Uganda

The International secretariat’s assessment is that Requirement 1.5 is fully met. In its comments on the draft Validation report, the MSG explained what priorities from the National Development Plan III (NDP) have been adopted, including BO transparency and ASM framework. They noted how the EITI activities in the 2023-2024 work plan addressed both objectives. The current work plan (2023/2024) is the product of input and support from all constituencies. Stakeholder consultations found that the process for developing and updating annually the work plan was transparent and inclusive of the views of members of each constituency. However, while the 2022/2023 and 2023/2024 work plans do include general linkages to national priorities, most of the activities are tied to the implementation of the EITI and the first Validation of the country. The reference to recommendations from reporting and independent studies, on artisanal mining and gold smuggling, is limited. The work plan references the goals of the NDP III to increase the extractive sector’s overall relevance for the economy, such as in local content, investment, exploration and processing. Chapter 6 and 7 of the NDP III are respectively dedicated to the mining and oil and gas sector and highlight the need for a strengthened legal and fiscal framework of ASM and improvement of the legal and institutional framework of both sectors (p.71) as important pillars – which the work plan explicitly reference. The work plan does not include activities on local content or environmental mitigation, and only one activity in the second quarter on the regularisation of the ASM sector, which are stated objectives of the NDP III. The 2023-2024 work plan is largely costed but does not indicate the source of funding apart from the government. In its comments on the draft Validation report, the MSG indicated that the government is funding all activities except those related to ASM that will come from the program IMPACT. It includes rough time indications per activity (per quarter). It includes activities on the dissemination of EITI Reports and one activity on gender. It addresses the removal of the legal obstacle on contract disclosure (but no beneficial ownership) and contains two additional activities on the publication of contracts and licenses. Several capacity building activities targeting MSG members, companies, and government, are included (see activities 3.3.a and c). In terms of consultation with stakeholders on objective of the workplan, several activities were held where the draft plan such as a workshop in the eastern region of Mbale district in August 2022. The National Development Plan notes the relevance of ASM for the country, as noted in section 6.3.1 of the 2020-20252 version. Ensuring inclusion of activities that result in providing estimates on ASM activities (production and export as a minimum, see also assessments of Requirements 3.2 and 3.3) and to address issues such as gold smuggling, would benefit from more activities in the work plan. Future work plans may wish to draw on findings and recommendations from existing research on small-scale mining and gold smuggling as those are governance issues that may benefit of MSG oversight to ensure priority recommendations are addressed. A thematic report on ASM in the country has been prepared but not yet published. Finally, the MSG is planning to link the work plan to a monitoring framework, as encouraged by the EITI Standard (see activity 1.3.3 of the work plan).

The Secretariat’s assessment is that Requirement 7.1 is fully met. Most stakeholders consulted considered that the overall objective to enable evidence-based public debate on extractive industry governance through active communication of relevant data to key stakeholders was fulfilled, although shortcomings in the critical aspect of the public debate were noted by some stakeholders. The Secretariat’s view is that the objective is fully met in the first three years of Uganda’s implementation after joining the EITI. The two (2019-2020 and 2020-2021) EITI Reports published in the period under review were posted on the Uganda EITI website, The MSG has produced summaries on the findings of EITI Reports. Civil society representatives contributed to Uganda EITI’s communication by organising conferences on the EITI 2019 and 2023 Standard and advocacy for the formalisation of the mining sector. There is evidence34 of use of extractive data by civil society, companies, or government institutions, including in the discussion on EACOP, the pipeline between Tanzania and Uganda. Industry has disseminated each report produced, while the Uganda EITI secretariat organised dissemination events supported by civil society and government representatives related to the recent thematic reports on Beneficial Ownership, (Hoima City the 23 August 2023), Dialogue on relevant governance issues has also been supported by partner organisations at multiple events56. In May 2021, the MSG, and Global Rights Alert (GRA) jointly organised a community engagement and field visit for MSG members to the Kagaba Hill in Kitumbi Sub-County, Kassanda district and Mubende District to create awareness about the EITI and its potential in transforming the ASM sector. Some stakeholders highlighted financing and resource constraints as a barrier to develop further dissemination and awareness activities but were overall satisfied with the current communication efforts. Uganda EITI has developed a five-year Communication Strategy with support from the European Union (EU) Justice and Accountability Reform (JAR) program. An MSG communications sub-committee was formed to oversee the EITI communication work plan. In addition, there is abundant documentation of press articles, radio, and TV-programs where EITI stakeholders discuss transparency in the extractive industries and raise awareness about the EITI. All MSG constituencies appear engaged in the communication of relevant data to key stakeholders, as documented on the Uganda EITI website and the 'Outcomes and impact’ template for this Validation. There is some evidence of the MSG explicitly considering the information needs and access challenges of different stakeholder groups. Uganda EITI appears to have prioritised outreach to civil society and journalists, including communities hosting extractive activities. The implementation of the last work plan (see Requirement 1.5) has highlighted the need to build the capacity of stakeholders at the national and regional levels, and stakeholder consultations emphasised the need for capacity building within government agencies and ministries in order to empower more use of EITI data and findings.

The Secretariat’s assessment is that Requirement 7.2 is mostly met. The Secretariat’s view is that the objective of enabling broader use of EITI data is in the process of being achieved. Uganda EITI publishes summary data files alongside each EITI Report. However, the data contained in the EITI Reports are not available in open format, and there are opportunities to increase the volume of data in open format, on the EITI national website and through systematic disclosures. In its comments on the draft Validation report, the MSG confirmed the open data policy and the MSG’s intention to make all data public, including contracts. Stakeholders consulted did not express any views on progress towards the objective of data accessibility. Uganda EITI has agreed an open data policy in October 2023 which clearly articulates the policy related to the release, use and reuse of Uganda EITI data. Summary EITI data on revenues and payments is available in open format through the summary data files prepared for the 2020-2021 and 2019-2020 EITI Reports. There is very little data from the extractive sector that have been published in open format in accordance with Requirement 7.2. b.

The Secretariat’s assessment is that Requirement 7.3 is fully met. In its comments on the draft Validation report, the MSG explained both how relevant recommendations have been acted upon by external stakeholders such as the Directorate of Geological Services, Uganda Revenue Authority, Uganda Registration Bureau Service and Ministry of Justice. Uganda EITI has made progress in identifying and addressing the causes of information gaps or discrepancies in EITI implementation, and progress in responding to the recommendations made by the Independent Administrator. MSG mechanisms for following up on recommendations and discrepancies were established in early 2022. It is too early to conclude whether they are fully effective in practice, given that it is the first Validation of Uganda, and the country has published two EITI Reports. In practice, there has been limited progress on follow-up on recommendations stemming from the 2020 and Uganda’s 2020-2021 EITI Reports and implementation for most of the period under review. Overall, the MSG, supported by the Uganda EITI secretariat appear to operate as the mechanism for following up on recommendations from EITI Reports. The minutes of MSG discussions (such as the MSG’s 13 April 2023 meeting) and other Uganda EITI documents, such as the ‘Outcomes and impact’ template and the Uganda’s 2020-2021 EITI Report, describe the establishment of a mechanism to identify, investigate and address the reasons for gaps in EITI reporting and the recommendations stemming from thematic studies and EITI Reports. The Uganda’s 2020-2021 EITI Report provides a table listing eight recommendations from the 2020 EITI Report and an update on progress in their implementation to date. The table confirms that seven of the recommendations are currently in progress, and one has been fully implemented. Uganda EITI’s 2023-2024 work plan notes in its objective 2.1 that activities to implement the recommendations will be undertaken, but only includes detailed activities for contract disclosure. There is further evidence of measures taken by the MSG to follow-up on implementation gaps after the publication of the 2020 and Uganda’s 2020-2021 EITI Reports in MSG meetings minutes, with letters sent and meetings organised with key government agencies and departments. One of the central recommendations stemming from the 2023-2024 work plan and MSG meetings relates to capacity building for stakeholders, in particular MSG members, civil society from national and local communities and civil servants. On balance, the Secretariat considers that the technical aspects of Requirement 7.3 are in the process of being addressed, pending confirmation that the recently established mechanism for following up on EITI recommendations is robust and sustainable in practice. In its comments on the draft Validation report, the MSG explained their strategy for future monitoring and evaluation, including following up on recommendations. They have included a specific action in the 2023-2024 work plan, to establish a MSG committee for that purpose and hired and monitoring and evaluation resource.

The Secretariat’s assessment is that Requirement 7.4 is fully met. In its comments on the draft Validation report, the MSG shared the link to the June 2022-June 2023 annual progress report that was recently published. Together with previous exercises of reviewing outcomes and impact, this published report allows the International Secretariat to conclude that the objective of public accountability of EITI implementation in Uganda is fully met. In July 2022, Uganda EITI produced a two-year progress report combining reflections on the impact of the EITI. The objective of this study was to identify, document and analyse the impact and concrete reforms generated by the implementation of the EITI Standard in the governance of the mining, oil, and gas sector in the country over the period June 2020-July 2022. This Annual Progress Report includes a dedicated section to lessons learned, good practices resulting from the implementation of the EITI Standard and recommendations. The document also includes a consistent documentation on progress in meeting each EITI Requirements of the 2019 Standard, a thorough summary of EITI activities, an overview of the MSG’s responses to EITI recommendations stemming from the 2020 EITI Report, an assessment of progress in meeting work plan objectives and a narrative account of efforts to strengthen the EITI’s impact. Stakeholders outside of the MSG do not seem to have been consulted on the outcomes and impact of the EITI ahead of the preparation of the Annual Progress Report. For the period July 2022-June 2023, stakeholders consulted during the Validation mission indicated that a similar report was in preparation at the time of the Validation. It has been later confirmed that this report is published. The report contains a summary of activities undertaking in the year covered, including preparing the Uganda’s 2020-2021 EITI Report, capacity building and dissemination activities. The report also included an overview of MSG responses to previous recommendations, lessons learnt and main achievements and efforts to strengthen EITI implementation. The International Secretariat’s view is that the objective of regular public monitoring and evaluation of implementation was fully met.

