In the context of high global prices for natural resources, governments seeking to increase the benefits of those resources for their own people are facing an increasing number of corporate lawsuits.
Under free trade agreements and bilateral investment treaties, foreign investors have the right to file such “investor-state” lawsuits in international tribunals to demand compensation for government actions that reduce their profits.
This newly updated edition of “Mining for Profits” finds that at the most frequently used tribunal, the International Center for Settlement of Investment Disputes (ICSID), 43 of 137 pending “investor-state” cases are related to oil, mining, or gas. By contrast, one year ago there were only 32 such cases and 10 years ago there were only 3.
In one of the most controversial cases, Pacific Rim is suing the government of El Salvador, demanding $77 million over the denial of a gold mining permit on environmental and public health grounds. The firm charges that the government’s refusal to grant the permit is a violation of its right to “fair and equitable treatment” and other protections under the Central American Free Trade Agreement (CAFTA).