Country Risk Profiles

Timber

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List of risks by indicator

Risks are listed below and organised under the relevant indicator. Click on the risk below for details on the specifc risk, mitigation options and the related legal requirements.

Specified Risks
Low Risks
Not Applicable

Legal rights to harvest

1.1 Land tenure and management rights

Low risk concluded

1.2 Concession licenses

Risk that concession leases are not converted to Timber Utilisation Contract (TUCs)

1.3 Management and harvesting planning

Plantation and reforestation plans are lacking
Risk that area plans, and operational plans are lacking or not meeting legal requirements

1.4 Harvesting permits

Illegal issuing of special permits
Logging takes place without a permit
Logging takes place without an Entry permit
Award of salvage permits for banned species in violation with salvage permit conditions

Taxes and Fees

1.5 Payment of royalties and harvesting fees

Low risk concluded

1.6 Value-added taxes and other sales taxes

Low risk concluded

1.7 Income and profit taxes

Low risk concluded

Timber harvesting activities

1.8 Timber harvesting regulations

Low risk concluded

1.9 Protected sites and species

Protected species are illegally harvested
Protected areas are illegally harvested

1.10 Environmental requirements

Low risk concluded

1.11 Health and safety

Personal safety and protective equipment are not provided to or used by workers

1.12 Legal employment

When a union is in place there is a risk that collective bargaining agreements are not in place, or that the terms of the collective bargaining agreements are not met by companies
Workers do not have contracts and obligatory insurance
Risk that pensions contribution payment (tier 1 contributions and tier 2 deduction payments) are not paid by the employer

Third-party rights

1.13 Customary rights

Low risk concluded

1.14 Free prior and informed consent

Low risk concluded

1.15 Indigenous/traditional peoples rights

Low risk concluded

Trade and transport

1.16 Classification of species, quantities, qualities

Low risk concluded

1.17 Trade and transport

Transport of logs for the domestic market takes place without Log Measurements Conveyance Certificate (LMCCs)

1.18 Offshore trading and transfer pricing

Low risk concluded

1.19 Custom regulations

Low risk concluded

1.20 CITES

CITES species are illegally harvested and exported with a CITES permit fraudulently issued

Processing

1.23 Legal Registration of Business

Companies operate without legal registration of business

1.24 Environmental Requirements for Processing

Processing entities do not have a valid operating environmental permit obtained from the EPA

1.25 Processing Requirements

Timber processing entities are not registered with the TIDD

1.26 Health and Safety in the Timber Processing Sector

Personal safety and protective equipment are not provided to or used by workers

1.27 Legal Employment in The Timber Processing Sector

When a union is in place there is a risk that collective bargaining agreements are not in place, or that the terms of the collective bargaining agreements are not met by companies
Workers do not have contracts and obligatory insurance
Risk that pensions contribution payment (tier 1 contributions and tier 2 deduction payments) are not paid by the employer

1.1 Land tenure and management rights

Last updated on 2022-02-22 Low risk concluded Low RISK

Ghana has a dual legal land system based on customary rules and a legal system dating back to British Colonial rule. The competing systems create power vacuums and opportunities for exploitation by both customary and statutory officials (Frimpong Boamah, 2019).However, according to experts consulted (Osei, January 2022), when focusing on land rights related to forest and timber specifically, the legislation is clear about land and tree ownership ... VIEW MOREGhana has a dual legal land system based on customary rules and a legal system dating back to British Colonial rule. The competing systems create power vacuums and opportunities for exploitation by both customary and statutory officials (Frimpong Boamah, 2019).
However, according to experts consulted (Osei, January 2022), when focusing on land rights related to forest and timber specifically, the legislation is clear about land and tree ownership and management responsibilities of forests, including plantation establishment. If conflicts occur related to land rights, these are usually not about forest areas but in farmland and settlement areas and relate to who becomes the chief, etc. (Frimpong Boamah, 2019).
According to expert consultation, there are no known forest land and tree ownership issues, disputes or violations which have been identified related to the current legal framework. Consequently, the risk is considered as low risk

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve

Description of legal requirements

A forest reserve can be managed by the owner (stools or private) under the direction of the Forestry Commission or the Government for the benefit of the owner. The Forestry Commission uses Timber Utilisation Contracts (TUCs) and other permits established with timber companies to execute its management responsibilities. There is, therefore, legal clarity in terms of management responsibilities.

All stool lands in Ghana are vested in the appropriate stool on behalf and in trust for the stool's subjects following customary law and usage (The Constitution of the Republic of Ghana, 1992. Chapter 21, Article 267 (1)). The ownership of land within a proposed forest reserve shall not be altered by being classified as a forest reserve (Forest Act 1927, section 17 (1) (CAP 157)).
Concession Act of 1962 Act 124 (Section 16 Forests reserves and timber concessions) vests all lands with forest reserves in the President in trust for the stools concerned, except for a reserve constituted at the request of a private owner, all off-reserve lands and Kumasi Town lands which had timber concession granted before the commencement of this act, and all timber on any other land. The Timber Resources Management Amendment Act, 2002 (Act 617) excludes private timber plantations from the award of timber rights. The stool chiefs, clan heads and skins hold trusteeship titles to land on behalf of the people. Outright land ownership is not a common form of land tenure in Ghana. Leases and rentals (alienations) are possible, but the land reverts to the allodial titleholders at the expiry of the lease. Article 36 (8) The guiding principles of state policy of the 1992 Constitution of Ghana also provides that ownership and possession of land carry a social obligation to serve the larger community. The managers of public, stool, skin and family lands are trustees charged with the obligation to discharge their functions for the benefit of the people of Ghana, of the stool, skin, or family concerned.
The above mentioned constitutional and legislative provisions clarify land and tree ownership. Stools and owners of alienated land remain the owners of forests, including reserved forests. All naturally occurring trees are vested in the President in trust for the people, while planted trees belong to the landowner. There are ongoing processes to share the benefit from naturally occurring trees outside the forest reserves with those who tend such trees, but this does not affect naturally occurring trees vested in the president.
The Forestry Commission has the legal authority to manage Ghana’s forest reserves and protected areas. This includes granting timber rights and wildlife licenses (Forestry Commission Act 1999 (Act 571), Section 2b). The responsibilities of the Forestry Commission include harvest planning and monitoring the forest condition. After granting harvesting rights, the forest management in practice becomes the “co-responsibility” of the rights holder and the Forestry Commission.
A forest reserve can be managed by the owner (stools or private) under the direction of the Forestry Commission or the Government for the benefit of the owner (Forest Act 1927, CAP 157, Section 17(2)). Except for Pra Anum forest reserve, which the state has taken ownership of, all forest reserves in Ghana are owned by their respective stools. The stool manages none under the direction of the Forestry Commission; the Forestry Commission is managing all forest reserves.
The FC uses Timber Utilisation Contracts (TUCs) and other permits established with timber companies to execute its management responsibilities. There is, therefore, legal clarity in terms of management responsibilities.

Legally required documents

Business registration certificate
Certificate to commence business
Registered interest in land with timber rights (optional) for the legal protection of timber rights interest in the area of the timber rights (e.g. land deed)

Applicable legislation

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1.2 Concession licenses

Last updated on 2022-02-22 Risk that concession leases are not converted to Timber Utilisation Contract (TUCs) Specified RISK

Concessions or leases used to be granted under the Concessions Act, 1962 (ACT 124). However, with the enactment of the Timber Resources Management Act, 1997 (ACT 547), all leases were supposed to be converted to TUCs within 6 months of Act 547 coming into force. Some timber companies operating with leases applied for the conversion when the application opened between March and September 1998, but the Forestry Commission did not process the applic... VIEW MOREConcessions or leases used to be granted under the Concessions Act, 1962 (ACT 124). However, with the enactment of the Timber Resources Management Act, 1997 (ACT 547), all leases were supposed to be converted to TUCs within 6 months of Act 547 coming into force. Some timber companies operating with leases applied for the conversion when the application opened between March and September 1998, but the Forestry Commission did not process the applications. Later, these companies were requested to re-apply and pay timber rights fees (TRFs) following the enactment of the (currently revoked) LI 1721, which introduced TRFs. The timber companies contested whether LI 1721 could have a retrospective effect and resolved not to pay the TRF. Regulation 77 of the new LI 2254 (2017) provides that these timber companies shall apply to the Forestry Commission (FC) within six months to have their leases, contracts, licenses, or other permits other than TUCs converted to large- or small-scale TUCs. Companies that did not pay their TRFs under the original permit, lease or contract shall pay a one-off TRF and companies that did not have a social responsibility agreement (SRA) under the original permit, lease, or contract shall negotiate SRA at the value of 5% of the stumpage fee with the affected communities as part of the conversion process.
The LI 2254 revoked all the previous timber regulations. It helped to do away with their controversial issues such as “special permits”, which some stakeholders felt was being abused by the Forestry Commission to allocate timber rights instead of competitive bidding administratively. The LI 2254 has replaced this with the small-scale TUC through competitive allocation based on the applicant’s technical and financial capabilities, regulatory compliance, one-off TRF and SRA. In addition, the FC is to guarantee public access to information on the key timber rights information on its website or upon request. Currently, this information is not available online.
The previous clearly shows that the introduction of LI 2254 in 2017 have attempted to resolve the contentious issues such as the conversion of leases to TUCs, (as well as the issues related to special permits, SRA on salvage permit areas) and lack of timber rights allocation transparency and information disclosure. The transitional provisions of LI 2254 are in the process of implementation. The FC announced the opening of the conversion of extant leases to TUCs in May 2019 with 7 June 2019 as the deadline, and applications are being processed. The law has addressed the challenges, and the process is back on track, but the transfer of leases to TUC is still in process. As of January 2022, some leases and permit conversion applications had gone through administrative processing but still lacked the approval of the Parliament.
Though it is believed that the conversion of leases and permits will be done soon, there is a legality risk until these leases are converted to TUCs. The final report of Ghana and the European Union (EU) independent assessment of the legality assurance system described in the Voluntary Partnership Agreement (VPA) on FLEGT between Ghana and the EU, which was shared with both parties on 31 December 2020, concluded that the system was not ready due to several gaps, including the long-standing issue of conversion of extant leases to Timber Utilization Contracts, which requires the political approval of the Parliament to happen.

References

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The risk applies to the following source types

Natural forest

Risk mitigation options

Document verificationStakeholder consultation

Verify Timber Utilisation Contract (TUC)

Verify Evidence of application for transferring of lease from the Forest Entity

Verify Forestry Commission's website

Check the Forestry Commission's website for list of TUC Holders in Ghana to verify if the FME has a valid TUC : https://docs.google.com/spreadsheets/d/1lsn8DsUclq8F5xyVlqA-8tBfvkPxluSnCeyWwor0I_E/edit?pref=2&pli=1#gid=0

Consult Timber Validation Division of the Forestry Commission

Consult with Timber Validation Division of the Forestry Commission on the status of TUC application

Description of legal requirements

The forest management entity shall hold a Timber Utilization Contract (TUC).

The legal right to harvest timber in Ghana in the form of concession is granted through the award of small and large scale timber utilisation contracts (TUC) (Act 547, Act 617, LI 2254) by the sector (MLNR) minister acting on the recommendation of the FC. TUC agreements are ratified by the Parliament of Ghana (ACT 547; LI 2254). Both small- and large scale TUCs can be granted on- and off-reserve areas. Timber felling rights are awarded in only production zones. A TUC is not renewable (LI 2254, Art 23).
Large scale TUC allocation process
Large scale TUCs are required to be awarded through competitive bidding processes based on the applicant’s technical and financial capabilities, regulatory compliance, one-off Timber Rights Fees (TRF) and Social Responsibility Agreement (SRA). Competitive bidding involves:
1)   pre-qualification evaluation and,
2)   the main bidding process for timber rights.

Prequalification requirements include possession of:
1)   Certificate of Business Registration;
2)   Proof of full payment of applicable forest levies;
3)   Income tax, VAT and social security clearance certificates;
4)   Where applicable, evidence of value-added processing to maximise income;
5)   A statement of all timber rights, including sizes, held by the applicant at the time of the application;
6)   Qualification and competence of the timber operations staff of the applicant;
7)   Where applicable, proof of membership of a recognised timber trade association; and
8)   evidence of a labour certificate.
For the main bidding process, for each area proposed for granting of timber rights, the chief executive of the commission, based on the timber inventory and other relevant information, shall specify:
1)   A timber harvest schedule for the area;
2)   The amount of performance bond to be posted by the person to whom timber rights to the area may be granted;
3)   The amount of a reserve bid below which the grant of timber rights for the area will not be made;
4)   Any management requirements and restrictions specific to the contract;
5)   The time and place at which the bids will be opened; and
6)   Any other information relevant to the grant and exercise of the timber right.
Following this process, a written contract is signed by the Minister and ratified by the Parliament of Ghana, granting timber harvesting right to the successful bidder.
Small scale TUC allocation process
Small scale TUC are granted on 1) production forest reserves or on public land which do not qualify for a full cycle harvest rotation because the timber on those lands is insufficient for long term viable timber operations, and; 2) in an off-reserve area where the tree stocking per unit area is very low and will not qualify for a large scale TUC. The specific time needed for harvesting timber shall not exceed 2 years, and the area identified for small-scale TUC shall not exceed 6 km2 or cover more than 5 compartments. A production forest reserve shall not be fragmented to grant small-scale timber rights (LI 2254, Art 10)
As provided under section 18 - Manner of selection for small scale timber utilisation contracts of LI 2254, small scale timber rights go through competitive allocation rather than competitive bidding for large-scale timber rights. The competitive allocation is a more simplified process than the bidding process for large-scale TUCs, as some process steps have been removed.
According to LI 2254, art 20, a Small Scale TUC shall be awarded based on
a)   Technical and financial capabilities as well as the compliance of the applicant with the relevant regulations;
b)   A proposal of SRA with local communities and
c)   A proposal for the payment of a one-off timber rights fee based on the tree stocking of the area.
The small scale TUC rights hall be awarded to the qualified applicant with the highest offer in terms of the selection criteria in article 20 a-c) (see above) (LI 2254, Art 21(12)).
Public access to information
The FC is to guarantee public access to information on the following key timber rights information on its website or upon request (LI 2254, section 76):
(a) A list of preregistered timber companies;
(b) A list of companies with valid property marks;
(c) A list of large-scale timber utilisation contracts (with specified details);
(d) A list of small-scale timber utilisation contracts (with specified details);
(e) List of salvage permits (with specified details);
(f) A list of certificates of purchase.

