FOURTH REPUBLIC
Petroleum Revenue Management
Act 815
Act,
2011
ARRANGEMENT OF SECTIONS
sections
Preliminary matters
1.
Application
2.
Establishment of Petroleum Holding Fund
3.
Payment into Petroleum Holding Fund
4.
Payment with petroleum in place of cash
5.
Prohibited use of Petroleum Holding Fund
6.
Petroleum Holding Fund receipts
Other petroleum receipts
7.
Carried and participating interest
8.
Transparency and accountability of petroleum
receipts
Allocations and disbursements
9.
Establishment and object of the Ghana
Stabilisation Fund
10.
Establishment and object of the Ghana Heritage
Fund
11.
Ghana Petroleum Funds
12.
Withdrawals from the Ghana Stabilisation Fund
13.
Withdrawals from the Ghana Heritage Fund
14.
Finality of payments
15.
Reconciliations of Petroleum Holding Fund
16.
Disbursement from the Petroleum Holding Fund
17.
Benchmark Revenue
18.
The Annual Budget Funding Amount
19.
Transfers into the Consolidated Fund
20.
Consolidation of Ghana Stabilisation Fund and
Ghana Heritage Fund
21.
Use of the Annual Budget Funding Amount
22.
Extra budgetary activities and statutory
earmarking prohibited
23.
Transfers into the Ghana Heritage Fund and Ghana
Stabilisation
Fund
24.
Transfers for exceptional purposes
Management and investment of Ghana Petroleum
Funds
25.
Obligations of the Minister
26.
Management obligations of the Bank of Ghana
27.
Investment rules
28.
.
Reports on the Ghana Petroleum Funds
Investment Advisory Committee
29.
Establishment of Investment Advisory Committee
30.
Functions of the Investment Advisory Committee
31.
Appointment of members of the Investment
Advisory Committee
32.
Tenure of office of members of the Investment
Advisory Committee
33
Meetings
of
the Investment Advisory Committee
34
.
Disclosure
of interest
35.
Publication
of membership of the Investment Advisory
Committee
36.
Allowances
37.
Secretariat of the Investment Advisory Committee
38.
Absence of
advice from the Investment Advisory Committee
39.
Release
of
advice
from the Investment Advisory Committee
40.
Oversight of and reporting on the Ghana
Petroleum Funds
Encumbrances, auditing and reporting
41
Encumbrances
on the assets of the Petroleum Holding Fund and
the a Ghana Petroleum Funds
Audit of the Petroleum Funds
42.
Public funds
43. Books of the
Petroleum Funds
44.
Internal
audit
45. External audit
46..
Annual
audit
47. Special audit
48 Annual report
on the Petroleum Funds
Accountability,
transparency and public oversight
49.
Transparency
as a fundamental principle
50.
Non-compliance with an obligation to publicise
information
51.
Public interest
and Accountability
.Committee
52. Objects of the Accountability
Committee
53
, Functions
the
Accountability Committee
54.
Membership of the Accountability Committee
55.
Tenure of members and eligibility for
appointment
56.
Reporting
57.
Allowances
Miscellaneous matters
58.
Penalties
59.
Transitional and final provisions
60.
Regulations
61.
Interpretation
SCHEDULES
THE EIGHT HUNDRED AND FlFTEENTH
ACT
OF THE PARLIAMENT OF THE REPUBLIC OF GHANA
ENTITLED
PETROLEUM REVENUE MANAGEMENT ACT, 2011
AN
ACT to provide the framework for the collection,
allocation and management of petroleum revenue
in a responsible, transparent,
accountable
and
sustainable
manner for the benefit f the citizens of
Ghana
in accordance with Article 36 of the
Constitution and for
related matters.
DATE OF ASSENT: 11th April, 2011.
PASSED by Parliament and assented to by the
President:
Preliminary matters
Application
1. (1)
This Act shall regulate the collection,
allocation and management by government of
petroleum revenue derived from upstream and
midstream petroleum operations.
(2) Where
there is any conflict between the provisions of
this Act
and
(a)
any other enactment, or
(b)
the terms, conditions and stipulations in a
petroleum authorisation,
on the collection, allocation and management of
petroleum revenue, the provisions
of
this Act
shall prevail.
Establishment of Petroleum Holding Fund
2.
(1) A Petroleum Holding Fund is hereby
established as a designated
public fund at the Bank of Ghana to receive and
disburse petroleum revenue due the Republic.
(2) The petroleum revenue shall be deposited in
the Petroleum Holding Fund for subsequent
transfers in accordance with the provisions of
this Act.
Payment into Petroleum Holding Fund
3.
(1) Petroleum revenue due the Republic derived
from whatever source shall be assessed,
collected and accounted
for by tbe Ghana
Revenue Authority.
(2) The petroleum revenue assessed as due in
each. month shall be paid by direct transfer
into the Petroleum Holding Fund by the
fifteenth
day of the ensuing month by the entities obliged
to make the payment.
(3) The entity shall notify the Ghana Revenue
Authority in writing of the payment into the
Petroleum Holding Fund.
(4) Where the liability of an entity to make
a payment is not discharged on or before the due
date, the entity shall pay
as a
penalty, an additional five percent of the
original amount for each
day
of default or the default rate established under
any other law, whichever
higher.
(5) For the purposes of this Act, petroleum
revenue paid into the Petroleum Holding Fund
shall not be
(a)
treated as part of the normal tax revenue for
purposes provided for in relevant laws of the
Republic; and
(b)
used as the basis for the determination of any
statutorily earmarked funds.
Payment with petroleum in place of cash
4.
(1) Where government elects for payment in
petroleum instead of cash, the value of the
petroleum in US Dollars on the
day the
petroleum
is received by or on behalf of the government
shall
be
reported
and
recorded by the Ghana Revenue Authority as the
payments for the Petroleum Holding Fund.
(2) The proceeds of the sale of the petroleum
shall be credited to the Petroleum Holding Fund
within sixty calendar days after the receipt of
the petroleum.
(3) Where payments are made in petroleum, the US
Dollar equivalent of the payment on the date of
receipt ·shall be shown as a receipt into the
Petroleum Holding Fund for the purpose of
reporting.
Prohibited use of Petroleum Holding Fund
5.
(1) The amount in the Petroleum Holding Fund
earmarked for transfer into the Ghana Petroleum
Funds, shall not be used
(a)
to provide credit to the government, public
enterprises, private sector entities or any
other person or entity, and
(b)
as collateral for debts, guarantees, commitments
or other liabilities of any other entity.
(2) In order to preserve revenue streams from
petroleum and ensure the object of this Act,
there shall not be any borrowing against the
petroleum resreve.
Petroleum Holding Fund receipts
6.
The following shall constitute the gross
receipts of the Petroleum Holding Fund:
(a)
royalties from oil and gas, additional oil
entitlements, sui- face rentals, other receipts
from any petroleum operations and from the sale
or export of petroleum;
(b)
any amount received from direct or indirect
participation of the government in petroleum
operations;
(c)
corporate income taxes in cash from upstream and
midstream petroleum companies;
(d)
any amount payable by the national oil company
as corporate income tax, royalty, dividends, or
any other amount due in accordance with the laws
of Ghana; and
(e)
any amount received by government directly or
indirectly from petroleum resources not covered
by paragraphs (a) to
(d)
including where applicable, capital gains tax
derived from the sale of ownership of
exploration, development and production rights.
Other petroleum receipts
Carried and participating interest
7.