The Secretariat’s assessment is that Requirement 1.1 is fully met. The International Secretariat assessment is that the objective that the government is fully, active, and effectively engaged in the EITI process has been achieved. Throughout consultations with stakeholders, there was a strong consensus that the government has led and facilitated EITI implementation since Uganda was admitted to the EITI in 2020. This has happened through leading EITI implementation with high-level participation, enabling EITI implementation, including MSG functioning, reporting and dissemination and debate. Since declaring its intention to join the EITI in 2019 and throughout the first years of implementation, the Government of Uganda has continuously expressed clear commitment to implement the EITI, as documented in the ‘Stakeholder engagement‘ template. The government constituency involves several high-ranking officials as evidenced by the appointment of three co-EITI champions. Two ministers of state, one from the Ministry of Energy and Mineral Development, and the other from the Ministry of Microfinance and Small Enterprises, as well as the Director of Economic Affairs. Together they have spearheaded the constituency and the MSG. Through the consultations it was evident that the holders of these posts have the authority and garner confidence from stakeholders to coordinate action and resources for EITI implementation. Government priorities for the EITI have been aligned with the current national development plan (2020-2025). The government’s constituency is highly engaged and well-coordinated through a well-established EITI national secretariat, led by two staff, a National Coordinator, and the head of the secretariat, which provide coordination and steering to the different government agencies involved in EITI work, including scoping, policy, MSG activity (such as developing work plans and annual progress reports),, as well as facilitating dissemination and debate on EITI-related matters. The participation of government agencies has gone beyond the leading agencies mentioned above. Entities such as the National Planning authority (NPA), Ministry of Justice, Uganda Revenue Authority (URA), the Petroleum Authority of Uganda (PAU), Bank of Uganda, National Environmental Management Agency (NEMA) have also been engaged in EITI implementation efforts. The participation of the government agencies in the MSG is well organised through the MSG ToRs and was preceded by a mapping exercise led by the Ministry of Finance. Two additional agencies (NPA and PAU) were added to the initial representation during the period under review. The evidence documented in the Validation template confirms that the constituency has been involved in MSG's regular activities, various working groups established by the MSG, ad-hoc consultations, dissemination, and debate activities, as well as the preparations and consultations of Validation. Stakeholders from all constituencies confirmed that the government, beyond just the co-Champions, is fully and actively engaged in the EITI process. EITI implementation has benefited in the period under review from resources coming mainly from two sources, the government's own budgetary allocation and development partners (European Union’s technical and budget support). For the period 2023/2024 the government support totalled Ush 2.2 billion (USD 580,000). The national secretariat is generously staffed and hosted in the Ministry of Finance. While acknowledging the adequate funding during the period under review, various stakeholder expressed concerns about the sustainability of current resourcing when external support is reduced or stopped. The government expressed its commitment to continue supporting EITI implementation at an adequate level. All in all, the government is fully, actively, and effectively engaged, through both high-level political leadership and operational engagement.

The Secretariat’s assessment is that Requirement 1.2 is fully met. This assessment is based on the evidence indicating that the organised part of the industry, represented by the umbrella association, the Uganda Chamber of Mines and Petroleum, is fully, actively, and effectively engaged in the EITI process. The oil and gas subsector and the non-metallic and small-scale organised mining sector have been fully engaged in core aspects of EITI implementation. The mining sector is engaged in the EITI, especially through active non-metallic operators that are part of the Uganda Chamber of Mines and Petroleum. Non-metallic companies that have reported data in the EITI Reports and engaged in the MSG. While these organised stakeholders have been fully engaged, there remains a segment of relevant industry actors involved in gold production, refining and export that seem absent from engaging on the EITI process. Limited data about regarding this part of the industry is discussed in the assessment of requirements 6.3, 3.2 and 3.3, preventing a comprehensive understanding of its significance. The industry constituency is composed of three parts: the oil and gas sector, the formal mining sector, and the informal and small mining subsector. The first two are grouped under an umbrella chamber called Uganda Chamber of Mines and Petroleum which has over 200 members. The other under the Uganda Association of Artisanal Small-scale Miners representing over 158 associations. As such, the industry is adequately represented in the MSG. The Validation templates document that the baseline condition of the industry was marked by significant fragmentation. The chamber has been instrumental in bringing the constituency together to engage in the EITI implementation. Hence that, at the level of MSG activity, there is adequate participation of representatives of companies and the representatives from the two chambers in MSG affairs. Regarding requirement 1.2.b, this assessment confirms that this representation was mainly selected and agreed via the chambers and with the direct involvement from individual oil and gas companies currently active in the sector (the SOE Uganda National Oil Company (UNOC), Total, Oranto, CNOC, Armour Energy). The ‘Stakeholder engagement’ template provided evidence that this selection process was independent and properly conducted. Consultations did not raise any concerns about industry representation in the MSG. Regarding requirement 1.2.a, the template also documented that the industry constituency was engaged in the development of work plans and the review of annual progress. Similarly, the constituency participated in dissemination activities and in debate of controversial issues like the development of the East African Crude Oil Pipeline (EACOP). During the period under review, the oil and gas subsector was mostly in the development phase. In the FY 2021 this sector reported payments totalling USD 47 million but it is anticipated that revenues will significantly increase during the full production phase. Validation consultations corroborated that the oil and gas sub-constituency is highly involved and committed to the EITI process. The picture in the mining sector is mixed. The sector contribution to government revenues is more limited. In FY 2021 the sector reported 25% of total government revenues from extractives (USD 16 million). Despite this minor contribution compared to oil and gas, the mining sector faces challenges such as widespread informality and a dearth of reliable information regarding production and mining activities. The more formal part of the subsector is the non-metallic sector (quarries), which is represented on the MSG and accounted for the majority of reported payments from mining activities. From consultation to stakeholders, this assessment concludes that the oil and gas companies are fully active in EITI implementation, while the mining industry is engaged mainly through the non-metallic companies represented in the Uganda Chamber of Mines and Petroleum. This lack of participation from gold mining is linked to challenges in formalising mining activity rather than legal obstacles to participation. Notably, the mining reform passed in 2022 set a framework for formalising small-scale producers. Consulted stakeholders highlighted that this would pave the way for an improved engagement from the ASM subsector. In particular, the Uganda Association for Artisanal and Small-scale Miners expressed, in the consultations, their commitment to more effective engagement as the 2022 mining reform is implemented. In preparing for the full operations in the coming years, consultations with oil and gas companies showed they were committed and prepared for future EITI implementation when their projects will come to stream. All in all, the current engagement of industry, especially oil and gas companies are fully, actively, and effectively and has set the foundation for meaningful engagement when their future operations reach full scale positioning them as significant fiscal contributors. However, good governance of the sector will not be fostered until all components from the mining sector are fully engaged in the transparency practices brought by the EITI. This will need to include not only upstream companies but also refiners and traders if the challenges related to the gold subsector are to be fully addressed. In summary, this assessment concludes that in the period under review, the organised part of the industry, notably the nascent oil and gas sector, the non-metallic mining subsector and the association representing the artisanal and small-scale subsector, have been fully engaged in the EITI process. It is strongly recommended that future EITI implementation prioritise engagement with gold producers and operators through the gold value chain in order to tackle the myriad challenges facing this subsector.

