limits the public’s
understanding of mining companies’ environmental obligations.
Licenses
2.2 Contract and license allocations
Requirement:
Fully met
90
The Secretariat's assessment is that Requirement 2.2 is fully met. It should be
noted that there were no licensing activities in oil and gas in the period reviewed
in the previous Validation.
The objective of this requirement is to provide a public overview of awards and
transfers of oil, gas and mining licenses, the statutory procedures for license
awards and transfers and whether these procedures are followed in practice.
This can allow stakeholders to identify and address possible weaknesses in the
license allocation process. Based on available documentation and stakeholder
consultations, the Secretariat’s assessment is that the objective has been
fulfilled. Consulted government stakeholders agreed that the objective was
fulfilled. Disclosures related to the award and transfer of oil, gas and mining
licenses are comprehensive and technical and financial criteria used in the
award and transfer process are clearly defined and EITI-DR confirmed that there
were no deviations from statutory procedure in the award and transfer of licenses
in the period under review.
It does appear that the recommendation from the previous Validation to more
clearly document technical and financial criteria in the award of mining licenses
has been accomplished. The Dominican Republic systematically discloses
information on the award and transfer of mining licenses and uses EITI reporting
to summarise this information and act as a central location for links to various
government websites where this information is systematically disclosed. Award is
executed through a first-come, first-served process for most mining areas. In 2020, nine mining licenses were awarded and one mining license was
transferred. Areas considered to be of importance, so-called ‘fiscal reserves,’ are
governed by a contractual system where contracts can be awarded using bid
rounds, though there were no awards in fiscal reserves in the period under
review. Technical and financial criteria are disclosed for the award and transfer of
mining licenses.
In oil and gas, bid rounds are used to award licenses and the bid round that
began in 2019 resulted in the award of one oil and gas exploration license. The
Terms of Reference associated with the 2019 bid round are publicly available
and contain the bid criteria required to be considered. While there are
documents that should list applicants, these documents only list Apache
Corporation (the winning applicant). Government stakeholders explained during
consultations that Apache was the only company that met the pre-application
standards and was therefore the only company eligible to bid on the license. The
list of companies that expressed interest but were not eligible to bid is not
publicly accessible but this does not constitute a gap in Requirement 2.2 given
that these companies did not meet the pre-application standards to submit bids
in the 2019 bid round. These stakeholders added that there is not significant
interest from multinational oil companies in Dominican deposits but that they
hoped this would change.
During stakeholder consultations and in its response to the draft assessment,
the MSG confirmed that there were no non-trivial deviations in mining, oil and gas
license awards and transfers. There is no comment on the efficiency and
effectiveness of the licensing and contracting systems in the EITI Report,
although this is only an encouraged aspect of Requirement 2.2.d.
2.3 Register of licenses
Requirement:
Fully met
90
The Secretariat's assessment is that Requirement 2.3 is fully met, as in the
previous Validation.
In mining, the cadastre is comprehensive and includes all data points listed in
section 2.3.b of the Requirement. Companies not covered by the EITI reporting
process are also included in this cadastre. DGM hosts a regularly updated mining
cadastre that provides public access to information on mining licenses of
different types. Government stakeholders consulted noted that efforts to digitise
the mining register are underway. In oil and gas, the MEM provides
comprehensive information on the one active oil and gas exploration and
production contract with Apache. Given ongoing efforts to develop a petroleum
register, the Dominican Republic is encouraged to set clear objectives to create
such a register prior to upcoming bid rounds.
Ownership
2.5 Beneficial ownership
Requirement:
Partly met
30
The Secretariat's assessment is that Requirement 2.5 is partly met.