(1) Revenue due from the direct or indirect
participation of the Republic in petroleum
operations, including the carried and
participating interests shall be paid into the
Petroleum Holding Fund.
.
(2) The payment into the Petroleum Holding Fund.
Shall be the net of
(a)
the equity financing cost including advances and
interest on the carries and participating
interest of the Republic
(b) the cash or the equivalent barrels of
oil that shall be ceded to the national oil
company our of the carried and participating
interest recommended by the minister and
approved by parliament
(3) The Ghana Stabilisation Fund shall receive
from the Petroleum Holding Fund a percentage of
petroleum revenue which is determined by
Parliament as savings for the purpose of this
Act.
Establishment and object
of the
Ghana Heritage Fund
10.
(1) A Ghana Heritage Fund is hereby established.
(2) The object of the Ghana Heritage Fund is to
(a)
provide an endowment to support development for
future generations when petroleum reserves have
been depleted;
and
(b)
receive excess petroleum revenue.
(3) The Ghana Heritage Fund shall receive from
the Petroleum Holding Fund a percentage of
petroleum revenue which shall be determined by
Parliament as savings for the purpose of this
Act.
(4) Despite section 20, Parliament may by a
resolution supported by the votes of a majority
of members of Parliament at intervals of fifteen
years from the date of commencement of this Act,
review the restriction on transfers from the
Ghana Heritage Fund and authorise a transfer of
a
portion of the accrued interest on the Ghana
Heritage Fund into any other fund established by
or under this Act.
Ghana Petroleum Funds
11.
(1) The Ghana Stabilisation Fund and the Ghana
Heritage Fund are collectively to be known as
the Ghana Petroleum Funds.
(2) The Ghana Petroleum Funds shall both receive
from the Petroleum Holding Fund, petroleum
revenue in excess of the Annual Budget Funding
Amount.
Withdrawals from the Ghana Stabilisation Fund
12.
(1) Where petroleum revenue collected in any
quarter falls below one quarter of the Annual
Budget Funding Amount for that financial year,
withdrawals may be made from the Ghana
Stabilisation Fund.
(2)The allowable amount to be withdrawn shall be
the lesser of
(a) seventy-five percent of the estimated
amount of the short- fall for that quarter; or
(b)
twenty-five percent of the balance standing to
the credit of the Ghana Stabilisation Fund at
the beginning of the financial year.
(3) In the event of petroleum revenue shortfalls
in the second and third quarter of the same
financial year, the amount to be withdrawn at
the end of the third quarter from the Ghana
Stabilisation Fund shall be double the allowable
amount of the third quarter shortfall.
(4) If there are successive shortfalls in any of
the preceding quarters in the same financial
year, the fourth quarter withdrawal from both
the Petroleum Holding Fund and the Ghana
Stabilisation Fund shall be enough to meet the
Annual Budget Funding Amount approved in the
Appropriation Bill for that financial year,
subject to section 19 (2).
(5) Transfer out of the Ghana Stabilisation Fund
shall only be done for the purpose of
alleviating shortfalls in actual petroleum
revenue in accordance with subsections (1), (2),
(3) and (4).
Withdrawals from the Ghana Heritage Fund
13.
Withdrawals from the Ghana Heritage Fund shall
be in accordance with the transfer procedures in
section 20.
Finality of payments
14.
An obligation to make a payment into the
Petroleum Holding Fund, the Ghana Stabilisation
Fund or the Ghana Heritage Fund shall not be
discharged until the entire amount has been
deposited integrally and unconditionally into
the respective earmarked Petroleum Funds.
Reconciliations of Petroleum Holding Fund
15.
(1) Not later than the end of the first quarter
of each year after the commencement of this Act,
the Minister shall reconcile the actual total
petroleum receipts and the Annual Budget Funding
Amount of the immediately preceding year and
shall submit a written report to Parliament.
(2) The report shall include the following
information:
(a)
the Annual Budget Funding Amount for the
immediately preceding two years;
(b)the
actual inflows and outflows of the Petroleum
Holding Fund for that year;
(c)
the balance of actual receipts for the year
being reconciled over the Annual Budget Funding
Amount; and
(d)
recommendations for the reconciliations and
adjustments needed to account for any deviations
so that the inflows and outflows related to the
Ghana Petroleum Funds match the actuals of the
year.
,(3)The
report shall be published in the Gazette
and at least two state owned daily
newspapers not later than April 30th
of the year in which the reconciliation
carried out.
Disbursement from the Petroleum Holding Fund
16. Disbursements
from the Petroleum Holding Fund shall be made
only
(a)
to the Consolidated Fund in support of the
national budget;
(b)
to the Ghana Petroleum Funds for purposes of
savings and
inverstments,
and
(c)
for exceptional
deductions according to the provisions of this
Act.
Benchmark Revenne
1.7.
The Minister
shall not later than September I" of each year
estimate and certify the Benchmark Revenue using
the formula set out in the First
Schedule.
The Annual Budget Funding Amount
18. (1) The annual Budget Funding Amount
from petroleum revenue shall not be more than
seventy percent of the Benchmark Revenue.
(2) The
exact
percentage of the Benchmark Revenue which shall
be allotted
to the Annual Budget Funding Amount shall be
guided by a Medium-term development strategy
aligned with a long term national development
plan, absorptive capacity of the economy and the
need for prudent macroeconomic management.
(3) For each financial year, the percentage of
the Benchmark Revenue allotted
to
the Annual Budget Funding Amount shall be
approved by parliament
/
as part of the national budget.
(4)
The
spending
allocation determined under subsection
(1)
shall be review
every three
years with the first review to occur before the
commencement at'
the 2014 financial year.
(5)
The
review
shall be conducted by the Minister taking into
account the development needs as well as the
absorptive capacity of the economy and cognisant
of the need to maintain macroeconomic stability.
(61 Any proposed changes following the review
shall be subject to ratification
by a resolution of Parliament supported by the
votes of not less than two thirds of the members
of the Parliament
(7)
The Annual Budget Funding Amount may be used as
collateral for debts and other liabilities of
Government for a period of not more than ten
years after the commencement of this Act.
Transfers into the Consolidated Fund
19. (1) Transfer of the Annual Budget Funding
Amount from the Petroleum Holding Fund into the
Consolidated Fund
(a)
shall be in quarterly instalments of an amount
not more than one-quarter of the Annual Budget
Funding Amount; and
(b)
shall only take place after publication of the
Annual Budget in the
Gazette
confirming the appropriation amount approved by
Parliament for that financial year.
(2) The total amount withdrawn
'from
the Petroleum Holding Fund for budget funding
for any financial year shall not exceed the
Annual Budget Funding Amount approved by
Parliament for that financial year.
Consolidation of Ghana Stabilisation Fund and
Ghana Heritage Fund
20. (1) Within one year after petroleum reserves
are depleted, the moneys held in both the Ghana
Stabilisation Fund and Ghana Heritage Fund shall
be consolidated into a single Fund to be known
as the Ghana Petroleum Wealth Fund after which
the Ghana Stabilisation Fund and
the Ghana Heritage Fund shall cease to exist.
(2) After petroleum reserves are depleted, the
Annual Budget Funding Amount shall not exceed
the sum of dividends from the national oil
company and the earnings on the Ghana Petroleum
Wealth Fund.
Use of Annual Budget Funding Amount
21. (1) The Annual Budget Funding Amount is part
of the national budget and its use and
expenditure are subject to the same budgetary
processes that are necessary to ensure efficient
allocation, responsible use and effective
monitoring of expenditure.