The Secretariat’s assessment is that Requirement 1.3 is mostly met. In its comments on the draft Validation report, the MSG asked for clarification on whether this assessment was due to the engagement of the constituency in implementing the EITI or due to the enabling environment that they considered to be beyond their capacity to influence. The objective of this requirement includes both the engagement of the constituency and the enabling environment for this engagement to occur. The International Secretariat considers that the objective is mostly met due to weaknesses in the enabling environment documented in this assessment. Civil Society Organisations (CSOs) in Uganda have been sufficiently engaged on the EITI process participating in core activities of EITI implementation and discussions on key issues such as fiscal justice, oil revenue management, beneficial ownership, environmental regulation, and removing obstacles for civic participation in key extractive regions. This has happened within a challenging environment for civil society derived from restrictive regulations that made CSOs vulnerable to reprisals and sanctions. While there is sound evidence that CSOs have actively participated in the EITI process, this assessment has equally identified obstacles that prevent an enabling environment for full, sustainable engagement to occur over time. The breaches to crucial parts of the EITI CSO Protocol such, as freedom of expression and capacity to operate freely in relation to extractive governance explain why the objective of this requirement is not considered as fully met. CSO’s engagement has occurred against a civic space environment that, at a closer view, raises concerns, especially about the vulnerability and sustainability of this space for CSOs to operate. There have been incidents of repressive responses to protest on issues of importance to good governance of extractives, such as environmental impact of the oil pipeline being built to transport future Ugandan crude oil. The stringent regulations governing the registration, renewal, and conduct of activities, including public meetings, for NGOs operating in the extractive sector, represent a constant burden. CSOs face the constant risk of reprisals and other reprisals for non-compliance with these regulations. Sometimes, these reprisals have exceeded the mere administrative penalties and include arrests. In its comments on the draft Validation report (Annexe 11), CSO stakeholders noted that these restrictions have not been seen in other sectors of the economy. They also acknowledged that reduction of funding derived from the closure of the Democratic Governance Facility (DGF) has significantly impacted many NGOs, particularly those focused on areas related to governance and human rights. In the same comments, the MSG submitted further evidence of public debate, including the participation of ACODE, a CSO represented in the UGEITI’s MSG, on discussing crucial and acute problems related to the illegal gold mining in central Africa7, an issue8. The International Secretariat acknowledges this evidence but maintains the view that there have been breaches of the EITI protocol. Specifically, there have been instances of civil society being hindered due to retributions against CSOs substantially engaged in extractive issues, such as the civil society activists and human rights defenders. This includes arrests of protesters opposing the EACOP project. Incidents in relation to the East African Crude Oil Pipeline (EACOP) The International Secretariat conducted a desk review based on publicly available references to several occurrences of restrictions to the expression and operation of organisations and citizens that have campaigned on the issue of the EACOP, a thermally insulated and more than 1400 kilometres long pipeline that will transport oil produced from Uganda’s Lake Albert oilfields to the port of Tanga in Tanzania (80% of the pipeline is in Tanzania) for further commercialising it to world markets. This infrastructure is key to the oil industry being developed in Uganda. Environmental organisations both in Uganda and globally have heavily criticised EACOP on the grounds of environmental risks, impact on local communities, and climate change overall concerns. Between 2021 and 2023, the consulted references show evidence of a number of arrests, including violence used against protesters, office raids and intimidation against individuals (mostly students) and organisations like the Africa Institute for Energy Governance (AFIEGO) in Kampala and in the oil regions (notably in towns like Hoima and Buliisa). The incidents reported, while are not directly linked to activities undertaken and organised as part of the UGEITI work, are related to issues like environmental impact, land acquisition for the pipeline route and the compensation process to affected population, that are directly related to the governance and development impact of extractive activities. The International Secretariat considers that the arbitrary detentions, use of violence against protesters, and intimidations against organisations campaigning on extractive issues constitutes breaches of the freedom of expression and capacity to freely operate in relation to the EITI process. MSG comments to draft Validation report. In its comments on the draft Validation report, the MSG argued for an upgrade in the assessment of Requirement 1.3 to ‘fully met’ given their view that there has been a great improvement in the engagement of CSOs involved in the extractive sector, save for a few cases, over the years. They stressed that CSOs have worked with government to undertake UGEITI public awareness activities, a practice that was previously uncommon. The MSG highlighted evidence of public debate and civil society participation in discussions on all mining-related topics. They confirmed that they have remained actively engaged in the EITI process, including using EITI platform to raise awareness about governance challenges. In its comments, the MSG acknowledged the existence of arrests of civil society activists and human rights defenders, including arrests of EACOP protesters. They added that “Nevertheless, many Civil Society Organizations remain active in Uganda and have complied with the country’s legal framework. It should be noted that the CSOs that have complied with the statutory requirements have not faced challenges operating in the country. This is attested to by the vibrant participation of Civil Society at the UGEITI MSG engagements and other for a regarding EITI implementation”. The International Secretariat concludes that it appears that there have not been government actions aimed at restricting civic space in relation to the activities undertaking by the EITI on public debate on natural resource governance during the period under review. However, it is the Secretariat’s view that the objective of an enabling environment for civil society engagement in all aspects of the EITI process is mostly met given the breaches of the EITI protocol: Participation of civil society, as evidenced in the arrests and restrictions imposed on CSOs documented through this assessment. These restrictions have affected organizations and individuals engaged in public debate of issues directly related to extractive sector impact and governance. The following sections analyse this enabling environment for civil society through the different aspects covered in the EITI civil society protocol. Expression: According to international rankings of civic space, the environment for CSOs in Uganda is considered poor and constrained. In its comments on the draft Validation report, the MSG noted that this is also in accordance with CSOs in Uganda following the restrictions imposed by the Public Order Management Act and the NGO Act. Freedom House rated Uganda’s global freedom as “Not Free” with a score of 35/100 (100 being the best score). Civicus’ 2023 assessment of Uganda’s civic space is “Repressed” (score of 30/100, with 100 being the best). The US Department of State’s 2022 Report on human rights practices in Uganda documents abundant human rights violations. Amnesty International’s latest report (2022) on Uganda questioned the response of the government to suggestions aimed at addressing challenges on freedom of expression, association, and assembly. The reports states “The government did not accept the universal periodic review (UPR’s) recommendations to end the intimidation and harassment of human rights defenders, civil society actors, bloggers and journalists”. Uganda’s ranking in the ICNL 2023 Rule of Law index was 128 (worst being 140). Against this wider background, the CSOs operating in the EITI sphere have nonetheless managed to be meaningfully engaged in the EITI as documented earlier in this section. In practice, CSOs in UGEITI have been able to engage in public debate. The section “Media engagements” in the Validation templates (see page 69-74 of the ’Stakeholder engagement’ template) documents several CSOs opinions on themes from revenue mobilisation, royalties’ allocation, fiscal justice, contract transparency and socio-economic impact. Stakeholders consulted during the Validation mission did not report the occurrence of any reprisal during UGEITI-organized activities. Through the consultations, several stakeholders observed that issues of natural resource governance have been openly discussed in the public by CSOs. Stakeholders consulted though pointed out to members of CSOs, included members of AFIEGO, being arrested for activities genuinely related to raising concerns on aspects affecting the extractive sector9 and legal reforms that limit the funding available for these organisations. In its comments on the draft Validation report, the MSG noted that public debate has included broader mining sector issues, not solely those related to illicit gold mining. However, they also acknowledged that “There have been arrests of civil society activists and human rights defenders, including arrests of EACOP protesters with the government declaring that their activities contravene the law”. The International Secretariat concludes that the inability to freely express opinions, such as opposing the EACOP or demanding adequate or prompt compensations for the affected parties by that infrastructure, without risking restrain or reprisals, constitutes a breach of the ability to speak freely. Operation: Consulted stakeholders acknowledged that while they have been able “to operate with some level of freedom in relation to the EITI process”, there are restrictions to operation coming from “the stringent administrative and regulatory framework which have limited the CSO engagement efforts” (see page 59 of the ’Stakeholder engagement’ template). Two main obstacles derived from this framework related to the NGO Act 2016 and NGO 2017 regulations, that imposed cumbersome and discretionary written approval from the district authorities on CSO activity despite being licensed to operate nationally. In its comments on the draft Validation report, the MSG added that they had faced stringent and unprecedented penalties for the renewal of NGOs registration. In addition, access to funding have been curtailed by the restrictions to donor’s operations derived from this regulation, and by the reduction of international sources of financing following closure of the multi-donor Democratic Governance Facility (DGF) and more generally the global recent trend to prioritise funding for other areas of development. Several civil society organisations represented on the MSG access funding from this fund, and the restriction affects their ability to operate. In its comments on the draft Validation report, the MSG noted that public debate has included broader mining sector issues and not only those related to illicit gold mining. They equally acknowledged that “the operating environment for civil society organisations in Uganda has faced some challenges in the recent past. In 2021, the Government enhanced the enforcement of the regulatory framework by subjecting CSOs to registration, licensing, and reporting obligations. As a result, in August 2021, the operations of 54 NGOs in Uganda were suspended by the NGO Bureau, most of these working on governance areas, while some of them working on the extractive sector”. In relation to the stringent approval required for public activity by CSOs it was striking to hear a comment in the consultations conducted with more than 25 CSOs, during the Validation mission, that the mere meeting where these consultations were held could be declared illegal. The general view was that EITI activities, as illustrated by this meeting, are tolerated but the legal framework still could be used to obstruct these activities or even worse to penalise organisers. This situation of a selective lax enforcement of this stringent rule leaves CSOs vulnerable to reprisal. While funding of EITI work for CSOs was available at the beginning of the period under review, current sources of funding has dried up as some donor’s funding is no longer available. In its comments on the draft Validation report, the MSG clarified that this was due to both internal and external factors. Stakeholders noted that the oil and gas sector will enter in full operation and mining reforms are to be implemented, CSOs will require capacity building to be able to monitor the sector. With reduced funding available the ability to engage meaningfully is limited. Funding constraints was not the only concern expressed by stakeholders on future engagement. The vulnerability of CSOs to reprisals while conducting their mandate of open discussions and citizen monitoring, is a significant concern. As noted in this assessment, there is a common view among CSOs that their engagement in the EITI process has been possible during the period under review but that if the restrictive regulations would have been enforced, they could have faced consequences. The International Secretariat concludes that the legal and administrative restrictions affecting the ability of CSOs to participate in advocacy and debate on extractive issues have in the case of Uganda, for the period under review, affected the operation of CSOs in two aspects, the reprisals affected public advocacy in 2021-2022 and the vulnerability that EITI activities could have triggered sanctions selectively enforced. Association: Before Uganda decided to join the EITI, a number of CSOs were already engaged in advocating for EITI membership. When the government decided in 2019 to submit its candidature of application to join the EITI, the engagement of CSOs for participating in the EITI process unfolded organically and seamlessly. The Validation template documents this process thoroughly. Independent nominations were mainly channelled through the umbrella civil society forum (see page. 50 of the Stakeholder engagement Validation template). These umbrella associations, PWYP and CSCO, in turn, were composed of more than sixty organisations nationwide. Consulted stakeholders confirmed that the selection of CSO nominees for the MSG was conducted openly and independently. During the period under review, no members of the CSO constituency were replaced in the MSG. The evidence discussed earlier in this requirement regarding the widespread and meaningful CSO engagement attests to the ability of CSOs to communicate and cooperate with each other. Consulted stakeholders commented that this has been largely facilitated by the coordination role played by the umbrella CSOs associations involved in EITI work. The evidence also points out to adequate communication channels between the CSOs represented in the MSG and the wider space of society actors, including media and parliamentarians. Engagement: CSOs are actively engaged in the EITI, including the core processes like work planning, scoping, and reporting, dissemination, and debate (see pages 51, 53-57& 62 of the Stakeholder engagement Validation template). Notably, CSOs have advanced outreach activities to regions, especially in the Bunyoro sub-region (see pages 60-61 & 64 of the Stakeholder engagement Validation template). The Validation templates documented that in August 2023, CSO provided additional reflections on areas such as environment and climate change, and the theory of change for Uganda’s EITI (see page 52 of the Stakeholder engagement Validation template). The constituency has particularly been engaged in dissemination of EITI Reports through different fora, including parliamentary debates, and in the capital and regions (see p.53-55 of the Stakeholder engagement Validation template). Similarly, CSOs have made use of the EITI data as documented in page 57 of the Validation template. All in all, the International Secretariat concludes that the CSO constituency has been able to operate through several dimension of the EITI process, including MSG work, dissemination, and debate, and reaching out to regions and beyond the MSG. The evidence shared in the Validation template and discussions during the Validation consultations confirm that the CSO constituency has been actively involved in the design and implementation of the EITI in Uganda. This can be seen through CSOs participation in the various committees set by the MSG to discharge core functions like work planning and reporting. Some of these committees were chaired by CSOs members. CSOs have been actively engaged in dissemination and debate on issues like tax justice, beneficial ownership, contract transparency, legislative bodies’ s capacities to oversee oil and gas sector, modernisation of regulatory framework to tackle problems of artisanal and small scale-mining and issues of civic space in affected regions. Stakeholders acknowledged, though, that their engagement in monitoring and evaluation of the EITI process was limited, due to resourcing constraints. Access to public decision-making: In addition to the well-documented engagement of CSOs in the EITI process, dissemination, and public debate, in earlier part of this requirement, the Validation template highlights that CSOs were involved in reviewing aspects of revenue management in the Public Finance Management Act, the recent mining reform (2022 Mining and Minerals Act) and drafting of the petroleum laws. During the Validation consultations, stakeholders reminded of the advocacy efforts made by UGEITI (including CSOs) for the introduction of beneficial ownership disclosures. The template also documented reaching out to parliamentary discussions (see page 66 of the Stakeholder engagement Validation template). Consulted stakeholders did not raise any further frustrations on the lack of access to public debate.

