Democratic Republic of the Congo

Overview and role of the EITI

The Democratic Republic of the Congo’s economy is highly dependent on the extractive sector, which accounted for 46% of the government’s revenues and 99.3% of exports in 2019. The country’s mineral deposits include more than fifty identified ores. A dozen of these is exploited: copper, cobalt, silver, uranium, lead, zinc, cadmium, diamond, gold, tin, tungsten, manganese and some rare metals such as coltan. Due to a drop in cobalt demand, the extractive sector’s contribution to GDP fell from 20.1% in 2018 to 13.5% in 2019.

The DRC began implementing the EITI in 2007 at the height of the commodity boom. Decades of conflict, political instability, corruption and mineral smuggling had decimated the country’s mining sector and left the government with large liabilities for its state-owned enterprises, which had become practically insolvent. Despite the country’s vast natural resources, two-thirds of the Congolese citizens were living below the poverty line. In this context, the government committed to implement the EITI to attract foreign direct investment to revive the mining sector and ensure that revenues are well managed for the benefit of citizens.

Innovations and policy reforms

• By adopting a more streamlined approach to EITI reporting, ITIE-RDC focused its resources on producing thematic reports on matters of public interest, including beneficial ownership, contracts, licensing, royalties, state-owned enterprises and an infrastructure agreement between a state-owned mining company and China.
• To facilitate the collection of data from over 200 companies, ITIE-RDC launched an online software to automate reporting by companies and government entities and reconciliation of data.
• Discussions between civil society and company representatives led to the adoption of a repository and a template for disclosing social expenditures.
• EITI stakeholders in the DRC contributed to establishment of transparency provisions in the 2018 Mining Code, including on the traceability of mining revenues, transparency in the award of mining rights and the disclosure of beneficial ownership data.

The DRC’s mining sector is governed by the 2002 Mining Code, as amended and supplemented by Law n°18/001 of March 9, 2018. In addition to the Mining Code and Regulations, other legal and regulatory texts contain provisions relating to the mining sector, like the Tax Code or the Customs Code.

The Ministry of Mines, which implements the mining policy of the government, is competent to grant or refuse to grant mining rights.

The law on the general regime of hydrocarbons establishes the general regime applicable to hydrocarbons. It defines the legal and fiscal regime on the one hand and, on the other hand, upstream and downstream activities. The Ministry of Hydrocarbons implements the corresponding policy.

Mining rights are granted by the Mining Cadastre (CAMI) in accordance with the Mining Code, through either a tender process or by a request for rights. Extractive companies apply for special subsoil use permits, which are awarded through auction.

Exploration and exploitation rights in the petroleum sector are granted through a tender process. Product sharing agreements define conditions for hydrocarbon exploration and extraction and are obtained through direct negotiations.

ITE-RDC maintains a registry of mining licenses and petroleum contracts. Some contracts are also available on the Resource Contracts Portal.

The 2018 Mining Code and its implementing decree include provisions related to the disclosure of beneficial owners by mining companies. However, a self-assessment and consultations carried out in March 2018 highlighted concern about the sustainability of the framework and the comprehensiveness and reliability of reported data.

Beneficial ownership data for extractive companies has been disclosed in EITI Reports since 2015, albeit not comprehensively. The DRC does not have a public beneficial ownership registry.

In May 2021, ITIE-RDC published a study on the current practice of beneficial ownership transparency, noting gaps in disclosure by several companies. The study provides recommendations to accelerate beneficial ownership disclosure in line with EITI Requirement 2.5.

The 2018 Mining Code (Article 242) stipulates that shares of mining royalties (“redevances minières”) are to be paid directly by mining companies as follows:

• 25% to the provincial authorities;
• 15% to the decentralised territorial entity which hosts the extractive project;
• 10% to the Mining Fund for future generations;
• 50% to the central government.

Between 2016 and 2018, DRC EITI sought to clarify whether the revenue sharing formula under the previous Mining Code had been applied in practice. The findings showed that revenues had not been disbursed by the central government to the local level in accordance with the regulatory framework. With support from civil society organisations, the 2018 Mining Code introduced direct payments by mining companies to local authorities from July 2018 onwards.

Increasing transparency and public debate around local revenue allocation and management is one of the DRC EITI’s thematic priorities. The DRC EITI website presents detailed data by company and, where available, by province. A study published in 2021 assesses whether amounts were effectively paid in the period 2018-2020 and looks at how these revenues are managed locally.

ITIE-RDC is administered by the DRC Multi-Stakeholder Group (MSG) in accordance with Prime Ministerial Decree 09/27 of 16 July 2009. The MSG is chaired by the State Minister of Planning, Mr Christian Mwando. The first vice-chair is the Minister of Mines, Ms Antoinette N’Samba. The second vice-chair is the Vice-Prime Minister of Environment and Sustainable Development, HE Ms Eve Bazaiba. The MSG is comprised of representatives from government, industry and civil society.

The DRC was found to have made meaningful progress in implementing the 2016 EITI Standard in October 2019, following its first Validation. The Validation identified 13 corrective actions to be addressed by the country’s next Validation, which commenced in January 2022.