EARTHblog

Imposing mines through trade agreements?

April 6, 2011 • Scott Cardiff

A number of mining companies have been filing for arbitration in international tribunals under trade and investment agreements to seek compensation for mines that governments decided should not go forward. That's correct: the elected government says "no" to a mine (due to community opposition, expected impacts, regulations, or other reasons), and the company then sues for compensation in the World Bank's International Center for Investment Disputes (ICSID).

One such case was dismissed and another filed just in the last month. The hearing for a third -- the case of Pacific Rim vs. El Salvador -- has recently been delayed. These are the latest in an apparent series of cases of mining companies seeking to make money in international tribunals or impose their bad projects on countries that don't want them.

In a decision last week, the ICSID ruled that Milwaukee-based Commerce Group could not bring its case before ICSID under the Central American Free Trade Agreement (CAFTA) because the company had not halted ongoing court proceedings in El Salvador. The company had been seeking damages exceeding $100 million. The technicality spared El Salvador further proceedings for those claims, but the government of El Salvador is still required to pay massive legal fees.