Canadian mining investment in Africa has shown remarkable growth in the past decade.[1] The continent currently receives roughly 20 per cent of Canadian overseas mining capital, which in 2009 was valued at over $20-billion.[2][3] As with other mining regions, Africa is rife with complaints concerning human rights abuse and environmental destruction associated with these investments. Most recently, five people were fatally shot at Barrick Gold’s North Mara mine in Tanzania and allegations have surfaced regarding sexual abuse at this operation. Barrick reports finding ‘credible evidence’ that its security guards and Tanzanian police sexually assaulted local women.[4]

Canadian mining companies seem to enjoy impunity virtually everywhere that they operate overseas. Many governments are unable or unwilling to effectively regulate transnational corporations, and judicial institutions are often compromised by myriad issues. It’s not surprising then, that the victims of Canadian corporate abuse turn their sights on Canada. This is the jurisdiction where many mining companies are granted legal personality through incorporation. Canada is also the world’s greatest source of capital for the sector.[5] The Canadian government proactively partners with the mining industry, funding and insuring overseas operations, both through domestic institutions and the multilateral development banks. Canada provides political support to its companies and is increasingly active in the overseas promotion of ‘corporate social responsibility’. The Canadian government is also an important shareholder in this sector via a public pension fund with assets valued at $148-billion.[6]

Thus far, Canada has abdicated its governance responsibility regarding the overseas activities of the mining sector, refusing to regulate either the companies or the government agencies that support them, or to take legislative action to ensure that non-nationals who are prejudiced by the activities of Canadian companies are able to seek redress in Canada.

In 1997, a group of indigenous Guyanese initiated a suit in the Superior Court of Quebec. The Guyanese citizens were the victims of an environmental disaster at the Omai gold mine. They sued for negligence in Quebec, where the mine’s majority owner, Cambior, was incorporated. This was the first suit brought by non-nationals before a Canadian court concerning the overseas operations of a Canadian mining company. The court dismissed the case, declining to exercise jurisdiction. The judge ruled that Guyana was the appropriate venue for the suit, despite expert testimony regarding the inability of that country’s judiciary to provide the victims with a fair trial,[7] and ordered the plaintiffs to pay the company special costs. Subsequent suits brought in Guyana were also dismissed, leaving the victims without remedy.

The Cambior decision cast a decided chill on litigation in Canada concerning overseas mining. Potential plaintiffs were discouraged by the precedent and by the adverse costs award.
Buoyed by record-setting mineral prices, Canadian companies sustain an unbridled expansion throughout the world, and allegations of human rights and environmental harm continue to surface in their wake. Over ten years since the Cambior decision, there is greater awareness in Canada regarding the impacts of the global mining industry, including in the legal community, and foreign nationals are once again testing the legal waters.

Since 2009, foreign plaintiffs have brought four cases against mining companies before Canadian courts. The first was launched in the province of Ontario by three Ecuadorians who were threatened and physically assaulted by security forces allegedly contracted by mining company Copper Mesa.[8] The plaintiffs sued the Toronto Stock Exchange (TSX) and two of the company’s directors in negligence. The Ontario Superior Court dismissed the plaintiffs’ arguments that the defendants owed them a legal duty of care, meaning that neither the TSX nor the corporate directors had sufficient connection to the plaintiffs to establish an enforceable legal obligation. The decision was upheld on appeal.

Two additional cases[9] involving Guatemalan plaintiffs have been launched in Ontario against mining company Hudbay Minerals Inc. The first concerns allegations that security guards employed by the company killed an indigenous leader who opposed the company’s operations. The second suit was brought by 11 indigenous women who claim to have been gang-raped by company security guards, police officers and army officers when their families were evicted to make way for the company’s operations. The Ontario Superior Court has yet to rule on whether it will accept jurisdiction and hear the Guatemalans’ claims.

Finally, last year, Congolese nationals filed a petition for certification as a class action before the Superior Court of Quebec, the same court that refused to hear the Guyanese petition. The case concerns egregious human rights violations that took place in 2004 in the Congolese town of Kilwa. At least 73 civilians were summarily executed when the Congolese Armed Forces attacked local residents. Others suffered torture and illegal detention. A UN investigation revealed that Canadian company, Anvil Mining, provided the army with planes, vehicles, personnel and food that were used during the attack.

