Investor-state challenge vs La Puya resistance elevates corporate profit over human rights

Published by Brent Patterson on

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In March 2010, residents from the communities of San José del Golfo and San Pedro Ayampuc – an area known as La Puya, just north of Guatemala City – began their struggle against the Vancouver-based Radius Gold Inc. Tambor mine.

By March 2012, they set up a peaceful, 24-hour a day blockade to the entrance of the mine. They did so because they had neither been informed nor consulted about the mine, they had concerns about water contamination and the amount of water the mine would use in an already dry region, and to protect the environment.

By August 2012, Radius Gold Inc. sold the Tambor mine to the US-based Kappes, Cassiday & Associates, but retained an economic interest in the mine (including quarterly royalty payments on the gold production from the mine).

Just a few months later, in November 2012, the Peace Brigades International-Guatemala Project began accompanying the Peaceful Resistance of La Puya.

Then in May 2014, the blockade was violently evicted by riot police with flash bombs and tear gas. The Center for International Environmental Law notes: “Those who refused to move were beaten. The eviction left 20 community members injured and 7 hospitalized.”

Even after the blockade was broken by the police, members of La Puya continue to maintain a 24-hour presence in moral opposition to the project.

It was then that the resistance turned to the courts – and won.

In July 2015, a Guatemalan court ruled in favour of La Puya, ordering EXMINGUA – the Guatemalan subsidiary of Kappes, Cassiday & Associates – to suspend all activities at the mine until a community consultation was held.

Then in February 2016, the Guatemalan Supreme Court ruled to provisionally suspend the mining licence due to a lack of prior consultation.

But in December 2018, KCA filed a $300 million claim with the International Centre for Settlement of Investment Disputes, a World Bank arbitration mechanism.

The company cites community protests and unjust treatment by the state as a violation of the terms of the Free Trade Agreement between the Dominican Republic, Central America and the United States.

Most recently, in March 2020, an ICSID arbitration panel rejected Guatemala’s ‘preliminary objections’ to the challenge and admitted the case for consideration on its merits. Emma Schoenberger notes this here, as does Jen Moore here.

As such, ten years after a Canadian mining company set this process in motion, the Peaceful Resistance of La Puya continues in their struggle for the Indigenous right to free, prior and informed consent; the human right to clean drinking water; and the human right to a safe, clean, healthy and sustainable environment.

Key concerns raised by human rights activists about investor-state dispute settlement (ISDS) suits include: they are generally heard by secretive tribunals, rather than the regular court system; the provision elevates economic interests above human rights; and the threat of them can place a ‘chill effect’ on governments that further empowers transnational corporations to violate human rights.

Peace Brigades International supports the call for a United Nations Binding Treaty on Transnational Corporations and Human Rights. Proponents of the Binding Treaty have called for the abolition of ISDS provisions from trade agreements.

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