Given its failure to pay its fees to ICSID, the tribunal rejected the extension request by the mining company Commerce Group in the trial against El Salvador
On August 9th the International Centre for Settlement of Investment Disputes (ICSID) denied an extension request by the mining company Commerce Group Corp to continue its suit against the Salvadoran government. The ruling announced through its website makes reference to its finding that the company has not demonstrated that it has the financial resources to continue the process in this tribunal, which is part of the World Bank. It is a ruling that we favor despite being based on the non-payment of fees by the company and not on the recognition of the dangers of pollution and destructive mining. A similar resolution on this case had already been announced by ICSID in 2012, so it is not a victory for the Salvadoran state in its defense of its sovereign right to deny mining permits to the company.
In October 2010, Commerce Group, a mining company of American origin, initiated a lawsuit for USD $100 million against the Salvadoran state when it revoked the operating license for the San Sebastian mine. The mine is located in the province of La Union in the east of the country, where the mining company maintained operations intermittently for several decades of the last century. The permit was denied because of the pollution of the San Sebastian River and other irreversible ecosystem impacts. The San Sebastian River, located at the foot of the mine in the municipality of Santa Rosa de Lima, today suffers alarming levels of pollution from the mining of heavy metals by the same company. Experts and national and international organizations, the Ministry of Environment and Natural Resources and the Human Rights Ombudsman, have denounced the contamination at the site and pointed out that the serious environmental degradation is affecting the rights to life, water, food, health and the environment of communities in the area.
Despite the disaster, Commerce Group has continued attempting to blackmail the Salvadoran state, making use of international corporate tribunals while not responding to the proven pollution impacts and without respecting the refusal of the people who prefer to preserve the few natural resources they have left.
As in the case of the demand for USD $315 million that the Canadian company Pacific Rim is bringing against the Salvadoran government, this is an extortion that demonstrates the enormous privileges that our policy makers have given to multinational corporations.
The Salvadoran state, in particular the institutions that must protect it, instead of celebrating victories that do not belong to them, and if indeed it is their intention to ensure our national sovereignty, should review and stop promoting investment agreements, such as the free trade agreement with the United States, the Association Agreement with the European Union, the Partnership for Growth and the law for Private Public Partnerships, that give privileges and maximum protection to the investment rights of transnational corporations to the detriment and expense of our sovereignty and human rights. In addition, if its mandate is to promote and defend the rights of the Salvadoran population, the government should urgently promote a law that bans metal mining given the enormous risks that it entails to the country.
San Salvador, August 10, 2013
National Roundtable on Metallic Mining