Note on… the Canadian mining Bill on Corporate Accountability (the buried one)

November 11, 2010

By Antoine Martin.
While I questioned in a recent note some criticisms as to the ‘failure’ of US Courts to recognise the responsibility of foreign corporations for their activities abroad, it is interesting to emphasise briefly that the Canadian House of Common just rejected the idea of holding its mining industry liable for similar abuses.

The Corporate Accountability of Mining, Oil and Gas Corporations in Developing Countries Act

In April 2009 already, John McKay, a Liberal Member of Parliament, proposed the Corporate Accountability of Mining, Oil and Gas Corporations in Developing Countries Act before a sceptical Parliament (a first draft was passed in a vote of 137 to 133). Despite the protests of the Mining Industry, McKay re-presented the Bill last week. The facts, as he formulates, indeed “show companies involved in human-rights abuses, they show companies involved in using rape and murder as measures of security in order to secure their sites, they show companies operating without licenses in countries, they show significant environmental degradation.”[1]

The Bill, therefore, would have rendered illegal human-rights abuses by Canadian mining companies abroad, and punished those found to be involved in immoral behaviour by limiting their Export Development funding and embassy promotion. An administrative procedure would have been created in practice, allowing the Department of Foreign Affairs to investigate all complaints brought before it.

“Canada is the world centre for mining. It has the best technology, the biggest companies, the most expertise and the most favourable conditions. When C-300 passes, these facts will remain the same. Good corporate social responsibility is good for business, and good business is good corporate social responsibility. A responsible mining Bill is good for Canada”[2]

The buried Bill

The news nevertheless, report that the House of Commons just defeated the Bill aimed at ‘encouraging Canadian mining firms to act ethically’ abroad. The deliberations, though, were tight (140-134), and for most commentators, the refusal is due to the lobbying battle which the industry led against its detractors.[3]

In a concluding statement,[4] the Prospectors and Developers Association of Canada (PDAC) and the Mining Association of Canada (MAC) indeed suggested that the industry’s commitment to CSR was already significant and overall largely sufficient. The new Bill, in other words, would have had no effect, and would have rendered Canadian miners uncompetitive.

“Canada’s mining and exploration industry is already actively engaged in Corporate Social Responsibility practices and Bill C-300 would not have enhanced Corporate Social Responsibility (CSR). Canada’s competitors would have used the passage of Bill C-300 as a tool to undermine the competitiveness of Canadian firms in the highly competitive global extraction industry. Frivolous or vexatious claims would have been filed against Canadian firms by competitive interests at no cost or risk to themselves

[…] Canada’s exploration and mining companies recognize that good CSR is the right thing to do”.

The eternal debate, therefore, remains unsolved. While international commentators promote a need for corporate liability, states and corporations rather deny the existence of such obligations under international law.  Corporations, as they say, only ‘should’ consider whether or not they want to voluntarily abide by CSR standards (the approach, in fact, is similar to John Ruggie’s policies on corporate ‘responsibility’). The mining Bill, nevertheless, is now buried, which suggests that the regulatory v. voluntary divide is not sorted (yet), and neither is the issue of corporate liability for human rights abuses.

[1] Vancouver Sun, October 26, 2010

[2] Mckay, in the Vancouver Sun

[3] Globe and Mail Oct. 27, 2010, Lobbying blitz helps kill mining ethics bill

[4] Statement By Prospectors And Developers Association Of Canada And The Mining Association Of Canada On The Defeat Of Bill C-300

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