Legal framework for forest management and timber trade of Ghana

Forest governance

• The Ministry of Lands and Natural Resource (MLNR) has over-all responsibility for sector planning and policy direction for monitoring and evaluation of development policies and programs.
• The Forestry Commission (FC) has overall responsibility for forests and wildlife management in Ghana. Its core responsibility is to provide services that guarantee the sustainable development and management of forests and wildlife, and optimize their contribution to national socio-economic development.
• The Forest Services Division (FSD) is responsible for forest management throughout Ghana. It has the task of enforcing forest laws and regulation, and to make sure that stakeholders such as local communities and timber companies obey rules and regulations.
• The Timber Validation Department is responsible for verification and validation of application for timber products licenses
• The Timber Industry Development Division (TIDD) provides technical services for the growth of the timber industry. The services include development of skills, grades, standards, and the provision of marketing information for industry. TIDD issues licenses to cover timber products to be traded
• Support Services The Resource Management Support Centre (RMSC) is responsible for the exploration, development, facilitation, institutionalisation, and implementation and monitoring of effective and affordable forest and wildlife management systems in the country in accordance with the national forest and wildlife policy.

The key regulation regarding forest governance is Timber Resource Management and Legality Licensing Regulations, 2017 (LI 2254). This law regulates the grant of timber rights and related matters. It encompasses (a) the identification of land suitable for the grant of timber rights, (b) the terms and conditions for small and large scale timber rights, (c) other sources of timber, and (d) the legality licensing scheme.

Legal rights to harvest

No person shall harvest timber in Ghana unless that person holds timber rights.

• a Timber Utilization Contract (TUC), which is a written contract signed by the Minister and ratified by the Parliament granting a timber harvesting right, except in the case of land with private forest plantations or lands with timber grown or owned by an individual or group.
• Salvage Permit (SP), which is an administrative permit signed by the Forestry Commission to salvage trees from an area undergoing development. To be considered legal, the permit needs to be covered by the application and an inspection report from Forest Service Division.

Timber Utilisation Permit (TUP), which is a small scale permit to harvest a defined number of trees for social or community purposes signed by the Forestry Commission. Timber from these permits cannot be sold or exported.

Taxes and fees

• Stock Survey (on reserve) fees: paid to the Forest Services Division in respect of its services provided to loggers to carry out stock surveys.
• Pre-felling (off – reserve) inspection fees:
• Salvage award inspection fees
• Property mark application/renewal fees: Every company/person who wishes to cut or fell any growing timber for export or conversion in a mill shall register a property mark. The applicant shall support with his application evidence of valid income tax, VAT and social security clearance certificates together with social responsibility agreement executed with the inhabitants of the permit area and a non-refundable registration fee of Two Thousand Ghana Cedis (GH¢2,000). A registered property mark shall expire after a period of six months commencing from 1st January and is renewable after every six months (GH¢100).
• Ground rent fees: annual rent, meaning the fee levied or paid per hectare per annum to the owner or landlord for the exercise of timber rights on his piece of land as specified in the contract
• SRA fees (5% of stumpage) paid to forest fringe communities for provision of social facilities and amenities.
• One-off Timber Rights Fees (TRF),
• Stumpage fees,  the amount of tax imposed on the value the standing tree
• Export levies (on specified timber species)
• Annual license renewal fees
• Corporate income tax

Timber harvesting activities

Before timber rights are issued, a written consent should come from the land owners. This is because the felling may affect their farms or planted trees. Harvesting of timber without a permit is not allowed by law. The FSD prepares a  harvesting schedule for areas to be logged and conducts pre-felling inspections and stock surveys resulting in availability of stocking data, including stock maps, yield list and yield maps.

In the management of the TUC areas, the first step corresponds to the development of the TUC (Area) operation plan, by the contractor (or planting plans in case of forest plantations). This plan provides the major details of the operations are given which will be carried out in the coming years. Operational plans for the Timber Utilisation Contract (TUC) areas are prepared by the contracting companies which outlines timber harvesting standards and specifications for operations such as road and bridge construction, felling, skidding and log markings and approved by the Forest Service Division.

Allocation of yield is based on a formula that takes into consideration the felling limit of trees, forest condition score and the FC’s fine-grained environmental protection standards.