Legally required documents

Evidence of a labour certificate
Evidence of value-added processing to maximise income (if applicable)
Income tax, value added tax and social security clearance certificates, and;
Lease Agreements (for on and off reserve plantation operations)
Proof of full payment of required forest levies;
Proof of membership of a recognised timber trade association (if applicable)
Qualification and competence of the company’s staff, with the manager being a professional forester
Small- or large-scale timber utilisation contract signed by the Minister and ratified by the Parliament of Ghana
Statement of all timber rights and other logging permits held by applicant at the time of application
Timber Operational Specifications (TOS)
Certificate of Business Registration

Applicable legislation

VIEW LESS

1.3 Management and harvesting planning

Last updated on 2022-02-22 Plantation and reforestation plans are lacking Specified RISK

The management and harvesting planning procedures are detailed and laid out in the FC's MoPs (Section A-F). The roles of the various divisions of the FC (FSD and RMSC) and the TUC holders in the process are clearly defined. The planning process involves several cross-checking by different divisions of the FC, which ensures the planning regulations are implemented. A review of a sample of the public summaries of FSC Controlled Wood audit repor... VIEW MOREThe management and harvesting planning procedures are detailed and laid out in the FC's MoPs (Section A-F). The roles of the various divisions of the FC (FSD and RMSC) and the TUC holders in the process are clearly defined. The planning process involves several cross-checking by different divisions of the FC, which ensures the planning regulations are implemented. A review of a sample of the public summaries of FSC Controlled Wood audit reports for the period 2019-2020 found no instance of non-compliance with the management and harvesting planning requirements. However, not all forest reserves have the strategic management plans required. The final report of Ghana and the European Union (EU) independent assessment of the legality assurance system described in the Voluntary Partnership Agreement (VPA) on FLEGT between Ghana and the EU, which was shared with both parties on 31 December 2020, concluded that the system was not ready due to several factors, including the absence, or obsolescence, of forest management plans by the Forestry Commission. As part of the preparation for FLEGT licensing in Ghana, there is ongoing capacity building. Most small and medium scale companies seek to meet the TUC area plans and TUC operational plans for FRs and OFRs. Still, many are currently not meeting the requirements.
In March 2021, at least 70 management plans, including new and outdated plans, were under review. In February 2022, FC was almost done reviewing all the management plans for all the production forest reserves (Osei, January 2022).

References

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The risk applies to the following source types

Plantation in forest reserves

Risk mitigation options

Document verification

Verify Plantation or Reforestation plan

Plantation or reforestation plan approved by the Forestry Commission shall be available

Description of legal requirements

Plantation and reforestation plan shall be in place.

There are different levels of forest management planning in Ghana.
1.   Strategic management plans are prepared and implemented by the Forestry Commission at the forest reserve level and the TUC area level,
2.   the TUC Holder prepares and implements TUC area plan and TUC 5-year operational plan for TUCs in Forest Reserves (FRs) and Off Forest Reserves (OFRs) covering one coupe (or group) of compartments, and;
3.   Compartment Logging Plan covering a single compartment for FRs and annual logging plan for OFRs.
4.   Plantations in forest reserves require commercial plantation or afforestation plans prepared by the plantation developer to apply to the Forestry Commission.
The Forestry Commission is responsible for harvesting and monitoring forest conditions (Section 2b of the Forestry Commission Act 1999 (Act 571)). The Forestry Commission (FC) has developed Manual of Operations (MOPs) sections A-F, which operationalises the Timber Resources Management Act 1997 (Act 547) and the Timber Resources Management and Legality Licensing Regulations, 2017 (LI 2254).
For any forest reserve (Natural Forest and plantations in forest reserve), the strategic planning sets objectives to guide forest resource management in the long term and delineate the area into production and protective (coarse-grained protection) zone. Timber felling rights are awarded in only production zones. For any Defined Forest Area (DFA) for which harvesting rights are granted, a map delineating the boundary must be prepared by the Forest Services Division. The whole DFA is required to be divided into felling coupes or blocks. The felling coupes or blocks are sub-divided into smaller harvesting units called compartments for on-reserve.
As part of the process of awarding and managing the implementation of the TUCs, the Forestry Commission requires companies to prepare operational plans at varying levels of detail using the approved formats contained in the Forestry Commissions Revised Logging Manual the Revised Logging Manual Appendices.
The compartment and annual plans involve pre-harvest inspection and enumeration of commercial species and yield selection. The stock survey or pre-survey inspections must be conducted, and the results of this survey fed into the yield allocation process. The pre-inspection survey and enumeration are verified by an independent team from the Forest Services Division (FSD). The FSD selects individual trees for harvesting and prepares a yield summary (or yield marking in the case of off-reserve areas) and a yield map (for forest reserve operations). The yield summary, map (together with pre-inspection data), and a logging plan (completed by the TUC holder) are submitted to the RMSC for vetting.
Thus, before harvesting in any forest reserve compartment or Off-forest Reserve area, the Forest Services Division conducts inventory or enumeration of all trees. MOP Section D prescribes the procedures for the inventory and subsequent selection of trees (yield) for harvesting. During the stock survey enumeration, every tree species with a diameter greater than 50 centimetres belonging to FIP Class I is identified and recorded. Other FIP Class I species with a minimum felling limit of 50 centimetres, and trees in the 30-50 centimetres class, are identified and measured. Unless specially requested by the TUC holder, FIP Class 2 species are not enumerated. The identified and recorded trees are given species code and stock survey numbers. The stock survey number is marked on each tree with ascribing knife, in a position that will not be disturbed if the tree is felled (e.g. at the stump).
Within a month after the stock survey, the FSD conducts a 10% check survey of each compartment to confirm fieldwork accuracy and the validity of subsequent yield allocation. The Resource Management Support Centre of the FC also carries out random check surveys from time to time. Once the stock survey has been completed and checked, the FSD prepares a stock map showing the location of all trees assessed (i.e. summary of the stock survey). A yield that details individual species in various diameter classes is prepared and approved. The TUC holder or contractor uses the approved yield for harvesting.
FSD range supervisor captures the details of each tree felled on a tree information form (TIF). The TIF contains information such as the stock survey number, harvested species, and quantity (volume).
The documents are vetted against the requirements of MoP Section D. In particular, the compartment level plan or the logging plan is a guide to provide compartment level protection (fine-grained protection) for individual species, habitats etc. The plan identifies the site of log dumps, forest road network and planned skidding trails. It is only after this elaborate process that the yield summary (yield marking), harvesting plan/schedule for forest reserves (Act 547 3 (3a), LI 2254 Section 56; MoP Section E) and logging plan for off-forest reserves (MoP Section F) and yield map can be approved and released to the TUC holder for harvesting to commence.
Plantations
Planning for an entry permit for on-reserve plantations is managed by the FC.
Salvage permits
Planning requirements for salvage permits are specified in the contract terms and follows the timber harvesting standards and specifications in Section 3 of the Logging Manual.

Legally required documents

Approved Annual Logging Plan for OFRs (harvesting plan)
Approved Compartment Logging Plan for FRs (harvesting plan)
Approved coupes/harvesting schedule or blocks
Approved map of the concession/permit area
Approved TUC area plans for Off Forest Reserves (OFRs)
Approved TUC operational plans for FRs and OFRs
Approved yield/markings
Commercial plantation plans for FRs
Pre-harvest inspection reports
Signed social Responsibility Agreement (SRA) with forest fringe communities (for TUCs, salvage and other permits)

Applicable legislation

VIEW LESS

1.3 Management and harvesting planning

Last updated on 2022-02-22 Risk that area plans, and operational plans are lacking or not meeting legal requirements Specified RISK

References

VIEW LESS

The risk applies to the following source types

Natural forest

Risk mitigation options

Document verification

Verify Timber Utilisation Contract (TUC) area plan

TUC holder must have TUC area plan covering the whole TUC area in forest reserves and off forest reserves that has been approved by the Forestry Commission

Verify Harvesting plan

TUC holder must have harvesting plan or 5 year TUC operational plan covering one coupe or group of compartments to be logged over five year period.

Verify Timber Utilisation Contract (TUC) operational plan

TUC holder must have harvesting plan or 5 year TUC operational plan covering one coupe or group of compartments to be logged over five year period.

Verify List of trees approved for harvesting by the Forestry Commission

The TUC holder must have a map delimiting the defined forest area and the sub-divisions or order in which the area is to be harvested (e.g. harvesting schedule or felling coupes) prepared and approved by the Forestry Commission.

Verify Compartment logging plan

TUC holder must have a compartment logging plan for forest reserves and annual logging plan for off forest reserve areas approved by the Forestry Commission as part of the yield approval process.

Description of legal requirements

Area and Operational plans shall be in place and meet legal requirements

Legally required documents

Approved Annual Logging Plan for OFRs (harvesting plan)
Approved Compartment Logging Plan for FRs (harvesting plan)
Approved coupes/harvesting schedule or blocks
Approved map of the concession/permit area
Approved TUC area plans for Forest Reserves (FRs)
Approved TUC area plans for Off Forest Reserves (OFRs)
Approved TUC operational plans for FRs and OFRs
Approved yield/markings
Commercial plantation plans for FRs
Pre-harvest inspection reports
Signed social Responsibility Agreement (SRA) with forest fringe communities (for TUCs, salvage and other permits)

Applicable legislation

VIEW LESS

1.4 Harvesting permits

Last updated on 2022-02-22 Illegal issuing of special permits Specified RISK

The LI 2254 has attempted to resolve the contentious “special permit” allocation of timber rights by competitively allocating small-scale TUCs. However, illegal harvesting and trade of rosewood (Pterocarpus Erinaceus) is still happening, despite a ban placed on the harvest and trade for the fifth time in Ghana since March 2019. Rosewood has also been listed on Appendix II of the Convention on International Trade in Endangered Species of Wild ... VIEW MOREThe LI 2254 has attempted to resolve the contentious “special permit” allocation of timber rights by competitively allocating small-scale TUCs. However, illegal harvesting and trade of rosewood (Pterocarpus Erinaceus) is still happening, despite a ban placed on the harvest and trade for the fifth time in Ghana since March 2019. Rosewood has also been listed on Appendix II of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) since January 2017. According to the EIA undercover investigative report (EIA, 2019), an institutionalised scheme, fuelled by bribes, is to mask the timber's illegal harvest, transport, export, and CITES licensing. The key illegal schemes used include fraudulent use of “salvage permits,” misdeclaration of timber species, use of “escorts” to deal with control points, forging of official documents, and retrospective issuance of CITES permits.
According to the EIA report, “…salvage permits have turned into a massive laundering mechanism for illegal timber and a source of profit for vested political interests.” (EIA 2019, p. 4)
The Forestry Commission has challenged the EIA report (EIA, 2019), but there are other public reports of illegal harvesting of Rosewood; some of the cases are in the courts. It is argued that this is a case of a single species and can be isolated. However, given that the alleged modus operandi of the “illegal” scheme includes misrepresenting the species, it is possible to apply the same methods to harvest other banned species. News items on published scientific analysis by researchers at the Forestry Research Institute of Ghana (FORIG) also indicate lower reported rosewood export figures to China. In contrast, China's figures for rosewood imports indicate high figures from Ghana. Besides Rosewood, even after the LI 2254 was passed, the Forestry Commission continues to issue special permits instead of competitive allocation (Ghenvironment.org, 2021).
The FSD fines arrested illegal operators, and the lumber was confiscated and auctioned (Derkyi and Dietz, 2014). Such products, therefore, become legal and enter the legal sources of timber. However, these products are mainly traded in the domestic market space.
Chainsaw milling is not allowed in Ghana, but there are an estimated 100,000 chainsaw millers. The numbers have only increased since they were made illegal in 1998 in a failed effort to halt deforestation. In October 2020, according to an unpublished EU review seen by Yale Environment 360, around two-thirds of the timber traded domestically in Ghana was illegal and thus placed on the market without required permits. These operations are publicly known, support some 650,000 mostly rural people, and deliver more than twice as much economic benefit as the commercial legal sector. The situation opens for corruption by leaving the loggers and those who trade in their produce to extortion by local officials and police (Pearce, 2020).