The objective of this requirement is to enable the public to know who ultimately
owns and controls the companies operating in the country’s extractive
industries, particularly those identified by the MSG as high-risk, to help deter
improper practices in the management of extractive resources. There is a strong legal and regulatory structure for the collection of BO information by the
DGII and with the completion of the BO roadmap in 2019, the MSG has carried
on efforts to overcome barriers to public disclosure of BO information, as noted
in the MSG’s response to the draft assessment. The MSG also noted that there
were efforts by the MSG to collect BO information from material companies in
the scope of EITI reporting but that financial secrecy provisions prohibited the
disclosure of this information in the 2020 EITI Report. Many civil society
stakeholders consulted indicated that without public disclosure of this
information, the objective of this requirement was far from being achieved.
Consulted government representatives noted that the upcoming 2021 EITI
Report will include BO information from material companies, which represents
some progress toward the public disclosure of this data.
The MSG has agreed upon a definition for beneficial ownership, including
disclosure thresholds, and for politically exposed persons through Law 155-17
and its accompanying regulations. There is a strong legal and regulatory
framework for the collection of beneficial ownership information from all
companies in the Dominican Republic, including from extractive companies.
Mining industry representatives consulted confirmed that all foreign mining
companies were required to form a domestic legal entity to bid on or apply for
extractive licenses, which ensures that mining interests cannot be held by a
foreign entity that is not subject to BO reporting requirements. However, this
legal and regulatory framework does not extend to the public disclosure of this
information in any form and efforts to collect BO data from all companies
selected to report in this Validation cycle was stymied by financial secrecy
provisions prohibiting the disclosure of this information. Meeting minutes from
the Working Group on BO show that the MEM began drafting a resolution to
require all mining companies to report BO information that would be included in
the Mining Register hosted by DGM. Civil society stakeholders consulted
considered the construction of a separate BO Mining Register to be an
unnecessary compromise considering that DGII already holds this data. The
2020 EITI Report notes that this resolution is still under revision. While a BO
Roadmap is included for consideration in this Validation cycle, it appears to only
run through 2019. In its comments to the draft assessment, the MSG provided
meeting minutes that indicated successful efforts to lift financial secrecy
provisions to enable companies to disclose BO data, which is expected to take
place in the upcoming 2021 EITI Report.
Given the lack of a MEM resolution and the fact that material companies did
not disclose their BO information, there is no public accessibility of BO data in
the Dominican Republic. BO data is not publicly available for extractive
companies or for those bidding on or applying for mining, oil and gas projects.
EITI reporting reflects the MSG's confirmation that all data points required
under the 2019 EITI Standard are included in the DGII BO register but there is
no discussion or documented efforts to overcome barriers to public disclosure
found in the DGII BO register. Information on legal ownership is publicly
available in the Dominican Republic through the FEDOCAMARAS register,
though individuals must specifically request this information from the
FEDOCAMARAS register for each company of interest. Given that a company may operate under the jurisdiction of multiple Chambers of Commerce if the
company has operations in different regions of the country, the practice of
making individual requests could prove to be time-consuming and represent a
barrier to access to information.
Civil society stakeholders consulted highlighted the presence of Dominican
public officials as beneficial owners of mining companies in the Panama Papers
leak as a clear reason for the publication of BO information. While it is not
against the law for public officials to hold interest in extractive projects or
companies, civil society stakeholders were of the opinion that this information
should be public knowledge. These representatives noted that while BO
information can be found for multinational mining companies in the metallic
mining sector, the same is not true for beneficial owners of non-metallic mining
companies that also have large operations in the Dominican Republic. Mining
industry representatives from large multinational companies indicated their
willingness to supply BO information and to forego fiscal secrecy laws that
prevent such disclosure. These stakeholders noted that direction needed to
come from government to ensure proper disclosure of this information. Based
on the comments made by the MSG in their response to the draft assessment
and by government representatives consulted on the disclosure of BO
information in the upcoming 2021 EITI Report, it appears that there has been
positive progress since the previous Validation.
State participation
2.6 State participation
Not applicable
The Secretariat's assessment is that Requirement 2.6 is not applicable in the
Dominican Republic in the period under review, as in the previous Validation.