The Secretariat’s assessment is that Requirement 1.4 is fully met. The International Secretariat concludes that the objective of an independent and balance MSG exercising active and meaningful oversight of all aspects of EITI implementation has been achieved. This has happened through inclusive and well organised MSG functioning, facilitated by a well-staffed and proactive national secretariat. Regarding the formation of the MSG as established in Requirement 1.4.a, it is worth noting that Uganda decided to implement the EITI in January 2019 via a Cabinet decision after years of consideration and pondering the value of the EITI. Notably, civic society had for years lobbied the government and other stakeholders for Uganda to join the EITI. Therefore, when the government decided to join the EITI a good amount of the outreach and discussions with CSOs were already advanced, facilitating the selection of the representation of this constituency. As documented in the ‘Stakeholder engagement’ template, the formation of the government constituency for the MSG was led by the Ministry of Finance. The process was thorough and effective (see Requirement 1.1). Consultations with stakeholders confirmed that industry was also engaged by the government to form the EITI’s MSG in an open and independent way. On the MSG’s internal governance as established in Requirement 1.4.b, the government adopted a comprehensive set of norms for the multi-stakeholder group (ToR MSG). The ToR address all the areas expected by this requirement. These include clear role and responsibilities of MSG members, nomination procedures for representatives of each constituency, decision making procedures including quorum and voting, replacement and cessation of membership, observers’ policy, circulation of documents and convening meetings and recording of proceedings. The ToR also provides for the code of conduct of MSG members, the MSG policy on working groups and committees for discharging various functions and addressing specific aspects of the MSG mandate (the MSG has established nine committees to address areas from scoping and materiality, contracts, reporting, environment, and validation) and establishing a national secretariat. The national secretariat is headed by the National Coordinator, with more than 12 staff and is funded from the budget of the host Ministry of Finance and Planning. The MSG in the period under review has maintained a slightly more than 20% of female representation overall. The MSG has a clear mandate to address its obligations under the Standard such as approving the work plan, overseeing reporting and data disclosures, and engaging with stakeholders including wider audiences for dissemination and debate and ensuring relevant involvement of relevant institutions, among others. In supporting the MSG, the ToR also set the composition and functions of the national secretariat. The MSG has established a modest compensation for attendance to the MSG meetings meant to cover the cost of transportation to meetings in Kampala. Throughout all consultations different stakeholders confirmed that they were pleased with the functioning of the MSG, including the support from the national secretariat. Stakeholders outside the MSG did not raise any concerns about representation including nomination processes. For the period under review, the membership of the MSG was based on the initial selection in 2019 and the provision of renewing the duration for three more years. The replacement of individual members is well documented in the ‘Stakeholder engagement’ Validation template and has followed the self-adopted rules in that regard. No stakeholders consulted raised any concerns about this aspect or any other that could constitute a non-trivial deviation from the adopted terms of reference. Review of documentation provided in the Validation templates, MSG documents and consultations confirmed that UGEITI’s MSG exercises meaningful oversight of all aspects of EITI implementation with the meaningful involvement of all three constituencies which are represented in a balance way with inclusive decision-making.

The Secretariat’s assessment is that Requirement 3.1 is fully met. Public access to an overview of the mining, oil and gas sector in the country and its potential, including recent, ongoing, and planned significant exploration activities is provided through EITI reporting and through systematic disclosures in government portals such as Petroleum Authority of Uganda, the Directorate of Petroleum, and the Directorate of Geological Survey and Mines. This ensures public’s access to an overview of Ugandan extractive sector and its potential. Consulted stakeholders did not express any view on this objective. The Uganda’s 2020-2021 EITI Report for Uganda provides a brief introduction to the history of its extractive industries. Likewise, the website of the Petroleum Authority of Uganda presents an overview of the petroleum exploration, covering the period from 1925 to 2017.Information on reserves is also included. The report provides estimated values of prospective oil and gas resources and discoveries (drawing from systematically disclosed information in governmental websites, see here, here and here) as well as the volumes and geographic locations mineral reserves, including a map showing mineral occurrences. This is systematically disclosed by the Directorate of Geological Survey and Mines through the Handbook Investment Opportunities in Uganda's Mineral Sector. Additionally, the report lists key players and projects with significant economic potential. For the oil and gas sector these descriptions focus on two major projects—the Tilenga project and the Kingfisher project-, also described in detail on Uganda’s National Oil Company's website. Supplementary links for a comprehensive overview of Uganda’s extractive industries and main developing projects are available in Uganda’s EITI website. The informal mining sector is a relevant source of employment and income in Uganda. The report incorporates an account of artisanal and small-scale mining (ASM), its contribution to the country’s workforce in 2018, active ASM areas in Uganda, the type of minerals produced by the sector, and recent government initiatives aimed at formalising.

The Secretariat's assessment is that Requirement 6.3 is fully met. The objective of ensuring public understand of the extractive industries’ contribution to the national economy and the level of natural resource dependency is fulfilled through EITI reporting, government disclosures, and stakeholders’ attempts to provide an overview of the ASM sector contribution to the economy, ensures a public understanding of the extractive industries contribution to the national economy and the level of natural resource dependence. Uganda’s 2020-2021 EITI Report provides information about extractive industries contribution to the economy, including contributions of informal mining and quarrying to the GDP, with data sourced Uganda Bureau of Statistics. Additionally, contextual information on the ASM sector is provided, drawing from a report commissioned by UGEITI in an effort to collect reliable estimates. The ASM report discloses official DGSM statistics of ASM license-holders’ contributions to national revenues for years 2014-2021. In its comments on the draft Validation report, the MSG submitted the ASM report as an annexe, albeit indicating that this report had originally not been public since not all the relevant stakeholders in the MSG were content with publishing it. Various government publications and websites display information on the contribution of the extractive industries to the economy (see here and here). This is complemented through EITI disclosures, constituting a more centralised and comprehensive source of information. Uganda’s 2020-2021 EITI Report provides in absolute and relative terms the extractive industries' contribution to GDP (including from informal mining and quarrying), government revenues, exports, and employment, broken down by sector, gender and company. It is noteworthy that underlying export data presents some weaknesses (as highlighted under the assessment of Requirement 3.3). Uganda's EITI reporting provides an overview of the location of the main extractive activities in the country, also systematically disclosed through government websites. The 2020 EITI Report also addresses the ASM sector, incorporating (outdated) estimates of ASM employment, geographical distribution, and formal ASM contributions to national revenues from 2014 to 2021, types of commodities produced, along with current challenges and recent reforms. Information references a 2021 report on ASM stakeholder mapping. In its comments to the Validation draft assessment, the MSG noted that the consultancy was commissioned by UGEITI in an effort to gather reliable data and statistics on the ASM sector. The study methodology was based on a desk review of relevant ASM documentation with key informant interviews conducted remotely due to the COVID-19 lockdown. This consultancy was used by the IA in its preparation of the 2nd UGEITI Report. However, the MSG also noted that the consultancy report had not been validated by all relevant stakeholders raising questions over the ASM estimates are taken as the view of the MSG or not. In its 27th meeting minutes the MSG opted to include another source, although information from the ASM report was included in the EITI Report. During stakeholder consultations the IA confirmed that third-party estimates were not included because they were considered unreliable.

The Secretariat’s assessment is that Requirement 2.1 is fully met. Stakeholders did not provide any commentary on this requirement. UGEITI both, through the Uganda’s 2020-2021 EITI Report and its website provides a thorough overview and links to the legal framework governing the extractive industry. This includes the laws, policies, regulations for both the oil and gas sector and for mining and minerals. For the oil and gas sector it includes the fiscal regime (including detailed information on payments in pages 47-50), a model contract for the production sharing agreements, revenue management, specific obligations related to environment and health, the national petroleum policy, and the special provisions of the East African Crude Oil Pipeline (EACOP). It also includes a summary of the roles of government institutions involved in the extractive sector. Similar information is provided for the mining sector. The Uganda’s 2020-2021 EITI Report also discusses the 2022 comprehensive mining reform. The Mining and Mineral act of 2022 introduced a significant number of new provisions to govern the mining sector. The report gives a summary of those (see pages 52-56) including the functions of the mining regulator DGSM (Directorate of Geological Surveys and Mines), the introduction of the state equity participation in large and medium scale mining and the mining royalty system and its distribution between national and subnational governments. UGEITI has provide the necessary information for a public understanding of all aspects of the regulatory framework applicable to extractive activities.

The Secretariat’s assessment is that Requirement 2.4 is partly met. In its comments on the draft Validation report, the MSG documented its efforts to seek full publication of oil and gas contracts, including the MSG decision to escalate the issue of contract disclosure to the Cabinet on 7 December 2023. The International Secretariat welcomes this additional information on the efforts made but retains its assessment that the objective of ensuring public accessibility of all licenses and contracts has been partly met. The objective of full public accessibility of all licenses and contracts has not been met in Uganda. All consulted stakeholders, across all constituencies, acknowledged that the lack of publication of oil and gas contracts is a serious gap that needs to be addressed. The government policy on contract transparency is stated in the Uganda’s 2020-2021 EITI Report (see page 87) making a reference to Uganda’s 2005 Access to Information Act and the Public Procurement and Disposal of Public Assets Act 2003, both of which provide a generic legal basis for the disclosure of information, including contracts. The report also refers to the 2022 Mining Law that stipulates full disclosure of mining agreements to be entered by the Uganda Mining company. The MSG confirmed their policy reiterating that this refers to the official policy stipulated in the laws. In practice, disclosure of contracts is limited. In the oil and gas sector, the government has made public the model of the production sharing agreements, but no concluded contract has been made public. In its comments on the draft Validation report, the MSG documented progress in the direction of publication of contracts. Two companies, Total and CNOOC, holders of the licenses for the largest petroleum projects in development have in principle agreed to publish their contract once it becomes Uganda policy. The International Secretariat welcomes these steps but notes that only represents limited progress toward full accessibility to contracts. In the mining sector, the 2022 Mining Law introduces several types of licenses according to scale (large, medium, small, artisanal) with clear parameters and a model for future mining agreements, but actual licenses have not been made available. The list of mineral rights that were awarded during FY 2020-21 is available in the report (See annexe 1) and the active licenses to 2021 (annexe 5). However, it is not clear the contractual terms associated to those licenses that seems to have been awarded in accordance with the previous mining law. On actual disclosures the report explains that access to actual documents can be provided upon the regulations of the access to information laws (for oil and gas) and upon paying a fee for mining licenses. However, full publication of those petroleum contracts is currently prevented by a consideration of confidentiality taken by the government and acknowledged by UGEITI in the Uganda’s 2020-2021 EITI Report and through the Validation consultations. The MSG has formed a committee to address contract disclosures. Discussions on this issue have been maintained for more than 2 years, including a roadmap to full disclosures. However, for the period evaluated in this Validation, this remains work in progress. Two petroleum companies, holders of oil and gas licenses, have committed to make contracts public. On the mining sector, the 2022 Mining Law stipulates disclosure of mining contracts via the cadastre online and that access to copies of the licenses will be granted upon formal request and payment of a fee. Consulted stakeholders confirmed this situation and the commitment to address the issue of full disclosures in the future but no specific timeline was shared. All in all, despite some efforts by UGEITI in bringing the information available on contracts, both in oil and gas and mining, full contracts are not publicly available.

