East Asia & the Pacific
Cambodia / Cambodia: VEIL II-01/Ratanakiri Province
Vietnam Enterprise Investments Limited (VEIL or the Fund) is a closed-end investment fund which has been in operation since 1995. The Fund has a capital base of just over US$500 million and is managed by Dragon Capital Management Ltd., a subsidiary of Dragon Capital Group (DCG). IFC has invested US$16.4 million in the Fund. The Fund aims to invest in publicly or privately issued securities of Vietnamese companies, with the stated aim to provide incentives for the development of Vietnamese capital markets by increasing liquidity of Vietnamese securities. One of the companies DCG invests in through the Fund is Hoang Anh Gia Lai (HAGL).
In February 2014, local members of 17 villages in Ratanakiri Province in Cambodia lodged a complaint with CAO with the support and assistance of five Cambodian NGOs. The complaint raises a range of environmental and social concerns about HAGL’s Cambodia operations, including impacts on water sources and fish resources, loss of land, lack of compensation, lack of information disclosure and engagement with the people, threat to spiritual, cultural and indigenous practices, as well as use of child labor. The complaint alleges non-compliance with IFC policies and procedures and with Cambodian laws. The complainants requested that CAO keep their identities confidential.
The CAO found the complaint eligible for further assessment in February 2014 and concluded the assessment of the complaint in April 2014. Based on stakeholder discussions conducted as part of CAO's assessment of the complaint, the Complainant and Company have agreed to engage in a voluntary dispute resolution process. In December 2014, the affected communities selected their representatives and in January 2015 the parties adopted Ground Rules for the mediation process.
In March 2015, CAO released a communiqué regarding the adoption of a mediation agreement by the parties to the VEIL complaint and the issuance of their first Joint Statement regarding the ongoing mediation process. The communiqué in English and Khmer, and Joint Statement, can be accessed via the "View Documents" tab below.
The dispute resolution process is ongoing and CAO continues to work with the parties on moving forward with the process.
Note: An assessment does not entail a judgment on the merits of the complaint. Rather, the aim is to listen to people's concerns, understand the different perspectives, and gauge whether it is possible to address the concerns in a collaborative process.
Status as of March 17, 2015
- Project Name & Number
- VEIL II 20926
- Financial Markets
- Dragon Capital Group
- East Asia & the Pacific
- Environmental Category
- Quasi-equity US$16.4 million
- Eligible: Completed
- Assessment Period: Completed
- Facilitating Settlement: In Process