I THINK MINING

    Is the Canadian mining industry loosing the battle of public opinion, and if so, why?

This question is prompted by the news that the president of the Alberta Enterprise Group said “the Alberta government and energy industry must step up their listless defence of the oilsands and better fund their PR battle against environmental groups.”

Meanwhile two hundred delegates convene in Montreal to push for Canadian Federal legislation that would make Canadian mining companies report on their human rights activities in foreign countries.   Mineweb reports that the Prospectors and Developers Association of Canada “has urged the foreign Affairs and International Development Committee of the House of Commons to reject the bill they say would harm Canada’s mineral industry and its reputation in less developed nations.” 

Here is a summary of the bill under discussion:

Bill C- 300, also known as the Corporate Accountability of Mining, Oil and Gas Corporations in Developing Countries Act, aims to promote responsible environmental practices and international human rights standards on the part of Canadian mining, oil and gas corporations in developing countries.  Introduced by Liberal MP John McKay, an attorney, the act would give the federal Ministers of Foreign Affairs and International Trade the responsibility of holding corporations accountable for their practices by submitting annual reports to the House of Commons and the Senate for review.

A comprehensive collection of web links to the text of the bill and comments for and against the bill is available at this link. 

The purpose of the bill as set out in the bill itself is: ”to ensure that corporations engaged in mining, oil or gas activities and receiving support from the Government of Canada act in a manner consistent with international environmental best practices and with Canada’s commitments to international human rights standards.”  In practice the bill is short and a quick read.  It provides for anybody, anywhere to lodge a complaint against a Canadian company “engaged in mining, oil, or gas activities.”  The Minster of Foreign Affairs and/or the Minister of International Trade is then required to investigate. 

The bill calls for the government to issue guidelines on what constitutes good practice by Canadian mining, oil, and gas companies operating abroad.  Basically the bill requires the guidelines to ensure that such companies operate “in a manner consistent with international human rights standards.”  Then the bill follows with a few sneaky provisions: one would in effect stop a company from operating if the Minister found against them in any complaint; another would preclude the government helping affected mining companies; and a third would forbid investment by the Canada Pension Plan in affected mining companies.  It all sounds innocent, but it is draconian in the hands of an activist. 

Strangely the web is mostly silent on the bill and its implications.  There are the usual repeats of the PDAC statement, and the usual rants about Canadian taxpayer money going to support companies that mine in other countries in purported violation of international human rights standards. 

In a cold, ivory tower perspective, the bill is fascinating as it is the first I am aware of that tries to enable a government, in this case the Canadian Federal Government, to manage the affairs of companies operating in a foreign country–even if that operation is in full accord with the laws of the foreign country.  The bill is also the first, that I am aware of, to make it so easy for foreigners to bring complaints against a national company in the nation state, not in a court of law, but in the smokey halls of the regulators and government employees. 

If this bill passes, we can be sure a whole new industry will spring up: lawyers and fresh-faced youth running to the two Ministers noted in the bill claiming every form of abuse by every Canadian mining company in every foreign country imaginable.   Canadian mining companies will establish new departments whose sole focus will be fighting every spurious claim and defending the few that may have merit—either way the costs for consultants and lawyers will be high.  But what concerns me most is that a bunch of government employees will have to be gathered to judge the merits of the claims.  That is scary: a true harkening back to the Star Chamber of Medieval Horrors.  Imagine, the accused Canadian mining company cannot defend itself in a Canadian court.  That sounds like the nasty dictatorial countries the promoters of this bill are supposedly trying to protect.  

Undoubtedly there are instances of Canadian mining companies acting badly—as an American I still smart at the Canadian takeover of Cuban nickle mines and the exploitation of the workers for Canadian profit.  Nice thought that an wronged American shareholder of the old Cuban nickle mines might be the first to bring suite in Ottawa against Sherritt, demanding a living wage for Cuban nickle miners.

   Undoubtedly, Canadian mining companies have benefitted from the action of foreign governments, primarily those consisting of Spanish-derived rulers, against the native-Indians in remote, but gold-rich jungles.   Imagine the complaint by Hugo Chavez against the Canadian mining company on misuse of Indian lands in some South American dictatorship. 

If this is a politically incorrect perspective—so be it.  The debate is a good one to have.   The future beckons with much opportunity for mining and improvement of human rights and protection of the environment here and abroad.   Canada should lead the way.  But it will ba  lonely road if we are trying to change the habits of junior miners in Vancouver; while at the same time establishing new norms of international law; while setting up a Star Chamber in Ottowa.