The 2020 Report provides an overview of the relevant legal provisions regarding environmental regulations for the oil and gas sector (see pages 40-45), the mining sector (see pages 51-54) and the regulatory agency National Environment Management Authority (NEMA) (see pages 132-135). However, information on actual practices, and availability of, for example, environmental impact assessments, monitoring procedures, liabilities and rehabilitation programmes as encouraged in Requirements 6.4.a and 6.4.b are not available. The Secretariat's assessment is that Requirement 6.4 remains not assessed, given that several encouraged aspects of this requirement remain to be addressed by the EITI.

The Secretariat’s assessment is that Requirement 2.2 is fully met. The Secretariat’s view is that EITI and government disclosures provide a public overview of awards and transfers of oil, gas, and mining licenses, statutory procedures, and practice adherence, allowing stakeholders to identify and address possible weaknesses in licenses allocation process. Uganda has disclosed comprehensive information on procedures governing mining, oil and gas contract and license allocations. The Independent Administrator (IA) undertook a robust diagnostic of the licensing practices identifying minor deviations from statutory procedures. While stakeholders held different opinions on the significance of these findings, the IA regarded them as weaknesses warranting improvement. The IA also made recommendations to licensing authorities regarding potential legal loopholes. Given the lack of new oil and licenses awards and transfers in 2020-2021, the MSG did not carry out the same type of diagnostic work on petroleum licenses. Uganda’s EITI Reports present a partial list of bidding applicants to Uganda’s second petroleum licensing round but, during the period for comment, the MSG submitted the full list of applicants. General information on the process for transferring licenses can be found in Uganda’s regulatory frameworks. Based on available documentation and stakeholder consultations, the Secretariat’s assessment is that the objective has been fulfilled. A detailed breakdown of active licenses by type, recipient, commodity, grant expiry date, area and district is provided in an annexed table within the 2020-2021 EITI Report. Uganda has disclosed information about awarding procedures for mining licenses and other permits through EITI reporting and through systematic disclosures on the DGSM website (see here, here and here). The Uganda’s 2020-2021 EITI Report offers a comprehensive account of the licensing process, entities involved, and application requirements for each type of permit/license. DGSM confirmed that no weighing scheme was applied in the granting of mining license. Consulted stakeholders, including the MSG, IA and DGSM, confirmed the use of a risk-based approach through a representative sample to assess non-trivial deviations from statutory procedures. Additional details of the methodological analysis for mining rights issued in the fiscal year 2020-2021 were provided in the addendum to 2020 UGEITI Report. The IA identified small deviations, which although not regarded as weaknesses by the MSG, were deemed worthy of consideration by the IA. The IA also noted weaknesses arising from legislation loopholes whereby a company explores an area for several years but loses the mining lease to another company due to not being able to comply with the requirements to retain or renew the license. Concerning mining rights and mining lease transfers, stakeholders explained that these are subject to ministerial approval (as prescribed under sections 131 and 156 of MMA 2022) and that no transfers took place during fiscal year 2020-2021. This was attributed to movement restrictions during the COVID-19 pandemic and due to the halt on licensing process as the MMA was being passed. In its comments to the draft Validation report, the MSG supplemented the information with annexe 2 of the addendum to the 2020 UGEITI Report. This annexe clarified the absence of transfers and weighing schemes for mining license transfers or applications. For the oil and gas sector, the report provides a detailed list of licenses and permits necessary throughout the exploration, development, and production phases. The information encompasses the specific requisites for each type of right, permit or license and the associated regulatory framework. There were not new petroleum license/permits granted or transferred for the period under review (as confirmed by the Directorate of Petroleum). The Uganda’s 2020-2021 EITI Report presents a brief narrative of contract awarding process, along with information about the first licensing round (2015) and a description of the second licensing round (2019-2020), pre-qualified applicants and the technical and financial criteria used. During the period for comment, the MSG submitted an addendum to the UGEITI 2020-2021 Report. Annexe 1 of the addendum submitted by the MSG discloses the names of two more applicants: Foxhill Investments Ltd and Sarova Petroleum Resources Limited JV, and M/s Profile International Limited. Stakeholders from the Petroleum Authority of Uganda confirmed that a weighing scheme is applied to allow assessing financial capability and technical competence for granting licenses and contract awards. Regarding the transfer of petroleum rights, the process mandates obtaining written consent of the Minister of Energy and Mineral Development, and applications must follow a prescribed form and manner (in accordance with Section 87 of the Petroleum EDP Act, 2013).

The Secretariat’s assessment is that Requirement 2.3 is fully met. Uganda’s systematic disclosures and EITI reporting ensure public accessibility of comprehensive information on property rights in the extractive industries. The Mining Cadastre Map (MCP) provides information on active mining licenses, including all the data points listed in section 2.3.b of the Requirement, but it does not maintain a register of expired licenses. Thus, EITI reporting provides a more comprehensive list of active mineral licenses from fiscal year 2020-21. In its comments to the draft Validation report, the MSG explained that efforts are underway to comprehensively disclose information, including for all licenses held by entities not covered by the EITI reporting process and that information in the MCP has been updated to ensure comprehensive disclosure of information related to all licenses held by companies in the scope of EITI reporting. In the realm of oil and gas, the Petroleum Authority of Uganda has taken strides in transparency by releasing detailed information on both active and inactive licenses. Consulted government stakeholders considered that there was good public information on property rights. Uganda has recently developed the Mining Cadastre Map, an interactive platform facilitating access to information on active mining licenses. This tool is accessible to the public without any associated fee or restriction. Users can filter licenses by type, either by selecting categories or interacting directly with the map. Detailed information, including license holders, application dates, award and expiry dates, commodities, location, and size becomes available upon clicking the designated area on the map. Coordinates are also disclosed. Currently, the portal does not allow the download of data in open format. Consulted stakeholders from the government constituency confirmed that the Mining Cadastre Map maintains up-to-date information and therefore expired licenses are not available in the portal. The full list of licenses in mining sector active during fiscal year 2020-21 is annexed to the Uganda’s 2020-2021 EITI Report, but without application dates and coordinates. During consultations stakeholders noted that application dates for licenses were usually available in the MCP. However, the Validation team found that application dates for some licenses held by companies in the EITI scope were not published in the MCP. The MSG submitted this information in the addendum and notified the DGSM, which reflected the information on the MCP system, meaning that information for the licenses held by companies in the scope of EITI reporting can be now found in the MCP. In accordance with the stipulations outlined in the Petroleum Act of 2013, Uganda manages a repository of all petroleum licenses. This platform currently publishes all active licenses: 9 production licenses with expiry date between 2036 and 2038, and 4 exploration licenses. Additionally, information of inactive licenses with data spanning from 1991 to the day includes data of 11 exploration licenses, 13 appraisal licenses and 1 production license. Information is downloadable in excel format which include “activity start date” (application date), “effective date” (grant date), expected duration, production sharing agreement (PSA) associated, license name, type, and alias. The register covers all active licenses, including those held by non-material companies. Section “licensing activities” of the repository breaks down information by bidding round or direct licensing. Section “PSAs” has published general information on production sharing agreements (PSA), including PSAs aliases, signature dates, effective/expiry dates, and PSA associated licenses. An accompanying map facilitates the identification of the respective fields; additionally, the repository provides information on the acreage and name of licensed blocs.

The Secretariat’s assessment is that Requirement 2.5 is partly met. The MSG’s ‘Transparency’ Validation template considers the objective of enabling the public to know who ultimately owns and controls the companies operating in the country’s extractive industries as fulfilled. Some government stakeholders consulted considered that the objective was close to being fulfilled although all consulted stakeholders agreed that full transparency in beneficial owners of extractive companies was not yet achieved. The Secretariat concludes that the objective is not yet fulfilled but welcomes the government efforts and recent reforms and encourages stakeholders to accelerate progress on the public disclosures of beneficial ownership information that is being collected by the Uganda Registration Service Bureau (URSB). Uganda has established an enabling legal and regulatory environment for the collection but not the public disclosure of beneficial ownership information on companies in all sectors. Beneficial ownership disclosures are governed by the amended Companies Act 2022, the Partnership Act 2022, the Trustees Incorporation (Amendment) Act 2022, the Cooperative Societies (Amendment) Act 2022 and included in the 2022 Mining and Minerals Act. Uganda agreed on a definition of beneficial owner, threshold (5% per the 2022 Mining Act) and politically exposed persons in the national legislation and has started beneficial ownership data collection in January 202314, including those of mining and petroleum companies. It remains however unclear if the information collected is available to the public. The MSG did not have access to the data and has not performed a review of the currently existing data. In its comments on the draft Validation report, the MSG noted the progress reported by the URSB on the collection of BO information as part either of new registration or updating information in the Online Business Registration System (OBRS). The MSG noted the recent removal of Uganda from the “grey list” of FATF given progress with collecting BO data. However, as this system does not categorise companies by economic sector, it is not possible to assess how many companies of the universe of extractive companies have filled BO data. In any case, BO data will only be accessed by competent authorities, and public access to BO information is not possible at present. For these reasons, the International Secretariat maintains its assessment of partly met in accordance with established criteria in similar cases of limited progress in enabling public knowledge of who ultimately owns and control companies operating in the country’s extractive industries. In parallel, Uganda EITI has requested the beneficial owners of extractive companies for its Uganda’s 2020-2021 EITI Report. The results lack comprehensiveness as the data collection process solely focuses on material companies, and only three of 12 material companies reported in fiscal year 2020-21. In the MSG comments and input submitted on 27 March 2024, the MSG noted that four companies submitted BO data including two publicly listed. The International Secretariat welcomes this clarification but retains its assessment that this represents only limited progress. Uganda EITI has published a review of beneficial ownership data collection and acknowledged in the Uganda’s 2020-2021 EITI Report the weaknesses of the information. Some information on legal owners of all extractive companies (182) is located in the annexe 12 of the Uganda’s 2020-2021 EITI Report, without indicating the percentage of shareholding held by each individual. Uganda EITI reporting has not yet referenced filings to stock exchanges by extractive companies in Uganda that are wholly owned subsidiaries of publicly listed companies.