Where there was a lack of material revenues that made this requirement not
applicable in the previous Validation, the one SOE that was previously active,
CORDE, has now been fully dissolved with all equity interests transferred to a
national wealth fund, FONPER. The 2020 EITI Report clearly describes the
process by which these participating interests were transferred to FONPER and
notes that CORDE's titleship to mining concessions was transferred to the
Commission for Liquidation of State Entities (CLOE) where these mining
concessions were revoked. It does not appear that there are any outstanding
loans held by CORDE at the time of dissolution but EITI reporting is less clear
whether loans or loan guarantees were given to other extractive companies by
the government.
4.2 In-kind revenues
Not applicable
The Secretariat's assessment is that Requirement 4.2 is not applicable in the
Dominican Republic in the period under review, as in the previous Validation.
There is no evidence of in-kind revenues in the mining sector, while oil production
in the country is still in the exploration stage. The previous Validation Report
found no indication of payments made in-kind, while the scoping study prepared
for the 2019-2020 EITI Report found this requirement to be not applicable.
4.5 SOE transactions
Not applicable
The Secretariat's assessment is that Requirement 4.5 is not applicable in the
Dominican Republic in the period under review, as in the previous Validation. The
scoping study prepared for the 2019-2020 EITI Report found this requirement to
be not applicable and included a reference to the MSG discussions regarding the
inapplicability of this requirement. The Report also describes the dissolution of
CORDE and the subsequent transfer of activities to the Finance ministry
(Ministerio de Hacienda), CLOE and FONPER. However, the government should
clarify the number of shares and participation that relevant government entities
hold from CORDE’s dissolution.
6.2 SOE quasi-fiscal expenditures
Not applicable
The Secretariat's assessment is that Requirement 6.2 is not applicable, as in the
previous Validation. Government stakeholders consulted confirmed that there
are no state-owned enterprises in the extractives sector in the Dominican
Republic, with the sole SOE, CORDE, being dissolved in 2019. Therefore, there were no off-budget extractive-funded expenditures by SOEs on behalf of the
government.
Civil society indicates that there are pending cases of quasi-fiscal expenditures
that should be reported but does not provide information to support these
assertions.
Production and exports
3.2 Production data
Requirement:
Fully met
90
The Secretariat’s assessment is that Requirement 3.2 is fully met, which is an
improvement from the previous Validation. The Secretariat concludes that the
objective for this requirement has been fulfilled given that the Dominican
Republic publishes the sales value of non-metallic minerals by commodity, which
was missing in the previous Validation. However, civil society representatives
considered that sales values published by MEM were different from the real
production value, raising concerns about how production values are calculated
and thus implying that the objective is not yet exceeded.
The Dominican Republic discloses total production volumes and sales values of
metallic and non-metallic minerals for both 2019 and 2020 fiscal years, and this
information is systematically disclosed. Although this information is
disaggregated by commodity, it is not further disaggregated by company or
region. In their response to the draft assessment, civil society representatives
expressed concerns about production volumes and values of non-metallic
minerals such as larimar and amber not being disclosed at the required level of
disaggregation. Additionally, the rationale behind the average price used for
calculating sales values for both metallic and non-metallic minerals is not clear.
The 2019-2020 EITI Report describes relevant mining auditing procedures, as
well as relevant rules and protocols regulating the quality of information about
production. The protocol for auditing procedures of the mining industry includes
the legal framework and technical specifications for surface and sub-surface
exploration. Although the report states that production values are collected using
the Annual Operation Reports from mining licenses, the report does not include
further information on how production data has been calculated or the use of
national or international baselines to calculate this information. The 2019-2020
EITI Report does not disclose estimates of production data from artisanal and
small-scale mining and it does not appear that these estimates are available
from third-party sources.