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verification

Verify Harvesting permit

Collect harvesting permit for all timber sources. If timber originates from special permits, avoid purchasing.

Description of legal requirements

Harvesting shall not take place under Special permits

Timber harvesting permits in Ghana are granted primarily through the award of:
•   Small Scale and Large-Scale Timber utilisation contracts (TUC) (Act 547, Act 617 and LI 2254) by the Minister of the Ministry of Lands and Natural Resources (MLNR), acting on the recommendation of the Forestry Commission. TUC agreements shall be ratified by the Parliament of Ghana (ACT 547). TUC is considered concessions, and the allocation of TUCs are covered under sub-category 1.2.
Apart from TUCs, the Chief Executive, upon recommendations from the FC, and following provisions made in LI 2254, may also grant administrative harvest permits, such as:
•   Salvage permits: for abandoned logs or forest areas undergoing developments. For example, farmlands or areas undergoing settlement expansion or road construction (Regulation 28 and 29, LI 2254).
•   Entry permit: for plantations in forest reserves managed by the Forestry Commission. The grant of entry permit follows a bidding process and evaluation of bids by the Timber Right Evaluation Committee of the Forestry Commission.
•   Timber Utilisation Permit (TUP) grants permission to use a specific number of trees in an area not subject to a TUC for social or community use purposes. See 1.15. Timber from TUP cannot be used for commercial purposes.
The harvesting regulations in Ghana stipulate that the Contactor or TUC holder should hold a valid timber harvesting permit (in the form of TUCs, entry permits or salvage permits) at the time of logging.
For any Defined Forest Area (DFA) for which harvesting permits are granted, a map delimiting the boundary is required to be prepared by the Forest Services Division (FSD) of FC. The whole DFA is required to be divided into felling coupes or blocks. The felling coupes or blocks are sub-divided into smaller harvesting units (e.g. compartments). A schedule listing the order in which the coupes/blocks and the sub-divisions are to be logged prepared by the TUC holder and is vetted and endorsed by the Resource Management Support Centre (RMSC) of the FC. For each harvesting unit, pre-harvest inspections (stock survey or pre-survey inspections) must be conducted, and the survey results fed into the yield allocation process. An independent team from the FSD verifies the pre-inspection survey. The FSD prepares a list of individual trees for harvesting (a yield summary or yield marking in the case of off-reserve areas) and a yield map (for forest reserve operations). The yield summary, map (with pre-inspection data), and a logging plan (completed by the TUC holder) are submitted to the RSMC for vetting. These documents are vetted against the requirements of MoP Section D. It is only after this elaborate process that the yield summary (or yield marking in off forest reserve areas), logging plan and yield map can be approved and released to the TUC holder for harvesting to commence. The TUC holder must obtain approval for the trees or volume to be harvested (including a permit for restricted species) by an application through the Regional Forest Manager and to hold a valid property mark.
For non-TUC areas, salvage and entry permits are obtained through an application to the Chief Executive of the FC and do not require parliamentary approval. Harvesting requirements are set out in the permit conditions, including volumes to be salvaged, duration and location of the salvage.

Legally required documents

Approved harvesting schedule/blocking or coupes delineation
Approved yield/markings
Concession map
Entry permit or released letter issued by the FSD Forest District
Logging plan
Pre-harvest compartment inspections/ field inspection report for salvage permits
Valid property mark

Applicable legislation

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1.4 Harvesting permits

Last updated on 2022-02-22 Logging takes place without a permit Specified RISK

References

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The risk applies to the following source types

Natural forest

Risk mitigation options

Document verification

Verify Timber Utilisation Contract (TUC)

TUCs shall be available and contain the required documentation/ information:

Concession map;
Valid property mark;
Approved harvesting schedule/blocking or coupes delineation;
Pre-harvest compartment inspections;
Approved yield/yield marking;
Logging plan

Verify Salvage permits

Description of legal requirements

Contactor or TUC holder shall hold a valid timber harvesting permit (in the form of TUCs, and/or salvage permits)

Legally required documents

Approved harvesting schedule/blocking or coupes delineation
Approved yield/markings
Concession map
Entry permit or released letter issued by the FSD Forest District
Logging plan
Pre-harvest compartment inspections/ field inspection report for salvage permits
Valid property mark

Applicable legislation

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1.4 Harvesting permits

Last updated on 2022-02-22 Logging takes place without an Entry permit Specified RISK

References

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The risk applies to the following source types

Plantation in forest reserves

Risk mitigation options

Document verification

Verify Entry permit or released letter issued by the FSD Forest District

Entry permits are obtained through application to the Chief Executive of the Forestry Commission. Verify that harvesting requirements are set out in the permit conditions.

Description of legal requirements

Entry permit shall be in place

Legally required documents

Approved harvesting schedule/blocking or coupes delineation
Approved yield/markings
Concession map
Entry permit or released letter issued by the FSD Forest District
Logging plan
Pre-harvest compartment inspections/ field inspection report for salvage permits
Valid property mark

Applicable legislation

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1.4 Harvesting permits

Last updated on 2022-02-22 Award of salvage permits for banned species in violation with salvage permit conditions Specified RISK

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve

Risk mitigation options

Document verification

Verify Salvage permits

Receive copy of and verify that salvage permits are not issued for banned species or misused to harvest banned species:

Salvage permits shall be issued through application to the Chief Executive of the Forestry Commission;
Verify that species specified in the terms of permits are not misrepresented or changed, and that these species are not on the list of banned/restricted species;
Verify that harvesting requirements are set out in the permit conditions, including volumes to be salvaged, duration and location of the salvage. The location and duration of salvaging shall be verified with supply chain documentation.

Description of legal requirements

Salvage permit shall be issued only when justified and shall follow the legal requirements

Legally required documents

Approved harvesting schedule/blocking or coupes delineation
Approved yield/markings
Concession map
Entry permit or released letter issued by the FSD Forest District
Logging plan
Pre-harvest compartment inspections/ field inspection report for salvage permits
Valid property mark

Applicable legislation

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1.5 Payment of royalties and harvesting fees

Last updated on 2022-02-22 Low risk concluded Low RISK

In 2014, there was a general improvement in the forestry sector's fiscal regime due to the introduction of computer-based revenue management programs used by the Forestry Commission (Hoare 2014). The FC publishes quarterly revenue disbursement and indicates that it achieves over 95% of revenue collection rates. Companies have a 30-day grace period to pay once the FC issues the royalty bill. The FC controls payments through the enforcement of ... VIEW MOREIn 2014, there was a general improvement in the forestry sector's fiscal regime due to the introduction of computer-based revenue management programs used by the Forestry Commission (Hoare 2014). The FC publishes quarterly revenue disbursement and indicates that it achieves over 95% of revenue collection rates. Companies have a 30-day grace period to pay once the FC issues the royalty bill. The FC controls payments through the enforcement of property mark renewal. Companies are required to renew their property mark every six months and are not allowed to operate without a renewed property mark.
A report produced by the Forest Governance Learning Group and Civic Response in 2013 concluded that from 2003 to 2012, a total loss in real revenue of $16 million was recorded due to the Forestry Commission not adjusting stumpage to the applicable dollar value as contained in the Fifth schedule of LI 2254. However, already in 2016, it was found that the Forestry Commission had made progress in reviewing the stumpage rates and estimating the potential stumpage rates and corresponding SRAs before logging commenced. Copies of these estimates are available at the various Forest Services Division offices (expert consultation conducted by NEPCon, 2016). As of December 2020, no newer research was done by CSOs on the matter.
The payment of timber rights fees (TRF), a key issue related to royalties and harvesting fees, has been resolved. The TRF is about the conversion of leases to TUCs. Timber rights holders and the Forestry Commission have resolved their differences, which paved the way for companies to submit their conversion applications for processing. Unlike the lease conversion process, which ends at parliamentary ratification, the TRF payment is completed within the administrative process. It is therefore low risk given the level of progress achieved so far.
Expert consultation conducted by NEPCon (Now Preferred by Nature) in 2016 showed that payment agreed under Social Responsibility Agreements (SRAs) were sometimes violated by some timber contractors. However, most contractors provided additional support to the communities than only the legally required 5% of stumpage fee. Communities can ensure they receive the due amount if they have information on stumpage value. The information on the actual volumes of timber extracted is the basis for calculating royalties and SRAs available at the FC and its district offices (FSD) located within or near the forest areas. Landowners can obtain this information to verify the appropriate revenue independently. Most companies employ forest operations workers from the forest fringe communities, and some of these workers also have access to extracted volumes. They are sometimes included in SRA committees in the communities. The service charter of the Forestry Commission identifies reports and publication of materials as the main tool for communicating with the public. However, the official redistribution figures are usually published a year in arrears.
SRA and stumpage information delivery to local communities has improved with the involvement of civil society organisations in awareness-raising and establishment of SRA committees in some forest fringe communities. Activities and programmes on the implementation of the VPA have also contributed to an increase in the awareness of communities and improved access to information. The Resource Management Support Centre of the Forestry Commission prepares estimates of potential stumpage and corresponding SRAs and timber rights operators to pay SRA in advance before the logging begins. These estimates are available at the Forest Services Division offices and are accessible by communities and other stakeholders. Continuous audits carried out by the Timber Validation Division is improving the system. Royalty disbursement has improved (expert consultation conducted by NEPCon, 2016). A new template has been developed for monthly reporting on SRA implementation in the district offices of the Forestry Commission. The Resource Management Support Centre (RMSC) of the Forestry Commission has (in collaboration with some Civil Society Organisations) developed a compliance checklist to assist the Forestry Commission in monitoring compliance with the due process in the SRA negotiation and implementation (Joint Monitoring and Review Mechanism, 8th Session, March 2016). The Forestry Commission’s Guidelines for Social Responsibility Agreement (Forestry Commission, 2017) contains the SRA requirements, processes, and procedures, including a template for SRA and GhLAS Social Responsibility Agreement Checklist (Osei, January 2022).

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Description of legal requirements

Royalties and harvesting fees in Ghana include:
1)   Timber right fee; (TUCs)
2)   Contract area rent; (TUCs)
3)   Stumpage fee; (TUCs and salvage permits)
4)   Social responsibility agreement (TUCs and Salvage permits).
Timber right fees are paid to the Forestry Commission after the award of harvesting rights and before harvesting commences. Contract area rent is paid annually on a per hectare basis over the area of timber rights. Stumpage fees are paid on the tree by tree basis for each company harvest tree.
Social Responsibility Agreement (SRA) is a social tax that a timber company pays to support the development of local communities around its TUC area. The monetary value of the support is 5% of the stumpage paid in respect of trees harvested within a defined forest area. Small scale and large-scale TUC permits in both natural forests and plantations, and salvage permits require SRAs (LI 2254, Section 3 (e) of Act 547; Sections 29(5), 17(11) b and 20(1)b).

Legally required documents

Approved yield/markings
Contract area rent
FC receipts of stumpage/bill payment
FC stumpage/services bills
Operator FC statement account
SRA payment records
Timber right payment
Social Responsibility Agreement (SRA) and payment records

Applicable legislation

Timber Resources Management and Legality Licensing Regulations, 2017 (LI 2254), 2017.

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1.6 Value-added taxes and other sales taxes

Last updated on 2022-02-22 Low risk concluded Low RISK

The Ghana Revenue Authority (GRA), Customs Division and the Timber Industry Development Division (TIDD) enforce the applicable laws relating to VAT and other taxes. Wood products exports are well-documented to ensure there are few risks. The GRA, with the help of the TIDD, tracks companies with the tax identification number (TIN) to ensure taxes are paid. Exports are mostly through the banking system and are well documented (expert consultation c... VIEW MOREThe Ghana Revenue Authority (GRA), Customs Division and the Timber Industry Development Division (TIDD) enforce the applicable laws relating to VAT and other taxes. Wood products exports are well-documented to ensure there are few risks. The GRA, with the help of the TIDD, tracks companies with the tax identification number (TIN) to ensure taxes are paid. Exports are mostly through the banking system and are well documented (expert consultation conducted by NEPCon, October 2016). In some isolated cases, wood could be concealed and exported without paying taxes. Summary reports of the FSC audit also confirm that VAT and other sales taxes are enforced for FSC certified wood from natural forests.

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Description of legal requirements

Value Added Tax Act, 2013 imposes valued added tax and defines the persons and businesses liable to pay tax. The Value Added Tax Act was amended in 2017, but amendments did not apply to the forestry sector.

The Trees and Timber (Amendment) Act 1994 (Act 493) contains fees, fines, and export levies in the forestry sector. Sections 1 – 3 of this Act reviewed the fees and fines upwards, whereas Section 4 introduced an export levy for air-dried lumber. All levies payable under Section 4 are paid to the Forest Products Inspection Bureau (now Timber Industry Development Division (TIDD)) at the time of the export of the timber (Section 4 15B (2)). Value Added Tax Act, 2013 imposes valued added tax and defines the persons and businesses liable to pay tax. The Value Added Tax Act was amended in 2017, but amendments did not apply to the forestry sector.