The Secretariat's assessment is that Requirement 2.6 is mostly met. The objective of this requirement is to ensure an effective mechanism for transparency and accountability of SOE’s and state participation through a public understanding of whether the SOE’s management is undertaken in accordance with the relevant government framework. Uganda has disclosed information on state participation in extractive industries through EITI reporting and systematic disclosures. Information appears to be more comprehensive from the side of the oil and gas sector, particularly with UNOC’s website disclosures. Reports of the Office of the Auditor General (AOG) containing limited financial information of the SOEs are publicly available. In its comments to the draft Validation report assessment, the MSG provided additional information on state participation in extractive industries. However, it is the Secretariat’s view that SOE participation in mining sector remains unclear, primarily due to the lack of a list of state participation in mining companies. Additionally, the current regulatory framework does not facilitate a full disclosure of financial information, necessary for a comprehensive understanding of practices governing transfers of funds between the SOE(s) and the state, retained earnings, reinvestment, third-party financing, and loan/loan guarantees. The Secretariat retains the assessment that this objective is mostly met. In the mining sector, the National Mining Company (NMC) has been created by the 2022 Mining and Minerals Act and was therefore not active in the year under review. Kilembe Mines Limited (KML), a 99% state-controlled company in charge of the maintenance of the mining assets of the Kilembe mines, has no active project in the sector. Both companies are subject to annual audits conducted by the OAG as mandated by law. Overall, the Companies Act 2012 contains information on the statutory financial relationship between the government and the two mining SOEs, including the rules governing transfers of funds between the SOEs and the state, retained earnings, reinvestment, and third-party financing. This information could be found through OAG's report to Parliament. In practice, the OAG's reports for the year ended 30th June, disclose some financial information concerning KML, such as outstanding receivables, profitability, return on assets and liquidity (see here and here). The Uganda’s 2020-2021 EITI Report does not contain information on loans and loans guarantees from SOE or the state to mining companies. However, a section of the OAG report includes an analysis of SOEs that had taken loans. According to the 2022 Mining and Minerals Act the state is entitled to participation of up to a maximum of 15% in the large-scale and medium-scale mining licenses, managed by NMC. The Uganda’s 2020-2021 EITI report also indicates that since 2001 KML has a 25% shareholding in Kasese Cobalt Company Limited. However, it remains unclear IF KML’s level of participation in companies, subsidiaries or joint ventures operating within the country's mining sector expands beyond these cases. In the oil and gas sector, UNOC is the only active SOE along with its two subsidiaries in the midstream sector, the Uganda Refinery Holding Company Limited (URHC) and the National Pipeline Company (Uganda) Limited (NPC). These subsidiaries are identified and described in the Uganda’s 2020-2021 EITI Report. Information on the participation of UNOC in the two oil and gas projects is systematically disclosed. The PSA model available online15 indicates that the terms attached to UNOC’s equity are carried equity. The Uganda’s 2020-2021 EITI Report describes the rules related to SOEs’ financial relations with government, with information on statutory financial relations systematically disclosed through the Petroleum Act and the Companies Act. Any profit that is made by UNOC that does not go to the petroleum fund should be declared as dividend and sent to the treasury. A recent legal reform of the Public Finance Management Bill 2021 enables UNOC to retain earnings to meet cash calls, rather than transferring them into the Petroleum Fund. Stakeholders have expressed concerns regarding this development. UNOC, established as a Limited Liability Company, is not mandated by law to publish its Audited Financial Statements (AFS). Instead, UNOC’s accounts are disclosed to OAG, which conduct the audit of the AFS. The findings of this audit are included in the OAG's report to the Right Honourable Speaker of Parliament. In its commentary to the draft assessment, the MSG provided additional documentation confirming this information. The OAG's general report on the AFS for the two SOEs in the extractive sector for FY 2020-21 are publicly available. The report on the AFS of UNOC disclose some aggregated figures of revenue performance and absorption of funds, along with comments on the state participation in the oil and gas Industry. However, it lacks fully disaggregated figures concerning to transfers, reinvestment and third-party financing related to UNOC joint ventures and subsidiaries. The EITI reporting does not include information on loans or loan guarantees in the period under review. The addendum submitted by the MSG in the commentary period, further explains that according to legal requirements, UNOC must obtain clearance and advice from the Ministry of Finance (MoF) before acquiring any loans, as the company's assets are considered state assets. Consulted UNOC stakeholders clarified that in the event of loans or loan guarantees, such information would be disclosed through their AFS to the OAG. UNOC’s website systematically discloses information on SOEs' interests in subsidiaries and joint ventures, including the terms attached to equity in companies and projects. Additional written clarification was provided by UNOC stakeholders in the commentary phase with regards to its upstream equity participation.

The Secretariat's assessment is that Requirement 4.2 is not applicable in the period under review. There was consensus among stakeholders consulted that extractive companies do not make in-kind payments to government collecting agencies. The Secretariat’s view is that the objective of ensuring transparency in the sale of in-kind revenues of minerals in the period under review is not applicable given that the government does not collect any such revenues at present.

The Secretariat's assessment is that Requirement 4.5 is mostly met. Due to the weakness of the disclosures on the financial relations between the state and extractive SOEs and the unavailability of the audited financial statements of the SOEs, the Secretariat’s assessment is that the objective to ensure the traceability of payments and transfers involving SOEs to strengthen public understanding of whether revenues accruable to the state are effectively transferred to the state and to assess the level of state financial support for SOEs is mostly met. Stakeholders consulted did not express any views on the fulfilment of this objective. Transfers from SOEs to government are not considered material by the MSG, but transfers from government to SOEs are, with respective transfers of UGX 34 billion and UGX 0.8 billion to UNOC and KML indicated in the Annual report from the Auditor general of Uganda. However, the MSG’s ‘Transparency’ Validation template indicates that the transfers stemmed from the SOEs to the state, contradicting the audit report. The audited financial statements of UNOC, its subsidiaries or KML are not publicly accessible. The results of the annual audit by the Auditor General are available for the two active SOEs, UNOC and KML. The Uganda’s 2020-2021 EITI Report documents that SOEs do not collect revenues on behalf of the state and did not make any material payments to the state. The Uganda’s 2020-2021 EITI Report does not comment or include items from the audited financial statement that could confirm the financial flows between the SOEs and the State. It is therefore not clear that disclosure of SOE payments and government revenues can be considered comprehensive and reliable.

The Secretariat's assessment is that Requirement 6.2 is mostly met. The objective of this requirement is that where state-owned enterprises undertake extractive-funded expenditures on behalf of the government that are not reflected in the national budget that these are disclosed to ensure accountability in their management. In its comments on the draft Validation report (see annexe 8a), the MSG clarified that the Public Finance Management Act allows for appropriation of petroleum revenues to fund infrastructure development projects. For the period under review however, the SOE UNOC did not incur in any expenditure on the development of common facilities in the Kaabale Industrial Park (See annexe 8b of the MSG comments). Considering this clarification, the Secretariat’s opinion that this objective has been mostly met. The Uganda’s 2020-2021 EITI Report adopted the definition of quasi-fiscal expenditures from the EITI Standard and notes that UNOC and KML did not report on any quasi-fiscal expenditures (QFEs). There are no minutes or explanation provided to allow the International Secretariat to understand how the MSG came to the definition as it applies to Uganda’s SOEs, and how it concluded that such expenditures were not undertaken by UNOC or KML. It does not appear that there have been discussions on projects and activities that could potentially fall within the scope of QFEs. According to stakeholders consulted, the MSG has not agreed and communicated to the SOEs a clear definition of quasi-fiscal expenditures (QFEs). In its comments on the draft Validation report, the MSG clarified that they had indeed adopted a definition of QFEs. However, the Secretariat was still not able to confirm that extractive SOEs are not, for example, providing subsidies or undertaking infrastructure investments that could be considered as QFEs in the period under review. The MSG also noted that the SOE UNOC has informed that future revenues will be transferred to the Petroleum Fund. Given that the law also allows for appropriation of oil revenues for development infrastructure, it is required that future EITI Reports make transparent the occurrence or not of such appropriations.

The Secretariat’s assessment is that Requirement 3.2 is mostly met. The Secretariat’s view is that the objective of this requirement, to ensure public understanding of extractive commodities production levels and the valuation of extractive commodity output is mostly fulfilled given gaps in the disclosures related to artisanal and small-scale mining production that imply that a comprehensive view of the country’s mineral output has not yet been disclosed. The Uganda’s 2020-2021 EITI Report discloses total volumes and values of mining production disaggregated by mineral. There is no associated production for the oil and gas sector, still at the pre-production phase. Estimated production associated with the informal sector was not disclosed despite its significant contribution to metallic mineral and gemstone production. Consulted stakeholders considered the objective was not yet fully achieved with this being an area for further improvement. Representatives from the Directorate of Geological Survey and Mines (DGSM) and from the Ministry of Energy and Mineral Development (MEMD) described ongoing efforts to increase monitoring of artisanal operations and to develop reliable mineral production statistics. In its commentary to the draft assessment, the MSG highlighted that current estimates were outdated and that discussions with the Planet Gold Project are underway to conduct a study to generate reliable and updated information on gold production quantities. Given the lack of updated estimates and the sector's relevance, the Secretariats retains the assessment that this objective is mostly met. The Uganda’s 2020-2021 EITI Report provides a breakdown of volumes and values for fourteen different types of minerals, sourced from the DGSM. A graph represents the contribution to mining production by mineral product. Information is not yet disaggregated by state, region, company, or project. While most stakeholders considered that the formal sector was well captured in the Uganda’s 2020-2021 EITI Report, they highlighted that the informal sector remained a weakness, with information gaps yet to be addressed and work still to be done. Some stakeholders acknowledged that local mining production was predominantly associated to the construction sector and highlighted ongoing efforts to curve the opacity of the mining sector, including legal reforms, ASM formalisation initiatives and the exploration of funding sources to strengthen informal production monitoring. The national secretariat and the Independent Administrator (IA) noted that although third-party sources were considered during the preparation of the Uganda’s 2020-2021 EITI Report, these were not deemed reliable enough to be included. During a field visit the IA noted un-reported mineral production with companies holding exploration licenses. In general, consulted stakeholders emphasised the outstanding inability to ascertain the extent of Uganda’s informal mining sector. Other challenges highlighted by stakeholders were the lack of capacity and financial support for ASM sub-sector, seen an obstacle to the effectiveness of new initiatives and regulations. In the addendum to the Uganda’s 2020-2021 EITI Report, submitted by the MSG it is noted that UGEITI work plan 2023/2024 includes the production of a study to document the size of ASM.