3.3 Export data
Requirement:
Fully met
90
The Secretariat’s assessment is that Requirement 3.3 is fully met. While the
assessment of Requirement 3.3 was “exceeded” in the previous Validation, the
criteria for assessments of “exceeded” now require that all encouraged aspects
of the requirement be addressed and that the data be systematically disclosed.
The Secretariat concludes that the objective of ensuring public understanding of
extractive commodity production levels and the valuation of extractive commodity
output is fulfilled, but not yet exceeded pending the disclosure of the
methodology for calculating export data and ASM estimates.
The 2019-2020 EITI Report discloses total export volumes and the value of
exports for metallic and non-metallic commodities. Although this information is
disaggregated by mineral, it is not further disaggregated by region, company or
project. Stakeholders consulted stated that disaggregated information is not
provided due to confidentiality policies (deber de reserva). In their response to
the draft assessment, civil society representatives expressed concerns about export volumes and values of non-metallic minerals such as larimar and amber
not being disclosed at the required level of disaggregation. The EITI-DR website
discloses information about export revenues paid by companies to government.
Information about silver and gold exports is systematically disclosed on the
customs website and information about exports of non-metallic and metallic
commodities is disclosed through the Central Bank website.
The Dominican Republic does not provide information on how export data has
been calculated or if any national or international calculation methodology has
been used to this end. Although the country is in the process to regulate ASM,
estimates of export data from artisanal and small-scale mining is not included.
When consulted, the Independent Administrator expressed that it is not yet
possible to know the export values of ASM as there is no existing typology for
classifying ASM exports in the regulatory agencies involved. Additionally,
government representatives consulted confirmed that ASM has only local
demand.
Revenue collection
4.1 Comprehensiveness
Requirement:
Fully met
90
The Secretariat's assessment is that Requirement 4.1 is fully met, as in the
previous Validation. The assessment of Requirement 4.1 is not yet exceeded
pending the discussion with constituencies outside of the MSG about the
relevance of the inclusion of non-material companies in the scope of the EITI
Report and the publication of audited financial statements by companies in the
scope of EITI reporting. Multiple civil society representatives consulted stated
that a lack of publicly accessible audited financial statements from mining
companies prevents the public from knowing whether these companies are
fulfilling all their payment obligations under Law 64-00. These discussions could
include relevant government agencies from the sector responsible for disclosing
mining information. The Secretariat concludes that the objective for this
requirement has been fulfilled, given that the Dominican Republic ensures
comprehensive disclosures of company payments and government revenues
from oil, gas and mining.
EITI-DR has agreed on a materiality definition for selecting revenue streams and
companies in the scope of reporting, including reporting thresholds and the
options considered. The MSG minutes indicate that, in December 2021, the MSG discussed the different options to define materiality, which was later approved at
the MSG’s 08-2021 meeting. The minutes reflect the MSG discussion about the
twelve revenues streams considered to be material, the four companies making
material payments, the four government entities receiving relevant payments and
the materiality threshold. Options and rationale considered by the MSG are
included in a separate materiality report.
The revenue streams considered material are publicly listed in a separate
materiality report, in MSG minutes and in the EITI Report. Although they are not
described in these documents, a description is also published on the EITI-DR
website. The MSG agreed on excluding certain revenue streams from the scope
of EITI disclosures given the lack of materiality of payments related to these
streams with a thorough rationale provided in the materiality report.
The government fully reported all revenues considered in the materiality
threshold, including revenues from non-material companies. Information of
material revenues is presented in aggregate and disaggregated by revenue
stream. EITI-DR has also demonstrated that no company making material
payments to government has been exempted from disclosure and the scoping
study prepared for the 2019-2020 EITI Report includes an analysis of material
payments and material companies. However, civil society stakeholders expressed
concerns on how companies not considered in the scope of reporting but having
a substantive impact at the community level are not taken into consideration
when preparing the EITI Report.
