Special Agriculture and Business Leases

Last updated: August 2017

Papua New Guinea (PNG) is a nation of landowners. Under its Constitution, people are guaranteed legal ownership over the land they have traditionally lived on and used, and the forests that grow on it. But by 2011, more than
12% of this land had been handed out by the government as large agricultural concessions known as Special Agriculture and Business Leases (SABLs). Under these leases, Malaysian-controlled companies began logging and clearing vast areas of rainforest and exporting the valuable timber.

A government inquiry concluded in 2013 found that most of the SABLs reviewed had violated laws meant to protect people’s land rights, but the government failed to act on its recommendations. The leases have been associated with a range of human rights and environmental abuses. Police on the payroll of logging companies have harassed, arrested and beaten landowners who try to speak out.

In August 2016, the Supreme Court struck down an SABL that had accounted for roughly 10% of all logs exported under the leases. The Court found the SABL had been issued without the consent of indigenous landowners, in violation of PNG law, and declared all operations under it illegal. Yet in the months following the decision, at least six more ships carrying millions of dollars of illegal timber cut under the lease set sail for China.

The PNG government has since made a series of public statements, reported by major national and international media outlets, declaring SABLs illegal and announcing their cancellation. While this raises serious questions about the legal status of the leases, at the time of writing the government did not appear to have taken any subsequent actions to cancel leases or halt operations. Logs continue to be cut and exported under SABLs.

Below is a timeline of some key events. While the Prime Minister and Land Minister have recently stated that SABLs are illegal and have been cancelled, at the time of writing the government had not issued any subsequent directives to cancel leases or halt operations under them. Logs continue to be cut and exported under SABLs. When we asked companies operating under SABLs to comment, Rimbunan Hijau, Bewani Oil Palm Plantations Ltd. and KK Connections Ltd. challenged the validity and applicability of the PNG government’s statements reported by the media and maintained that all their operations are legal.

1996: Land Act amendments introduce SABL mechanism. It goes largely ignored for years.

2003 – 2011: The Government quietly hands out SABLs covering 55,000 km2 of land to mostly foreign-controlled companies.

March 2011: Following a complaint by civil society groups, the UN Committee on the Elimination of Racial Discrimination sends a public letter to PNG’s Ambassador to the UN, stating its concern that SABLs had been granted “without…the consent of indigenous landowners.”

March 2011: A group of academics and civil society groups sign the Cairns Declaration calling for a moratorium on SABLs and an independent review of their legality and constitutionality.

July 2011: The Government declares a moratorium on new SABLs and launches an official Commission of Inquiry (COI) into 77 of the leases.

August 2012: Greenpeace publishes major exposé of SABLs.

June 2013: The COI publishes report assessing 42 SABLs, documenting numerous legal violations and recommending that nearly all leases be revoked or suspended, but fails to publish findings for the remaining SABLs.

June 2014: The National Executive Council (NEC) and Prime Minister Peter O’Neill announce decision to revoke SABLs where recommended by the COI, repeal the SABL mechanism, and review the legality of SABLs the COI failed to publish recommendations for.

July 2014: An SABL in the Turubu area of East Sepik Province is ruled to be illegal by the National Court. The decision is appealed to the Supreme Court a week later and a stay on the lower court decision allows logging to continue.

July 2014: Department of Lands and Physical Planning publishes a list of 29 SABLs to be revoked based on the COI’s recommendations. The list omits all but one of the SABLs where logging was occurring, even where the COI recommended they be revoked.

August 2015: Leaseholders of the Turubu SABL win Judicial Review case challenging the COI report and resulting NEC cancellations. The Court does not question the COI’s findings but quashes the report on procedural grounds.

August 2016: Supreme Court upholds 2014 National Court ruling that the Turubu SABL is illegal.

November 2016: PM O’Neill tells Parliament and the news media that the SABLs are being cancelled.

March 2017: PM O’Neill states in a press conference that “…we have cancelled all the licenses. All the SABL licenses are illegal in this country.”

April 2017: Lands Minister Benny Allan states that SABLs are illegal and calls on leaseholders to surrender land titles.

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