a stream of incomes.101 The temptation is thus huge for those in power both to exploit those resources in order to create as much wealth as possible within the shortest possible time (for they do not know for how long they will stay in power), and to sell off the right to exploit resources to the highest bidder (in order to cash in immediately the equivalent of all future income streams that could result from exploiting the resource), but sometimes with scant attention being paid to the long-term impacts or to the interests of the local communities. Awareness has grown about the potential human rights implications of agreements concluded between investors and host governments for the exploitation of natural resources. How the level of royalties should be set and how the revenues accruing to the State should be spent has only rarely been considered, however.102 Good practices, in contrast, are found in instances where a procedure is set up to ensure that the exploitation of the natural resources shall bring about important benefits to the local population. For instance, Peru’s auctioning of public land is designed to ensure favorable contract terms and, by "eliminating direct negotiations between private buyers and public officials", to reduce the risks of corruption.103 During the auction process, the Government makes public the investment commitment, the bid value of the land, data on the land size, and business plans. Furthermore, if the land is not used for its intended business plan within one year of it being transferred, it will revert back to the original owner. Public auctioning of exploitation rights can be a highly effective way to raise the levels of royalties: after Cameroon introduced a public tendering system for awarding logging rights, thus introducing competition between potential investors, payments from companies wishing to gain the access to forests (forest royalties, in particular) increased from a baseline of 0.6 USD per hectare per year in 1990 (a level set at the time by the authorities) to 5.6 USD per hectare per year for forest management units in 2006, and 13.7 USD per hectare for timber sales in 2005.104 Attempts have also been made to ensure the redistribution of revenues to the local population. They have rarely been successful. Cameroon, for instance, adopted a regulatory framework on forest, wildlife and fisheries which requires logging companies to pay an Area Fee (AF), which is intended to benefit the communities neighbouring the logging concessions.105 Between 1998 and 2009, 50 per cent of royalties went to the Treasury, 40 per cent to municipal councils and 10 per cent to village committees that manage forest royalties.106 Following the adoption of Act No. 2009/019 of 15 December 2009 on local tax systems, a share of revenue could henceforth be allocated to non-forest communities: 50 per cent of the revenues from forest exploitation now go to the Treasury, 20 per cent to FEICOM — the community mutual assistance fund —, 20 per cent to municipal councils and 10 per cent to local committees. An assessment of the system, ten years after it was launched and after the equivalent of 85 million USD had been redistributed across about 50 village councils, showed mixed results at best: the mayors, who play a key role in the management of AF resources, have often been accused of embezzlement; accountability mechanisms proved hardly effective, as even mayors who 101 M. Humphreys, J. Sachs, and J. Stiglitz (eds.), Escaping the Resource Curse (New York: Columbia University Press, 2007), at 8. 102 It is telling, for instance, that none of the ten principles listed by the Special Representative of the Secretary-General on Business and Human Rights in the guidance he set out in 2011, refers to either of these two key questions (see Addendum to the Report of the Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises, John Ruggie – ‘Principles for Responsible Contracts: Integrating the Management of Human Rights Risks into State-Investor Contract Negotiations: Guidance for Negotiators’, 25 May 2011, UN Doc. A/HRC/17/31/Add.3). 103 Global Witness, Dealing with Disclosure: Improving Transparency in Decision-Making Over Large-Scale Land Acquisitions, Allocations and Investments (April 2012), at 34. Peru’s land auctioning process entails the following steps: (1) the government reviews all rights and claims to the land and determines what rights can be transferred; (2) auction announcements, including bidding terms, are published on the government’s website, in the government gazette, and in the media for 90 days; (3) to be eligible, bidders are then required to prequalify by posting a bond equal to "at least 60% of the minimum bid price, plus the intended amount of investment"; and (4) all bids are ranked according to price offered and the project investment amount. 104 Report of the Special Rapporteur on the right to food, Olivier De Schutter, Addendum: Mission to Cameroon (16-23 July 2012) (A/HRC/22/50/Add.2), para. 61 (citing World Bank and PROFOR, Forêts tropicales humides du Cameroun. Une décennie de réformes (by Giuseppe Topa, Alain Karsenty, Carole Megevand and Laurent Debroux) (Washington D.C., 2010), 232 pages, at 44; it is unclear from the study whether these figures refer to real or nominal amounts). 105 See Id., para. 57. 106 This followed the adoption of Act No. 94-01 of 20 January 1994, on forests, wildlife and fishing. 24

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