Title License to Drill
Subtitle A Manual on Integrity Due Diligence for Licensing in Extractive Sectors (International Development i
Author Cari L. Votava, Jeanne M. Hauch, Francesco Clementucci
ISBN 9781464812712
List price USD 37.50
Price outside India Available on Request
Original price
Binding Paperback
No of pages 140
Book size 216 x 279 mm
Publishing year 2019
Original publisher The World Bank
Published in India by .
Exclusive distributors Viva Books Private Limited
Sales territory India, Sri Lanka, Bangladesh, Pakistan, Nepal, .
Status New Arrival
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Reviews:

Time and again, the EITI’s experience supporting good governance in resource-rich countries has shown the importance of “getting it right” along all stages of the extractive industry value chain. Ensuring that licenses are awarded in a transparent and responsible manner is a crucial first step where additional guidance is sorely needed. With its emphasis on beneficial ownership disclosure and step-by-step guidance, this manual is a welcome tool for anyone working towards better governance in the extractive industries.

—Jonas Moberg, Executive Director, EITI

The allocation of licenses in the extractives sector is a foundational determinant of whether citizens will benefit from natural resources or not. This manual is a very important contribution to innovative efforts aimed at improving transparency and reducing corruption during this critical stage of the natural resources decision making chain.

—Daniel Kaufmann, President and Chief Executive Officer, Natural Resource Governance Institute

This manual provides detailed and thorough guidance for mitigating corruption risks in a highly vulnerable yet critical stage of the extractives value chain: licensing. This stage plays a large and important role in determining the nature and scope of benefits that citizens will derive from extraction. Too often, licensing has been shrouded in secrecy, allowing individuals to privately benefit at the expense of achieving positive resource-based development gains. The easily accessible knowledge contained in this manual will help governments and other key stakeholders to ensure the integrity of the licensing process.

—Kendra Dupuy, PhD, Senior Advisor, Natural Resource Management, U4 Anti-Corruption Resource Center

Serious corruption risks arise when there are inadequate mechanisms for investigating and disclosing the ownership and character of license applicants. This comprehensive manual is a valuable and practical resource that will help all of us working in resource-rich countries to address risks related to conflicts of interest, hidden beneficial ownership, weak integrity checks, and lack of due diligence. What’s at stake is significant: the transparency and accountability of a country’s mining sector licensing regime.

—Delia Ferreira Rubio, Chair, Transparency International Board

A very crucial building block to embedding the culture of transparency and good governance in licensing in the extractives sector. Countries should propagate within extractives licensing laws an obligation that officials publicly disclose beneficial ownership of licensees in extractive sectors. The lack of such transparency increases risks of corruption. 

—Modibo Traore, Officer-In-Charge, African Natural Resources Center, African Development Bank

The extractive industry is one of the critical revenue generating sectors of the economy, especially in West Africa. This World Bank manual contains useful measures to beam a piercing searchlight to prevent criminals from reaping what they do not sow, in a sector where transparency and accountability are sorely lacking. It is a valuable tool for improving governance and accountability in extractive sectors in the West Africa region and beyond. Criminals do not deserve our pity, their victims do!

—Muazu Umaru, Director, Research and Planning, Inter-Governmental Action Group Against Money Laundering in West Africa (GIABA)


Description:

Natural resources have the transformational potential to support economic and political stability as well as contribute to national prosperity and economic development. However, in countries dependent upon natural resource sectors, poor management of these sectors often contributes to corruption, illicit financial flows (IFFs) and thus, poverty. Adequate transparency and accountability in regulatory management of these sectors is a challenge for resource rich countries.

Poor licensing decisions in natural resource management can open a pandora’s box of corruption risks. This manual provides methods and options based on good practices to improve transparency, accountability, and integrity in the regulatory licensing process and integrity due diligence. The manual borrows models from the Basel Core Principle ‘fit and proper’ concept, and provides options for conducting effective (a) beneficial ownership; (b) criminal/legal; and (c) conflicts of interest checks, with a goal of integrating these into the regulatory licensing process. The manual also identifies common legal framework defects that can facilitate corruption risks, and offers options based on principles of regulatory integrity to reduce these risks.

The good practices identified can help countries allocate limited financial resources in conducting thorough background checks in a cost-effective manner, as well as meet EITI’s requirements for public disclosure of beneficial owners and politically exposed persons. These strategies for reducing opportunities for corruption in extractive sectors can help reduce IFFs that can sap resources from the economy and inhibit a country’s ability to achieve the Sustainable Development Goals.


