Local Content Laws & Contractual Provisions

The VCC is examining local content provisions inserted in legal frameworks governing resource investments, including in contracts, legislation and bidding practices, and looks at ways to leverage investments to increase local content, i.e., develop human capital and local supply chains in host countries through local recruitment, training, technology transfer and local procurement of goods and services. These provisions can be key to translating resource investments into sustainable benefits for local communities. Typically, local content provisions require investors to meet targets measured as a percentage of investment, hours worked, equipment supplied or jobs created. These requirements often go unfulfilled. Our research will examine the reasons these targets go unmet, including compliance mechanisms, public monitoring, and the need for frameworks to stimulate skills development. The VCC is also surveying and analyzing treaty provisions that may prevent, counsel against, and /or shield local content standards, including provisions in investment treaties that address performance requirements.