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Concessions and Leases in the Lao PDR

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Map A3: Area be<strong>in</strong>g surveyed compared to that actually cleared for coffee production by Outspan Company <strong>in</strong> Paksong District<br />

Regulatory Issues<br />

Limitations on Area Granted<br />

Regulations exist for grant<strong>in</strong>g l<strong>and</strong> for <strong>in</strong>vestment <strong>and</strong><br />

development, but <strong>the</strong>ir impact depends completely on<br />

compliance <strong>and</strong> enforcement. Particularly important for<br />

<strong>in</strong>vestment projects <strong>in</strong> <strong>the</strong> forestry sector approved before<br />

2007 is <strong>the</strong> Forestry Law of 1996, which established <strong>the</strong><br />

division of responsibility for approv<strong>in</strong>g concessions <strong>and</strong><br />

leases. It set area ceil<strong>in</strong>gs for <strong>the</strong> authorization of l<strong>and</strong><br />

<strong>in</strong>vestments <strong>in</strong> forest l<strong>and</strong> to be converted <strong>in</strong>to o<strong>the</strong>r<br />

l<strong>and</strong> uses for different levels of government responsible.<br />

District authorities can grant up to three ha, prov<strong>in</strong>cial<br />

authorities up to 100 ha, <strong>the</strong> central government up to<br />

10,000 ha <strong>and</strong> projects greater than 10,000 ha require<br />

National Assembly approval. But s<strong>in</strong>ce newer regulations<br />

set <strong>in</strong> 2009, district level authorities are no longer allowed<br />

to grant l<strong>and</strong> for plantations, while prov<strong>in</strong>ce level<br />

authorities are allowed to grant only degraded forest<br />

up to 150 ha (500 ha for barren l<strong>and</strong>) to <strong>in</strong>vestors, <strong>and</strong><br />

<strong>the</strong> central government is limited to 150-15,000 ha (500-<br />

30,000 ha for barren l<strong>and</strong>); <strong>and</strong> anyth<strong>in</strong>g bigger than this<br />

must be approved by <strong>the</strong> National Assembly (PM decree<br />

No. 135/PM on L<strong>and</strong> <strong>Leases</strong> <strong>and</strong> L<strong>and</strong> <strong>Concessions</strong> 2009).<br />

In many cases, <strong>the</strong> <strong>in</strong>ventory team found that authorities<br />

on prov<strong>in</strong>cial or district levels were approv<strong>in</strong>g l<strong>and</strong> areas<br />

over <strong>the</strong> limit of <strong>the</strong>ir m<strong>and</strong>ate. For example, <strong>in</strong> Vientiane<br />

Prov<strong>in</strong>ce <strong>the</strong> <strong>Lao</strong>-Thai Hua Rubber Co. Limited was granted<br />

a l<strong>and</strong> area of 670 ha <strong>in</strong> 2006 by <strong>the</strong> prov<strong>in</strong>cial authority.<br />

O<strong>the</strong>r cases show that regulations can be evaded, as <strong>in</strong><br />

Xayabury Prov<strong>in</strong>ce <strong>in</strong> 2001, where <strong>the</strong> prov<strong>in</strong>cial governor<br />

approved a l<strong>and</strong> concession for a <strong>Lao</strong> company named<br />

“Y & P Agriculture CO. LTD” for Paulownia or Kiri tree<br />

plantation on an area of 300 ha <strong>in</strong> Kenthao District. In<br />

order to grant such large concession area at <strong>the</strong> prov<strong>in</strong>cial<br />

level, <strong>the</strong> l<strong>and</strong> was divided <strong>in</strong> several parcels <strong>and</strong> <strong>the</strong><br />

approvals were made <strong>in</strong> separate documents. Thus<br />

ultimately, ceil<strong>in</strong>gs on <strong>the</strong> area granted at different<br />

levels of government prove weak tools for regulat<strong>in</strong>g<br />

large-scale l<strong>and</strong> <strong>in</strong>vestments.<br />

ANNEX - Case Studies<br />

83

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