Contents:

Foreword • Preface • Acknowledgments • About the Authors • Abbreviations

Introduction • The Potential of Improved Integrity Screening • Overview • Notes • References

Chapter 1: Overview of Basic Licensing Concepts • Defining Critical Sectors • Overview of Integrity Checks • Politically Exposed Persons: A Crosscutting Issue • Licensing as a Gatekeeping Function • Integrity, Financial, and Technical Reviews • Licensing and Procurement • Notes • References

Chapter 2: Calibrating Risk • Targeting Resources: A Risk-Based Approach • Risk Profiling • Diagramming Integrity Checks • References

Chapter 3: Beneficial Ownership • Identifying Beneficial Owners • Verifying and Documenting Beneficial Ownership • Who Should Be Checked? • Public Disclosure of Beneficial Ownership Information • Notes • References

Chapter 4: Criminal and Legal Background • Verification of Criminal History • Verification of Civil or Administrative Sanctions • Cost-Effective Strategies for Background Checks • Following Up on Negative Information • Notes • References

Chapter 5: Conflicts of Interest • Defining Types of Conflicts of Interest • COIs in Integrity Screening • COIs: Officials with a Role in Licensing • Implementation of COI Policy • Strategies upon Detecting Potential Conflicts of Interest • Administrative and Legal Aspects of the COI System • Notes • References

Chapter 6: Policy and Legal Framework • Accountabilities and Safeguards • Information Sharing, Public Access, and Confidentiality • Politically Exposed Persons • Authorization, Certification, and Notification of Assessments • Administrative Appeal Procedures • Timing of Checks • Notes • References

Chapter 7: Implementing the Regulatory Process • Step 1: Intake and Review of Previous Applications • Step 2: Initial Risk Assessment and Basic Due Diligence • Step 3: In-Depth Background Checks and Further Due Diligence • Step 4: Final Risk Assessment • Step 5: Conclusion and Notification • Sequencing of Integrity Checks • Analysis of Negative Information • Effective Implementation of the Integrity Screening System • Notes • References

Chapter 8: Documenting and Monitoring Effectiveness • Internal Documentation • Monitoring the Quality of Existing Licensees • Efficiency and Cost-Effective Integrity Checks • Monitoring Risk Assessment Decisions • Monitoring Regulatory Effectiveness • Notes • References

Chapter 9: Recommendations for an Improved System • Recommendations • Thematic Preview: An Effective Integrity System

APPENDIX A: Resources for Learning about Beneficial Ownership

APPENDIX B: Websites, by Country, Listing Debarred Companies

APPENDIX C: Finding and Using a US Securities and Exchange Commission Form 10-K or 10-Q

APPENDIX D: Industry-Specific Resources

APPENDIX E: Identifying High-Risk Countries and Persons

APPENDIX F: Additional Resources on Conflicts of Interest

APPENDIX G: EITI Requirement 2.5 on Beneficial Ownership Disclosure

APPENDIX H: String Searches

APPENDIX I: UK Companies House for Information on Companies and Directors

APPENDIX J: Business Registration Data

Glossary

Boxes • Figures • Tables


About the Authors:

Cari L. Votava is a senior financial sector specialist in the World Bank’s Financial Market Integrity Unit. She has more than 30 years of experience in international and financial law and regulation, corruption prevention, and anti–money laundering / countering the financing of terrorism (AML/CFT). She holds an LL.M. from the London School of Economics, a J.D. from Notre Dame Law School, and is recognized as a global policy, legal, and technical expert in implementation and assessing effectiveness of AML/CFT, the rule of law, asset disclosure, and other corruption prevention systems. She has designed and implemented innovative corruption prevention–related technical assistance projects in countries worldwide, and has been recognized for her work in fragile and conflict-affected states.

Jeanne M. Hauch is vice president and general counsel of the Millennium Challenge Corporation, a US government international development agency. She was educated at Yale Law School and the Woodrow Wilson School at Princeton University. Later, she was a Fulbright scholar in France and served as a law clerk at the US Supreme Court. From 2009 to 2017, she worked at the World Bank, concentrating on anticorruption and anti–money laundering, primarily with the Financial Market Integrity and Stolen Asset Recovery (StAR) units. She has also served as a counsel to the International Monetary Fund and is a member of the faculty of the George Washington University Law School. Before joining the World Bank, she was a US federal prosecutor, specializing in international issues.

Francesco Clementucci is an experienced ethics and anticorruption lawyer. He has served as a legal officer for the European Court of Human Rights, the US Embassy in Italy, and the European Commission, as well as an election observer for the European Union in Venezuela. In 2010 he joined the World Bank, where he works with various units (such as Financial Market Integrity, Stolen Asset Recovery, Global Governance, and Integrity) on activities related to anticorruption, public administration reform, and AML/CFT. He also advises other national agencies, international organizations (such as the European Union, United Nations Development Programme, Council of Europe, and Organisation for the Prohibition of Chemical Weapons), and nongovernmental organizations (Transparency International) on matters of legal development, financial disclosure, integrity, ISO 37001, transparency, and economic crimes.


Target Audience:

This manual is a welcome tool for anyone working towards better governance in the extractive industries.

 
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