The Cerna Sanchez Family
Land compensation and land rights
5% equity stake
Minera Yanacocha S.R.L. is a large open-pit gold mine located in the Andes mountains, in the Department of Cajamarca, Peru. The company is engaged in the exploration and production of gold. Over a period from 1993 to 1999, IFC committed three loans to finance the capital expenditure programs for three of the Company’s mines, Carachugo, Maqui Maqui and La Quinua. In parallel, IFC made an equity investment for a 5% ownership stake in the Company, which it continues to hold.
In May 2013, CAO received a complaint from several members of a family in Cajamarca who are concerned about lack of compensation for lands owned by their family, which they claim has prevented them from reaping its benefits. The complainants also state that the company never provided compensation for said lands.
CAO found the complaint eligible for assessment in May 2013. The assessment concluded in October 2013 with the family and the company agreeing to engage in a voluntary dispute resolution process facilitated by CAO. This is captured in CAO's Assessment Report, which is available under "View Documents" below.
In preparation for dialogue, CAO held separate capacity building workshops with the parties, and helped them design a joint process for addressing the issues in the complaint. The parties set up a smaller working group which included representatives of the family and the company, and met on a monthly basis to review documentation and establish facts. In May 2014, the working group reported that they had reached an impasse. As there was no agreement by the parties on how to overcome the impasse, or reach a common understanding, the dispute resolution process was brought to an end.
As per its Operational Guidelines, CAO has referred this case to its Compliance function for appraisal of IFC's performance with regard to the project.
In May 2015, CAO published a Compliance appraisal report regarding IFC's investment in Yanacocha and considering four separate complaints (04, 05, 06 and 07). CAO has determined that an investigation was not merited and has closed the four cases.
CAO's Compliance appraisal report, providing a full description of CAO's decision with regard to this case, is available under "View Documents" below. As of May 29, 2015, CAO has closed the case with no further action.
Status as of May 29, 2015