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Norway: Procurement Law to Stem Deforestation, Protect Human Rights Adopted

(Sept. 16, 2016) On June 17, 2016, the Norwegian Parliament passed a new procurement law that mandates consideration of environmental consequences, human rights, and other social effects in public procurement processes. (Lov om Offentlige Anskaffelser (Anskaffelsesloven), LOV 2016-06-17-73 [Procurement Act No. 73 of June 17, 2016], LOVDATA.) This goal is spelled out in article 5 of the new Procurement Act.  It states:

§ 5. Environment, human rights and other social considerations

The state, municipalities, and municipal agencies, as well as public organizations, shall establish public procurement policies in a manner that will reduce harmful environmental effects and promote climate-friendly solutions when relevant. This should for instance be done by the principal [agency] taking life-cycle costs into consideration.  These principals shall also establish their own procedures for promoting respect for fundamental human rights in public procurement where there is a risk for violation of those rights. The [Ministry of Trade, Industry and Fisheries] shall publish further regulations on the matter. The principal can set its own requirements and criteria tied to the different stages of the procurement process, provided that public contracts are made in a way that promotes consideration for the environment, innovation, working conditions, and social considerations and provided that the demands are connected to the delivery [of items or service being procured].

[The Ministry of Trade, Industry and Fisheries] can, in an accompanying regulation, require the state, municipalities, municipal agencies, and public organizations to set limits on the number of levels in the supply chain during procurement in industries where there are special challenges tied to illegal working conditions.

The principal must require a universal design in public contracts correlating with the provisions [on such contracts] set down in regulations.

[The Ministry of Trade, Industry and Fisheries] can in regulations require principals to include requirements of universal design in public contracts. (Id.)

The adoption of the law follows Norway’s signing of the Amsterdam Declaration, an international instrument first initiated by Denmark, France, Germany, the Netherlands, and the United Kingdom that seeks to eliminate deforestation from agricultural commodity chains within Europe. (Press Release, Regjeringen, Norge slutter seg til Amsterdam-erklæringene (June 14, 2016); Amsterdam Declaration “Towards Eliminating Deforestation from Agricultural Commodity Chains Within European Countries,” The Netherlands Ministry of Foreign Affairs website (Dec. 7, 2015).)

Norway previously signed an agreement with other donors (the European Union, Germany, France, and the United Kingdom) to aid the Democratic Republic of the Congo in its fight against deforestation. The total donation is capped at $200 million, of which Norway will donate up to NOK1,520 million (about US$182 million).  (Press Release, Regjeringen, Norge med i ny avtale om bevaring av Kongos regnskog (Apr. 22, 2016); Press Release, United Nations Development Programme, Major Agreement Between CAFI and the DRC Sets Best Practices to Prevent Tree Loss and Ensure Sustainable Development: Signature of US$200 Million Agreement for DRC Forests Takes Place in Geneva on April 22 (Apr. 22, 2016).)

According to the legislative history of the Norwegian Procurement Act, the new human rights and environmental requirements are a modernization of the law in its current form, which had already required state and municipalities to “consider” life-cycle costs, universal design, and environmental consequences of procurement. (Proposisjon 51 L (2015-2016) Lov om offentlige anskaffelser (Anskaffelsesloven) [Government Bill on Procurement], REGJERINGEN.NO.)

The new Act also serves to implement three EU Directives on procurement:

The Procurement Act is expected to enter into force on January 1, 2017. (Press Release, Regjeringen, Enklere anskaffelsesregler [Easier Procurement Rules] (Aug. 18, 2016).) Organizations concerned about deforestation have given positive recognition of the adoption of the Act.  (Elyse Wanshel, Norway First Nation to Ban Deforestation, HUFFINGTON POST (June 7, 2016).)