Legally required documents

Export levy receipts/letters of credit/bank advice.
GRA tax clearance certificate

Applicable legislation

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1.7 Income and profit taxes

Last updated on 2022-02-22 Low risk concluded Low RISK

Companies are required to make statutory payments to GRA and obtain clearance. The approved clearance is required to renew the timber companies’ property mark. The property mark must be renewed every six months, and companies cannot work with an expired property mark.The tax laws are well enforced by the Ghana Revenue Authority (GRA). The GRA monitors the tax payment of companies using the TIN numbers. The GRA also conducts documentary and fiel... VIEW MORECompanies are required to make statutory payments to GRA and obtain clearance. The approved clearance is required to renew the timber companies’ property mark. The property mark must be renewed every six months, and companies cannot work with an expired property mark.
The tax laws are well enforced by the Ghana Revenue Authority (GRA). The GRA monitors the tax payment of companies using the TIN numbers. The GRA also conducts documentary and field (office to office) audits, resulting in increased revenue collection and reduced tax default by limited liability companies in Ghana (expert consultation conducted by NEPCon, 2016). A review of a sample of FSC audit summaries of various companies in Ghana from 2020 shows this requirement is met.

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Description of legal requirements

Income tax rate for companies in the forest sector is 25%.

Domestic taxes are administered by the Domestic Tax Revenue Division (DTRD) of the Ghana Revenue Authority (GRA). The relevant income taxes (Income Tax Act, Act 896 section 1) administered by the DTRD are Corporate Tax. This is the tax paid by companies on their profits in the year. The tax rate for companies in the forest sector is 25%.
Free zone companies licensed under the Free zone Act, 1995 (Act 504) are exempted from the payment of income tax on profits for the first 10 years [Act 896, sixth schedule, section 134, 9(1)].
The GRA uses a taxpayer identification numbering (TIN) system to identify and track taxpayers (Act 632).

Legally required documents

GRA tax clearance certificate
Ghana Revenue Authority (GRA) Tax Clearance Certificate

Applicable legislation

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1.8 Timber harvesting regulations

Last updated on 2022-02-22 Low risk concluded Low RISK

The Forest Services Division enforces the minimum girth limit on timber rights holders. Some timber contractors could harvest outside the approved yield. Much of the illegal actions on the ground is carried out by illegal operators, who do not observe the harvesting regulations, such as no logging in buffer zones; protection of some species; and quantity of trees removed per hectare that is set out in the Logging Manual and Key Standards for Log... VIEW MOREThe Forest Services Division enforces the minimum girth limit on timber rights holders. Some timber contractors could harvest outside the approved yield.
Much of the illegal actions on the ground is carried out by illegal operators, who do not observe the harvesting regulations, such as no logging in buffer zones; protection of some species; and quantity of trees removed per hectare that is set out in the Logging Manual and Key Standards for Logging in the High Forest Zone at all times. These operators operate illegally, without a permit and do not have the requisite documents to trade legally. The FC and its divisions, such as FSD and RMSC, have the task force to check illegal activities. However, this level of illegal harvesting is only traded on the domestic market and cannot enter the export market. The introduction of the Domestic Timber Inspection Certificate (DoTIC) and the sustained monitoring by the FSD taskforces are making it less economical and unsustainable for illegal operators for the domestic market. In spite of this progress, more work needs to be done as there is still illegal timber on the domestic market (Osei, January 2022).
The Forest Services Division of the FC monitors the harvesting operations of TUC holders. It carries out 100% post-felling checks and checks for compliance with logging requirements before a compartment closure certificate is issued. These certificates are available at the FSD office that oversees the harvesting area. Implementing the Ghana Legality Assurance System (especially the Wood Tracking System, which verts all required information inputs and outputs including reconciliation of volumes and flags inconsistences) makes it impossible to get export permit where descripences are flagged (Osei, January 2022). The continuous monitoring by the TVD and the Independent Monitor (IM) are helping to improve the system to check illegal harvest. Timber exports volumes and related documentary evidence are reconciled in the centralised Wood Tracking System (WTS). Any discrepancies are flagged for the necessary legal regularisation before export permits can be issued. Post-felling checks are required for all harvests regardless if destined for export or the domestic market.

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Description of legal requirements

The Forest Services Division of the Forestry Commission has prepared a logging manual and key standards for logging in the High Forest Zone (HFZ) of Ghana to guide the harvesting operations of timber contractors as required under Section 10 of the Timber Resources Management Act (Act 547) [as amended by the Forestry Commission Act, 1999 (Act 571), Sch. to s.35(2)].
Some forest reserves have been zoned into production and protection areas. The guideline provides that logging is permitted only in the timber production areas. Harvesting is selective of individual trees in natural forests and clear-felling in even-aged commercial plantations (both on- and off-reserve). Minimum felling girth limits are set for individual species, and it is an offence to fell trees below their minimum girth limits. The logging manual gives detailed prescriptions to include the prohibition of harvesting in riparian buffer zones, steep slopes, swampy sites, etc. The manual prescribes directional felling at all possible situations and gives specifications for road, skid tracks, log yard constructions, and maintenance.

Legally required documents

Approved harvesting schedule/blocking or coupes delineation
Approved logging plan
Compartment closure certificate
Log information form (LIF)
Tree information form (TIF)
Plantation or reforestation plan

Applicable legislation

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1.9 Protected sites and species

Last updated on 2022-02-22 Protected species are illegally harvested Specified RISK

Risks are associated with illegal logging of protected species and in protected areas. Illegal logging of protected species: following the ban on the harvesting, transport, processing, export, or sale of rosewood (Pterocarpus Erinaceus), the Forestry Commission granted Salvage Permits to 13 companies to remove the already harvested rosewood. However, these companies may have abused their permits at the time (NEPCon expert consultation, 2016). Th... VIEW MORERisks are associated with illegal logging of protected species and in protected areas.
Illegal logging of protected species: following the ban on the harvesting, transport, processing, export, or sale of rosewood (Pterocarpus Erinaceus), the Forestry Commission granted Salvage Permits to 13 companies to remove the already harvested rosewood. However, these companies may have abused their permits at the time (NEPCon expert consultation, 2016). There have also been recent reports of illegal harvesting and trade in rosewood (Pterocarpus erinaceus) (EIA, 2019, EIA 2020) despite a ban placed on the harvest and trade for the fifth time in Ghana in March 2019. Rosewood has also been listed on Appendix II of the Convention on International Trade in Endangered Species of Wild Fauna and Flora (CITES) since January 2017. Rosewood occurs in the Savannah Regions of Ghana, protected from timber concessions. Rosewood harvesting thus mostly comes from off-forest reserves.
According to Nature and Development Foundation, there are continued sales of Pericopsis Elata (also known as Afromosia) on the local market without accompanied licenses (Appiah and Bediako, 2020). Pericopsis elata is a scarlet star species listed as a restricted species.
Illegal logging in protected areas: illegal logging is a threat to protected areas and is documented in several studies/reports. A study of six forest reserves by Derkyi and Dietz (2014) showed that the issue was connected to illegal chainsaw milling offences, mainly in forest and off-forest reserves. Also, a Mongabay investigation showed that illegal logging in forest reserves are commonplace. While the FC did seize some illegally logged timber, a chainsaw operator also informed Mongabay that members of the FC task force to prevent illegal logging were routinely bribed, making it possible to transport in the daytime and to pass the checkpoints established by the FC (Yoda, 2019). Afriyie (2021) reported that logging had taken place in protected areas due to illegal settlements depending on the forest resources for livelihood, high economic gains and corruption between perpetrators and wildlife officials (Afriyie et al., 2021).
In 2019, EIA also reported that encroachment into protected areas takes place to harvest rosewood (EIA, 2019), and Afriyie (2021) supports that the demand for rosewood is a driver for illegal logging in the protected areas and that China is a key market driving this demand for rosewood (Afriyie et al., 2021).

References

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The risk applies to the following source types

Natural forest

Risk mitigation options

Document verification

Verify Permit for restricted species

For restricted timber species, loggers must hold a valid permit for restricted species issued by the FC for the defined harvesting unit.

Description of legal requirements

Protected/restricted/banned species are harvested only under a valid permit

Protected areas
Ghana established an extensive forest estate in the high forest zone in the 1920s, consisting of 1.63 million hectares of forest reserves. These reserves include permanently protected areas (352,500 ha of national parks and globally significant biodiversity areas of 117,322 ha). The remaining lands in the off-forest reserve areas are primarily farmlands.
The FC is responsible for the planning of harvesting and monitoring forest conditions (Section 2b of the Forestry Commission Act 1999 (Act 571)). The FC’s Manual of Operations (MOPs) sections A-F operationalises the Timber Resources Management Act 1997 (Act 547) and the Timber Resources Management and Legality Licensing Regulations, 2017 (LI 2254).
The strategic planning sets objectives to guide forest resource management in the long term and delineate the forest reserve areas into production and protective zones. Timber felling rights are awarded in only production zones.
No logging operation, including felling, skidding, road and log yard construction, is permitted in a Protected Area. Such areas include sacred groves, hill sanctuaries, provenance protection areas, convalescent areas, special biological protection areas, and swamps. Protected Areas must be marked on the TUC Operational Plan and the Annual Logging Plan at the appropriate scales. The Contractor is responsible for ensuring that the Logging Supervisor is familiar with the location of all Protected Areas that fall within or adjacent to the Contract Area (Revised Logging Manual, section 3.2-art. 7) (TimberLex, 2021).
Protected species (Star ratings and restricted species)
Several tree species are put under Ghana’s conservation star ratings for conservation purposes. The star rating system was designed to assign each species to a category denoting its conservation priority and is based on an extensive botanical survey of the forest estate completed by the Forest Services Division in 1992. Star values can help forest managers identify genetic hotspots throughout the high forest zone. The numeric value related to the hotspot is known as its Genetic Heat Index (GHI). Forest reserves or portions of reserves with a high Genetic Heat Index (greater than 150) are designated as Special Biological Protection Areas and are permanently removed from production (FAO, N.Y).
Revised Logging Manual. Section 3.2 – Art.6 Protected species. Any tree species classified as Black Star cannot be felled under any circumstances. Any species classified as a Special Permit Species cannot be felled unless this is specifically authorised by a permit from the District Forest Manager for road or log yard construction. Black Star and Special Permit Species are listed in Appendix 6, which the Forestry Department may amend from time to time.
Black Star species are the highest priority for protection, followed by Gold, Blue, Scarlet, Red, Pink and Green Stars, respectively (MoP, Instruction Sheet A2.3)
The monitoring requirement specified in Section 3 (6) of MOP F prescribes that the FSD should ensure that no black star species or restricted species are felled.
Schedule 8 of the Timber Resource Management and Licensing Regulations (2017), LI 2254, lists the timber species restricted for felling. These species can only be felled with a restricted species permit issued by the FC with the approval of the Minister (LI 2254, Art 74).
Protected species belonging to the classes “Restricted Timber Species” and “Black Star” are identified during the stock survey but not measured (Mop, Instruction Sheet C4.1, 2.4). Black Star species shall be protected with an exclusion zone of 100m radius around the tree location. MoP Introduction sheet No D2, 7.3 lists the current Black star species. In contrast, Introduction sheet MoP, Instruction Sheet D4, 4.2 lists Scarlet species (species threatened in Ghana by over-exploitation) and the approach for yield calculation. Permits for issuing Scarlet species can be issued.
Ghana has ratified the CITES Convention. Pericopsis Elata (Afromosia) and Pterocarpus Erinaceus (rosewood) are found in Appendix II.
Ghana’s Cabinet introduced a ban, effective from 1st January 2014 (temporary ban introduced in 2012), on the harvesting and exporting of Pterocarpus Erinaceus (rosewood) until further notice.

Legally required documents

Approved compartment logging plan

Applicable legislation

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1.9 Protected sites and species

Last updated on 2022-02-22 Protected areas are illegally harvested Specified RISK

References

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The risk applies to the following source types

Natural forest

Risk mitigation options

Document verificationField verification

Verify Approved harvesting schedule/blocking or coupes delineation

Approved harvesting schedule/blocking excluding large, protected areas (referred to as "coarse grain" protection (e.g. provenance areas, globally significant biodiversity areas, etc.) forest progress maps

Verify Timber Utilisation Contract (TUC) area plan

TUC area map showing locations of large, protected areas within a forest management unit or defined forest area.

Verify approved yield/markings

Yield maps indicating locations of fine grain protection areas (all trees in fine-grained areas are required to be exempted) must be available to logger onsite.

Visit Logging area

It shall be verified that the above listed documents are available to the logger onsite.

Description of legal requirements

Harvesting shall not take place in protected areas.