None of the stakeholders consulted expressed concerns about the
comprehensiveness of disclosures, the materiality thresholds or any negative
impact of the confidentiality policies affecting comprehensiveness. In the
Dominican Republic, companies' private data is protected by law 11-92 of the tax
code. Therefore, to be able to conduct the EITI Report, reporting companies
shared with the Ministry of Mines (through the Ministry of Finance) an
authorisation to suspend their right to the confidentiality of their data.
The EITI Report describes discrepancies in the reconciliation between material
companies and reporting entities. In all cases, an explanation of these
discrepancies is included, although there is no evidence of the MSG discussing
these discrepancies. In its response to the draft assessment, the MSG confirmed
that discrepancies are always discussed during the approval process for EITI
Reports and that a consensus is reached before approval so that all
constituencies’ opinions can be heard. The IA acknowledges that discrepancies
are mostly based on delays from reporting companies in sending data to the
Independent Administrator. An explicit statement from the Independent
Administrator of the impact of these gaps on the comprehensiveness of the
report is not included, although the EITI Report specifies that differences found in
the reconciliation process represent less than 0.01% of total reconciled
revenues. This information is also included in the summary of key findings from
the reconciliation process. The Dominican Republic could strengthen the comprehensiveness of data disclosures by improving intra-agency coordination
and reinforcing the participation of the national auditing agency.
The EITI Report includes a summary of audited financial statements for material
companies, although none of them are publicly available. From companies
considered in the EITI Report scope as material, DOVEMCO did not provide
audited financial statements. DOVEMCO is a Bauxite selling company that has
had partial operations since 2016.
4.3 Infrastructure provisions and barter arrangements
Not applicable
The Secretariat's assessment is that Requirement 4.3 remains not applicable in
the period under review, as in the previous Validation. The previous Validation
found that DOVEMCO had an agreement with the government of the Dominican
Republic to rebuild a road affected by mining operations. However, the last
Validation found that this did not constitute an infrastructure or barter agreement
as defined in Requirement 4.3 as this infrastructure project as not conducted in
exchange for extractive licenses or mining rights. The 2019-2020 EITI Report
notes that DOVEMCO has not rebuilt this road as the company has had
intermittent operations. Stakeholders did not express concerns related to this
requirement.
4.4 Transportation revenues
Not applicable
The Secretariat's assessment is that Requirement 4.4 remains not applicable in
the period under review, as in the previous Validation. The scoping studies
conducted for the 2015, 2016, and 2019-2020 EITI Reports confirm the
inapplicability of this requirement as government entities do not receive
transportation revenues that can be considered material under the scope of
reconciliation. Some of the civil society stakeholders consulted alleged that there
might be transportation revenues that might not be material, but that could have
negative impact in communities. However, there is no specific information of this
allegation referenced in the EITI Report, in the MSG minutes or mentioned by any
other group during consultations.
4.7 Level of disaggregation
Requirement:
Fully met
90
The Secretariat's assessment is that Requirement 4.7 is fully met. The objective
of ensuring that the public can assess the extent to which government can
monitor its revenue receipts is fulfilled,
The 2019-2020 EITI Report presents data disaggregated by individual company,
government entity and revenue stream. However, stakeholders expressed
concerns on this requirement given the lack of disaggregated information at the
subnational level, particularly for alleged transportation revenues, though the
International Secretariat did not find evidence that such transportation revenues
exist. In their response to the draft assessment, civil society representatives
expressed concerns about the level of disaggregation of non-metallic minerals
such as larimar and amber.
Although there is no evidence that the MSG has further discussed the scope of
this requirement since the previous Validation, the previous Validation report
states that each company has only one project in the country, and therefore
reporting is allegedly by project. The Dominican Republic could benefit from
following the recommendation from the scoping study prepared for the 2019-
2020 EITI Report, where it is recommended that the MSG re-evaluate the scope of this requirement however there is no evidence that the MSG discussed the relevance or the barriers for disclosing project level information.
