TIMOR-LESTE Law and Practice Contributed by: João Afonso Fialho, Tomás Cabral Anunciação and Teófilo de Jesus, VdA
• development of local infrastructure; • resettlement, if necessary; • protection of the environment; • protection and/or relocation of cultural and/or religious sites; and • rights of access or easements for the move - ment of populations and animals, as well as for the grazing of the latter, or access to water or cultural and religious sites. If the presence of local communities in the con - cession area is not compatible with the devel - opment of the mining activities, the holder of the mineral rights, together with the local and national authorities, must prepare and imple - ment a relocation plan, which must be approved and monitored by the competent government entities. The relocated communities are entitled to be compensated by the mining rights holders for the loss of crops, livestock and forest prod - ucts, among other things, where profits have ceased due to land usage. There are other protective local content provi - sions in the Mining Code aimed at protecting local entrepreneurs and promoting local busi - nesses, benefiting from a statutory preferential right in procurement procedures for the provision of goods and services to the mining industry. 2.4 Prior and Informed Consultation on Mining Projects The Mining Code foresees prior consultation with local communities in the following situa - tions: • the closure of a mining project (this consulta - tion must be provided for in the correspond - ing mining closure plan, which is mandatory); • the approval of the development of mining activities in protected areas; and
• the planning and development of mining activities and, if applicable, the relocation of the local communities impacted by mining activities. 2.5 Impact of Specially Protected Communities on Mining Projects There are no provisions addressing specially protected communities in mining projects in Timor-Leste. 2.6 Community Development Agreement for Mining Projects Community development agreements for mining projects are not mandatory by law, nor are they common practice in Timor-Leste. 2.7 Environmental, Social and Governance (ESG) Guidelines and Regulations ESG policies are incorporated in various scat - tered legal statutes, but there are no express ESG regulations for the mining sector. Nev - ertheless, the Mining Code enshrines certain industry-specific ESG principles with which the holders of mineral rights must comply. These include the duty: • to conduct mineral activities under strict envi - ronmental regulations; • to comply with the applicable local con - tent policies on recruitment and training of Timorese nationals, and procurement of local goods and services; • to ensure the involvement of local communi - ties; • to abide by local laws and regulations; and • to adopt the best business ethics practice. However, ESG provisions can also be found in mineral investment contracts (where applicable),
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