Legally required documents

Approved compartment logging plan

Applicable legislation

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1.10 Environmental requirements

Last updated on 2022-02-22 Low risk concluded Low RISK

Apart from logging in submerged forests, most companies logging in the forest reserve and off forest reserve areas (both natural and plantation forest) approved by the Forestry Commission (FC) may not have an EPA permit EPA as required by law. This is because the EPA certificate is not part of the required documents for timber rights by the FC. Once the companies have met environmental standards prescribed in the forest law, the FC may recommend ... VIEW MOREApart from logging in submerged forests, most companies logging in the forest reserve and off forest reserve areas (both natural and plantation forest) approved by the Forestry Commission (FC) may not have an EPA permit EPA as required by law. This is because the EPA certificate is not part of the required documents for timber rights by the FC. Once the companies have met environmental standards prescribed in the forest law, the FC may recommend that companies apply to the Ministry of Lands, Forestry and Mines for the grant of timber rights.
According to most officials at the Forestry Commission, there is an unwritten understanding between FC and EPA that the different levels of forest management planning and operational restrictions, set out in the forest laws, are adequate to safeguard any breaches of other environmental requirements; further, the EPA's environmental requirements can be waived once the forest operator meets the FC's management planning requirements. For example, the EPA’s EIA requirements include restrictions on logging in watershed areas. The Forestry Commission’s coarse grain protection removes watersheds from the timber production areas of the forest reserves, so this EPA requirement is already addressed. For forest plantations inside forest reserves, plantation developers must prepare commercial plantation plans for approval by the Forestry Commission as part of the plantation development application process. This ensures watersheds are identified and protected. The Ministry of Environment, Science and Innovation, in its 2016 Biodiversity strategy, however, reported that the involvement of EPA in EIA in the forest sector has been non-existent. Though the Biodiversity strategy acknowledged that the Forestry Commission has strict environmental regulations concerning forest management, it proposed that the Forestry Commission be allowed to conduct external environmental auditing to strengthen the process. Private plantation developers outside the forest reserves must meet the EPA requirements.
The review of sampled FSC audit summaries in 2020 shows that companies pursuing FSC certification are making efforts to be provided with environmental permits from the Environmental Protection Agency (FSC audit reports). Companies usually have an EPA permit for their factory or processing operations but not forest operations.
Note: While the EPA requirements are clear, so far, it has not been applied in normal forestry operations (i.e., environmental permits are not issued, and EIA are not conducted). This is mainly because the forestry planning and management requirements are considered sufficient to meet the EPA requirement. There is, therefore, an unwritten agreement between the FC and EPA. Ghana’s VPA legal timber definition also does not include EIA. Ghana’s legal definition of timber under the VPA does not include this provision.

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Description of legal requirements

Logging Manual prescribes environmental standards as guidance (on logging activities in riparian areas, fire precautions, restricted/protected species and protected areas) to the timber contractors on the planning and operational aspects of timber harvesting.

The Logging Manual (Section 3.2, subsections 1 – 7) prescribes environmental standards as guidance (on logging activities in riparian areas, fire precautions, restricted/protected species and protected areas) to the timber contractors on the planning and operational aspects of timber harvesting. He provides basic information on good working practices.
Section 3 of Schedule 1 (Regulation 1(1)) of the Environmental Assessment Regulation, 1999 prescribes undertakings that require registration and an environmental permit from the Environmental Protection Agency (EPA). Relevant undertakings include the management of forested land for the primary purpose of harvesting timber in a contract area (logging) and forestry services such as pesticide application and the introduction of exotic species (animals, plants or microbial agents). Applications for the environmental permit are required to detail:
i.   The location and size of the area;
ii.   Technology intended to be used;
iii.   Environmental, health and safety impacts of the undertaking;
iv.   A clear commitment to avoid any adverse environmental impacts which the undertaking could avoid;
v.   A clear commitment to address unavoidable environmental, health and safety impacts and to implement necessary mitigation steps ;
vi.   The concerns of the general public, if any, and in particular concerns of immediate residents; and
vii.   Alternatives to the establishment of the undertaking.
The EPA screens the application under regulation 5 and issues a report on the application which states whether the application is approved or not, or whether the submission of (a) a preliminary environment report or (b) an environmental impact statement is required.
An application is approved at the initial assessment; the EPA registers the undertaking and issues an environmental permit.
Where an application is rejected, the undertaking cannot commence. It is already in existence and discontinued.

Legally required documents

Approved yield/markings
Blocking report (for submerged forests)
Compartment closure certificate
Environmental impact assessment
Environmental management report
Environmental permit
EPA certificate of registration
Field observations by audit team
FSD felling inspection report
List of infractions raised by FSD in offence register
Logging plan
RMSC post-harvest audit report

Applicable legislation

Environmental Assessment Regulation. 1999. (LI 1652), 1999.
Environmental Assessment (Amendment) Regulations. 2002. (LI 1703), 2002.
Logging manual.
Riparian Buffer zone Policy for Managing Freshwater Bodies in Ghana, 2011.

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1.11 Health and safety

Last updated on 2022-02-22 Personal safety and protective equipment are not provided to or used by workers Specified RISK

Companies in Ghana have improved in terms of health and safety; especially following the pursuit of forest certification and the implementation of VPA licensing. However, for some companies, safety requirements are not fully observed (EU FLEGT Facility, 2018). In some cases, Personal Protective Equipment (PPE) is not supplied to workers, or often employers provide PPE to workers but the use is not enforced. Workers in most companies belong to tra... VIEW MORECompanies in Ghana have improved in terms of health and safety; especially following the pursuit of forest certification and the implementation of VPA licensing. However, for some companies, safety requirements are not fully observed (EU FLEGT Facility, 2018). In some cases, Personal Protective Equipment (PPE) is not supplied to workers, or often employers provide PPE to workers but the use is not enforced. Workers in most companies belong to trade unions, and have collective bargaining agreement (CBA) with their employers which requires the provision of PPE as an essential part of the agreement, however in some cases the terms of the CBA, especially PPE provision, are not met (Expert consultation conducted by NEPCon, 2016; Arts et al., 2021). The review of sampled FSC audit summaries, from 2020, did not show any risks with this category (FSC audit reports). Higher compliance with PPE requirements in certified companies are supported by the story of the EU FLEGT Facility, 2018, noting that many of the larger companies have increased awareness due to private certification schemes. However, it was also noted that many smaller companies lack behind (EU FLEGT Facility, 2018).

The Timber Validation Department audit companies to check they comply with health and safety requirements and verify that companies have the required annual health and safety certificate from the Factories Inspectorate Division of the Ministry of Employment and Labour Relations (EU FLEGT Facility, 2018). However, factory inspectors help companies to meet safety requirements in the factories but not within forest operations.

In Arts 2021 auditing and enforcement practices by the FC are covered. The study refers to only one Forest Reserve (multiple forest operators) but provides an indication of compliance level. While it was generally found that that the forest operations where in compliance with the requirements related to forest management and harvesting, health and safety was typically violated (regardless of company size), with a high degree of staff not using PPE. When violations were detected, an educational lecture was given to the staff, but with no further consequences for the forest operations, which were allowed to continue as before. The auditors and the local FC department interpreted the lack of PPE as a non-compliance, but not as a “real” illegality, irrespective of the law (Arts et al., 2021).

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verificationField verification

Verify records from the timber operator to demonstrate that all employees are registered under the NHIS

Registration can be verified through;

Records from the timber operator to demonstrate that all employees are registered under the NHIS, or;
Identity cards for registered persons under the NHIS shall be in place for all staff (issued by NHIA).

Verify Identity cards for registered persons under the NHIS

Identity cards should be issues by NHIA

Verify Records on compensations

Records on compensations should be available to demonstrate that the worker compensation law is consistently implemented in events of accident, death or injury of an employee arising from work.

Verify Training records

Training records must be available and demonstrate that adequate health and safety training, consistent with the risk associated with their responsibilities, have has been given to employees and contractors consistent with the risk associated with their responsibilities.

Visit Logging area

Verify the following in the field:

employees are provided a safe working environment and personal protective equipment (PPE);
PPEs are not paid by workers;
PPEs are being used in the filed;
appropriate health facilities are available to employees and contractors.

Description of legal requirements

Personal safety and protective equipment shall be used by workers

Labour regulations, 2007 (LI 1833), Sections 18 to 20 and Sections 25 to 28; Labour Act, 2003 (Act 651): Part XV: 118-121; and 30 of Act 328 (factories, offices and shops act, 1970) provides for occupational safety and health and medical examination of workers at work. Section 75 of Act 328 provides the powers of inspectors to enter and inspect a factory at any time. As part of the requirements (Section 118 to 121 of the Labour Act), the employer is responsible to ensure workers are provided with satisfactory, safe and healthy conditions. Workers are obliged to use safety appliances, fire-fighting equipment and PPEs provided by the employer; and report imminent hazards to employer. Employers are required to report occupational accidents and diseases to the appropriate government authority. Supply of personnel protection equipment (PPE) and training of workers on safe felling practice, and observation of safety requirements in the timber industry.

In the absence of specific health and safety requirements in the forest sector in Ghana, the ILO Code of Practice on Safety and Health in Forestry Work (as set out in Table 1, page 37) is used as the minimum requirement for Health and Safety. Employers are required by the National Health Insurance Authority Act, 2012 (Act 852: Part II sections 12-13) to register their employees on the National Health Insurance Scheme (NHIS).

Employers are required by the Pesticides Control and Management Act, 1996 (Act 528: Section 21) to provide workers with the means to protect themselves from injury or hazards when handling pesticides. In case of injury, accident or death of employees, the Workmen's Compensation Law (PNDC law 187) provides the procedure for compensation.

Legally required documents

Industrial hygiene survey report (from Department of factory inspectorate or their sub-contracted agencies)
Records of health and safety training
Records of payment of work-related injury compensation
Records of purchase and provision of personal protective equipment
Workers registration on the National Health Insurance Scheme (NHIS)

Applicable legislation

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1.12 Legal employment

Last updated on 2022-02-22 When a union is in place there is a risk that collective bargaining agreements are not in place, or that the terms of the collective bargaining agreements are not met by companies Specified RISK

Companies in Ghana have improved in terms of legal employment; especially following the pursuit of forest certification and the implementation of FLEGT VPA licencing. Even so, some companies may not have collective bargaining agreement and some companies who have a collective bargaining agreement may not implement some of the clauses such as leave entitlement. Some workers may still work without a contract and therefore lack the obligatory insura... VIEW MORECompanies in Ghana have improved in terms of legal employment; especially following the pursuit of forest certification and the implementation of FLEGT VPA licencing. Even so, some companies may not have collective bargaining agreement and some companies who have a collective bargaining agreement may not implement some of the clauses such as leave entitlement. Some workers may still work without a contract and therefore lack the obligatory insurances. This violates the legal rights of workers (expert consultation conducted by NEPCon, 2016). The review of FSC audit summary reports indicates, in most cases employees can secure SSNIT clearance certificate even when they owe significant Tier 1 contributions and penalties payments. Likewise, most companies have deducted Tier 2 pension contributions from their workers over several years as required. But most of these companies have failed to pay the deductions made to the Tier 2 pension fund manager for investment and subsequent payment to the workers when they are on retirement. The National Pension Regulatory Authority (NPRA) is yet to be effective at enforcing this legal requirement. The review of FSC audit summaries for 2019-2020, confirms the existence of legal employment violations by timber rights holders including non-payment of Tier 1 and 2 deductions of workers.

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verification

Verify Collective Bargaining Agreement (CBA)

Verify that the Collective Bargaining Agreement (CBA) is signed between the employer and the local workers' union). The CBA specifies the condition of employment (including employer and employee responsibilities, wages, and leave) and serves as the basis of employer-employee relations. Employees' contract and condition of service should be consistent with the regulations of the CBA.

Description of legal requirements

When a union is in place, a binding Collective Bargaining Agreement (CBA) signed between the employer and the local workers' union must be available.

Labour Act, 2003 (Act 651) applies to all forestry workers, Section 10 and 79 of Act 651 provides the rights of a worker to form or join a trade union. Section 12 requires that workers are given an employment contract and section 20 provides the requirements for leave entitlement.
Section 12 to 17 of the Labour Act prescribes the conditions for legal employment, a written contract is required for workers engaged in employment for 6 months, or more, or a number of working days that is equivalent to 6 months or more within one year. The employer is required to provide the newly employed worker with written details of the contract of employment between the employer and worker, subject to the terms of the contract and within two months following the commencement of the employment. Employers are prohibited from using restrictive employment conditions to discriminate against persons, and from preventing or requiring workers to form or take part in activities of trade union. Section 15 provides the grounds for the termination of employment; Section 16 prescribes the types of employment contract; and Section 17 describes the conditions for terminating employment contract. Section 96, 98 refers to Collective agreement. Section 99 provides conditions for collective bargaining. The National Pension Act 2008 (Act 766), establishes National Pensions Regulatory Authority as the regulator and outlines the three-tier pension scheme. Employers are required under Section 3 (Contributions to the Scheme) to make deductions of pension contributions and to make payment to mandatory First and Second Tier schemes within 14 days of the preceding month. Section 33 establishes The Social Security and National Insurance Trust (the SSNIT) as operators of the basic national social security scheme referred to as the social security scheme or Tier 1. Employees are required to make Tier 1 contributions to SSNIT and Tier 2 Contributions to their selected NPRA approved trustee.

Legally required documents

Signed Collective Bargaining Agreement (CBA)
SSNIT clearance certificates
SSNIT contribution payment receipts
Tier 2 Payment/deposit receipts to an NPRA approved trustee
Workers employment contract

Applicable legislation

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1.12 Legal employment

Last updated on 2022-02-22 Workers do not have contracts and obligatory insurance Specified RISK

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verification

Verify Employment contracts

Verify that timber operators have formal employment contracts for their employees and/or contractors. Verify that timber operators maintain records which demonstrate that casual workers, who have worked for more than 6 months continuously, are made permanent staff and provided with a formal contract.

Verify Records of payment of SSNIT contributions made by the employer

Verify that permanent employees are registered with the Social Security and National Insurance Trust (SSNIT) and given social security numbers.

