This is the gist of the CRP review assessment and warrants a detailed coverage as it is very clear on its analysis and justification for supporting the eligibility of the complaint, despite the ADB’s own internal reviews and management response. It is also quite damning on ADB and its staff for non-compliance with their own policies and procedures. The CRP conducted its review under four eligibility criteria:
A. Evidence of non-compliance
B. Has non-compliance caused material harm or is it likely to cause such harms?
C. Is there evidence that the harm resulted from ADB-funded projects?
D. Is there evidence that the harm resulted from the non-compliance of these projects?
A. Evidence of Non-Compliance:
CRP based its assessment here on available prima facie evidence and find that it was satisfied with prima facie evidence that Phases II and III (Phase I considered ineligible because complaint was submitted outside of 2 years closure which is unfortunate as complainants requested that all Phases I, II and III were part of the same project requiring all to be reviewed for compliance) failed compliance with relevant policies and procedures of ADB (para 13) lists these prima facie evidence under:
Para 14 i – Phase I acknowledged key lessons from implementation of project included appreciation for sensitivity of land issues requiring a gradual approach; and need for ongoing and effective community advocacy
Para 14 ii – Phase II completion report stated that one of the three priority areas for implementation was national coordination of customary lands stakeholders and effective community advocacy, a community advocacy strategy developed, CLAC had conducted public consultations of customary land reforms, but this had been the ‘most challenging’ output of the project. The report also stated that “while the use of customary land is of economic importance for the people of Samoa, it is culturally sensitive and requires community consultations, and as government continues its reform plans, the public will need to be continuously consulted.
Para 14 iii – completion reports acknowledge the critical need for continuous stakeholder, community, and public information dissemination and meaningful consultations, emphasizing that these have been challenging. CRP, however, found no evidence of this posted on ADB’s website to comply with policy requirements despite repeatedly acknowledging that customary land reform is a sensitive issue and ought to be done with stakeholder consultations and communications
Para 14 iv, v, ix, x, xi, xii – CRP supports the complainants claim with prima facie evidence that Phase I emphasis was on community advocacy on information sharing rather than meaningful consultations (this also proves that in Phase I, ADB was guilty of non-compliance with its own policies). This is also found to be the case in Phase II and start of Phase III.
Para 14 vi – CRP interviewed the staff of ADB Pacific Office in Suva that manages the TAs for Samoa, and find despite their unsupported reports on numbers of participants in consultations, others interviewed confirm that these were not meaningful in accordance with ADB policies and procedures and not conducted in a manner that was accountable to participants.
Para 14 vii – CRP again found staff of ADB in the Suva Pacific Office to have failed to comply with ADB policies and procedures in respect of inability to produce record of alleged consultations as evidence of proceedings - no record of consultations done meaningfully, no record of issues raised by participants, no record of any feedback to participants as to what happened to their concerns and suggestions, what was stated, what decisions made, no record of response and accountability document so participants know the fate of their suggestions. These basic steps if taken seriously by staff as required by ADB policies and procedures increase credibility and trust in the consultation process but the Pacific Office produced no such record when specifically requested by CRP.
Para 14 viii – confirm the uncertainty amongst customary landowners in Samoa over the intent and meaning of the law reforms supported by ADB and highlight the missed opportunity had there been compliance to ADB policies and procedures for meaningful consultations and public communications, this mistrust and uncertainty will have been reduced or avoided.
B. Has Non-Compliance Caused Material Harm Or Is It Likely to Cause Such Harm?
Para 15 – CRP confirms that there is prima facie evidence that non-compliance is likely to cause direct and material harm to the complainants and those affected by the project.
Para 15 i – more than 80% of land in Samoa is customary land commonly owned and managed by aiga led by their matais, and customary lands are dear to Samoans in terms of their close relationship with it, see it as intrinsic part of their cultural identity and way of life. Customary lands cannot be alienated or disposed of by anyone, but held in perpetuity by the family and transmitted from generation to generation. The number of family members who commonly own customary lands can change from time to time as members die, born, and travel abroad, but these lands have been the natural resources upon which the Samoan civilization was built over thousands of years and there are prima facie evidence that customary land rights were respected even when Samoa was under colonial rule.