Every logging company should apply for a property mark, which can be obtained from the Forest Services Division of the Forestry Commission. The property mark needs renewal every 6 months, and it will be mentioned on e.g. the LMCC and waybill.

Based on the operational plans the contractor develops (compartment) logging plans and should apply for a felling permit. A pre-felling inspection by the District Forest Officer should ensure that all trees are inspected and due payments have been paid, after which a felling permit can be issued.

Third parties’ rights

The Social Responsbility Agreement (SRA) forms an integral part of the timber rights access process under the Timber Utilization Contract (TUC). The SRA is an agreement between a TUC holder and the landowning communities (forest fringe communities) which spells out the social obligations of the contractor to the landowning communities to a value of 5% stumpage paid on timber harvested. It ensures that the TUC holder respects the rights, social and cultural values of landowning communities during its operations.

SRA ensures the following:

• TUC holder operates in a socially responsible manner;
• TUC holder respect existing rights of the communities for access to certain forest products;
• TUC holder respect the social and cultural values of the communities in which they operate;
• Communities benefit from timber exploitation;
• Communities are consulted in the management and exploitation of timber resources;
• Communities specify the conditions under which the TUC holder operates;
• Communities benefit directly from the exploitation of timber resources from their land for community development initiatives and programmes.

Free prior and informed (FPIC) provisions under the TUC process are the following:

• Identification of TUC Area: This is done by the FC in consultation with the District Chief Executive (DCE) of the district(s) concerned. An inventory report is compiled and recommendations made for the grant of timber rights in the area.
• Field Inspection: If the area is considered viable for the grant of timber rights, a field inspection is undertaken. A field inspection team is constituted by the FC in consultation with the DCE of the area. The field inspection team must consist of the following: two (2) district assembly members; a representative from the traditional council; a district forestry officer; land owners or their representatives and  at least one farmer.
• Notification of the People of the area nominated: 21 days notice is put at the district assembly, the traditional council and the unit committees of the land area to be considered for the grant of timber rights. If issues of conflict arise within the 21 days, a committee is put in place to study and address the issues raised.
• Written Consent: If no issues come up within the 21days or issues that come up within the 21 days are resolved, a written consent is obtained from the land owners, individuals or groups whose lands are affected.
• Compensation Negotiation & Payment: The potential TUC holder is required to identify, engage and negotiate with farmers whose lands will be affected by the timber logging operations on compensation. Compensations must be negotiated, agreed and paid by the bidder.

SRA negotiation: The highest TUC bidder is required to conclude SRA negotiations and sign SRAs with the communities to be affected. This SRA process must be in line with the laid down procedure and represent a value of 5% of total stumpage fee of the timber to be harvested.

Grant of timber rights: The grant of timber rights is only given to the highest bidder after proof of having complied with all the conditions including compensation and SRA.

SRA Fulfilment: Communities are required to demand the fulfilment of the SRA as agreed and signed. Failure of the logger to comply with the SRA amounts to an infraction and should result in the nullification of the grant of timber rights (TUC). Communities can also request for a re-negotiation of the SRA if irregularities are identified (e.g. if it comes to the notice of communities that the package agreed earlier is less than 5% of the stumpage fees).

Community Access to Non Forest Timber Products & timber off-cuts: Communities  have the right to access the area for NTFPs and off-cuts.

Monitoring of Logging Operations: Communities have the responsibility to monitor timber logging operations and ensure the timber company is not engaged in any irregularities and illegalities. Communities are encouraged to report such actions through the complaints mechanism of the FC or seek redress through the courts.

Trade and transport

Soon after tree felling a Tree Information Form (TIF) should be completed by the field staff ensuring that species, tree reference number, tree length and the four diameter measurement are entered. Additionally, the contractor should complete a Log Information Form (LIF), which ensures that all logs after cross-cutting are numbered and which provides the link between the tree information on the TIF and the Log measurement and conveyance certificate (LMCC). In case of forest plantations the TIF and LIF are replaced by the Plantation Production Certificate (PPC). A LMCC is issued for conveyance of logs from the log yard to its final destination on a vehicle basis. The LMCC is stamped by the District Forestry Office and signed by the Forestry official before the logs leave the forest.

All prospective buyers of timber and wood products are required to officially register with TIDD for processing and issuance of Buyers Registration Certificate. The certificate is valid for one calendar year and it is renewable upon re-application.