Verify Receipts of payments issued by SSNIT

Verify that permanent employees are registered with the Social Security and National Insurance Trust (SSNIT) and given social security numbers.

Description of legal requirements

All forest workers shall have an employment contract and social security insurance. Permanent employees are required to be registered with SSNIT and given social security numbers

Legally required documents

Signed Collective Bargaining Agreement (CBA)
SSNIT clearance certificates
SSNIT contribution payment receipts
Tier 2 Payment/deposit receipts to an NPRA approved trustee
Workers employment contract

Applicable legislation

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1.12 Legal employment

Last updated on 2022-02-22 Risk that pensions contribution payment (tier 1 contributions and tier 2 deduction payments) are not paid by the employer Specified RISK

References

VIEW LESS

The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verification

Verify Payment receipts

Payment receipts which show that employers have made pension contribution payment to the appropriate scheme organisations.

Description of legal requirements

Employers are to deduct and make pension contribution payment to the appropriate scheme organisations.

Legally required documents

Signed Collective Bargaining Agreement (CBA)
SSNIT clearance certificates
SSNIT contribution payment receipts
Tier 2 Payment/deposit receipts to an NPRA approved trustee
Workers employment contract

Applicable legislation

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1.13 Customary rights

Last updated on 2022-02-22 Low risk concluded Low RISK

The first joint assessment of Ghana's Legality Assurance System from January 2010 found that implementation of SRAs is not consistent with the law. SRA agreements are sometimes violated by some timber contractors (expert consultation conducted by NEPCon, 2016); although most contractors pay more than the legally required 5% of stumpage fee (expert consultation conducted by NEPCon, 2016), by supporting development projects in the communities. ... VIEW MOREThe first joint assessment of Ghana's Legality Assurance System from January 2010 found that implementation of SRAs is not consistent with the law. SRA agreements are sometimes violated by some timber contractors (expert consultation conducted by NEPCon, 2016); although most contractors pay more than the legally required 5% of stumpage fee (expert consultation conducted by NEPCon, 2016), by supporting development projects in the communities. Communities could ensure they receive the due amount, if they have information on stumpage value. The information on actual volumes of timber extracted, which is the basis for calculating royalties and SRAs, is available at the FC and its District offices (FSD) located within or close to the forest areas. SRA communities can obtain this information to independently verify the appropriate revenue due. Most companies employ forest operations workers from the forest fringe communities and some of these workers also have access to extracted volumes and are sometimes included in SRA committees. The Service Charter of the Forestry Commission use reports and other publications as the main tool for communicating with the public. However, the official redistribution figures are usually published a year in arrears. Information distribution on SRA and stumpage information to local communities has improved with the involvement of civil society organisations, through awareness creation and establishment of SRA committees in some forest fringe communities. Activities and programmes on the implementation of the VPA has also contributed to increase the awareness of communities and improved access to information. The Resource Management Support Centre of the Forestry Commission in response to the first Joint Assessment Report of the VPA prepares estimates of potential stumpage and corresponding SRAs for upfront payment by timber right holders before logging begins. These estimates are available at the Forest Services Division offices and are accessible to communities and other stakeholders. Continuous audits carried out by the Timber Validation Division and the implementation through the independent monitor of the Ghana Legality Assurance System (GhLAS) is improving the system. Royalty disbursement has improved (Expert consultation conducted by NEPCon, 2016). A template for compliance checklist has been developed for monthly reporting on SRA implementation in the district offices of the Forestry Commission. The Resource Management Support Centre (RMSC) of the Forestry Commission has (in collaboration with some Civil Society Organisations) developed a compliance checklist to assist the Forestry Commission in monitoring compliance with the due process in the SRA negotiation and implementation (Joint Monitoring and Review Mechanism, 8th Session, March 2016). Currently, several civil society organisations, NGOs and the FC have implemented projects as part of VPA implementation which has improved SRA implementation (10th Ghana-EU Joint Monitoring and Review Mechanism meeting). Payment can be before or after harvesting as the company agrees with the community. And payments are witnessed by the Forest Services Division and the District Assembly. Payments are made to SRA Committees through the bank, and not to individuals.
One key finding from the Joint Assessment of the Ghana VPA in 2019 was the inconsistent implementation of the SRA. This is, however, not a legal compliance issue but an efficiency issue resulting from the different community structures and traditions.
Compensation paid by loggers to farmers/landowners for crop damage due to logging in off reserve areas is usually inadequate. The Ministry of Food and Agriculture determines the rates payable per type of crop, but the rates are usually not followed (expert consultation conducted by NEPCon, 2016). Usually, there is a bargain between the property owner and timber contractor; either party could lose (expert consultation conducted by NEPCon, 2016). The joint assessment of the Ghana VPA in 2019 also found inconsistences in the calculation of compensation for damaged crops by loggers and recommended the basis for calculating compensation for damaged crops be included in the SRA. This again is not a compliance issue but a matter of inefficient implementation of compensation to farmers for damaged crops by loggers.

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Description of legal requirements

Royalties: The 1992 constitution, art 267 (2, 6) stipulates that 10% of the revenue accruing from stool lands (revenue from rents, dues, royalties, revenues or other payments to the Stool lands) shall be paid to the office of the Administrator of Stool Lands to cover administrative expenses; and the remaining revenue shall be disbursed in the following portions; the District Assembly is entitled to 55%, the Stool is entitled to 25%, whereas the traditional authority’s share is 20%.
Social responsibility agreement: direct benefit sharing arrangements between communities and logging companies are in the form of Social Responsibility Agreements (SRAs). Small scale and large-scale TUC permits in both natural forests and plantations, and salvage permits require SRAs (LI 2254, Section 3 (e) of Act 547; Sections 29(5), 17(11) b and 20(1)b). According to the law, the monetary value of the timber rights operator’s contribution to community development should be 5% of the stumpage paid in respect of trees harvested within a defined forest area (LI 2254 (26) 1 and 2). This agreement is arrived at through a consultation process facilitated by the FSD (Instruction Sheet C3.2 of MOP Section C). The District Manager of the FSD defines the boundaries of a TUC area, in consultation with land-owning communities. During the consultation, the purpose of SRA, as part of TUC, is explained and the community proposes the priorities for local development and particular conditions for the future logging company’s operation. These development priorities and conditions are incorporated into a preliminary document called the Timber Operational Specifications (TOS). The TOS, which is included in the advertisement for TUC tenders, forms the basis for negotiations of SRA terms between the timber company that wins the TUC and the appropriate land-owning community or communities. The SRA in effect includes social responsibility requirements, environmental restrictions and code of conduct requirements such as observation of taboo days.
Compensation: farmers and landowners who have property on land in off forest reserve areas suitable for TUC qualify for compensation under the forestry laws. The consent of these landowners must be sought before timber right or TUC is awarded.

Legally required documents

Approved yield/markings
FC receipts of stumpage/bill payment
FC stumpage/services bills
Operator FC statement account
Proof of payment of compensations for damaged farms and crops
Proof of payment of SRA proceeds and adherence to signed SRA agreement
SRA payment records
Tree information form (TIF)
Social Responsibility Agreement (SRA) and payment records

Applicable legislation

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1.14 Free prior and informed consent

Last updated on 2022-02-22 Low risk concluded Low RISK

Section 17. Ownership of land within forest reserve of the Forest Act, 1927 (CAP 157) clarifies in item (1) that, the ownership of land within a proposed forest reserve shall not be altered by its constitution as a forest reserve. The Forestry Commission usually seeks the consent of landowners before timber rights can be granted. The landowners are part of the timber rights granting process (expert consultation conducted by NEPCon, 2016). These p... VIEW MORESection 17. Ownership of land within forest reserve of the Forest Act, 1927 (CAP 157) clarifies in item (1) that, the ownership of land within a proposed forest reserve shall not be altered by its constitution as a forest reserve. The Forestry Commission usually seeks the consent of landowners before timber rights can be granted. The landowners are part of the timber rights granting process (expert consultation conducted by NEPCon, 2016). These processes are provided in MOP C Section 4.2 for forest reserves and MOP F Section 2.1 for off forest reserves. In off forest reserve areas, the consent of farmers is not usually sought (expert consultation conducted by NEPCon, 2016), but as TUCs are not very common in off reserve areas due to low timber stocking, the issue is minor. When farmers’ consent is sought, farmers, or their representatives, are also involved in the pre-felling survey to identify the trees in off forest reserve areas (expert consultation conducted by NEPCon, 2016). The farmer must agree before a tree can be marked and given out to a timber contractor. The farmer reaches an agreement with the timber contractors on the necessary compensation for crops that may be damaged. Farmers report to the Forestry Commission if the timber contractor fails to honour the agreement. These harvesting operations involve single trees and reported cases are very low.
Currently, the FC has provided the opportunity for farmers to register the trees they have planted on their farms or naturally growing trees they have nurtured on their farms so they can own the trees (Idh, 2019; World Cocoa Foundation, 2020).

References

VIEW LESS

The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Description of legal requirements

Section 4(2) of Timber Resources Management (TRM) Act 547 (and Section 2 of amendment Act 617) states timber rights shall not be granted for logging on lands subject to alienation or farmlands without written authorisation of the landowner(s).
Regulations 4, 5 and 6 of LI 2254 requires the Forestry Commission must seek the consent and agreement of landowners before lands (public lands and forest reserves) identified as suitable for timber rights can be administered. Regulation 6 provides the procedure for resolving conflicts and objections by landowners on the grant of timber rights. Manual of Procedures (MOP) C Section 4.2 (forest reserves) and MOP F Section 2.1 (off forest reserves) provides the procedures for the involvement of landowners.

Legally required documents

Landowner and others holding interest in the area written consent
Landowners written consent (on reserve)
Timber Operational Specifications (TOS)

Applicable legislation

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1.15 Indigenous/traditional peoples rights

Last updated on 2022-02-22 Low risk concluded Low RISK

References

VIEW LESS

The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Description of legal requirements

Legally required documents

Approved yield/markings
FC stumpage/services bills
Operator FC statement account
Proof of payment of compensations for damaged farms and crops
Proof of payment of SRA proceeds and adherence to signed SRA agreement
SRA payment records
Tree information form (TIF)
Social Responsibility Agreement (SRA) and payment records

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1.16 Classification of species, quantities, qualities

Last updated on 2022-02-22 Low risk concluded Low RISK

There can be misclassification or identification of species during stock survey (pre-felling inventory), which might lead to misclassification of timber in transport documents. High value species may be misclassified as low value species and vice versa. Some merchantable trees may not be captured during enumeration and therefore lack a stock number. Timber contractors may swap lower value species with closely related high value species. Under-mea... VIEW MOREThere can be misclassification or identification of species during stock survey (pre-felling inventory), which might lead to misclassification of timber in transport documents. High value species may be misclassified as low value species and vice versa. Some merchantable trees may not be captured during enumeration and therefore lack a stock number. Timber contractors may swap lower value species with closely related high value species. Under-measurement of log volumes is also possible during TIF and LIF preparation stage (expert consultation conducted by NEPCon, 2016) but not frequent and can easily be detected with the introduction of the WTS which is able to reconcile species and stock numbers to flag inconsistencies and discrepancies (Osei, January 2022),
A wood-balance analysis carried out by Hoare in 2014 on Ghana’s timber, compared the legal supply of timber (from official records of harvest and imports) with consumption (based on domestic consumption and exports), this analysis shows a gap between supply and consumption. This gap could be due to under reporting of harvested tree volumes captured on the TIFs. Stock numbers of approved trees are sometimes repeated, in order to harvest more trees outside the yield. This contradicts the procedures in the MOP Section D.
However, this risk is minimized through: enforcement of enumeration check surveys; TIDD volume measurements; regular audits by the TVD; and the Independent Monitor of the GhLAS (JMRM May, 2019). The introduction of the WTS has allowed for volume reconciliation at all levels, as well as the input output volume reconciliation forms, 'introduced at the sawmills, have helped to reduce this risk to insignificant levels.

References

VIEW LESS

The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Description of legal requirements

Under sub-category 1.3 the inventory and marking of trees prior to harvesting are covered. After harvesting FSD range supervisor captures the details of each tree felled on a tree information form (TIF). This translates into 100% post-felling check by the range supervisor. The TIF contains information such as the stock survey number, harvested species, and quantity (volume).
For natural forest, the Contractor completes a log information form (LIF) which covers logs produced from each tree based on the TIF. The LIF contains the stock number, species and volumes of logs recovered from the tree. A Log measurement and conveyance certificate (LMCC) is prepared by another FSD Range Supervisor using the information on TIF and LIF. This is to provide assurance that the information provided by the FSD and the contract agree, before logs are trucked from the forest to the processing site or point of sale. The LMCC follow the transport of logs and includes the stock number, species and volumes of logs.
For forest plantations (on- and off-reserve), TIF and LIF are replaced by the Plantation production certificate. A Log measurement and conveyance certificate (LMCC) is issued also for transport of timber from plantations.
Transported logs from both plantations and natural forests are checked at the various check points along highways or mills through species identification, re-measurement of each log volume and quality grading by the Timber Industry Development Division (TIDD). The TIDD also issues various timber products inspection certificates for all processed logs based on species classification, qualities and volumes (TIDD Timber Trade Procedures and Guidelines).