In 2006, a Congolese military prosecutor charged Congolese soldiers implicated in the event with war crimes. Three expatriate employees of Anvil Mining were also indicted for their alleged complicity in the crimes. However, the military court acquitted all defendants, including the former general manager of Anvil’s Congolese subsidiary, Pierre Mercier, a Canadian national. The judicial proceedings were widely criticised. Louise Arbour, former justice of the Supreme Court of Canada and then the United Nations High Commissioner for Human Rights, expressed concern regarding both the judicial process and its outcome.[10]

The 2010 petition in Quebec was launched by an association comprised of Kilwa survivors and the relatives of victims. The plaintiffs allege that because Anvil provided the Congolese Armed Forces with logistical support in the commission of human rights violations, the company is therefore complicit. In particular, the plaintiffs allege that Anvil vehicles were used to transport civilians to the periphery of the town, where they were executed, and that airplanes leased to the company were used to bring soldiers to Kilwa, where the crimes were committed.

In March, Anvil sought to have the case dismissed on jurisdictional grounds. It argued that the connection between Quebec and the incidents in question was too tenuous for the Quebec court to assume jurisdiction. The company emphasised, for example, that its head office is located in Australia and that no decision-making regarding operations at its Dikilushi mine in the Democratic Republic of Congo were made in Quebec. Finally, Anvil argued that should the court find jurisdiction, it should decline to hear the case, deferring to more appropriate venues such as the DRC and Australia, as occurred in the Cambior suit.

The following month, the Superior Court denied Anvil’s motion for dismissal and assumed jurisdiction in the case. Justice Emery found that ‘it is impossible to determine that the authorities of the Congo or of Australia would clearly be more appropriate for hearing the case. In fact, at this stage in the proceedings, everything indicates that if the court were to refuse to accept the application […], there would be no other possibility for the victims' civil claim to be heard.’[11]

The court’s decision is significant. It indicates a new openness on the part of the judiciary, at least in the province of Quebec, to consider cases involving foreign plaintiffs and events that occur outside Canada. However, in the latest chapter of what promises to be a hotly-contested process, the company was granted leave to appeal the court’s decision in early June.

The recent wave of litigation in Canada featuring foreign plaintiffs is an encouraging development that may offer victims some measure of redress for the damages they have suffered, while creating a deterrent for corporate malfeasance. While efforts advance to hold transnational corporations to account, the situation is far less encouraging with respect to another supranational actor - the international financial institutions.

In 2004, prior to the Kilwa massacre, the Multilateral Guarantee Investment Agency (MIGA) granted Anvil a US$13.6 million guarantee against the risk of war and civil disturbance for its Congolese mine. MIGA, which is part of the World Bank Group, facilitates private sector investment in developing and emerging markets. The International Finance Corporation (IFC), another World Bank agency, plays a similar role by providing private companies with loans and equity. In 2010, MIGA and the IFC provided the global mining industry with over US$900-million in support.[12] Given the multilateral nature of these institutions, Canadian courts are unlikely to accept jurisdiction in cases involving allegations of their complicity in the misconduct of their clients.

The issue of access to remedy for the victims of corporate abuse requires urgent attention. An obvious priority is to strengthen judicial institutions in the countries where abuse takes place. However, it’s also critical that the judiciary in multinationals’ ‘home’ countries, such as Canada, hear cases involving the alleged negligence and criminal wrong-doing of their companies in foreign countries, especially when the victims lack other viable options. The role of home governments in facilitating human rights violations and other types of abuse should also be examined by domestic courts.

Finally, as with the private sector, the multinational nature of international financial institutions should no longer hinder judicial oversight.

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* Karyn Keenan is the program officer at Halifax Initiative Coalition
* Please send comments to editor[at]pambazuka[dot]org or comment online at Pambazuka News

NOTES:

[1] Almost 700 per cent between 2001 and 2009.
[2] All values in Canadian dollars except where otherwise indicated.
[3] Natural Resources Canada. Unpublished data.
[4] http://www.thestar.com/business/article/999866--barrick-probes-assault-allegations
[5] http://www.tmx.com/en/pdf/Mining_Sector_Sheet.pdf
[6] http://www.cppib.ca/Investments/Total_Portfolio_View/default.html
[7] See Scott, Craig and Robert Wai, ‘Transnational Governance of Corporate Conduct through the Migration of Human Rights Norms: The Potential Contribution of Transnational “Private” Litigation,’ in C. Joerges, P. Sand and G. Teubner, eds., Transnational Governance and Constitutionalism (Oxford: Hart Publishing, 2004) 287-319.
[8] http://www.ramirezversuscoppermesa.com/
[9] http://www.chocversushudbay.com/
[10] http://bit.ly/kYADza
[11] http://www.ccij.ca/media/ccij-in-the-news/index.php?DOC_INST=15
[12] The World Bank Group in Extractive Industries. 2010 Annual Review.