Para 15 ii – When Samoa became independent in 1962, the rule that customary lands could not be alienated was entrenched in its Constitution. Article 102 of the Constitution states:
It shall not be lawful or competent for any person to make any alienation or disposition of customary land or of any interest in customary land, whether by way of sale, mortgage, or otherwise howsoever, nor shall customary land or any interest therein be capable of being taken in execution or be assets for the payments of debts of any person on his decease or insolvency
Provided that an Act of Parliament may authorize:
a. The granting of a lease of any customary land or of any interest therein…
Para 15 iii –leasing and licensing of customary lands has been practiced for many decades. The Alienation of Customary Lands Act 1965 (ACLA) regulated these leases and licenses as in para15 ii (a) above - entered into by the matai on behalf of all his customary land owners with their consent.
Para 15 iv – under ACLA, leases and licenses of customary lands could be granted only by the Minister responsible for lands, if in his opinion such leases or license or any interest therein was (a) in accordance with Samoan customs and usage (b) in accordance with the desires and interest of the customary land owners, and (c) in accordance with public interest. The Act made it clear that the Minister was required to act as a trustee for the customary land owners. This paragraph also gives details on process for granting of leases (advertising in Savali, filing objections, hearing and determining of same by Lands and Titles Court, etc.) and once lease is executed, the Act requires such leases and licenses to be registered with the Registrar of Lands
Para 15 v – When ACLA was passed, Samoa had a deed registration system where deeds executed with respect to land had to be registered but registration did not convey an ‘indefeasible title’ as in the Torrens system where ‘indefeasible title’ is ownership that cannot be defeated, revoked, or cancelled by reference to any past event, error or omission in the title
Para 15 vi – CRP finds that as a result of the three TAs of project funded by ADB, as well as advice, recommendations, draft Bills, and consultant papers developed and provided, the government enacted the Land Titles Registration Act 2008 which introduced for the first time in Samoa, the Torrens system of land title registration. This LTRA required leases and licenses of customary lands granted under Alienation of Customary Lands Act, to be made under LTRA, but registration of these in the name of the Minister undermines common ownership of customary lands, and concern that the Torrens system which conveys ‘indefeasibility’ title or interests on registration is incompatible with customary land ownership attributes, practices and principles. This inconsistency arises because owners of customary lands are ever changing whereas the owners of proprietors under the Torrens system is not. This paragraph makes reference to concerns of complainants supported by academic experts such as Ruping Ye and journal articles that analyze the legal effect and impact of the Torrens system through LTRA in Samoa.
Para 15 vii – the ADB support to the government also enacted the Customary Lands Advisory Commission (CLAC) through the CLAC Act 2013 to promote the greater economic use of customary lands for the development of Samoa. A consequential amendment in the last section of CLAC Act enlarged the scope of leases and licenses of customary lands and amend the ACLA by extending the meaning of ‘an interest’ in customary land lease or license to include “mortgage of the interest of lease or license” and required the process of registration and discharge of mortgages in the LTRA to be applied to such mortgages! The use of leasehold rights over customary lands as a collateral to raise funds through a secured loan was new to Samoan customary land laws!
Para 15 viii – address the fact that the effect of this 2013 amendment further erodes the inalienability of customary lands! The CLAC Act 2013 is unclear whether the process of customary land leases that requires advertising, hearing of objections, and decision of Lands and Titles Court under ACLA 1965 also applies to mortgaging of leasehold rights, as even if it did, it appears that subsequent assignment of mortgages for default may not be subject to such transparent and participatory process involving customary land owners. Complainants fear that mortgage of leases could be granted by the Minister without the consent of customary land owners and subsequent assignments of such mortgages for default could put customary lands in the hands of unknown third parties.
Para 15 ix - CRP supports these fears of the complainants – CLAC recognizes these dangers and is proposing legislation amendments to Parliament which help address these concerns – require written consents of customary land owners before a leasehold interest could be mortgaged, protect the rights of customary land owners to refuse consent to an assignment of mortgages and to ensure moneys recovered by the mortgagees on a default would be applied to outstanding lease rents as a first priority. Legislation amendments proposed by CLAC will place mortgages of leasehold rights of customary land owners under a distinct and separate regime established by regulations under LTRA 2008.
