ANNEX VISupplementary provisions
ANNEX VI TERMS OF REFERENCE FOR THE INDEPENDENT SYSTEM AUDIT (ISA) I. BACKGROUND AND JUSTIFICATION The aim of the Independent Legality Assurance System Audit (LAS) is to provide an assurance to all stakeholders with regard to the reliability and credibility of the FLEGT licences issued in the CAR. II. MISSIONS The ISA has the following general tasks: (1) to regularly assess the good implementation of all aspects of the LAS, in particular: — respect for the principles and criteria of the legality matrix; — the effectiveness of supply chain verification; — the effectiveness of verifications and verification checks; — the reliability of the system for issuing FLEGT licences; — the complaints management mechanism (registration of stakeholders’ grievances concerning (i) LAS implementation and (ii) independent audit activities); — the synergy between all elements of the LAS; — the synergy between all actors concerned and involved in the process (communication flows, filing, procedures, etc.); (2) to assess the adequacy of the data management systems supporting the LAS; (3) to identify weaknesses and failings in the system (proposing corrective actions is the responsibility of the Joint Committee); (4) to verify, where appropriate, the implementation of the corrective actions decided by the Joint Committee following identified weaknesses and failings, and assess their effectiveness; (5) to verify the use of FLEGT licences when timber products coming from the CAE are released for free circulation within the Union; (6) to draft and submit a report to the Joint Committee following each audit. III. REQUIRED QUALIFICATIONS The ISA shall be a body independent of the CAR’s administration, the Central African Republic’s private sector, local non-governmental organisations (NGOs) and the Union. It may be a research department, a consortium of research departments, a practice or organisation internationally renowned for its experience and credibility in audit missions. The structure must comprise a multidisciplinary team of experts specialising in audit and with a good knowledge of the way in which forest operations are undertaken, logging companies, and the procedures for exporting timber from countries of the Central African sub-region. The structure must also have an efficient internal control system in place. Commercial service providers under contract to the CAR government for the supply of other management and forest resource control services or any activity that will, or is likely to, create a conflict of interests for the provider are not admissible for audit activities. The ISA recruitment criteria are the following: — proven expertise in the forest sector in the Central African sub-region; — good knowledge of forest, fiscal, environmental, social and commercial legislation in the countries of the Central African sub-region. A knowledge of forest legislation in the CAR would be an asset; — at least 10 years’ experience in evaluating forest management and verifying the control chain in countries of the Central African sub-region; — the capacity to produce audit reports in accordance with international standards; — independence and credibility. IV. METHODOLOGY The ISA shall cover the whole process leading up to the issuing of a FLEGT licence, according to a procedures manual to be developed and submitted to the Joint Committee for approval within three months of its recruitment. The ISA methodology must cover all the points given in Section II relating to missions. The ISA must work according to a documented evidence-based procedure. For this, all documents required for issuing a FLEGT licence must be verified on the basis of multiple cross-referenced sources, where possible on the basis of samples and field-based verification activities in order to complete and cross-check the information coming from the documentary checks. The ISA may undertake investigations into complaints or observations received by the Joint Implementation Committee. At the start of Agreement implementation, the frequency of ISA interventions will be three times a year in the first year, twice a year in the second and third years, then once a year from the fourth year onwards. The ISA may undertake additional audits at the request of the Joint Committee. A detailed schedule approved by the Joint Committee, to include mission dates and dates for the submission of the corresponding reports, shall be supplied to the ISA prior to the start of its mandate. V. SOURCES OF INFORMATION The ISA will need free access to all information and sources it judges relevant. The Parties shall facilitate this access to information. The main sources of the ISA’s information with regard to actors involved in the FLEGT licensing scheme are as follows: — the licensing authority (Ministry for Water and Forests); — the Central Inspectorate for Water and Forests, where the final checks are made prior to issuing the FLEGT licence; — the Forestry Data Centre, where the FLEGT licences and export data for each logging company are