4.8 Data timeliness
Requirement:
Fully met
90
The Secretariat's assessment is that Requirement 4.8 is fully met, as in the
previous Validation. The Secretariat’s view is that the objective of ensuring that
public disclosures of company payments and government revenues from oil, gas
and mining are sufficiently timely to be relevant to inform public debate and
policymaking, has been fulfilled, although some stakeholders consulted
expressed the need of working on timelier data disclosures.
The Dominican Republic has published regular and timely information in
accordance with the EITI Board-agreed deadlines. The MSG has agreed on an
accounting period and the Annual Progress Report shows the progress on data
disclosure activities that have been completed according to the work plan. For
the 2019-2020 EITI Report, the original reporting deadline of 31 December 2021
was not met, and the Dominican Republic requested an extension to the EITI
Board which was granted on 9 February 2022.
4.9 Data quality and assurance
Requirement:
Mostly met
60
The Secretariat's assessment is that Requirement 4.9 is mostly met. The
Secretariat’s view is that the objective of ensuring that appropriate measures
have been taken to ensure the reliability of disclosures of company payments
and government revenues from the extractive sector has been mostly fulfilled,
but not yet fully met pending clarification on the lack of quality assurances from
DOVEMCO.
The MSG in the Dominican Republic has agreed on a procedure to address data
quality and assurance which are described in the materiality report prepared for
the 2019-2020 EITI Report. The agreement on these standard procedures is also
documented in an MSG minute and are in accordance with the standard
procedures endorsed by the EITI Board. Stakeholders consulted, including the IA,
did not express concerns about the comprehensiveness and quality of data
reported.
The information disclosed by the Government of Dominican Republic is subject to
national regulations and audits and the information provided for the 2019-2020
EITI Report was endorsed by a high-level official. Government agencies are
subject to auditing procedures established by the Camara de Cuentas and, in
addition, the executive agencies -including the Ministry of Energy and Mines- are
subject to the Office of the Auditor General of the Republic, through the Internal
Audit Unit.
The information disclosed by companies is subject to the regulations of the fiscal
authority (Dirección General de Impuestos Internos DGII), who has the
competence to audit the operations of taxpayers. In addition to the power of
inspection and audit, the DGII has the competence to determine tax liability and
penalties. To do this, the fiscal authority classifies taxpayers based on a risk
model as low, medium or high tax risk. Additionally, it performs desktop and onsite inspections, having access to databases of other institutions to cross-check
information and verify the data submitted in the tax returns. The information provided by companies participating in the EITI Report was
endorsed by a high-level official and copies of companies’ audited statements
were provided to the IA for review. Although almost all material companies
provided audited statements, DOVEMCO did not provide this information to the
Independent Administrator. For the 2019-2020 EITI Report, none of the audited
statements provided by companies are publicly available, although the fiscal
framework does not mandate companies to make these documents public.
The 2019-2020 EITI Report describes the assurances to be provided by the
participating companies and government entities to assure the credibility of the
data. For collecting information, the MSG agreed on data collection templates,
that were shared with material extractive companies and government entities in
January 2022. The data collection request consisted of a cover letter outlining
the data collection and reconciliation process. Reporting companies sent to the
Ministry of Finance a confidentiality waiver to disclose the tax data of their
operations in the country. Stakeholders consulted did not express concerns
about the process established for confidentiality waivers.
Although stakeholders consulted did not express concerns about the
comprehensiveness and quality of data reported, one of the reporting companies
-DOVEMCO- did not provide a quality assurance letter to the IA or the audited
financial statements.; the materiality report prepared by the Independent
Administrator states that only agreed procedures were undertaken and no
additional review of auditing procedures was conducted.
Revenue management
5.1 Distribution of revenues
Requirement:
Exceeded
100
The Secretariat's assessment is that Requirement 5.1 is exceeded.
The objective of this requirement is to ensure the traceability of extractive
revenues to the national budget and ensure the same level of transparency and
accountability for extractive revenues that are not recorded in the national
budget. The Secretariat’s assessment is that the objective has been exceeded.