(2) The use of the annual allocation of the
Annual Budget Funding Amount shall be
(a)
to maximise the rate of economic development;
(b)
to promote equality of economic opportunity with
a view
to ensure the well-being of citizens;
(c)
to undertake even and balanced development of
the regions;
and
(d)
guided by a medium-term expenditure framework
aligned with a long-term national development
plan approved by
Parliament.
(3) Where the long-term national development
plan approved by Parliament is not in place, the
spending of petroleum revenue within the budget
shall give priority to, but not be limited to
programmes or activities relating to
(a)
agriculture and industry;
(b)
physical infrastructure and service delivery in
education, science and technology;
(c)
potable water delivery and sanitation;
(d)
infrastructure development in telecommunication,
road, rail and port;
(e)
physical infrastructure and service delivery in
health;
(f)
housing delivery;
(g)
environmental protection, sustainable
utilisation and the protection of natural
resources;
(h)
rural development;
(i)
developing alternative energy sources;
(;) the strengthening of institutions of
government concerned with governance and the
maintenance of law and order;
(k)
public safety and security; and
(I)
the provision of social welfare and the
protection of the physically handicapped,
persons with mental disorders and disadvantaged
citizens.
(4) For any financial year, a minimum of seventy
percent of the Annual Budget Funding Amount
shall be used for public investment expenditures
consistent with the long-term national
development plan or with subsection (3).
(5) In order to maximise the impact of the use
of the petroleum revenue, the Minister shall
prioritise not more than four areas specified in
subsection (3) when submitting aprogramme of
activities for the use of the petroleum revenue.
(6) The programme shall be reviewed every three
years after the initial prioritisation, except
that in the event of a national disaster, the
Minister may make a special request to
Parliament for a release of revenue.
Extra budgetary activities and statutory
earmarking prohibited
22.
Outside of the allocation of the Petroleum
Holding Fund, extra budgetary activities or
statutory earmarking of petroleum revenue for
any consideration is prohibited.
Transfer
into the Ghana Heritage Fund and Ghana
Stabilisation Fund
23.
(1) Commencing in the year 2011 until the year
when petroleum production ceases,
the following rules shall apply:
(a)
where petroleum revenue collected in each
quarter of any financial year exceeds
one-quarter of the Annual Budget Funding Amount
of the financial year, as determined in section
18, the United States Dollar equivalent of the
excess revenue collected shall be transferred
from the Petroleum Holding Fund into the Ghana
Petroleum Funds, and
(b)
a minimum of thirty percent of the excess
revenue deter- mined in subsection (1)
(a)
shall be transferred into the Ghana Heritage
Fund and the balance shall be transferred into
the Ghana Stabilisation Fund each quarter.
(2) The split in subsection (1)
(b)
of the excess revenue shall be reviewed every
three years, exclusive of the year of revision,
with the first revision to occur in 2014.
(3) The accumulated resources of the Ghana
Stabilisation Fund shall not exceed an amount
recommended by the Minister and approved by
Parliament and the amount shall be reviewed from
time to time as necessitated by macroeconomic
conditions.
(4) Once the amount is attained, subsequent
transfers into the Ghana Stabilisation Fund
shall be allocated as transfers into the
Contingency Fund or for debt repayment approved
by Parliament.
(5) The transfer and any subsequent transfers
shall be made not later than the end of the
month after the quarter in respect of which the
excess revenue was calculated.
Transfers for exceptional purposes
24.
(1) Where a transfer is made from the Petroleum
Holding Fund for exceptional purposes to refund
tax overpayment and to pay management fees, the
transfer amount shall represent a reduction of
the Petroleum Holding Fund receipts and shall
not-be
considered as part of the
allowable transfer under the relevant
Appropriation Act.
(2) Where petroleum operations are carried out
on-shore, appropriate royalties shall be paid in
accordance with relevant laws.
(3) Where petroleum operations adversely affect
a community,
appropriate compensation shall be paid for the
benefit of the community in accordance with the
relevant laws.
Management and investment of Ghana Petroleum
Funds
Obligations
of the Minister
25.
The Minister shall
(a)
develop an investment policy for the investment
of the Ghana Petroleum Funds,
(b)
be responsible for the overall management of the
Ghana Petroleum Funds and shall oversee the
transfers into and disbursements from the Ghana
Petroleum Funds,
(c)
make decisions in relation to the investment
strategy or management of the Ghana Petroleum
Funds after seeking the advice of the Investment
Advisory Committee and the Governor, subject to
the provisions of section 38, and
(d)
enter into an Operations Management Agreement
with the Bank of Ghana for the operational
management of the Ghana Petroleum Funds, in form
and substance similar to the format in the
Second Schedule.
Management obligations of the Bank of Ghana
26.
(1) The Bank of Ghana is responsible for the
day-to-day operational management of the
Petroleum Holding Fund, the Ghana Petroleum
Funds and subsequently the Ghana Petroleum
Wealth Fund under the terms of the Operations
Management Agreement.
(2) The Bank of Ghana shall manage the Ghana
Petroleum Funds and subsequently the Ghana
Petroleum Wealth Fund prudently within the
framework of the operational and management
strategy provided by the Minister, taking
cognisance of
(a)
investment guidelines used by the Bank-of Ghana
for investments of a similar nature,
(b)
established and internationally recognised
principles of good governance for the benefit of
the Republic of Ghana, and
(c)
the need to support the national currency
against destabilising factors in accordance with
national monetary and foreign exchange policies.
Investment rules
27.
(1) The resources of the Ghana Petroleum fund
subsequently the Ghana Petroleum Wealth Fund
shall be invested
in
qualifying
instruments prescribed by Executive Instrument.
(2) The range of instruments designated as
qualifying
instruments
shall be reviewed every three years or sooner by
the Minister on the advice of the Investment
Advisory Committee.
Reports on the Ghana Petroleum Funds
28.
(1) The Bank of Ghana shall present to the
Minister and to the Investment Advisory
Committee, quarterly report.
On the performance
and activities of the Ghana Stabilisation Fund
and The Ghana Heritage Fund not later than the
end of the month following the end of each
quarter
(2) The
Bank of Ghana shall publish semi
annual reports
on the Ghana Stabilisation Fund and the Ghana
Heritage Fund not later than the 15th of
February and the 15th of August of each year and
shall present the report to Parliament and
publish it in two stare owned
daily
newspaper and on the website of the Bank.
Investment Advisory Committee
Establishment of Investment Advisory
Committee
29.
There is hereby established an Investment~,
Advisory
Committee
to advise the Minister and for the general
performance monitoring of the management of the
Ghana Petroleum Funds.
Functions of the Investment Advisory Committee
30.
(1) The functions of the Investment Advisory
Committee
are to
(a)
formulate and propose to the Minister the
investment
policy and management of the Ghana Stabilisation.
fund
and the Ghana Heritage Fund and the Minister
'shall
submit it for approval by Parliament;
(b)
advise the Minister on the broad investment
guidelines and overall management strategies
relating to the Ghana Petroleum Funds and
subsequently the Ghana Petroleum Wealth Fund
that the Minister shall provide to the Governor,
taking cognisance of international best practice
of investments of a similar nature; and
(c)
develop for the Minister as part of the
investment guide- lines, the benchmark
portfolio, the desired returns from and the
associated risks of the Ghana Petroleum Funds
and subsequently the Ghana Petroleum Wealth Fund
taking into consideration the investment
guidelines used by the Bank of Ghana for
investments of a similar nature.