Legally required documents

Approved export contract
Approved export permit
Approved yield/markings
Contract parking list
FC receipts of stumpage/bill payment
FC stumpage/services bills
Log information form (LIF)
Tree information form (TIF)
Plantation or reforestation plan

Applicable legislation

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1.17 Trade and transport

Last updated on 2022-02-22 Transport of logs for the domestic market takes place without Log Measurements Conveyance Certificate (LMCCs) Specified RISK

Often, Log Measurement and Conveyance Certificates (LMCCs) are not issued in the forest, as required by law, this is because the Forest Services Division (FSD) is unable to provide personnel at all the operational sites of timber right holders. The FSD has mounted LMCC issuing points at the converging points of the forest roads to ensure that all transported logs are covered with LMCCs (expert consultation conducted by NEPCon, 2016). The TIDD che... VIEW MOREOften, Log Measurement and Conveyance Certificates (LMCCs) are not issued in the forest, as required by law, this is because the Forest Services Division (FSD) is unable to provide personnel at all the operational sites of timber right holders. The FSD has mounted LMCC issuing points at the converging points of the forest roads to ensure that all transported logs are covered with LMCCs (expert consultation conducted by NEPCon, 2016). The TIDD checkpoints along the major highways and in some cases inside the timber rights’ holders’ premises ensures that the risk of under-measurement of logs, species misclassifications are minimised for both export and local market, and lumber (at least those for export) or forest products gaining access to the port without the necessary documentations is also minimised. Exporters require an input output statement to justify the volume being exported for an inspection, Log Measurement and Conveyance Certificates and export permits, this results in a further check. Therefore, the risk of violation of trade and transport requirements for forest products for export is low. However, some of the lumber sold on the domestic markets may not meet trade and transport requirements as approved input output statement and Log Measurement and Conveyance Certificates are not required by buyers.

The Ghana Wood Tracking System (GWTS) collects data at critical control points along the supply chain on the status of compliance by operators, with respect to their contractual obligations as required by the contractual requirements. The data sets collected at these control points are reconciled successively with the addition of new data sets in the process chain. On a near real-time bases, the GWTS labels all non-compliance cases as red flags, which may constitute flash points for prompt investigation and verification through field audits by the TVD of FC. If the FLEGT VPA will be implemented in future and, if there are no outstanding Corrective Action Requests, a FLEGT license for export or Domestic Timber Inspection Certificate (DOTIC) for local market will be issued to the operator.
Regular audits by the TVD and the Independent Monitor of the LAS ensure that systems are improved to check compliance. A review of a sample of FSC audit summaries of various companies in Ghana from 2020 did not show any risks with transport of wood.

References

VIEW LESS

The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verification

Verify Log measurement and conveyance certificate (LMCC)

Verify TIDD input output statement

Check to justify the volume being sold

Description of legal requirements

Log Measurements Conveyance Certificated (LMCCs) shall be in place

Section 3 in the Logging manual (1998) defines the regulations for marking and transport of logs. Regulation 57 of Timber Resources Management and Legality Licensing Regulations, 2017 LI 2254 sets out the approved periods for timber operation and transport of forest produce. For instance, timber operations and transport of wood before 6am and after 6pm is prohibited. Regulation 60 of LI 2254 requires timber is transferred or moved from the forest only under the Log Measurement and Conveyance Certificate, which is issued by the Senior Range Supervisor of the Forestry Commission. Section 2(I) and (II) of Act 571 (The Forestry Commission Act) and the TIDD's Timber Trade Procedures and Guidelines requires: the registration of timber and timber product vendors and exporters; vetting of export contracts; inspection of timber products (lumber, veneer etc.); issuance of timber products Log Measurement and Conveyance Certificate and timber export permits. Companies are also required to obtain weekend permits issued by the Forestry Commission for transporting wood on weekends. Other issues relating to timber operations and transport on taboo days in the forest fringe communities are usually captured in the Timber Operation Specification (TOS) and SRAs during the consultation process.

Legally required documents

Approved export contract
Approved export permit
Approved parking list/product inspection report (Lumber Inspection Certificate - LIC)
Certificate of registration with TIDD
Log measurement and conveyance certificate (LMCC)
TIDD input output statement
Weekend and holiday log transport permit (if applicable)
Plantation or reforestation plan

Applicable legislation

VIEW LESS

1.18 Offshore trading and transfer pricing

Last updated on 2022-02-22 Low risk concluded Low RISK

In the NEPCon Timber Legality Risk Assessment for Ghana from 2017 it was found that the Ghana Revenue Authority (GRA) was effective in undertaking desk and field transfer pricing audits in Ghana under the LI 2188. The GRA conducted over 250 reviews, mainly desk audits, by January 2015. This was followed by field audits or visits to company premises. It was not possible to identity actions on transfer pricing audits under the Transfer Pricing Regu... VIEW MOREIn the NEPCon Timber Legality Risk Assessment for Ghana from 2017 it was found that the Ghana Revenue Authority (GRA) was effective in undertaking desk and field transfer pricing audits in Ghana under the LI 2188. The GRA conducted over 250 reviews, mainly desk audits, by January 2015. This was followed by field audits or visits to company premises. It was not possible to identity actions on transfer pricing audits under the Transfer Pricing Regulations 2020 (L.I.2412).
The TIDD implements an export system to control prices and prevent tax laundry (Forestry Commission Act 571, 1999). All prospective buyers and exporters of timber and wood products are required to register with TIDD (https://www.oldwebsite.fcghana.org/page.php?page=46&section=22&typ=1&subs=253 or https://www.ghanatimber.org/register.php). Companies registered with the TIDD negotiate contracts with buyers based on the TIDD Guiding Selling Prices (GSP) and the TIDD receives, vets, and approves the contract and relevant documents on raw materials. The TIDD inspects the wood products after production and issues Wood Products Inspection Certificates. The timber company prepares an input/output list for the contract (Packing list) and the Summary Factory Specification Sheets. Before shipment, the timber contractor submits Permit Invoice Form, Permit Issue Form, Packing List, Summary Factory Specification Sheets, valid Ghana Exchange Control Form A2/Bank of Ghana Foreign Exchange Form 4A (FEX 4A), and approved payment receipts to the TIDD for approval.
The additional documentation and filing requirements for CbC reporting and local and master file submission under the Transfer pricing Regulation 2020 are likely to impose additional compliance burden on taxpayers in respect of related party transactions (Deloitte 2020). This arrangement ensures exported products are not sold at prices which are significantly lower than the market value of products and then sold to the next link in the supply chain at market prices, this arrangement thus avoids tax laundry (expert consultation conducted by NEPCon, 2016).

References

VIEW LESS

The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Description of legal requirements

Ghana’s new Transfer Pricing Regulations 2020 (L.I.2412) entered into force on 2 November 2020 and replaced the former regulation from 2012 (L.I.2188).
Ghana is not a member of OECD and the L.I.2412 does not fully follow the OECD Transfer Pricing Guidelines for Multinational Enterprises and Tax Administrations (OECD Guidelines) 2017. However, many of the OECD revisions introduced by the OECD Guidelines has been included in the 2020 regulation.
The Transfer Pricing regulation from 2020 apply to all persons who are in a controlled relationship under the Income Tax Act or any other tax law of Ghana. The principle of an arm’s length must be applied between related parties, and the regulations defines the requirements for assessing whether this is in place (EY 2020).
The definition of what constitutes an arm’s-length transaction has not changed in accordance with the long-established global practice. In line with the new guidance in the OECD Guidelines, however, the new Regulations now specifically require the consideration of the allocation of the economically significant risks in determining the comparability of transactions. Assumption of risk, performance of mitigation functions and financial capacity to bear risk are explicitly required to be considered in determining transfer prices (EY 2020, p. 2).
The transfer pricing regulations (2020) introduced safe harbor rules that exempt related-party transactions from having to maintain contemporaneous transfer pricing documentation.
Safe harbor rules can be applied for transactions of a value less than the Ghana Cedis equivalent of U.S. $200,000. However, there are several services not qualifying as a low value-adding service. For trade with timber and wood products it is relevant to note that services do not qualify as low value-adding services when: services constitute the core business of the persons in the controlled relationship; or the service is a manufacturing and production activities and sales (KPMG 2020).
Taxpayers with related-party transactions are required to maintain and file the following documentation with the tax authority (KPMG 2020):
•   Annual transfer pricing return—four months after the financial year-end
•   CbC report—12 months after the financial year-end
•   Local file—four months after the financial year-end
•   Master file—four months after the financial year-end

Legally required documents

Approved TIDD export contract
Approved TIDD export permit
Bank of Ghana foreign exchange form 4A
TIDD export minimum pricing categories

Applicable legislation

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1.19 Custom regulations

Last updated on 2022-02-22 Low risk concluded Low RISK

As required by the law, the Forestry Commission maintains a register of all timber companies licensed within Ghana, as exporters and importer. The TIDD implements an export system to control prices and prevent tax laundry. Companies registered with the TIDD negotiate contracts with buyers based on the TIDD Guiding Selling Prices (GSP). The TIDD receives, vets and approves the contract and relevant documents on raw materials. The TIDD inspects the... VIEW MOREAs required by the law, the Forestry Commission maintains a register of all timber companies licensed within Ghana, as exporters and importer. The TIDD implements an export system to control prices and prevent tax laundry. Companies registered with the TIDD negotiate contracts with buyers based on the TIDD Guiding Selling Prices (GSP). The TIDD receives, vets and approves the contract and relevant documents on raw materials. The TIDD inspects the wood products after production and issues Wood Products Inspection Certificates. The timber company prepares an input/output list for the contract (Packing List) and the Summary Factory Specification Sheets. Before shipment, the timber contractor submits Permit Invoice Form, Permit Issue Form, Packing List, Summary Factory Specification Sheets, valid Ghana Exchange Control Form A2/Bank of Ghana Foreign Exchange Form 4A (FEX 4A), and approved payment receipts to the TIDD for approval.
The TIDD maintains checkpoints on the highways to ensure all transported wood products to the ports have the required and approved documents. The approved documents (including packing list which contains information on species type, volume etc.) are submitted to the GRA (Customs) officials. The GRA (Customs) officials check the taxes payable per consignment, to the appropriate taxes are paid.

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Description of legal requirements

Act 571 (The Forestry Commission Act): Section 2(I) and (II) defines the FC's responsibility in registering and regulating timber traders. The Ministry of Food and Agriculture is mandated by Act 803 (Plants and Fertilizer Act, 2010) to issue Phytosanitary Certificates at exit points. All exported/imported timber and timber products are declared at the Customs Division of the GRA, through GCNet platform, to the TIDD which ensures all exported/imported wood have the relevant legal documents. The Ghana Revenue Authority Act 2009, Act 791 Section 2 (objectives of the Authority) includes the provision for a holistic approach to tax and customs administration. Section 17(b) creates the Customs Division of the Authority.

Legally required documents

Approved export contract
Approved export permit
Inspection certificate (lumber, veneer, etc.).
Phytosanitary certificate
TIDD certificate of registration

Applicable legislation

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1.20 CITES

Last updated on 2022-02-22 CITES species are illegally harvested and exported with a CITES permit fraudulently issued Specified RISK

CITES regulations are integrated into the forest management framework in Ghana. CITES species are not harvested as part of the normal yield process (selection of tree species for harvesting by the Forestry Commission). The local and international media and other publications are inundated with stories of illegal harvesting and trade of Rosewood (Pterocarpus erinaceus) despite the ban in place on harvesting and export. EIA, 2019 reported that salv... VIEW MORECITES regulations are integrated into the forest management framework in Ghana. CITES species are not harvested as part of the normal yield process (selection of tree species for harvesting by the Forestry Commission). The local and international media and other publications are inundated with stories of illegal harvesting and trade of Rosewood (Pterocarpus erinaceus) despite the ban in place on harvesting and export. EIA, 2019 reported that salvage permits granted to salvage already felled rosewood has effectively been intermittent suspensions to the ban, and traffickers explained to EIA that the ban was no obstacle to their business (EIA, 2019).
According to the undercover investigation by the EIA, 2019, the ruling party members at all levels of government are alleged to have established an institutionalized scheme, fuelled by bribes, to mask the illegal harvest, transport, export, and CITES-licensing of the timber. Illegal schemes used include fraudulent use of “salvage permits”; mis-declaration of timber species; use of “escorts” to deal with control points; forging of official documents; and retrospective issuance of CITES permits. The Forestry Commission challenged the EIA report however other public reports of illegal harvesting of Rosewood exist, some of which are in the courts (EIA, 2020, Yoda, 2019; Citinewsroom, 2019, Daily Trust, 2019; My Joy Online, 2019, 2019; Afriyie, et. al., 2021).
Given that falsification of CITES permits are included in the illegal export of rosewood from Ghana, this poses high risk for CITES certificates.
Although, this may be an isolated incidents of a single species, given the alleged modus operandi of the “illegal” scheme includes misrepresentation of species, it is possible other banned species could also be affected.
The risks identified for natural growing CITES species are only applicable to off reserve areas, as they mainly grow outside forest reserves.
Pericopsis elata (Afromosia) are endemic or confined to a specific forest reserve in Ghana. This area is under the concession of a specific company and this company is allowed to cut restricted amounts.
Pterocarpus erinaceus (rosewood) is a Savanna species which does not grow in the high forest zone of Ghana where forest reserves are located.
Cedrela are planted in plantations inside and outside forest reserves and are partly privately owned by investors in forest reserve plantations and fully privately owned in areas outside forest reserves.

