Canadian mining company Gran Colombia Gold is reportedly resorting to international arbitration under the Canada-Colombia free trade agreement.
The company’s operations – underground gold and silver mining – appear to have been beset with a variety of problems which, taken together, allegedly amount to a violation of the FTA.
First, according to Gran Colombia’s most recent financial report, the company’s operations in Segovia have been negatively affected by civil strikes and demonstrations carried out by informal miners in the region, who are participating in ongoing negotiations with the government to formalize their activity. While the company’s own employees are not involved in these demonstrations, the investor claims that the strikes have caused security concerns. However, the company claims to have agreed to participate in a roundtable with representatives of all parties involved in order to “analyze and propose solutions to improve social and economic matters” in the region.
In addition, local news reports that the company’s Marmato site has also been affected by incursions of illegal artisanal miners, and that the firm suffered an attack in February 2016 carried out by the National Liberation Army guerrilla group. The company’s most recent financial report, dated September 30, 2016, notes that the company has entered into an agreement to compensate these artisanal miners, in exchange for the cessation of mining activities, but no mention of an arbitration is made.
Now, local news reports that the company first notified Colombia of the existence of a dispute in October 2016, and on February 27, served the government with a notice of arbitration. The company reportedly alleges that their claim is based on government inaction in the face of these various threats to their operations, and claims damages of $700 million.
When contacted by IAReporter, an official with Colombia’s Ministry of Commerce noted in a brief response that the claimants appear determined to pursue their case through arbitration.
We’ve reported on several other mining-related treaty-based disputes in Colombia, including the Eco Oro case, the Glencore case, and the Cosigo case.
Still other treaty-based disputes have arisen in the telecoms and electricity sectors, and in the pharmaceutical context.