(2) Any advice given by the
Investment Advisory Committee on
investment strategy or the management of the
Ghana Stabilisation Fund
and the Ghana Heritage Fund shall take into
account:
(a)
the overall consideration that the Ghana
Petroleum Funds are funds from the exploitation
of non-renewable petroleum resources and the
overall objective that they are for the benefit
of current and future generations of citizens of
Ghana;
(b)
the current economic conditions, opportunities
and constraints in investment markets and the
constraints under which the Bank of Ghana and
other key institutions in Ghana operate; and
(c)
the need to ensure that sufficient funds are
available when needed for transfers to meet
unanticipated petroleum revenue shortfalls.
Appointment of members of the Investment
Advisory Committee
31.
(1) The Investment Advisory Committee comprises
seven members, at least one of whom is a woman,
who shall be persons of proven competence in
finance, investment, economics, business
management law or similar disciplines.
(2) A person is not qualified to be a member of
the Investment Advisory Committee if that person
(a)
is not a citizen;
(b)
has been convicted of a felony or an offence
involving dishonesty;
.
(c)
is adjudged to be a person of unsound mind;
(d)
in the case of a person in possession of a
professional qualification is disqualified or
suspended from practising the profession of that
person by order of a competent authority made in
respect of that person.
(3) The Minister in consultation with the
Governor shall nominate the members of the
Investment Advisory Committee for appointment by
the President.
(4) The President shall appoint the chairperson
of the Investment Advisory Committee.
Tenure of office of members of the Investment
Advisory Committee
32.
(1) A member of the Investment Advisory
Committee shall hold office for two or three
years and is eligible for re-appointment, but a
member shall not be appointed for more than two
consecutive terms.
(2) Despite subsection (1), a member
appointed for a three-year term is not eligible
for re-appointment.
(3) A member appointed for a two-year term
is eligible for one re-appointment but only for
another two year term.
(4) The President shall appoint three of
the members for three
years and four of the members for two years.
(5) A member of the Investment Advisory
Committee may at any time resign from office in
writing addressed to the President through the
Minister. '
(6) A member who is absent from two
consecutive meetings of the Investment Advisory
Committee without sufficient cause ceases to be
a member of the Investment Advisory Committee
and shall be immediately replaced.
(7) The President may by letter addressed
to a member revoke the appointment of that
member.
(8) Where a member of the Investment
Advisory Committee is for sufficient reason,
unable to act as a member, the Minister shall
determine whether the inability would result in
a declaration of a vacancy.
(9) Where there is a vacancy
(a)
under subsection (5), (6), (7) or section 34
(2),
(b)
as a result of a declaration under subsection
(8), or
(c)
by reason of the death of a member,
the Minister shall notify the President of the
vacancy and the President shall appoint another
person to fill the vacancy.
Meetings of the Investment Advisory Committee
33,
(1)
The Investment
Advisory Committee shall meet at least once
every quarter as may
become necessary for the performance of its
functions,
(2)
The chairperson
person
shall at the request in writing by three or more
members of the investment Advisory Committee
convene an extraordinary meeting of
the Investment Advisory Committee within seven
days after request
(3)
The
quorum
at a meeting of the Investment Advisory
Committee is five
members
of the Investment Advisory Committee
(4)
The
chairperson
shall preside at meetings of the Investment
Advisory Committee : and in the absence of the
chairperson, a member elected by the members
present from among their number shall preside.
(5)
Matters before
the Investment Advisory Committee shall be shall
be decided by a majority of
the members present and voting and in the event
of an equality of votes, the member presiding
shall have a casting vote.
(6) The Investment Advisory Committee may co-opt
a person with relevant technical
expertise to assist in the performance of its
functions.
(6) co-opted members shall not vote on matters
before the Investment Advisory Committee
Disclosure of interest
34.
(1) A member
or
co-opted member of the Investment Advisory
Committee who
has
an interest in a matter for consideration by the
Investment Advisory Committee shall
(a)
disclose the nature of that interest and the
disclosure shall form
part
of the records of the consideration of matter
(b)
participate in the deliberations of the
Investment Advisory Committee in respect of that
matter.
(2) A member
ceases to be a member of the Investment Advisory
Committee, if that member has an interest in a
matter before the Invest- Investment Advisory
Committee and
(a)
fails
disclose that interest, or
(b)
participates in the deliberations of the
Investment Advisory Committee in respect of the
matter.
Publication of membership of the Investment
Advisory Committee
35.
(1)
The Minister shall cause the names of members
the Investment Advisory Committee to be
published in the
Gazette
(2) The
Gazette
publication shall be updated
each time:
that
the membership of the Investment Advisory
Committee changes.
Allowances
36.
Members of the Investment Advisory Committee
allowances determined by the Minister.
Secretariat of the Investment Advisory
Committee
37.
(1) The Ministry shall provide the
secretariat
for the Investment
Advisory Committee and any other administrative
support or technical staff required by the
Investment Advisory
Committee
for the performance of its functions.
(2) A designated official of the Ministry not
below the rank of a
Director shall be the Secretary to the
Investment Advisory Committee
Absence of advice from the Investment Advisory
Committee
38.
(1)
Where the Investment Advisory Committee
is unable to provide
s
advice to the Minister within ten working
after a request or
within a shorter period determined by the Minister,
taking into account
the nature of the advice sought,
the Minister may take
a
decision
in
Consultation
with the Governor.
(2) Despite section 30 (1)
(c),
the Minister may take an urgent investment or
overall management decision in consultation with
the Governor where there is insufficient time to
seek the advice
of the
Invest-
ment Advisory Committee.
(3) Where the Minister takes a decision without
the
advice
of
the
Investment Advisory Committee, the Minister
shall inform the Investment Advisory Committee
in writing within forty-eight
hours after taking the
taking
the decision.
(4) The Investment Advisory Committee shall
advise
the
Minister
within five days after receipt of the information.
(5) The Minister shall re-examine the decision made
within forty-
eight hours having regard to the advice provided
by the
Investment Advisory Committee and take the necessary
follow-up action.
Release of advice from the Investment Advisory
Committee
39.
(1) The Minister shall provide Parliament with
any advice given by the Investment Advisory
Committee within seven days.
(2) The Minister shall within seven days after
the re-examination of the decision made under
section 38 (5), inform Parliament of the
decision.
Oversight of and reporting on the Ghana
Petroleum Funds
40.
(1) The Investment Advisory Committee shall
submit quarterly information reports and
analysis on the performance and activities of
the Ghana Stabilisation Fund and the Ghana
Heritage Fund to the Minister not later than
thirty working days after the receipt of
quarterly reports from the Bank of Ghana in
accordance with the reporting requirements of
the Bank of Ghana.
(2) The Investment Advisory Committee is
responsible for reporting to the Minister on the
performance and activities of the Ghana
Stabilisation Fund and the Ghana Heritage Fund
for the purpose of reporting in the annual
budget and financial statements.
Encumbrances, auditing and reporting
Encumbrances on the assets of the Petroleum
Holding Fund and Ghana Petroleum Funds
41. (1) The balance in the Petroleum Holding
Fund and the assets of the Ghana Petroleum Funds
and subsequently the Ghana Petroleum Wealth Fund
shall remain the property of the Republic of
Ghana.
(2) Any contract, agreement or arrangement, to
the extent that it encumbers or purports to
encumber the assets of the Petroleum Funds
whether by way of guarantee, security, mortgage
or any other form of encumbrance is contrary to
this Act and is null and void.