References

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The risk applies to the following source types

Natural forest

Risk mitigation options

Document verificationStakeholder consultation

Verify TIDD approved contract

A TIDD approved contract covering products produced from all species (including CITES species) to be shipped is required.

Verify TIDD export Permit

Verify CITES export permit

CITES export permit approved by the Wildlife Department of the FC.

Consult the Wildlife Division of the Forest Commission

Verify that the CITES permit has been legally issued.

Description of legal requirements

Species shall be correctly declared and a legally issued CITES import certificate shall be in place for CITES species

Ghana has ratified the CITES Convention as of 12 February 1976, but is as of January 2022 listed as a Category 3 country without implementing legislation (CITES 2022). According to “…Oppong (2017), old legislations that were enacted for management and regulation of wildlife resources in Ghana are those used for the implementation and enforcement of CITES in the country” (Koomson 2019).
Pericopsis elata (Afromosia) and Pterocarpus erinaceus (rosewood) are the wooden timber species in Ghana found in CITES, Appendix II.
Pericopsis elata is endemic to specific areas in Ghana and is classified as Scarlet star species (threatened in Ghana by over-exploitation) under Ghana’s species conservation star ratings and therefore protected. These species can only be felled with a restricted species permit issued by the FC with the approval of the Minister.
Both Pericopsis elata and Pterocarpus erinaceus are listed as restricted species in Schedule 8 of L.I.2257.
A ban on the harvesting and export of Pterocarpus erinaceus (rosewood) has been in place since 2012 and renewed several times since (EIA, 2019).
Cedrela odorata is included in appendix III. Cedrela odorata is an introduced plantation species in Ghana, found in both plantations in forest reserve areas and private plantations in off forest reserve areas. The species is not a native occurring species in Ghana, but as a CITES Appendices III listed species it is protected in at least one country, which has asked other CITES Parties for assistance in controlling the trade.
Exporters are required to obtain a CITES permit from the Forestry Commission before export.

Legally required documents

TIDD export Permit
CITES export permit

Applicable legislation

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1.23 Legal Registration of Business

Last updated on 2022-02-22 Companies operate without legal registration of business Specified RISK

Legal business registration has become more about providing business advantage to business entities by being able to obtain loans and government support. For this reason, even inactive businesses undergo registration. Since 2015, the Registrar General’s Department announced for all businesses and partnerships to update records with the department. Registration and the update of records is preceded by the registration for a Taxpayer Identificati... VIEW MORELegal business registration has become more about providing business advantage to business entities by being able to obtain loans and government support. For this reason, even inactive businesses undergo registration. Since 2015, the Registrar General’s Department announced for all businesses and partnerships to update records with the department. Registration and the update of records is preceded by the registration for a Taxpayer Identification Number (TIN) of the individual or directors registering the company. The TIN of the registered business can also be found on the business registration certificate. These provisions are largely enforced. See business name search link: https://egovonline.gegov.gov.gh/RGDPortalWeb/portal/RGDHome/eghana.portal?_nfpb=true&_st=&_pageLabel=portal_RGDHome_NameSearchPage_page&linksPageTitle=Name+Search&service=namesearch#wlp_portal_RGDHome_NameSearchPage_page
Valid registration with the TIDD of the FC as a processor and trader is part of the requirement for setting up a processing facility, as well as securing a Lumber Inspection certificate (LIC), Lumber conveyance certificate and an export permit for each export made. Therefore exporters do not risk defaulting on these requirements. Some timber processors for the domestic market however fail to have this registration with the TIDD and some registered entities do not renew their registration annually, as required by law, and therefore do not possess valid registration. Ghana’s implementation of the VPA has helped to improve this situation, if not eliminated the issue. If not adhered to both TIDD and the processors are issued with non-conformities from field verifications carried out by the TVD of the FC and the Independent Monitor of the GhLAS.

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verification

Verify Business registration certificate

Description of legal requirements

Environmental Assessment Regulations, 1999 Schedule 1 (Regulation 1(1)) lists the following applicable industries and products as requiring registration and an environment permit (Manufacturing Item 15 Wood):
a. Sawmill, planning mill and single mill product industries;
b. Veneer and plywood;
c. Other wood products;
d. Wood preservation facilities which use hazardous chemicals or similar chemical processes;
e. Particle board or wafer board production.
While this environmental requirement is applicable to the wood processing, an environmental permit is not included in the legality requirements for timber processing and trade under the Ghana Timber Legality Assurance System (GhLAS). However, timber processing companies that want to register with the Ghana Free Zones Authority are required by the Free Zone Board Act to have an environmental permit as part of their application process.
Timber processing entities need to have an Environmental Plan and go through the process of exemption or full EIA to acquire environmental permit from the EPA.

Legally required documents

Business registration certificate
TIDD Registration Certificate
Social security and National Insurance Trust (SSNIT) Clearance Certificate

Applicable legislation

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1.24 Environmental Requirements for Processing

Last updated on 2022-02-22 Processing entities do not have a valid operating environmental permit obtained from the EPA Specified RISK

While the EPA requires timber processing entities to acquire an environmental permit for their operations, this is not required by the Ghanaian legal timber definition for wood processors. Although, free-zone wood processing entities acquire an environmental permit as part of their application process there is a high probability of non-free-zone entities not having an operational environmental permit. The Ghana Free-Zone Board carry out regular a... VIEW MOREWhile the EPA requires timber processing entities to acquire an environmental permit for their operations, this is not required by the Ghanaian legal timber definition for wood processors. Although, free-zone wood processing entities acquire an environmental permit as part of their application process there is a high probability of non-free-zone entities not having an operational environmental permit. The Ghana Free-Zone Board carry out regular audits of free-zone entities, however limited information is available as to how the validity of the environmental permit for wood processing entities, are taken into accounts during such audits.
The review of sampled FSC audit summaries from the last five years, shows that companies pursuing FSC controlled wood certification are making efforts to be provided with environmental permits from the Environmental Protection Agency (FSC audit reports 2008-2018). Companies undergoing forest certification usually have an EPA permit for their factory or processing operations but not for forest operations.

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verification

Verify Environmental permit

Verify that an Environmental permit from EPA is in place.

Description of legal requirements

Wood processing industries are required an environmental permit from EPA

Per Section 2 of the Forestry Commission Act 571 which sets out the functions of the Forestry Commission, the TIDD has developed Timber Trade Procedures and Guidelines which cover processing. Among other requirements, companies wishing to set up timber processing operations are required to register with the TIDD through an application process. The TIDD’s evaluation of application completeness includes an inspection of required documents such as the business plan and feasibility report, which includes the sources of raw material used by the company. Also, per the procedures, timber processing companies are required to keep records of materials along their timber supply chain, from raw material source through processing, to point of sale or export. Companies are required to maintain a register for material inputs and product outputs for different mill transformation points. Companies are also required to maintain a simple register indicating work instructions at the different transformation points.

Legally required documents

Valid environmental permit from EPA
Valid factory inspectorate registration certificate
Valid TIDD registration permit

Applicable legislation

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1.25 Processing Requirements

Last updated on 2022-02-22 Timber processing entities are not registered with the TIDD Specified RISK

The requirement for registration with the TIDD as a timber processing entity is enforced and effective for exporting companies who need export permit from the TIDD. There has been a risk related to the domestic market, with instances of illegal processing mills (mainly) supplying timber to it. Ghana’s implementation of the VPA, and the verification audits by the TVD, have helped to improved compliance among small-scale processing entities. Requ... VIEW MOREThe requirement for registration with the TIDD as a timber processing entity is enforced and effective for exporting companies who need export permit from the TIDD. There has been a risk related to the domestic market, with instances of illegal processing mills (mainly) supplying timber to it. Ghana’s implementation of the VPA, and the verification audits by the TVD, have helped to improved compliance among small-scale processing entities. Requirements for the development of procedures, work instruction, and the keeping of records for materials along the timber supply chain from raw material source through processing, to point of sale or export are generally followed. This is particularly the case for larger processing entities, many of which are involved in voluntary certification and also export their products for which the TIDD ask for the input output records of their production to support their export permit application. The challenge is therefore with the small-scale processing entities who process timber for the domestic market where there is little experience or capacity to comply with these processing requirements (Osei, January 2022).

References

Ministry of Lands and Natural Resources and Joint Monitoring Review Mechanism (JMRM) 2018. Third summary monitoring report

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verification

Verify Valid TIDD Registration Certificate

Verify that timber processing entity, especially small-scale, has a Valid TIDD Registration Certificate

Description of legal requirements

Companies wishing to set up timber processing operations are required to register with the TIDD through an application process

Legally required documents

Company register of all timber material input and product output for different mill transformation points to demonstrate records of materials along their timber supply chain from raw material source through processing to point of sale or export
Company’s simple work instructions at the different transformation points
Valid TIDD Registration Certificate

Applicable legislation

Forestry Commission Act 1999 (Act 571) (defines legal authority for forest management)., 1999.

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1.26 Health and Safety in the Timber Processing Sector

Last updated on 2022-02-22 Personal safety and protective equipment are not provided to or used by workers Specified RISK

Despite all legal provisions in place and the progress made in compliance, health and safety issues in the workplace remains a challenge in some wood processing companies. Some of the large timber processing companies exercise a high level of compliance, however the situation is not the same across the timber sector especially in terms of provision of PPE and training on health and safety. There is room for improvement especially for entities not... VIEW MOREDespite all legal provisions in place and the progress made in compliance, health and safety issues in the workplace remains a challenge in some wood processing companies. Some of the large timber processing companies exercise a high level of compliance, however the situation is not the same across the timber sector especially in terms of provision of PPE and training on health and safety. There is room for improvement especially for entities not currently enrolled in voluntary certification or not yet covered by TVD legality verification audits (Osei, January 2022).
There are adequate legal requirements on health and safety applicable to the wood processing sector, however enforcement and compliance among the small and medium operations so far is inadequate.

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verificationField verification

Verify Records from the timber operator to demonstrate that all employees are registere

Records from the timber operator to demonstrate that all employees are registered under the NHIS

Verify Identity cards for registered persons under the NHIS

Identity cards should be issues by NHIA

Verify Records on compensations

Records on compensations should be available to demonstrate that the worker compensation law is consistently implemented in events of accident, death or injury of an employee arising from work.

Verify Training records

Visit Logging area

Verify the following in the field: o employees are provided a safe working environment and personal protective equipment (PPE). o PPEs are not paid by workers o PPEs are being used in the filed o appropriate health facilities are available to employees and contractors.

Description of legal requirements

Personal safety and protective equipment shall be used by workers

Legally required documents

Accident reporting records
Health and safety procedures and training records
Medical examination records for applicable worker
Personal protective equipment supply records
TIDD inspection reports
Workmen compensation payment records/insurance payment and claims records
Certificate of registration and renewal from the Department of Factory Inspectorate

Applicable legislation

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1.27 Legal Employment in The Timber Processing Sector

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verification

Verify Collective Bargaining Agreement (CBA)

• Verify that the Collective Bargaining Agreement (CBA) is signed between the employer and the local workers' union). The CBA specifies the condition of employment (including employer and employee responsibilities, wages, and leave) and serves as the basis of employer-employee relations. Employees' contract and condition of service should be consistent with the regulations of the CBA.

Description of legal requirements

All forest workers shall have an employment contract and social security insurance. Permanent employees are required to be registered with SSNIT and given social security numbers

Legally required documents

Signed Collective Bargaining Agreement (CBA)
SSNIT clearance certificates
SSNIT contribution payment receipts
Tier 2 Payment/deposit receipts to an NPRA approved trustee
Workers employment contract

Applicable legislation

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1.27 Legal Employment in The Timber Processing Sector

Last updated on 2022-02-22 Workers do not have contracts and obligatory insurance Specified RISK

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verification

Verify Employment contracts

Verify Records of payment of SSNIT contributions made by the employer

Verify that permanent employees are registered with the Social Security and National Insurance Trust (SSNIT) and given social security numbers.

Verify Receipts of payments issued by SSNIT

Verify that permanent employees are registered with the Social Security and National Insurance Trust (SSNIT) and given social security numbers.

Description of legal requirements

All forest workers shall have an employment contract and social security insurance. Permanent employees are required to be registered with SSNIT and given social security numbers

Legally required documents

Signed Collective Bargaining Agreement (CBA)
SSNIT clearance certificates
SSNIT contribution payment receipts
Tier 2 Payment/deposit receipts to an NPRA approved trustee
Workers employment contract

Applicable legislation

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1.27 Legal Employment in The Timber Processing Sector

Last updated on 2022-02-22 Risk that pensions contribution payment (tier 1 contributions and tier 2 deduction payments) are not paid by the employer Specified RISK

References

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The risk applies to the following source types

Natural forest
Plantation in forest reserves
Plantation off-forest reserve
Submerged forest

Risk mitigation options

Document verification

Verify Payment receipts

Payment receipts which show that employers have made pension contribution payment to the appropriate scheme organisations.

Description of legal requirements

Employers are to deduct and make pension contribution payment to the appropriate scheme organisations.

Legally required documents

Signed Collective Bargaining Agreement (CBA)
SSNIT clearance certificates
SSNIT contribution payment receipts
Tier 2 Payment/deposit receipts to an NPRA approved trustee
Workers employment contract

Applicable legislation

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