Para 15 x – it is likely that existing legal changes, the mortgage of leasehold right over customary lands may end up in the hands of third parties quite different from original lessees or mortgagees without the consent of the customary land owners! Also likely such third parties may exercise their rights under mortgage and take possession of customary lands and change the activities over which customary land owners have no control. This would be tantamount to curtailment and restrictions of customary land owners’ rights and diminution of bundle of rights associated with customary land owners in Samoa as a result of policy changes, and constitute likely harms to customary land owners, in the absence of safeguards now proposed by CLAC.
Para 15 xi – CRP supports the complainants reluctance to lease their customary lands or consent to mortgages of leasehold rights under the current laws arguing that lack of adequate safeguards does not give assurance that leased lands will remain with the contractual partner of the lease agreement. CRP states there is prima facie evidence that legal and policy changes of leasehold interests without the consent of land owners lead to unknown third parties acquiring rights of possession over such lands, too risky therefore to lease customary lands under the current legal regime that would constitute financial loss thus a material harm.
C. Is there Evidence that the Harm Resulted from ADB-Financed Projects?
Para16 – address the history of Samoan land reforms concerning customary lands where government of Samoa and ADB worked very closely and all three Phases I, II and III built on each other since 2003 as listed in the ADB website under Samoa Country Strategy and Program Update 2004-2006 to follow from exploratory work under Component 4 of ADB Small Business Development Project.
This supported a Working Group on the economic use of customary lands that reported to Cabinet recommending activities to promote economic use of customary lands. ADBs Phases I, II and III were to assist the government to implement Cabinet’s decision where amongst the expected outputs were “amendments to Alienation of Customary Lands Act 1965”, stakeholders consultations, and drafting of amendments to legislation relating to customary lands with the specific purpose of “encourage the economic use of customary lands in Samoa”.
Para 17 – Phase I completion report lists successful outputs as in para 16 above and proved that ADB and government of Samoa collaborated closely to develop the draft amendment Bill and to have it adopted by Parliament
Para 18 – Phase II successful outputs listed Customary Lands Advisory Committee established through the CLAC Act 2013, and the Alienation of Customary Lands Act 1965 amended to allow the mortgage of customary land leases. The 2013 amendment enacted a legal framework to enable the mortgaging of leases over customary lands and recommendations in the report state “Whilst the use of customary land as collateral for mortgages is still prohibited under Article 102 of the Constitution of Samoa, the mortgage of leasehold interests over customary lands is now possible under Section 15 of CLAC Act 2013. To support the mortgaging of leasehold interests over customary lands, there is a need to put in place an appropriate legal framework that protects the rights of the mortgagors, mortgagees, and customary land owners…”
Para 19 – Phase III report A functional Legal Working Group (LWG) is established and given that legal framework in place to allow mortgage of customary land , CLAC will work closely with the Banking Association of Samoa through this LWG to discuss further actions required to enable commercial banks take advantage of this framework and accept customary land leases as collateral
Para 20 - It is clear that ADB has been closely associated with the government of Samoa in a series of activities since 2003 and in all Phases I, II and III to develop the relevant concepts, draft laws, establish and develop capacity of relevant institutions under these laws, and to advocate the benefits of new laws allowing for leases and mortgages of leasehold interests over customary lands, and is continuing under Phase III where ADB is supporting government of Samoa to develop further legal reforms to facilitate the ability to offer customary land leases as collateral to financial institutions.
Para 21 – CRP confirms in its careful judgment ADB collaboration with the government of Samoa was a condition that resulted in the activities, outputs, and policy and legal changes in this project which have led to the harms in Section B above.