(3) A court shall not make an order for the
attachment of moneys in the Petroleum Funds
Audit of the Petroleum Funds
Public funds
42.
The Petroleum Holding Fund, the Ghana Petroleum
Funds and subsequently the Ghana Petroleum
Wealth Fund are public funds for the purpose of
article 175 of the Constitution.
Books of the Petroleum Funds
43.
The Bank of Ghana shall keep proper books of
accounts and records on the Petroleum Holding
Fund, the Ghana Petroleum Funds and subsequently
the Ghana Petroleum Wealth Fund.
Internal audit
44.
(1) The books of accounts, records, other
documents, systems and procedures relating to
the Petroleum Funds shall be audited by the
Internal Audit Department of the Bank of Ghana.
(2) The Governor shall submit quarterly
reports of the internally audited accounts to
the Minister and any other person required by
law to receive the report.
External audit
45.(1)
The Auditor-General is responsible for the
external audit of the Petroleum Funds and shall
audit those Funds each year.
(2) The Auditor-General may delegate
responsibility as provided for by law.
(3) Where the Auditor-General delegates
the duties, the appointment of the external
auditor shall be for a period not exceeding
three years and is not renewable.
Annual audit
46.(1)The
Bank of Ghana shall not later than three months
after the end of its financial year, submit to
the Auditor-General the financial statement and
relevant documents on the Petroleum Funds for
audit.
(2) The Auditor-General shall, not later
than three months after the receipt of the
financial statements and other relevant
documents referred to in subsection (1), submit
the audited report to Parliament.
(3) The Auditor-General shall determine if
(a)
the accounts have been properly kept;
(b)
the payments due to and disbursements from the
Petroleum Funds have been made; and the
Petroleum Funds have been managed in accordance
with the provisions of this Act.
(4) The Auditor-General shall publish the
reports on the Petroleum
Funds within thirty days after submission
to Parliament.
(5) The Auditor-General shall draw attention in
the report to any
Irregularities or any other matter which
in the opinion of the Auditor-
General ought to be brought to the notice
of Parliament.
Special
audit
47.
In addition to the audit prescribed in section
45, the Auditor- General may carry out special
audits or reviews of the Petroleum Funds in the
public interest and shall submit to Parliament
reports on the audits or reviews undertaken.
Annual report on the Petroleum Funds
48.
(l) The Minister shall submit an annual report
on the Petroleum Funds as part of the annual
presentation of the budget statement and
economic policies to Parliament.
(2) The annual report shall be prepared in a
manner that makes it easy for dissemination to
the public and shall include the following
information for the financial year for which the
report is prepared:
(a)
audited financial statements of the previous
year comprising
(i)
the receipts and transfers to and from the
Petroleum Holding Fund,
(ii) the deposits into and withdrawals from the
Ghana Stabilisation Fund and the Ghana Heritage
Fund, and
(iii) a balance sheet, including a note listing
the qualifying instruments of the Ghana
Petroleum Funds;
(b)
a report from the Minister describing the stage
of implementation of the programmed activities
funded by and the expenditures incurred on the
activities covered by the Annual Budget Funding
Amount in the financial year of the report.;
(c)
a report signed by the Minister describing the
activities of the Petroleum Funds in the
financial year of the report, including the
advice provided by the Investment Advisory
Committee, any reports prepared by the
Auditor-General drawing attention to particular
issues or matters that may be of concern or
interest to Parliament;
(d)
the income derived from the investment of the
Ghana Stabilisation Fund and Ghana Heritage Fund
during the financial year under review compared
with the income of the previous two financial
years;
(e)
a comparison of the income in paragraph
(d)
with
(i) the benchmark performance indices provided
to the Minister, and
(ii) the income of the previous two
financial years;
(f)
the liabilities of government borrowings; and
(g)
a list of persons holding positions required for
the operation and performance of the Ghana
Stabilisation Fund and the Ghana Heritage Fund,
including
(i) the Minister,
(ii)
the chairperson and members of the Investment
Advisory Committee,
(iii) the Governor, and
(iv) the investment manager, if any.
(3) The sources of the information described in
subsection (2) in
whatever form including the reports and
statements, shall be annexed to
the annual report.
Accountability, transparency and public
oversight
Transparency
as a
fundamental principle
49.
(1) The management of petroleum revenue and
savings shall always be carried out with the
highest internationally accepted standards of
transparency and good governance.
(2) The duties concerned with ancillary matters
of petroleum revenue and savings shall be
discharged with the highest internationally
accepted standards of transparency and good
governance.
(3) Information or data, the disclosure of which
could in particular prejudice significantly the
performance of the Ghana Petroleum Funds may be
declared by the Minister as confidential,
subject to the approval of Parliament.
(4) The declaration of confidentiality shall
provide a clear explanation of the reason for
treating the information or data as classified,
taking into account the principles of
transparency and the right of the public to
information.
(5) The declaration of confidentiality shall not
limit access to
information by Parliament and the Public
Interest Accountability Committee established
under this Act.
(6) Any information that is classified at the
time when it could have been published, as well
as the reason for it being treated as
classified, shall be made available to the
public upon request three years after the date
on which it could have been published unless the
reason for it being classified is still valid.
(7) Parliament, the Minister, the Bank of Ghana
and the Investment Advisory Committee in the
performance of their functions under this Act,
shall take the necessary measures to entrench
transparency mechanisms and free access by the
public to information.
(8) The Minister shall ensure that this Act and
any instructions related to the Ghana Petroleum
Funds, the Operations Management Agreement and
the annual reports are readily available to the
public.
Non-compliance with an obligation to publicise
information
50.
A person who fails to comply with any obligation
to publish information provided
for
in this Act, or causes another person to fail to
comply with, or in any manner hinders or causes
another person to hinder the compliance with
these obligations, commits an offence and is
liable on summary conviction to a fine not
exceeding two hundred and fifty penalty units.
Public Interest and Accountability Committee
51.
A Public Interest and Accountability Committee
is hereby established.
Objects of the Accountability Committee
52.
The objects of the Accountability Committee are:
(a)
to monitor and evaluate compliance with this Act
by government and other relevant institutions in
the management and use of the petroleum revenues
and investments as provided in this Act;
(b)
to provide space and platform for the public to
debate whether spending prospects and management
and use of revenues conform to development
priorities as provided under section 21 (3); and
(c)
to provide independent assessments on the
management and use of petroleum revenues to
assist Parliament and the executive in the
oversight and performance of related functions
respectively.
Functions of the
Accountability Committee
53.
(1) To achieve its objects, the Accountability
Committee shall
(a)
consult widely on best practice related to the
management and use of petroleum revenues; and
(b)
determine the rules of procedure under which it
will operate.
(2) The Accountability Committee shall have its
own secretariat that will facilitate the
performance of its functions.
Membership
of the Accountability Committee
54.
(1) The Accountability Committee consists of
eleven members including
(a)
a member to represent independent policy
research think tanks nominated by the
think-tanks,
(b)
a member to represent civil-society
organisations and community-based organisations
nominated by civil society,
(c)
a member each nominated by the
(i) Trade Union Congress,
(ii) National House of Chiefs,
(iii) Association of Queen Mothers,
(iv) Association of Ghana Industries and Chamber
of Commerce,
(v) Ghana Journalists Association,
(vi) Ghana Bar Association,
(vii) Institute of Chartered Accountants,
(viii) Ghana
Extractive Industries Transparency Initiative;
and
(ix) Christian groups namely the National
Catholic Secretariat, the Christian Council and
the Ghana Pentecostal Council on a rotational
basis,
(x) the Federation
of Muslim Councils and Ahmadiyya Mission on a
rotational basis, and
(xi) Ghana Academy of Arts and Sciences.