While there was a lack of clarity around retained earnings by CORDE in the
previous Validation, this issue has been resolved given the dissolution of
CORDE in the period under review. EITI reporting confirms that all extractive
revenues are recorded either in the national budget or in subnational budgets.
Extractive revenue allocations to funds occur after being recorded in national or
subnational budgets. Audited financial statements on the national budget and
national revenue classifications can be found on the Digepres website (here
and here). During consultations, Ministry of Finance representatives confirmed
that all government revenues are deposited in the National Treasury and
recorded in the national budget, as established by Article 24 of the Budgetary
Law for the Public Sector, No. 423-06. These representatives explained that
extractive revenues are used to finance expenditures established in the
General Budget of the Nation, unless otherwise determined by law. In its
response to the draft assessment, the MSG clarified that all revenues are
subject to national revenue classification systems, principally the Budget
Classifier Manual, and therefore references to international data standards,
such as the IMF’s Memorandum of Economic and Financial Policies were not
made.
5.3 Revenue management and expenditures
Not assessed
The Secretariat's assessment is that the Dominican Republic has made some
progress in disclosing revenue management and expenditure information,
although gaps in encouraged aspects of Requirement 5.3 remain. Therefore,
Requirement 5.3 remains not assessed, pending comprehensive disclosures of
all information encouraged to be disclosed.
The objective of this requirement is to strengthen public oversight of the
management of extractive revenues, the use of extractives revenues to fund
specific public expenditures and the assumptions underlying the budget
process. The Secretariat’s assessment is that the objective of this requirement
is not yet fulfilled.
The 2020 EITI Report and government websites such as the General
Directorate of Budget and Financial Transparency websites provide information
on earmarked extractive revenues and the federal government's budget
procedures. While some extractive revenues are recorded in subnational
budgets, it does not appear that there are such revenues directed to thematic
areas. In its response to the draft assessment, the MSG confirmed that all
extractive revenues are recorded in national or subnational budgets. Revenue
streams recorded in the federal budget are not distinguishable from one
another and budgetary laws regulate revenue expenditures on specific thematic
areas. The MSG’s response confirmed that none of these earmarked areas are
related to the extractive sector. Audit procedures were not referenced through
EITI reporting, though audit reports on the national budget can be found on
government websites. Government stakeholders consulted confirmed that
there were clear audit procedures associated with the national budget and
provided links to the websites for the Directorate General of Government
Accounting and Chamber for Accounting where audit reports for the national
budget can be found. EITI reporting provides some information on revenue
projections, in particular from the two main gold extraction projects operated by
PVDC and EnviroGold, and assumptions underpinning the budget. Financial
reports describing the management of extractive revenues by certain
government funds do not appear to be publicly disclosed.
Subnational contributions
4.6 Subnational payments
Not applicable
The Secretariat's assessment is that Requirement 4.6 is remains not applicable
in the period under review, as in the previous Validation. The previous
Validation explains that the only subnational payments applicable to extractive
companies derive from the General Law on Environment and Natural
Resources. It entitles municipalities where production is taking place to receive
5% of the “net benefits” generated. The 2019-2020 EITI Report states that for
the period under review, the MSG reviewed the applicability of this requirement
and found that only one license had legal obligation to make this payment.
However, the company operating this license did not report any benefit as it
was closing operations and therefore, this requirement remains as not
applicable.
5.2 Subnational transfers
Requirement:
Mostly met
60
The Validation found that Requirement 5.2 is mostly met. The recommendation from the previous Validation to “assess and disclose any discrepancies between the formulas and actual amounts transferred (1) from the central government to FOMISAR and (2) from FOMISAR to municipalities” has been mostly fulfilled.
The objective of this requirement is to enable stakeholders at the local level to assess whether the transfer and management of subnational transfers of extractive revenues are in line with statutory entitlements. The Secretariat’s assessment was that the objective is fulfilled. In its comments to the draft Validation report, the civil society constituency insisted that these transfers are not clear due to an improper base of revenue figures used for the calculation of these transfers.