The Secretariat's assessment is that Requirement 3.3 is partly met. While the export volumes and values are disclosed and reconciled in the Uganda’s 2020-2021 EITI Report, there are discrepancies in export figures presented by different entities. Consulted stakeholders expressed the need for greater transparency mineral trade, especially associated to the gold trade flows for this requirement to be fully met. In its comments to the draft Validation report assessment, the MSG noted that these inconsistencies were the basis for recommendations included in the 2020 EITI Report and provided additional documentation proofing proactive engagement on this topic by government entities. Nonetheless, the Secretariat considers that reliable export data and estimates of informal mineral exports are crucial to fulfilling the objective of ensuring public understanding of mineral export levels and the valuation of extractive commodity exports, given the significance of the informal sector contribution to Uganda’s total export levels. According to the EITI Report, Uganda exported solely gold and iron ore during fiscal year 2020-21. The values and volumes exports are disaggregated by refinery, but not yet by project or location. While the DGSM declared 7,500 tons of iron ore exported, and URA reported 9,859 tons. For gold exports, the report notes that the overall quantity of gold imported is higher than gold exported, with one refinery presenting exports without associated imports. Although the Uganda’s 2020-2021 EITI Report does not include an explanation for these differences, consulted representatives from the government constituency attributed the mismatch to a regulatory gap, wherein some actors or companies report to URA but not to DGSM. During consultations stakeholders pointed out that this issue had been recently addressed with new regulations in place to ensure clear and consistent reporting obligations for all licensees and actors involved in the mineral value chain. It was noted that data consistency should be expected in the next reporting cycle. Government publications are inconsistent when it comes to mineral exports. For instance, DGSM’s Fiscal Year 2020/21 Performance Report published in July 2021, declares no exports attributing this to the ban on raw mineral exports. Additionally, the DGSM 100 Magazine notes that while gold is Uganda’s biggest export in terms of value, it remains concentrated in the informal sector. Similarly, the 2021 Statistical Abstract states that gold and gold compounds were Uganda’s leading commodity export during 2020. Some consulted development partners noted that export data disclosed in the EITI Report did not capture ongoing events on the ground, especially given the lack of consistency and comprehensiveness of gold exports. A shared view among development partners was that the gold trade was highly opaque and that current gold statistics were still weak despite this being a pervasive issue. Civil society representatives also noted significant gold mineral trade flows despite Uganda’s relatively low gold production and expressed optimism in EITI implementation to address this gap. The IA pointed out to routes of trade with neighbouring countries and recommended Uganda to develop monitoring mechanisms to capture these routes, asses their materiality and conduct legal reforms to enhance the mineral traceability. The absence of an estimate of informal mineral exports as part of EITI implementation means that the necessary data to address issues related to exports is not available. As in the case of production (see Requirement 3.2), the IA informed that estimates associated to the informal sector (including unlicensed movement of gold) were excluded due to their perceived insufficiency. Consulted government representatives expressed hope in recent legal reforms to pre-empty any allegations of involvement with conflict minerals. During the commentary phase, the MSG submitted additional information on follow-up to EITI reporting recommendations. Annexe 5 of the submission comprises a letter addressed to the Commissioner Customs (URA) requesting the inclusion of MEMD (through DGSM) in the Electronic Single Window System. This integration aims to harmonise and establish controls that will ensure mineral imports and exports are accompanied with permits issued by the Ministry. The respective entities met and discussed a clear way forward, as reflected in the minutes attached to the annexe 5. This topic has been also discussed by the MSG during its meetings (see for instance here).here).

The Secretariat's assessment is that Requirement 4.1 is mostly met. In its comments on the draft Validation report, the MSG clarified that during the period under review there were no transfer fees given that the licenses transferred from Tullow to Total was still valid at the time of transfer. Considering this clarification, it is still not clear why the Licenses fees, as described in Table 20 of the Uganda’s 2020-2021 EITI Report (“Fees to be paid when applying for grant renewals, or transfers of petroleum licenses”), were not applicable for that transaction. The International Secretariat retains its assessment that the objective of ensuring comprehensive disclosures of company payments is mostly met. Most stakeholders consulted seemed satisfied with the country's EITI reporting coverage in terms of companies and revenues. The Secretariat believes that the objective is almost being met regarding full adherence to reporting by government entities and major companies, although it appears that the Uganda’s 2020-2021 EITI Report did omit at least one payment of license fee, casting a doubt on the comprehensiveness of the disclosure of revenue data. There is also room to strengthen the systematic disclosure of payments and revenues by government and companies. Uganda has published two conventional reconciliation reports since it joined the EITI, with a high coverage for the EITI reconciliation. The Uganda’s 2020-2021 EITI Report claims to provide comprehensive disclosure of government revenues from the extractive sector, as well as an assessment of the comprehensiveness and reliability of these disclosures. Material government entities, revenue streams and companies are clearly identified, and the materiality thresholds discussions are documented in the Uganda’s 2020-2021 EITI Report. All reporting entities have provided their reporting templates, and full government disclosure (including nonmaterial revenues) is provided, disaggregated by revenue stream, company, and government agency. Audited financial statements are publicly available for 25% of the material companies (3 out of 12). Disaggregated disclosure coverage for the oil and gas and mining sector of, respectively, 90 and 96%, suggest that this information is comprehensive, which is confirmed by the assessment from the Independent Administrator of the comprehensiveness of the revenues reported. However, the transfer of Tullow’s assets to Total in November 2020, subject to a fee, should have been materialised by a license fee payment, which is not recorded by the Uganda’s 2020-2021 EITI Report. While the Uganda’s 2020-2021 EITI Report contains a review of the audit status of significant companies, audited financial statements of extractive companies are not all accessible to the public.

The Secretariat's assessment is that Requirement 4.3 is not applicable for the year under review. The Uganda’s 2020-2021 EITI Report confirms the absence of such agreements in the mining and oil and gas sector.

The Secretariat's assessment is that Requirement 4.4 is not applicable for the year under review. The only project that could give raise to government revenues tied to transportation of extractive commodities is the EACOP project, which was still under construction for the year under review.

The Secretariat's assessment is that Requirement 4.7, which is to enable the public to assess the extent to which the government can monitor its revenues as defined by its fiscal framework, and that the government receives what it ought to from each individual extractive project. is mostly met, given the lack of disaggregation of the project-level payments stemming from companies holding several projects. Financial data is adequately disaggregated in the Uganda’s 2020-2021 EITI Report per government agency, company, and revenue stream. On project-level reporting, the MSG has approved a clear definition of project in the country for the mining and oil and gas sector. On the methodology, the Uganda’s 2020-2021 EITI Report claims that all revenue streams specific to the oil and gas and mining sector are disclosed at a project-level and lists them. The unique government agency responsible for the collection of all revenue flows is the URA. The actual practice of disclosure for the fiscal year 2020-2021 includes the 12 material companies. Each company reported their non-tax payments, disaggregated by revenue stream but not for different projects. However, material mining companies such the National Cement Company Uganda seem to hold at least four licenses, including one production and three explorations licenses. It is unclear if the company did not make any payments from its three exploration licenses or if it is a gap in the payments reported on a project basis. In addition, while revenue flows like annual mineral rents seem to be due for each exploration license, there is no trace of these payments disaggregated per mining license. For the oil and gas sector, the definition adopted by the MSG leads to consider the Tilenga or Kingfisher area as one single project. This results in aggregated reporting of payments from the operators such as Total or the CNOOC from the different blocks. However, in its payments to governments report, Total does disclose the payment of license fees disaggregated per block, in direct contradiction with the definition and the reporting adopted by the MSG

The Secretariat's assessment is that Requirement 4.8 is fully met. Most stakeholders consulted considered that the objective of timely EITI disclosures to inform policy making and public debate had been fulfilled. The Secretariat noted that both EITI Reports were published within the two-year allowance. The FY 2020 (to June 2020) was published in May 2022 and the FY 2021 (to June 2021) was published in June 2022. There is scope for further improvements in the timeliness of EITI disclosures by increasingly building on new systematic disclosures by the government. The MSG has consistently approved the period for reporting and adopted cash-based accounting for EITI disclosures.

The Secretariat's assessment is that Requirement 4.9 is fully met. Most MSG members consulted expressed satisfaction at the reliability of financial data disclosed in Uganda EITI reporting. Consulted stakeholders’ opinions were split over whether the EITI was contributing to strengthening routine government and company audit and assurance systems and practices, with some stakeholders considering that the EITI recommendations were more focused on the process of EITI reporting rather than broader audit and assurance practices. It was also noted that the data reported through EITI benefited from a greater credibility due to the work of an independent consultant for the production of the Reports. Auditing systems of the country from the Auditor General work well, and companies and government agencies are audited each year, although the Auditor General report covering the fiscal year 2020-21 could not be reconciled with the receipts reported by URA in their reporting templates given that the figures of the annual report of the Auditor General were not disaggregated. All government agencies provided the agreed quality assurances for the year under review. Nine (9) out of 12 companies did not provide the agreed quality assurances for their reporting template (22% of the total revenues, or 32% of the reconciliation). However, considering that the payments of these nine companies have been reconciled with the government revenues that were subject to credible, independent audit, applying international auditing standards, the Uganda’s 2020-2021 EITI Report contains the IA’s assessment of the comprehensiveness and reliability of the reconciled financial data, judging that the data is comprehensive and reliable. The Uganda’s 2020-2021 EITI Report provides a review of audit and assurance procedures and practices in both government revenue-collecting entities and material extractive companies and sets out the methodology and results of the reconciliation. The Uganda’s 2020-2021 EITI Report includes the IA’s clear assessment in line with its carrying out the agreed upon procedures. There is scope for Uganda to expand its use of EITI reporting as a regular diagnostic of government revenue collecting systems and controls as well as extractive companies’ practices, with a view to formulating recommendations for broader reforms in government and company audit and assurance policies and practices.