(2) The members of the Accountability Committee
shall be appointed by the Minister .
.
(3) A decision of the Accountability Committee
shall only be binding if taken by a majority
with a quorum of nine members.
(4) The committee members shall elect their own
chairperson from among the members at their
first meeting.
Tenure of members and eligibility
for appointment
55.
(1) The tenure of office of a member of the
Accountability Committee shall be two or three
years.
(2) A member appointed for a two year tenure is
eligible for re-appointment but not for more
than two consecutive terms.
(3) A member appointed for a two-year term is
only eligible to be appointed for another two
year term.
(4) A member appointed for a three year term is
not eligible for re-appointment.
(5) A person is not eligible for appointment if
that person
(a)
has been adjudged or otherwise declared,
(i)
bankrupt under any law in force in Ghana and has
not been discharged; or
(ii) to be of unsound mind or is detained as
an offender with mental disorder under any law
in force in Ghana; or
(b)
has been convicted for
(i) high crime under the Constitution or
high treason or treason or for an offence
involving the security of the State, fraud,
dishonesty or moral turpitude;
or
(ii) any other offence punishable by death or by
a sentence of not less than ten years; or
(iii) an offence relating to, or connected with
election under a law in force in Ghana at any
time; or
(c)
has been found by the report of a commission or
a committee of inquiry to be incompetent to hold
public office or is a person in respect of whom
a commission or committee of inquiry has found
that while being a public officer acquired
assets unlawfully or defrauded the State or
misused or abused office, or wilfully acted in a
manner prejudicial to the interest of the State,
and the findings have not been set aside on
appeal or judicial review; or
(d)
is under sentence of death or other sentence of
imprisonment imposed by any court; or
(e)
is otherwise disqualified by a law in force at
the time of the commencement of the Constitution
which is not inconsistent with a provision of
the Constitution.
(6) Members appointed to the Accountability
Committee have security of tenure and unless
otherwise
provided for by law, or for medical reasons, may
not be suspended,
retired
or removed from office.
Reporting
56.
The Accountability Committee
shall
(a)
publish a semi-annual
report and an annual report in at least
two state owned national daily newspapers by the
15th of
September and 15th of March each year;
(b)
publish the reports on the Accountability
Committee's website;
(c)
hold public meetings
twice each year to report on its mandate to the
general public, and
.
(d)
submit a copy of its semi-annual
report and annual report to the President and to
Parliament.
Allowances
57.
Members of the Accountability Committee shall be
paid the allowances determined by the Minister
and approved by Parliament.
Miscellaneous matters
Penalties
58.
(1) A person who
(a)
misappropriates the Petroleum Funds;
(b)
defrauds, attempts to defraud or conspires with
another person to defraud the Republic in
relation to the Petroleum
Funds;
(c)
uses, attempts to use or conspires with another
person to use information on the Petroleum Funds
or documents relating to the Petroleum Funds for
personal benefit or advantage or for the
personal advantage or benefit of another person;
commits an offence and is liable on summary
conviction to a fine of not less than five
hundred thousand penalty units or to a term of
imprisonment of not less than fifteen years or
to both.
(2) A person who abets in the commission of an
offence is liable on summary conviction to a
fine of not less than two hundred and fifty
thousand penalty units or to a term of
imprisonment of not less than seven years or to
both.
(3) A person who unlawfully discloses the
content of any document or information
pertaining to the operations of the Petroleum
Funds commits an offence and is liable on
summary conviction to a fine of not less than
two hundred and fifty thousand penalty units or
to a term of imprisonment of not less than seven
years or to both.
(4) Where the offence committed is by a body
corporate, that body corporate is liable on
summary conviction to a fine of not less than
seven hundred and fifty thousand penalty units.
(5) A penalty imposed under this section that is
not paid when it is due shall be subject to the
default payment rate established under section 3
(4).
Transitional and final provisions
59.
(1) The appointments necessary for the effective
functioning of the Investment Advisory Committee
and the Accountability Committee shall be made
within three months after the commencement of
this Act.
(2) The petroleum revenue that has accrued to
the Republic including any accumulated interest
on it shall at the commencement of this Act be
transferred or deposited into the Petroleum
Holding Fund established under this Act.
(3) The transferred or deposited revenue shall
be accounted for by the Ghana Revenue Authority
including reconciliations where necessary.
Regulations
60.
(1) The Minister may be legislative instrument
make Regulations for the effective performance
of this Act.
(2) Regulations made by the Minister shall
include the
(a)
reference pricing formula for purposes of
taxation or of determining the payment
obligations to the government of the petroleum
licensed operators to the Republic;
(b)
measurement of the quantity of petroleum
produced and calibrated for the purposes of
determining the basis of royalty and any other
payments due to the Republic; and
(c)
operational and management guidelines for the
management of the Petroleum Funds.
Interpretation
61.
In this Act unless the context otherwise
requires,
"Accountability Committee" means the Public
Interest and Accountability Committee
established under section 51;
"additional oil entitlement" means the portion
of a contractor's share of petroleum produced to
which the Republic is entitled computed on the
basis of the after tax inflation
adjusted rate of return that the contractor
achieved with respect to each field;
"Annual Budget Funding Amount" means the amount
of petroleum revenue allocated for spending in
the current financial year budget;
"Auditor" means the Auditor-General;
"basic services" includes education and
healthcare;
"Benchmark Revenue" means the estimated revenue
from petroleum operations expected by the
Government for the corresponding financial year;
"business or working day" means any day, except
Saturday, Sunday or a public holiday when banks
are open for business in Ghana;
"carried interest" means an interest held by the
Republic in respect of which the contractor pays
for the exploration and development costs
without any entitlement to reimbursement from
the Republic;
"confidential information" means information
that is designated or marked as "confidential";
"Court" means a Court of competent jurisdiction;
"disaster" includes an occurrence by which there
is a serious disruption of general safety
endangering the life and health of many people
or large material interests which requires
co-ordinated action by services of different
disciplines and floods, earthquakes, drought,
rainstorm, war, civil strife industrial
accidents;
"Ghana Heritage Fund" means the public fund
established under section 10;
"Ghana Petroleum Funds" means the Ghana
Stabilisation Fund and the Ghana Heritage Fund;
"Ghana Petroleum Wealth Fund" means the public
fund established under section 20;
"Ghana Revenue Authority" means the Ghana
Revenue Authority established under Ghana
Revenue Authority Act, 2009 (Act 791);
"Ghana Stabilisation Fund" means a public fund
established under section 9;
"Governor" means the governor of the Bank of
Ghana;
"Investment Advisory Committee" means the
Committee established under section 29;
"investment manager" means the Bank of Ghana or
any person or entity appointed as investment or
portfolio manager for purposes of this Act;
"manager of the Ghana Petroleum Funds" means a
person appointed by the Bank of Ghana to act as
a financial intermediary for the proper
management of the Ghana Petroleum Funds
including fund managers, brokers and dealers;
"midstream petroleum company" means a licensed
company engaged in petroleum operations between
the wellhead and a refinery, transportation and
the storage of petroleum;
"Minister" means the Minister responsible for
Finance;
\
"Ministry" means the Ministry responsible for
Finance;
"National Development Plan"
means a plan prepared by the National Development
Planning
Commission;
"national oil company" means the Ghana National
Petroleum Corporation and any other national oil
or gas company that may be established by the
government to participate directly in petroleum
activities;
"non-renewable petroleum resources" means finite
and exhaustible petroleum resources;
"participating interest" means the interest held
in petroleum operations by a party to a
Petroleum Agreement;
"payer" means any person or entity on whom there
is an obligation in accordance with this Act or
any other Act or legal instrument to make a
payment into the Petroleum Holding Fund;
"petroleum" means crude oil or natural gas or a
combination of both;
"petroleum authorisation" means
(a)
an access authorisation whether on-shore or off-
shore, a petroleum contract, a prospecting
authorisation or a seepage authorisation, or any
agreement made in respect of the authorisation
or contract, granted or entered in under the
Petroleum Exploration and Production Act, 1984
(p.N.D.C.L. 84), or
(b)
an authorisation or production sharing contract,
or any agreement made in respect of an
authorisation or contract, granted or entered
into under the Petroleum Exploration and
Production Act, 1984 (p.N.D.C.L. 84),
"Petroleum Funds" means the Petroleum Holding
Fund, the Ghana Stabilisation Fund, the Ghana
Heritage Fund and subsequently the Ghana
Petroleum Wealth Fund;
"petroleum operations" means authorised
activities under a petroleum authorisation;
"Petroleum Holding Fund" means the transitory
Fund established under section 2;
"petroleum reserves" means the petroleum that
can be economically extracted from petroleum
resources and which is anticipated to be
commercially recoverable by the application of a
development project to known discoveries from a
future date;
.
