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Public Interest & Development Law: Akpata calls on stakeholders to seek innovate ways to resolve C-H-C disputes

The Immediate past Chairman of the Nigerian Bar Association Section on Business Law (NBA-SBL), Olumide Akpata has called on legal practitioners and Alternative Dispute Resolution (ADR) experts to devise innovative and practical methods for managing and resolving Companies-Host-Communities (C-H-C) Conflicts.

Akpata, who made this call at the annual conference of the NBA Section on Public Interest & Development Law (SPIDEL) in Abia State last week, stated that in the absence of structured, institutionalised ADR process for settling C-H-C conflicts, the responsibility has fallen on those who play in the dispute resolution space to devise innovative and practical processes to avoid C-H-C conflicts altogether (if possible); detect potential C-H-C conflicts before they crystalize; and resolve the conflicts if they crystalize without destroying relationships.

The Templars’ Partner who spoke on the topic, “Alternative Dispute Resolution: Utilizing Institutional And Legal Strategies For Managing And Resolving Companies-Host-Communities (C-H-C) Conflicts”, broached the topic by first, weighing whether any institutionalised alternative dispute resolution strategies for C-H-C conflicts presently exist.

Akpata stated matter-of-factly, that there was no well-defined legal or institutional framework for resolving C-H-C conflicts outside of litigation, even though such conflicts have the tendency to be combustive if not properly managed.

“This may be contrasted, for example, with trade disputes where there are defined procedures for dialogue, negotiations and even industrial actions. Indeed, there is even a dedicated piece of legislation – the Trade Disputes Act, for good measure”, he said.

 He further disclosed that the lot of C-H-C conflicts, have been dependent on loose negotiations between the affected companies and host communities at the very best, or claws-out litigation as a middle ground, or outright resort to self-help at the very worst.

“It is, of course, not entirely strange to find a hybrid of sorts that incorporates elements of all three options in some C-H-C conflicts”, he said, stating that in the more complex cases that cut across multiple host communities, it has been helpful also to obtain affected host communities’ consent to appoint an independent-minded third party (typically someone from the host communities’ region) to serve as a co-ordinating counsel on behalf of the host communities for the settlement of the dispute.

The former NBA-SBL Chairman noted however that, the specific approaches for achieving these goals necessarily differ, citing his firm’s experience in dealing with host communities’ conflicts.

“Our firm’s approach, however, which has been deployed successfully in practice for different clients across different industries and sectors, has been to establish from the outset a mutually-acceptable, overarching contractual framework (usually a Memorandum of Understanding) to govern the relationship of our clients and their host communities,” he said.

According to Akpata, the contractual framework would establish, among other things, channels of communications and feedback between the companies and their hosts, so that grievances are relayed effectively before they become protests.

He continued, “It would also establish appropriate protocols for interface between the companies and their host communities at different, ascending levels, including providing for Liaison Officers to be appointed to the companies by the host communities”.

These Liaison Officers serve as the conduit for day-to-day interface between the companies and their hosts and have proved quite effective in resolving minor run-ins between member of the communities and the companies.

“For conflicts that require stronger intervention, the relevant traditional institutions of host communities—the Palace, council of elders, assembly of village heads, youth associations, etc., could be enlisted to play mediatory roles, especially if these institutions were involved (as they should) at the time the memorandum of understanding was concluded. Usually, these institutions can weigh in on brewing conflicts before they escalate and proffer helpful ways to manage them”, Akpata said

“Overall, by following a relationship-building approach with host communities that, fundamentally, channels negotiation and mediation, we have been able to successfully manage and resolve C-H-C disputes that could have resulted in potentially protracted litigation at a minimum,”

 Akpata thus proposed a concerted, co-ordinated approach among the key players of Government, relevant companies and the host communities.

“On Government’s part, there is need for a regulatory framework that would obligate companies to engage with their host communities as well as prescribe the parameters and mechanism under which companies and host communities must notify each other of disputes and make good-faith attempts to resolve them. For example, we could imagine a regulatory framework which imposes specific pre-action protocols on host communities and companies, as a pre-condition to validly exploring litigation.

“Such a protocol could, require host communities to appoint representatives who must liaise with their guest companies and through whom notice of any dispute must be communicated; obligate both companies and host communities to respond in a timely manner to notifications of disputes received from each other; and impose some form of mediation process (to be administered by an independent third party) in which the decision-making representatives of both the companies and the host communities must participate” he said.

According to him, given the strides that court-ordered mediation has made in settling civil cases, it is not inconceivable that such a framework could significantly reduce the potential for C-H-C conflicts to spiral out of control.

On the other hand, he urged companies to devote due attention to their interactions with host communities in project planning and execution. In other words, as a conflicts-avoidance tool, the interest and well-being of host communities should form an integral part of a company’s operations rather than be treated as a collateral matter.

Further, being able to connect with the traditional institutions in the host communities from the outset, and to carry them along throughout the lifespan of the project, is usually a priceless tool for companies to manage C-H-C conflicts if they arise.

Akpata also highlighted other measures such as, strict compliance with international best practices in executing projects, to ensure that the host communities’ environment suffers minimal degradation, as well as establishment of Corporate Social Responsibility initiatives that mainly respond to needs identified by the host communities themselves rather than those assumed by the companies.

“Finally, host communities, at a minimum, stand to gain when they co-ordinate their institutions and interest groups to ensure that communications and engagements with their guest companies are undertaken through mutually-recognised channels. Our experience shows that seemingly intractable C-H-C conflicts tend to be fuelled by cracks, rebellion and factions among relevant host communities’ institutions. As such, eliminating discord among members of host communities is a critical step towards an enduring management/resolution of C-H-C conflicts”, he said.

The former Chairman of the NBA-SBL concluded with a note, that there was no hard or fast rule about resolving C-H-C conflicts, given that there was also no statutory or institutionalised framework for managing these disputes.

As such, regardless of the alternative dispute resolution process that one fancies, the fundamental strategy in our experience is to ensure that the host communities’ buy-in into that process was secured at the earliest stages of the companies’ operations and is sustained for as long as the companies operate in their hosts’ territory.

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