The Secretariat's assessment is that Requirement 5.1 is fully met. The objective of this requirement is to ensure the traceability of extractive revenues to the national budget and ensure the same level of transparency and accountability for extractive revenues that are not recorded in the national budget. EITI reporting and systematic disclosures confirms that all of Uganda’s extractive revenues generated during the period under review were recorded in the national budget. Stakeholders consulted generally concurred those legal provisions and mechanisms, including provisions for potential off-budget revenues in the future, contribute to traceability. The Secretariat’s view is that extractive revenues generated during the period under review and disclosed both through government disclosures and EITI reporting, are traceable ensuring public oversight. The Uganda Revenue Authority (URA) holds the responsibility of collecting all the revenues from the oil and gas sector. These revenues are directly deposited into the Petroleum Fund (set in the Bank of Uganda). As stipulated by the Public Finance Management Act (PFMA) 2015, oil and gas revenues in the Petroleum Fund can be either transferred to the Consolidated Fund to support the annual budget, or to the Petroleum Revenue Investment Reserve. Currently, oil and gas revenues collected by the URA are relatively modest (pending the commencement of commercial production) thus all transferred to the Consolidated Fund and duly accounted for in the national budget. These revenues are systematically disclosed in the Petroleum Fund's 2020/2021 audited financial statements (see here), with this information also being published through EITI reporting. It is noteworthy that in the future, as oil and gas production gains momentum, there is a possibility of disbursements to the Petroleum Revenue Investment Reserve, which would be an extra-budgetary allocation. However, the PFMA 2015 establishes statutory guidelines on the Petroleum Fund performance through annual and semi-annual reports and financial statements which should be audited by the Auditor General and submitted to the Parliament. In addition to the Investment Fund, a recent amendment to the PFMA 2015 allows UNOC to retain and spend at source revenues generated from the sale of oil and gas instead of remitting them firstly to the Petroleum Fund. Although CSO had expressed concerns about the impact of the reform on public’s overview of public resource management (see here and here), stakeholders from the government constituency affirmed that the current legal framework incorporates extensive checks and balances, leading to the establishment of a resilient and transparent system and enabling the traceability of revenues, including those that may arise off-budget in the future. It was highlighted the UNOC has a Board that must report to the Parliament, and that this reform was addressing UNOC’s need to meet cash calls. Consulted stakeholders from Uganda’s Petroleum Authority noted that the intent was to make cash calls transparent and UNOC representatives explained that the balance of retained earnings are to be submitted to the Parliament within 90 days to the beginning of the calendar for budget approval. Concerning the mining sector, the Uganda’s 2020-2021 EITI Report explains that all mining revenues are budgetary and directly remitted to the Consolidated Fund. The Uganda’s 2020-2021 EITI Report falls short in clarifying which payments are collected by the National Environmental Management Authority (under the Ministry of Energy and Mineral Development).

The Secretariat's assessment is that Requirement 5.3 remains not assessed, given that some encouraged aspects of this requirement remain to be addressed by Uganda EITI. There is a comprehensive disclosure of the budgeting process and audit mechanisms, as well as publicly available information on earmarked petroleum revenues. However, the Uganda’s 2020-2021 EITI Report does not include assumptions underpinning forthcoming years related to production, commodity prices and revenue forecasts. Therefore, Requirement 5.3 remains not assessed, pending comprehensive disclosures of all information encouraged to be disclosed in accordance with the requirement. Uganda addressed some of the required aspects of Requirement 5.3 though EITI reporting and through information hosted in government websites. Information on earmarked revenues is publicly accessible in the Public Management Finance Act of 2015 (PFMA, part VIII). The PFMA section on transfers to the consolidated fund establishes that petroleum revenues shall be used for the financing of infrastructure and development projects of Government and not the recurrent expenditure. Additionally, the legislation allows for withdrawals from the Petroleum Fund to the Petroleum Revenue Investment Reserve, subject to authorisation from Parliament and approval by the Auditor General. Additionally, the government publishes a comprehensive description of the budget and audit processes through the Ministry of Finance, Planning and Economic Development (MoFPED) portal. Various sections within the website are geared towards public's understanding of the budgeting process. For instance, the Know Your Budget section includes an introductory page on Budget Basics, along with other sections specifically describing the process, timelines and tools. This information is also summarised in Uganda’s 2020-2021 EITI Report which presents a comprehensive description of Uganda's budgeting process based on the PFMA and on the MoFPED website. The Uganda’s 2020-2021 EITI Report specifies that oversight entities include the Budget Monitoring and Accountability Unit, the State House Monitoring Units, the Office of the Prime Minister and Office of the Auditor General. Reports on performance against set budgets as well as budget releases and expenditure data are published in open data format. However, release and expenditure data for years under review is yet to be published. Uganda’s MSG has not yet addressed information related to production and commodity price assumptions that would shed light on revenue sustainability and revenue dependency.

The Secretariat's assessment is that Requirement 4.6 is mostly met. Consulted stakeholders did not express any views on the objective of the objective of enabling stakeholders to gain an understanding of the benefits accruing to local governments through transparency in companies' direct payments and to strengthen public oversight of subnational governments' management of their internally generated extractive revenues. In Uganda, companies make diverse direct payments to districts. Seven out of twelve companies (two in the oil and gas sector and five in mining sector) retained in the reconciliation scope unilaterally disclosed subnational payments through MSG-approved reporting templates. Subnational payments encompass local service taxes, property taxes, trading licenses and ground rents. During consultations, the MSG indicated that subnational payments for the fiscal year 2020-2021 were not deemed material, constituting 0.4% of government extractive revenues. In its comments to the draft Validation report, the MSG reiterated that these payments were not significant to be considered material. The Secretariat’s view is that while some information on subnational payments was disclosed through EITI reporting, the objective of this requirement remains mostly met as the MSG decision on materiality relied based on company reporting led to consider these payments as material. The Uganda’s 2020-2021 EITI Report included unilateral disclosures by companies. The lack of disclosure of the receipt of these payments is problematic and was not explained in the report”.

The Secretariat's assessment is that Requirement 5.2 is mostly met. Uganda discloses the revenue-sharing formulas through governmental publications. The Secretariat’s view is that while information provided in the EITI Report and additional clarification by the MSG enables stakeholders at the local level to an understanding of royalty-sharing mechanisms, the current practice of mineral royalty transfers does not yet allow for an assessment of whether the transfers of extractive revenues are aligned with statutory entitlements. This is also in line with views of consulted stakeholders which expressed that subnational government entities lack information on subnational transfers. Uganda’s 2020-2021 EITI Report discloses mineral royalties transferred from the central government to three subnational levels, in aggregate and the individual transfers to each recipient. In its comments on the draft Validation report, the MSG provided additional information, clarifying the differences between expected and disbursed transfers. There remains a need to ensure that stakeholders at the local level have access to sufficient information that enables them to assess whether these transfers are in line with statutory entitlements. The international Secretariat retains is assessment that this requirement is mostly met. The Uganda’s 2020-2021 EITI Report notes that the MSG agreed to include information on subnational transfers through unilateral disclosures by relevant government agencies. Revenue sharing formulas are systematically disclosed through the Petroleum Fund Management Act 2015 (schedule 6), and in the MMA 2022. The inclusion of information on recent reforms and visual aids in the Uganda’s 2020-2021 EITI Report serves to enhance public understanding of extractive revenue allocation mechanisms to subnational government entities. According to regulatory provisions, it is established that 6% of petroleum royalties are to be transferred from the central government (Uganda Revenue Authority) to local governments. Concerning the mining sector, the Uganda’s 2020-2021 EITI Report presents the total expected royalties (in per the formula) and the aggregated amounts disbursed to three different subnational governments levels: local government, lower local government (sub county, town, council) and landowners. The report highlights an overall discrepancy between the expected amounts and the disbursed amounts. In its commentary to the draft assessment, the MSG explained that the discrepancy was an ongoing concern arising from disbursements that overlap financial years. In this sense a meeting would be held with the respective entities to address this matter. An additional analysis of the subnational transfers disclosed in the Uganda’s 2020-2021 EITI Report revealed that certain entities received higher amounts and more frequently than others. The MSG elaborated in their comments on the draft assessment that there were payments not reflected because of delays in royalty transfers either until beneficiaries submit their bank account information or resolve land issues. Third-party reports have also found that payment problems are compounded by the complex nature of land ownership (see here). Regarding the frequency of disbursements, the addendum specified that this is contingent upon the level of activity or production in mining. Consulted stakeholders highlighted that subnational entities often are unaware of transfers from mining royalties due to insufficient dissemination and notification mechanisms. They stressed that the obligation to inform is crucial for transparency, and providing more information on revenue transfers to districts would bolster Uganda's anti-corruption efforts. Consulted members of the civil society constituency noted that the lack of sufficient information prevents an assessment of the information disclosed in the Uganda’s 2020-2021 EITI Report regarding subnational transfers. They would like more outreach, dissemination, and funding to ensure a broader understanding of the disclosed information.

The Secretariat's assessment is that Requirement 6.1 is mostly met. The International Secretariat considers that a number of gaps identified in this assessment, relating to legal basis for mandatory expenditures, comprehensiveness of reported expenditures and clear distinction between expenditures and payments, prevent a public understanding of social and environmental contributions. Stakeholders did not express any additional view on the general objective of this requirement. In its commentary to the draft assessment, the MSG reiterated its decision of including these payments through unilateral disclosure of companies on the scope of EITI reporting. The Secretariat’s view is that this does not provide new information, and therefore retains its assessment of mostly met. First, the Uganda’s 2020-2021 EITI Report includes both mandatory and discretionary payments. While the Uganda’s 2020-2021 EITI Report provides a brief definition of social expenditures, a clear legal basis for reported mandatory expenditures is not indicated. Most mandatory social expenditures reported are related to compensations for resettlement of affected by the Tilenga project and expenses associated to the education and training of government officials, but the legal basis for this is not explained. Second, from the disclosures it is not possible to assess comprehensiveness of the reported expenditures. For example, only a mining company disclosed a mandatory social expenditure, but it is not possible to understand why the identified material companies did not report. Consulted MSG members noted that social and environmental expenditures these were not in the materiality scope and were included through unilateral disclosures from companies within the reporting scope. The limited number of companies that reported mandatory expenditures raises questions about the comprehensiveness of EITI disclosures. There is no evidence of the MSG considering a specific threshold for such expenditures, or additional documentation on the basis of this assessment. Despite the MSG establishing of a Local Content Committee tasked with informing on the materiality of companies' social payments, there is no additional explanation of the MSG approach to materiality. In the report, information is disaggregated by company, beneficiary, geographic distribution (districts/areas), and whether expenditures are made in cash or in-kind. In some instances, information on the nature of the expenditure and the parties involved is inconsistent or missing. Thirdly, relating to environmental expenditures, the report alludes to the legal framework governing the environment noting some environmental obligations. All the environmental expenditures disclosed are mandatory apart from one. However, payments and expenditures are conflated within the same category (such as environmental assessments, waste management fees and a payment to the petroleum fund). The nature, function or beneficiary of mandatory environmental expenditures declared by some mining companies lack clarity.