Dominican Republic EITI has demonstrated that two forms of subnational transfers of extractive revenues exist in the mining sector and has described the process for calculating transfers based on corporate income tax (consulted CSO representatives do not consider corporate income tax to be an adequate base from which to calculate subnational transfers and maintain that the base of calculation should be drawn from ‘net benefit’ of mining operations) and based on a flat fee. For the former, the amount transferred consists of 5% of the base of calculation, though no transfers were made in the period under review (there was a transfer by CORMIDOM in 2021). For the latter, 50% of the flat fee set on the extraction of physical materials is directed to affected communities.
The value of subnational transfers of mining revenues in 2020 are provided by FOMISAR and are broken down by each subnational government beneficiary. Budgeted and actual amounts are provided and a reconciliation of these differences is performed in the 2020 EITI report. Audited financial statements of FOMISAR transfers can be found on the DR EITI website. Differences between what was supposed to be transferred and what was transferred in practice are detailed in EITI reporting, which addresses the corrective action from the previous Validation.
The Validation Committee reviewed the case at its 31 October 2023 meeting. Following comments from Validation Committee members, the Committee agreed to downgrade the assessment of Requirement 5.2 on subnational transfers from ‘fully met’ to ‘mostly met’, given the lack of consensus on the accuracy of calculations of subnational transfers of mining revenues.
6.1 Social and environmental expenditures
Requirement:
Mostly met
60
The Secretariat's assessment is that Requirement 6.1 is mostly met despite
differing opinions among stakeholders as to whether this requirement is
applicable in the Dominican Republic, with government and industry
stakeholders considering that it is not applicable while civil society considers that
this requirement is applicable. In the previous Validation, Requirement 6.1 of the
2016 EITI Standard (that only covered social expenditures) was considered not
applicable as it was agreed that there were no mandatory social expenditures
mandated by law or contracts. The 2019 EITI Standard expanded reporting
requirements of Requirement 6.1 to require the disclosure of mandatory
environmental expenditures, when considered material, and encourage the
disclosure of voluntary environmental payments. The objective of this
requirement is to enable public understanding of extractive companies’ social
and environmental contributions and provide a basis for assessing extractive
companies’ compliance with their legal and contractual obligations to undertake social and environmental expenditures. Based on available
documentation and consultations, the objective of this requirement is mostly
fulfilled as differing opinions expressed by stakeholders and a lack of consensus
on the applicability of the requirement prevents a clear public understanding of
extractive companies’ social and environmental contributions and adherence to
legal and contractual obligations.
Concerning social expenditures, there have been no changes to laws or terms
of contracts since the previous Validation that have imposed mandatory social
expenditures by companies and voluntary social payments by companies were
not disclosed in the 2019-2020 EITI Report. Industry stakeholders consulted
confirmed that social expenditures were voluntary in nature and were defined
through Corporate Social Responsibility plans.
Concerning environmental expenditures, Articles 47 and 162 of Law 64-00 on
the Environment and Natural Resources mandate, respectively, the payment of
10% of the total costs of physical works and investments, and certain fees
depending on the category of environmental authorisation needed by metallic
mining companies. Further resolutions lay out costs associated with
environmental authorisations for non-metallic mining companies and for the
renewal, modification, or loss of these environmental authorisations.
Government stakeholders consulted confirmed that environmental payments
are made through this law and all payments are collected by the Ministry of the
Environment and Natural Resources. The 2020 Scoping and Materiality Report
provides unilateral disclosures from the Ministry of Environment and Natural
Resources on all environmental payments made in 2020 and concludes that
these payments are not considered material in the period under review given
that these payments amount to less than 1% of total government revenues,
which is the materiality threshold agreed upon by the MSG for the 2020 EITI
Report. Environmental expenditures were not reported by companies.