DENR/FAO/ITTO Regional Workshop

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VERIFOR Institutional and governance aspects of
legality verification

• DENR/FAO/ITTO Regional Workshop
• Improving Forest Law Compliance and Governance in
  Southeast Asia
• 11 September 2007, Manila

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Agenda

• Background
• The VERIFOR project aims, focus, partners
• Project timeline Update
• Potential positive and negative impacts
• Some conclusions

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Background
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Background

• What are verification systems (General)?
• Broad and multi-layered processes of
  investigation and validation.
• Forestry Verification System
• All the elements which make up the arrangements
  for ensuring legal compliance, including
  information provided by monitoring, audits,
  external observation and other means, as well as
  procedures for evaluating this information and
  deciding on a course of action.

• What do verification systems cover?
• Legal commitments
• Data exchange and notification arrangements
• Monitoring methods
• Communication, consultation and clarification
  mechanisms and
• An agreed method for making judgments on
  verification.

• Verification is a Forest Governance Issue, as the
  verification mechanisms are part of the overall
  forest governance system.

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Background

• Why develop verification systems for timber
  production?
• Control negative impacts of illegal activity
• Environmental damage
• Forest-dependent communities and
• Loss of public revenues.
• Illegality undermines good governance
  (Corruption).
• Increasing demand for proof of legal production
  from consumer nationsreflected in the EU Forest
  Action Plan for Law Enforcement, Governance and
  Trade (FLEGT).

• EU FLEGT
• Partner nations sign agreements to safeguard
  access to European timber markets.
• Requires effective and independent system of
  verification, with confidence of a wide variety
  of stakeholders and the public at large.

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Background

• Challenges to successful development of
  verification systems
• Increasing public oversight
• Defining what is legal
• Tackling conflicting claims and jurisdictions to
  land or resources
• Matching industrial capacity to forest potential
• Strengthening law enforcement agencies and
• Improving access to justice.

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The VERIFOR Project
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The VERIFOR Project

• Aim
• ensure that timber and forest products are
  legally harvested and help producer nations put
  in place verification systems with high national
  and international credibility.
• Focus
• institutional mechanisms rather than technical
  solutions
• the provision of equitable solutions without
  adverse effects on the poor and
• the principles of good governance.

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The VERIFOR Project

• Partner institutions
• Led by the Overseas Development Institute (ODI)
• The Centro Agronómico Tropical de Investigación y
  Enseñanza (CATIE) in Costa Rica
• The Center for International Forestry Research
  (CIFOR) in Cameroon and
• The Regional Community Forestry Training Center
  for Asia and the Pacific (RECOFTC) in Thailand.
• Funding 2.4 million from 2005-9
• 80 EU Tropical Forestry Budget Line
• 20 The Government of Netherlands and
• Additional funding for Latin America from the
  Government of Germany.

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Timeline

• 2005-Now Phase I activities primarily revolving
  around research, creation of case studies, and
  capturing lessons learned.
• Preparing a book on verification system design,
  implementation and sustainable operation and
  related training materials.
• Until Early 2009 Demand based offering of
  VERIFOR services relating to verification system
  desing International Conference at end of
  project.

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Governance and Institutional Considerations
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Governance and Institutional Considerations

• Desire for Independence
• Independence is a principle of action that
  implies freedom from influence of other parties
  or interests in decision making, with
  characteristics of objectivity and neutrality.
• Independence in a verification system is desired
  because it brings a high level of credibility to
  the verification process. It creates trust in the
  system of forest governance.

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Governance and Institutional Considerations

• Where is the verification mechanism?
• Can be an institution that is created by and part
  of a governance system, but separate from
  institutions that might place undue influence
  architectural governance design.
• Can be an outside private entity that is hired by
  the government and partially embedded in
  governance architecture.
• Can be completely outside of the governance
  architecture, but with a mandate to monitor
  created by the government or other entity.
• Acting alone (public watchdog)

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Governance and Institutional Operational
Considerations

• Clear and transparent standards by which the
  monitoring is conducted and conclusions are
  drawn.
• High levels of professionalism (civil service,
  private sector, or civil society organizations).
• Acceptance of the monitor by the parties
  involved, so there is a lack of interference with
  the monitoring role. As such, multi-stakeholder
  processes for design of the system are important.

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Considering potential impacts, both positive and
negative.
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Impacts of Verification (positive)

• Increased compliance less degradation
• Increased government revenue (royalties, taxes
  and penalty infractions)
• Increased availability of information and greater
  transparency greater awareness and
  understanding
• Improved planning (better information)
• Positive impacts on forest policy development

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Impacts of Verification(negative)

• Increased compliance costs for producers both
  large and small
• Increased operational costs for government
• Concentration of Industry
• Small operators marginalized into illegality
• Displacement of illegal activities to
  non-production areas (ex. agricultural
  conversion)
• Disincentive to plant trees (transaction costs
  too high)

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How to Minimize the Negative

• Essential that there is an inclusive
• multi-stakeholder design process
• Active involvement in government planning and
  decision making processes (notice/comment/appeal)
• Clear statement of objectives agreed upon by
  stakeholders during verification system design
• Ownership of the system by all (high level of
  credibility)

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How to Minimize the Negative

• Parallel process of law and policy reform
• Recognition of poor forest-dependent communities
  modes of using timber resources
• Increased access to legality for all involved
• Improved information flow/transparency
• Establishment of dispute resolution systems

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Conclusions

• Forest sector verification system design and
  implementation, and the use of independent forest
  monitors in conjunction with this, are still
  relatively new phenomena in the sector.
• Clear lessons have been learned, but more study
  is certainly required as such systems are
  designed and implemented.
• Verification system design and implementation
  must be done carefully, with potential impacts
  considered and then monitored

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www.verifor.org

• Project Leader David Brown (d.brown_at_odi.org.uk)
• Focal Point (Central America) Guillermo Navarro
  (gnavarro_at_catie.ac.cr)
• Focal Point (South America) Hans Thiel
  (hthiel_at_plus.net.ec)
• Focal Point (Africa) Tim Fometé
  (timfomete_at_yahoo.fr)
• Focal Point (Asia) Rob Oberndorf
  (robert_at_recoftc.org)