No winners in El Salvador vs Pacific Rim case

October 15, 2016

After seven years of arbitration the ISDS case brought by mining company Pacific Rim (OceanaGold) against El Salvador has been found without merit, meaning the country will not have to pay the $250 million sought by the company.

However, there are no real winners. El Salvador had to spend over $12 million to defend the case, brought despite the mining company never fulfilling the legal requirements for a mining license.  

Kevin Bracken and Joe Italia from the MUA, who have been key organisers of fortnightly rallies outside OceanaGold’s Melbourne headquarters, wrote to their supporters:

“The success of El Salvador in this case is not a victory for any form of justice from ICSID. The panel ruled in El Salvador’s favour because OceanaGold did not file a proper Environmental Impact Statement - a fact brought out by the grass roots activities of ADES. This case highlights the dangers of including ISDS clauses in trade agreements. The $8m awarded does not cover the $13m that El Salvador has spent defending the case.

We must continue to campaign against trade agreements that contain ISDS clauses and are not in the public interest. Public submissions are being accepted until 28 October by the Senate inquiry into the TPP. Please encourage as many people as possible to make submissions.”

Manuel Pérez-Rocha of the Institute for Policy Studies told the media:

 “The fact that Pac Rim – now OceanaGold – could sue El Salvador when it has never had a license to operate, is an abuse of process.

“That these suits take place far from any transparent, independent court system demonstrates why we are opposed to the Trans-Pacific Partnership and other so called free trade agreements.”

Marcos Orellana of the Center for International Environmental Law (CIEL) said:

“By allowing transnational companies to blackmail governments to try to force them to adopt policies that favor corporations, investor-state arbitration undermines democracy in El Salvador and around the world.

“Regardless of the outcome, the arbitration has had a chilling effect on the development and implementation of public policy necessary to protect the environment and the human right to water.”

AFTINET was an active supporter of the International Allies against Mining in El Salvador and hosted activist Vidalina Morales on her advocacy trip to Australia in 2013.