All the President’s Wealth The Kabila Family Business July 2017 Cover picture: Reuters/Robert Carrubba Layout and design: Garage East Copyright © Congo Research Group 2017 Executive Summary The Democratic Republic of Congo is entering that extend for more than 450 miles along its third decade of armed conflict. Throughout Congo’s southern border with Angola.3 Jaynet this period corruption has been tightly linked to Kabila, the president’s sister and a member conflict.1 The 2006 Congolese constitution was of parliament, owns a stake in the country’s created in the aftermath of thirty-two years of largest mobile phone network,4 while their 80+ dictatorship, during which President Mobutu brother Zoé, who is also a parliamentarian, Companies Sese Seko used public funds to enrich himself and owns companies that have been contracted to & businesses his allies, and sets up safeguards to prevent the work on some of the world’s richest mineral abuse of public office for personal enrichment. deposits.5 The network of family companies This report by the Congo Research Group (CRG) has the following characteristics: at New York University’s Center on International 71,000 hectares Cooperation is the first in a series of investigations • The businesses are invested in almost every part of farmland by CRG into links between politics and business in of the Congolese economy, including farming, Congo, aiming to promote greater accountability mining, banking, real estate, telecommunications and to bolster the oversight enshrined in the and airlines. constitution.It examines the business networks of the country’s most powerful elected official, • The value of their assets is difficult to determine. diamond permits President Joseph Kabila, and his family. However, a conservative reading of public along 450 miles of documents suggests that their companies have Congo’s border with Our research over the past 20 months, supported had hundreds of millions of dollars in revenues Angola by the Pulitzer Center on Crisis Reporting, shows since 2003, and that they own assets that are that the Kabila family either partially or wholly easily worth many tens of millions of dollars. owns more than 80 companies and businesses in the Congo and abroad. President Kabila • Over the years, some of the businesses have directly and through a company he owns with benefitted from Congolese government contracts, 4.8% stake in one his children holds more than 71,000 hectares as well as from contracts with the World Bank, the of the country’s (175,444 acres) of farmland.2 Two companies U.S. Overseas Private Investment Corporation, largest mobile phone that belong to the family own diamond permits and the United Nations.6 networks 1 All the President’s Wealth The Kabila Family Business The lack of fiscal transparency in the Congo The Kabila family’s investments will likely and in foreign tax havens where some of the play a role in their decision-making during the companies are registered formed a significant current political transition. While Kabila’s second obstacle to our research. While President mandate ended in December 2016, under the Kabila has reportedly declared his assets to terms of a deal signed with the opposition he the judiciary as required by the constitution, will stay in power until the next elections, which his submissions have not been made public, are supposed to be held before the end of 2017. rendering it impossible to verify their accuracy.7 There is no requirement in the Congo to While this report examines the assets of the publish property taxes or corporate taxes, presidential family, it is clear that members of making it difficult to know how much the the elite on all sides of the political divides have family’s companies are worth. abused their office for personal enrichment. While most international interventions in the Congo have This report is limited to our investigation placed an emphasis on negotiation and political into the Kabila family businesses and is not compromise, they have failed to hold elites or the intended to be a complete accounting of the corporations they work with accountable for this kind family’s various revenue streams. We also of corruption. do not conclude that the family’s holdings are necessarily illegal or corrupt. However, some of the family’s holdings may violate Congolese law or codes, while other ventures raise serious questions of conflicts of interest: • Congo’s Ministry of Mines has granted a company controlled by the president’s sister, Jaynet Kabila, more mining permits than allowed under the country’s mining code.8 Business linked to the Kabila family have • Companies belonging to Zoé Kabila have made benefitted from contracts with: millions of dollars from mining joint ventures and subcontracts, including at Sicomines, part of Congo’s $6.2 billion minerals-for- infrastructure deal with China.9 • Some of the family’s business assets are protected or overseen by members of the Republican Guard, which is likely outside the legal mandate of the force.10 • Family companies have benefitted from large state contracts, including for the issuing of drivers licenses.11 • At least one family company was part of a controversial 2011 copper mining deal that led the International Monetary Fund to United Nations cancel its half-billion dollar loan program Peacekeeping Mission with Congo.12 2 Recommendations This report examines the business activities of • All mining, oil, hydropower, and some of the most powerful people in the country timber contracts, memoranda of and proposes concrete measures that can be understanding, amended contracts, and taken by Congolese legislators and members other relevant documents related to of government to enhance transparency. These natural resources should be published measures include: as required by government decree.16 • All public officials should declare their assets • The government should digitize all as required by the 2002 code of conduct for landholding and incorporation records and public officials.13 make them readily available to the public. • Parliament should: • The ministry of mines should ensure that the 2002 mining code is applied to – pass legislation requiring all asset all companies and individuals equally, declarations by public officials to be made especially in terms of the number and size public, as is required in other countries;14 of permit holdings allowed and the right to – pass a law on access to information, which declare force majeure, which exempts permit would codify the right to information and holders from their obligations only under increase transparency into the business extraordinary circumstances. dealings of the government and all public officials;15 • The ministry of mines should make public – pass a law requiring charitable foundations all granted applications for force majeure, and non-profit organizations to publish along with the justification for granting statements of their finances, including their the designation. sources of funding. • Members of the Republican Guard should • The constitutional court should clarify the be withdrawn from sites that are linked to regulations in the constitution and legal code the businesses of the presidential family, regarding conflicts of interest for public especially mining sites, unless there is an officials, including the president. overriding national security interest. • President Joseph Kabila, Zoé Kabila, and Jaynet • Foreign investors in the Congo dealing Kabila should place their private business with Politically Exposed Persons should interests in an independently managed trust to be required to publish the financial avoid possible conflicts of interest. terms of their deals with PEPs. 3 All the President’s Wealth The Kabila Family Business Methodology This report relies almost exclusively on publicly available the Kabila family’s business interests. For example, documents. We obtained land titles, incorporation CRG did not include several large ranches, buildings, documents, board meeting minutes, mining permits, media companies, and business ventures that are widely and shareholder agreements through Congolese courts believed to belong to the family, as we could not obtain and registries throughout the country and online. the relevant documentation to prove ownership. While in principle most of these documents should be available to the public17—and all claims regarding Companies are also dynamic and their ownership structure company ownership here are backed up by official can change. Some companies listed in this report no longer documents or company websites—in reality many operate; a few may no longer have ties to the presidential company files were incomplete or could not be found. family. When company ownership is first listed, it includes In several cases registry workers would not release at least one date, usually the most recent, on which that certain filings, saying they were too sensitive. ownership was noted in official documents. CRG has tried to find the most recent shareholding, but publicly available CRG used these documents to amass a digital archive company documents are not always updated. This means that could be searched for links to the family. Those the current shareholding could be different than the links were then verified through interviews or other shareholding listed in this report. documents. Excerpts from some of those documents are available on the CRG website (allthewealth. We have included companies, businesses, organizations congoresearchgroup.org). The remainder is on file at and assets with current or previous links to the family CRG. Some responses may be published on the CRG through ownership or directorship positions. website at the time of publication or later. Companies that are no longer operational or that are The investigation coincided with a Bloomberg News no longer directly linked to the family are still included investigation into the Kabila family’s assets.18 CRG, here, for several reasons. Even companies that went along with the Pulitzer Center on Crisis Reporting, out of business may have been profitable or helped helped fund one of the Bloomberg journalists.