"petroleum resources" means petroleum in its
natural state that has either been discovered or
that has the potential of being discovered;
"petroleum revenue" includes
(a)
royalty in cash or in equivalent barrels of oil
or equivalent units of gas, payable by a
licensed producer, including the national oil
company or a company under a Production Sharing
Agreement or other agreement;
(b)
corporate income taxes payable by licensed up-
stream and midstream operators;
(c)
participating interest;
(d)
additional oil entitlements;
(e)
dividends from the national oil company for
Government's equity interest;
(f)
the investment income derived from accumulated
petroleum funds;
(g)
surface rentals paid by licensed producers; or
(h)
any other revenue determined by the Minister to
constitute petroleum revenue; derived from
upstream and midstream petroleum operations;
"public funds" has the meaning ascribed to it
under Article 175 of the Constitution;
"qualifying instrument" means
(a)
a debt instrument denominated in internationally
convertible currency that bears interest or a
fixed amount equivalent to interest,
(i) that is of an investment grade security, and
(ii) that is issued
by or guaranteed by the International Monetary
Fund, World Bank or by a sovereign State other
than the Republic of Ghana, if the issuer or
guarantor has investment grade rating; or
(b)
an internationally convertible currency deposit
with, a debt instrument denominated in any
internationally convertible currency that bears
interest or a fixed amount equivalent to
interest issued by
(.1) the Bank for International Settlements;
(ii) the European
Central Bank;
(iii) the Central
Bank of a sovereign State, other than the
Republic of Ghana, with a long- term investment
grade rating; or
(c)
a derivative instrument
(i) that is
solely based on an instrument that satisfies the
requirements of paragraphs
(a)
and
(b);
and
(ii) where its
acquisition reduces the financial exposure to
the risks associated with the underlying
instruments prescribed by the Minister;
"real rate of return on investment" means the
nominal return on investment less the inflation
or purchasing power adjustment that is necessary
to preserve the real value of the accumulated
funds;
"surface rental" means fees paid based on the
area of the licence held
"tax revenue" means any tax or duty imposed by
or under an Act of Parliament;
"upstream petroleum company" means a licensed
company engaged in the exploration, development
and production of petroleum; and
"withdrawal" includes transfers to and from the
Petroleum Holding Fund established under this
Act.
SCHEDULES
(Section 17)
Determining the Benchmark Revenue and Annual
Budget Funding
Amount from Petroleum Revenues
Benchmark Revenue from Petroleum Operations
(1) For the purposes of this section the Annual
Benchmark Revenue from petroleum operations
shall be calculated on the basis of actual and
expected average unit price for crude oil and
natural gas derived from a seven-year moving
average, the seven years being the four years
immediately prior to the current financial year,
the current financial
year itself and two years immediately following
the current financial year.
(2) The expected quantity shall be calculated on
the basis of expected average government take in
gross oil over a three year horizon, the three
years being theimmediately preceding, the
current financial year, and the one year ahead
projection following the current financial year.
(3) Expected revenue from crude oil is the
product of the unit prices and quantity data of
crude oil defined in paragraphs (1) and (2).
(4) Expected gas royalty shall be calculated on
the basis of anticipated royalties on associated
gas derived from a seven-year moving average,
the seven years being the four years immediately
prior to the current financial year, the current
financial year and two years immediately
following the current financial year.
(5) Benchmark Revenue is the sum of the expected
revenue from crude oil defined in paragraph (3),
expected gas royalties defined in paragraph (4),
and the expected dividends from the national oil
company.
That is, for each financial year,
Benchmark Revenue = Expected current receipts
from oil'
+
Expected gas royalties
+
Expected dividends from the national oil
company.
Annual Budget Funding Amount
(6) The annual allocation to the budget from
petroleum revenue for current spending is
determined as:
Annual Budget Funding Amount
=
Predetermined percentage of Benchmark Revenue.
(7) The predetermined percentage shall be
determined on year-to- year basis.
(8) For the purposes of this section "quarter"
means a three-month period ending March 31,
September 30 and December 31.
(9) Assumptions upon which the calculations are
made pursuant to paragraphs 1,2,3 and 4 above
shall be clearly identified and explained, and
any changes made in these assumptions in
subsequent calculations shall be clearly pointed
out.
(10) Assumptions made shall be prudent, reflect
international best practice of price forecasts
and be based upon internationally recognised
standards.
(11) The forecasts and the amounts determined in
accordance with the formula in paragraphs 1,2, 3
and 4 above shall be certified by a reputable
independent expert appointed in accordance with
the Public Procurement Act, 2003 (Act 663).
SECOND SCHEDULE
(Section
13, 25)
Operations Management Agreement
This Agreement is made on [date] between the
Minister of Finance and Economic Planning
("Minister") representing the Government of
Ghana and the Bank of Ghana hereinafter referred
to as the "Parties".
Whereas
(1) In accordance with section 25 of the Ghana
Petroleum Revenue Management Act, 2011 (Act 815)
(Law), the Minister is required to enter into an
Operations Management Agreement with the Bank of
Ghana for the operational management of the
Ghana Stabilisation Fund and the Ghana Heritage
Fund, which collectively shall
be referred to as Ghana Petroleum Funds.
(2) The Minister shall exercise the key
functions and competencies of the Government,
which has been assigned overall responsibility
for the management of the Ghana Petroleum Funds.
(3) The Bank of Ghana has been assigned the
responsibility for the efficient operational
management of the Ghana Petroleum Funds.
Now therefore it is agreed between the parties
as follows:
1. The Bank of Ghana shall undertake the daily
operational management of the Ghana Petroleum
Funds and shall be accountable for its
operational management to the Minister.