filed; — the secure export revenues company (currently BIVAC); — the administrative structures involved in verifying respect for the legality indicators: — Ministry for Water and Forests; — Ministry of Commerce; — Ministry of Finances; — Ministry of Public Service, Social Security and Labour; — Ministry of Justice; — Ministry of the Environment and Ecology; — Ministry of Public Health; — Ministry of Agriculture; — Ministry of Transport; — logging companies, beneficiaries of artisanal permits, community forests under logging and operators or owners of forestry plantations; — all departments involved in the different checks: the General Directorate for Water and Forests, the Department for Forest Logging and Industry, the Department for Forest Inventory and Land-use, the Regional Department for Water and Forests, the Mobile Intervention and Verification Brigade, the Central African Republic’s customs departments, the tax departments, the Department for the Living Environment and Environmental Planning within the Ministry of the Environment, the Labour Inspectorate, the phytosanitary departments, the Central African Road Haulage Office (BARC), the Ministry of Trade departments, the Ministry of Justice departments; — the competent authorities of the Union; — the Société d’exploitation des parcs à bois du Cameroun / SEPBC (Douala); — members of civil society (NGOs); — the people living near the PEAs and other logging permits; — development or support project staff involved in forestry development; — all other sources judged relevant. Complaints from stakeholders in the scheme for issuing FLEGT licences can be sent to the Joint Committee. This committee may make them available to the ISA. These complaints may thus also be a source of ISA information. Access to information shall initially be obtained by means of control reports, infringement reports resulting from controls, and verification reports on respect for legality indicators that shall be provided to the ISA. The ISA shall travel to the field, at its convenience, to obtain all information it judges relevant. The ISA must also consult the main databases such as those of the CDF, and Central African Republic’s customs authority. VI. REPORTS ISA reports shall contain all relevant information that drew the attention of the auditors. A framework for audit reports shall be provided by the ISA in the context of procedures documented and approved by the Joint Committee. After each audit, the ISA shall produce, within three weeks, a provisional report in French in eight copies: four copies are to be sent to the Ministry responsible for forests, and four to the Union, in addition to the electronic copy sent to both Parties. The report must present an analysis of all the system’s elements, verifying that all requirements relating to the LAS are observed by all system components. Comments from both Parties with regard to the provisional report, including complaints relating to the way in which the auditor is fulfilling its mission, shall be analysed by the Joint Committee and then sent to the ISA to produce the final report. The final report shall contain a response from the ISA to the comments made by the Joint Committee. The ISA shall systematically produce a summary report to be made public. This report shall summarise the final report and cover the main results, weaknesses and failings identified, and the concerns of the stakeholders. As appropriate, at the request of the Joint Committee, the ISA shall also produce a specific additional report when serious infringements, or serious weaknesses in the LAS, are identified. VII. RECRUITMENT PROCEDURES AND INSTITUTIONAL SET-UP The ISA shall be recruited via a competitive procedure from amongst national and/or international candidates following a call for tenders by the Ministry of Forests for a three-year period, renewable once only, and subject to the formal approval of the Joint Committee. The call for tenders shall be published in national and international publications and on Internet sites. The service provision agreement signed between the ISA and the Minister for Forests shall include: For the government: — non-interference in ISA activities; — access to public and private information related to the LAS, in accordance with national legislation; — access to the forest domain and timber transport, storage, processing and export facilities necessary for the LAS; — payment of invoices corresponding to the ISA’s services to be made whatever the conclusions of the audit. The CAR government shall administratively facilitate the ISA’s movements around the CAR’s territory and ensure its safe conduct during trips within the national territory. For the provider: — a quality service provision in accordance with the terms of reference; — guarantees relating to the protection and use of confidential information of a commercial nature. The activities to be undertaken by the ISA shall also be specified in this contract, along with payment methods and the respective responsibilities of the signatories to the contract.