Para 22 – This is a key finding of the CRP in terms of the ADB Management response that the legal reforms enacted by the Samoa Parliament are sovereign decision of Samoa thus cannot be ascribed to activities of ADB-funded projects. CRP disagreed with this position of ADB Management as in every ADB-funded sovereign project, the implementing agency is a government agency and all such projects seek to respect the sovereignty of borrowing countries. In this context the causal link between ADB’s project activities and the harm to complainants and affected customary land owners is always through a government implementing agency. CRP views that ADB Management argument that the laws were passed by Parliament and therefore there is an interruption in causal link, runs contrary to the very foundation of the Accountability Management Policy (AMP). The CRP confirms that the complainants grievances is that ADB’s non-compliance with its own policies and procedures have resulted in the stakeholders not being adequately informed or consulted in a meaningful manner causing likely harm to them and affected customary land owners from the resulting ADB advice, draft Bills and activities, and CRP accepts these matters as squarely fall within its purview in its compliance review and of the Accountability Management Policy (AMP).
D. Is there Evidence that the Harm Resulted from Non-Compliance of these ADB Projects?
Para 23 – the complainants argue that the likely harm is the result of ADB’s non-compliance describes in Section A above and contend because there was inadequate consultation under policies and procedures of ADB, the Phases I, II and III resulted in ADB providing advice, draft Bills, develop policy papers and other capacity building support to the government of Samoa which led to adverse and piecemeal changes in the laws governing customary lands.
Para 24 – restates that the complainants are not opposed to the economic use of customary lands but the complaint is that they and affected customary land owners have not had an adequate and meaningful opportunity to express their concerns and to have these accountably addressed. Complainants argue that had these meaningful consultations been done, there might have been many other good options for legislative reforms considered and adopted instead of the piecemeal approach resulting in uncertainties, distrust, and fears as to the destiny of long held and traditional customary land ownership and rights.
Para 25 - CRP stated there is prima facie evidence to suggest CLAC itself recognize the gaps in the current laws enacted as a result of activities under Phases I and II of the project. However, CRP cannot understand why legislative revisions CLAC plans to present to Cabinet and Parliament were not considered and proposed at the time when the CLAC Act 2013 was passed to enable mortgaging of leasehold interests over customary lands. Instead, an issue that ADB itself considered “sensitive” from the start ended up in legislation that did not address those concerns and resulted in creating the uncertainties in customary land ownership rights. When considered as a whole, CRP states there is prima facie evidence that ADB non-compliance with information dissemination and meaningful consultation with stakeholders as required by ADB policies and procedures, resulted in ADB failing to address their concerns in a timely and meaningful fashion which has directly led to policy and legal changes that are likely to cause material harm to complainants and customary land owners in Samoa.
Para 26 - In concluding, CRP finds there is prima facie evidence that there is adequate causal link between the likely harms referred to in Section B above and the non-compliance of ADB projects to their own ADB policies and procedures. There is further prima facie evidence that the ADB projects have resulted in ADB providing government of Samoa with draft Bills, advice, capacity building activities and advocacy, the content of which might have been different and might have addressed complainants and customary land owners concerns had there been adequate and meaningful consultations during all three Phases of this ADB-funded projects for Samoa.
On the complaint under the Samoa Agribusiness Support (SABS) Grant, whilst we have no objections to the objectives of this grant, we as complainants continue to argue that this will likely expand the scale of collateralized lending to businesses using customary lands as primary input. Whilst the three Commercial Banks have written to CRP that they have not taken any leases of customary lands as collateral for the loans and financial facilities granted under this SABS up to now, and will not be taking any such leases as collateral for future loans and financial facilities under SABS, there is evidence in respect of ‘companies’ engaged in leasing of customary lands amongst other concerns that only time will tell and to be the judge in the future of what we as complainants allege now.
Finally, on the concern in regards Indigenous Peoples Policy, we as complainants continue to be concerned that ADB seems to hide behind its own definition and policies to ignore its own global responsibilities as a Financial and Investment Institution like the World Bank, as well as International Organizations such as United Permanent Forum on Indigenous Issues (UNPFII), the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP), and other UN Agencies such as International Labor Organization (ILO) who recognize Samoans as Indigenous peoples. Especially a concern when the Indigenous Peoples Policy was recently triggered by the World Bank Policies under its Agriculture and Fisheries Cyclone Response Project to Samoa.