Obligations of the Minister
2. The Minister is responsible for the overall
management of the
Ghana Petroleum Funds, which shall include the
following functions to
be exercised by the Minister:
(a)
to formulate broad policy for the management of
the Ghana Petroleum funds;
(b)
not less than fifteen days prior to the
commencement of each calendar quarter, to
provide a forecast of the cash requirements of
Government for that quarter, including the
projected timings and amounts to be transferred
to and from
the Ghana Petroleum Holding Fund and the
applicable Ghana Petroleum Funds;
(c)
to provide by Legislative Instrument the
Regulations for the management of the Ghana
Petroleum Funds and to consult with the Governor
and the Investment Advisory Committee concerning
any changes that may be proposed to the
regulatory framework;
(d)
to ensure that requests by the Bank of Ghana for
guidance on ad-hoc policy decisions to enable it
to implement the operational management of the
Ghana-Petroleum
Funds are responded to clearly and in a timely
manner; and
(e)
to consult with the Governor and the Investment
Advisory
Committee,
as appropriate, concerning information to be
released to the public;
Obligations of the Bank of Ghana
3. The Bank of Ghana shall be responsible for
the operational management of the Ghana
Petroleum Funds, which shall include the
following functions:
(a)
the investment of the capital of the Ghana
Petroleum Funds in financial instruments as set
out in this Agreement, including exercising all
the rights and complying with all obligations
associated with the ownership of the Ghana
Petroleum Funds' assets;
(b)
receiving and accounting for the investment
income and other revenues of the Ghana Petroleum
Funds;
(c)
maintaining a register of the payments made as
Ghana Petroleum Holding Fund's receipts without
limiting the responsibilities of the proper
authorities for administering tax and royalty
payments;
(d)
maintaining the books of account for the Ghana
Petroleum Funds on behalf of the Minister;
(e)
appointing and dismissing banking
correspondents, dealers, brokers, custodians and
other financial intermediaries necessary for the
proper management of the Ghana Petroleum Funds;
(f)
acquiring and maintaining the information
necessary to construct benchmark indices and
construct notional portfolios for policy
development and reporting purposes;
(g)
evaluating the performance of external fund
managers appointed to manage the Ghana Petroleum
Funds' investments;
(h)
supplying information to the Minister and the
Investment Advisory Committee necessary for the
drafting of reports and statements relevant to
the management of the Ghana Petroleum Funds,
including all reports relating to the management
of the Petroleum Holding Fund and the Ghana
Petroleum Funds required by law, with the
information being available to the recipients at
least fifteen working days
before any legislated publication date unless
otherwise agreed between the parties;
(i)
meeting the operational expenses relating to the
management of the Ghana Petroleum Funds, which
shall be compensated for from the annual
management fee as established in the Operations
Management Agreement;
(j)
implementing systems, procedures risk management
practices and development of human resources to
minimize the risk of operational loss to the
Ghana Petroleum Funds;
(k)
advising the Minister of all significant
eventsaffecting the value of the Ghana Petroleum
Funds and other matters considered to be urgent
or of importance relating the management of the
Fund;
(I)
providing the members of the public with the
information concerning the Ghana Petroleum Funds
as required by the law; and
(m)assisting the Investment Advisory Committee
in the preparation of the Annual Report of the
Ghana Petroleum Funds.
4.
The Bank of Ghana shall implement the
operational management of the Ghana Petroleum
Funds through the adoption of the following
principles:
(a)
the assets of the Ghana Petroleum Funds shall be
maintained in the name of the Bank of Ghana, but
shall at all times be segregated from the assets
of the Bank of Ghana in such a manner as to
allow the beneficial ownership of the assets and
the income associated with those assets to be
clearly determined at any time;
(b)
the books and records of the Ghana Petroleum
Funds shall be maintained separately from the
books and records of the Bank of Ghana to the
maximum extent practicable;
(c)
the Bank of Ghana shall make the books and
records relating to the operational management
of the Ghana Petroleum Funds available at any
time on request to the Minister, staff
authorised in writing by the Minister and the
auditors of the Ghana Petroleum Funds; and
(d)
the Bank of Ghana shall ensure that all staff
associated with the management of the Ghana
Petroleum Funds shall be bound by a code of
ethics and rules to avoid conflicts of interest.
5.
The Bank of Ghana shall be permitted to invest
only in the qualifying instruments.
6.
The performance of the Ghana Petroleum Funds
shall be measured periodically against the
benchmark developed by the Investment Advisory
Committee and will be the subject of periodic
reports.
7. The Minister shall give the Bank of Ghana at
least four weeks' written
.
notice before implementing any change to the
mandate or benchmark, and the Bank of Ghana
shall advise the Minister as to the anticipated
length of time it will take to effect the new
requirements.
8.
The remuneration of the Bank of Ghana shall be
as recommended by the Minister and shall be
payable in monthly instalments from the assets
of the Ghana Petroleum Funds.
9.
The Bank of Ghana shall undertake the
appointment of portfolio managers, under the
following conditions:
(a)
the Bank of Ghana shall undertake the
procurement process in a fair and transparent
manner according to its internal procedures and
relevant laws of Ghana;
(b)
the Bank of Ghana shall provide a report to the
Minister on the appointment of Fund Managers
detailing the services to be provided, the
proposed level of fees, the proposed benchmark,
the levels of insurance cover against exposures
and the information concerning the procurement
process
that is necessary to inform the Minister that
the process was undertaken in accordance with
the Public Procurement Act, 2003 (Act 663); and
(c)
the Bank of Ghana shall enter into a contract
with a Fund Manager in its own name.
10.
Where the Bank of Ghana wishes to terminate the
contract of a Fund Manager, the Bank of Ghana
shall consult with the Minister as follows:
(a)
the Bank of Ghana shall provide a written report
to the Minister on the termination of a
portfolio manager's con- tract, with copy to the
chairperson of the Investment Advisory
Committee;
(b)
the Bank of Ghana shall define the grounds for
termination of a Fund Manager in the Investment
Guidelines; and
(c)
the Minister may, within five working days after
receiving the recommendation, seek the advice of
the Investment Advisory Committee concerning the
proposed termination of a Fund Manager's
contract.
11.
The Bank of Ghana is not liable for losses
arising from the operations of the Ghana
Petroleum Funds unless the losses arise from the
negligence of the Bank of Ghana or its
employees.
12.
The Minister shall provide to the Bank of Ghana,
at least five working days' notice of written
payment instructions to transfer amount from the
Ghana Petroleum Holding Fund or applicable Ghana
Petroleum Funds to the Consolidated Fund that
shall include the followinginformation:
(a)
the amount or amounts to be transferred;
(b)
the date or dates on which the transfer(s) are
to take place
(c)
the parliamentary appropriation under which the
transfer is authorised;
(d)
a statement that the provisions of sections 12
to 19 of the Act have been complied with,
including supporting documentary evidence as may
be relevant; and
(e)
the signature of the Minister.
13.
The Agreement may be amended by the parties at
anytime provided that the amendments shall not
be effective except in writing and signed by
both parties.
14.
The Minister shall at the request of the Bank of
Ghana delay the publication of amendments to
this Agreement concerning changes portfolio
allocations, benchmarks or other aspects that
may affect the value of the Ghana Petroleum
Funds until the Bank of Ghana has substantially
completed the related market operations.
15.
The Minister may propose changes to this
Agreement on the bas of advice received from the
Investment Advisory Committee after it
established.
Date of Gazette notification: 15th April,
2011.
GPCl/ASSEMBLY PRESS,
ACCRA.
GPCLlAI85/4/350/2011
Website:
www.ghanapublishingcompany.com
E-mail:
info@ghanapublishingcompany.com
|