The IISD Guide to Negotiating Investment Contracts for Farmland and Water

CARIN SMALLERMarch, 2015

CONTENTS

• Legal framework for investment in agriculture

• Deciding what type of investment to promote

• Designing the contract • Monitoring and enforcement

1. The legal framework for investment in agriculture

• Domestic law• Contracts (or other legal

instrument)• Investment treaties• Soft law: CFS-RAI, VGGT,

LPI, Guiding Principles on LSLBI, etc…

…IMPLICATION? Contract and treaty prevail over domestic law

2. Deciding what type of investment to promote

• Starting point is national strategy for agriculture and rural development

• Are the conditions ripe? screening investors, identifying suitable land and water, climate change (the scientific equation)

• Are communities involved? Mapping land and water rights, community engagement (the human equation)

3. Designing the contract

• Can be a contract/permit/licence/other

• Domestic law is “holy”• The IISD Guide as a

checklist • IISD model provisions as

examples NOT a blueprint• The contract as a public

document

3. Designing the contract

• Take feasibility studies & business plans seriously

• Give guidance on impact assessments & management plans

• Target financial & tax incentives

• Make promises legally binding (realistic and achievable)

• Water permits and fees• Exit strategy – assignment

and return of unused land (termination)

4. Monitoring and enforcement• Do not underestimate costs and

time involved (put resources aside)

• Annual reporting on implementation of commitments

• Periodic reviews (business plans, management plans, water use)

• Transparency and access to information

• Grievance mechanisms • International arbitration

Thank You

Carin Smallercsmaller@iisd.org