According to IFC, Zalar Holding SA (previously Zalagh Holding SA) is a vertically-integrated industrial poultry producer in Morocco, present across the entire poultry meat value chain: grain trading/import, animal feed production, day-old-chick/poultry production, broiler production, poultry slaughtering, and meat processing.  The project is mainly financed via IFC’s equity investment of up to US$24 million, and local bank loans.

In March 2016, CAO received a complaint filed on behalf of a coalition of community-based NGOs alleging that the installation of a poultry breeding facility in their village is causing air pollution and subsequent health issues for residents. The complaint is in relation to Atlas Couvoirs, a subsidiary of Zalar Holding Group.

CAO found the complaint eligible for assessment in April 2016  and conducted a field visit to discuss options for addressing the complaint with the relevant parties. During the assessment process, the complainants and the IFC client expressed their willingness to engage in a voluntary dispute resolution process facilitated by CAO. The assessment report is available at the below links in English and Arabic.

Starting in November 2016, CAO worked with the parties to plan the dialogue, and in December 2016, the parties agreed on a set of ground rules that set out, among other aspects, who would represent the community and the company in the process, principles of engagement such as good faith, and the roles and responsibilities of the parties and of CAO. 

Over a period of four months, CAO interacted with the parties both jointly and separately to assist them in working towards a mutually acceptable agreement. In February 2017, the company and community representatives found an agreement that sets out:

• The company’s commitment to adhere strictly to environmental regulations. The company further committed to sharing relevant government permits and independent expert audits regarding the environmental performance of its operations with the community representatives.
• The company’s commitment to prioritize hiring local community members from the Ristou, Tiddas, and Maaziz villages.
• The establishment of a dialogue committee that will meet at least once a year to discuss issues of concern or common interest, including community priorities for development projects for the company to support.
• The company’s commitment to a five-year plan to carry out community benefit projects responding directly to priorities identified by community representatives each year. In the context of this five-year plan, the company committed to finance projects worth up to 100,000 dirhams per year. See full agreement via the “Case Documents” section below this page.

This agreement was finalized and signed in August 2017 and is posted under documents below.  The agreement between the affected community and the company concluded the CAO dispute resolution process. CAO is currently monitoring implementation of the agreement to assist in ensuring its smooth implementation, sustainability, and success. In 2018, the parties successfully carried out the first company-funded community development project geared to benefit the village. The community representatives had identified the need for the local students to have a bus to transport them to a secondary school outside the village. The bus was effectively transferred and delivered to the community in June 2018. A Progress Report is available below for more details.

After careful considerations, and having debated other possible options, parties decided in 2019 that the second community development project would be the construction of a water tower along with the digging of a well, which would distribute water to Tiddas and surrounding villages. Over the course of the past three years, with delays in part due to the COVID-19 situation, parties have been working on the implementation of such project, including choosing adequate land on which to dig the well and build the water tower, requesting relevant authorizations, working on a budget and choosing a construction firm. The construction works started in September 2021 and are well underway.

Given the budget allocated to those two community-development projects, which equals the total amount provided for in the settlement agreement, parties agreed that with the completion of the water tower project, the obligations under Provision 6 and 7 of the agreement would be considered fully implemented. According to Provision 8 of the agreement, once the water tower project is completed, the parties will discuss the possibility of further collaboration.