Injustice Abroad: Canadian Corporate Accountability

Presented by Alison Mazoff, B.A. (Hons), J.D.

#OpenForJustice

What is Corporate Accountability?

A set of enforceable strategies used to influence corporate behaviour.

Usually, in the form of pressure exerted by governmental and social forces.

This presentation looks at the recent legal strategies used in Canada to hold Canadian mining companies operating abroad accountable for environmental destruction and human rights violations.

What motivates a Corp?

How does the Corp get $?

When they make a profit (have more assets than liabilities)

Profit = Assets – LiabilitiesAssets= +$, equipment, etc.Liability = - $: expenses

How does CA Work

Through laws or regulations, attaches more liability to an abusive behaviour than the asset produced by the abusive behaviour is worth.

Challenges with Canadian CA?

Canadian laws and Courts generally do not have jurisdiction over things that happen in other countries.

So what can a wronged group do if a Canadian Corp. abused them in another Country?

Sue the company where the abuse happened

A Plaintiff can sue an offending company in the jurisdiction where the offence occurred.

The problem is that even if the Plaintiff is successful, the Corp. might not have assets in the Jurisdiction where the Plaintiff obtained the Judgment.

So, what’s the problem?

Judgment

No assets

Register the

judgment

Assets/Sub corp

in Canada

Chevron v. YaigujeThe aftermath of mining in Ecuador

Ecuadorian Judgment

The Plaintiffs have been trying to bring Chevron to justice for over 20 years.

The Plaintiffs obtained a Judgment in Ecuadorian Court for $9.1 billion USD.

Chevron has Assets

In the U.S. In Canada (Chevron Canada)

Judicial History

ONSC

ONCA

SCC

Findings

Ontario Courts have the jurisdiction to decide whether or not the Judgment can be enforced whether against the Judgment Debtor, even if they are not in Canada and against the Canadian subsidiary of the Corp.

The Court will consider a company’s, within its jurisdiction, relationship with a foreign parent in deciding whether there is authority to enforce a Judgment against the Parent.

Why does this matter?

It’s a big deal: it opens doors for Canadian Courts to enforce Judgments of foreign courts if a subsidiary of a defendant is in its jurisdiction and against foreign corps. Outside of its jurisdiction.

No foreign Judgment

Over the past few years, several Plaintiffs have tried to sue those who abused them in a foreign country in Canadian Courts unsuccessfully.

Araya v. Nevsun

Nevsun is a Canadian mining company that indirectly owns 60% of a copper, gold and zinc mine in Western Eritrea known as Bisha mine.

Background

The Mine is owned by Bisha Mine Share Company, Segen Construction Company (owned by Eritrea’s ruling party) is a subcontractor of BMSC

Last year, allegations of human rights abuses and crimes against humanity surfaced from a Human Rights Watch report and a later UN report.

Claim Against Nevsun

Damages have not been quantified on the claim. This is the first claim in Canada based completely

on violations of international law. Nevsun has given 2 responses to the media: 1)

that it was required by the Eritrean government to use Segen Construction (owned by the ruling party) for the mine and regrets any forced labour and 2) that the allegations are unfounded.

Nevsun’s Response to Suit

Nevsun is an indirect Shareholder of Bisha Mine, the mine is controlled by BMSC.

Eritrea is not a “Rogue State” and military conscripts were not used.

Nevsun was not engaged in a venture with Eritrea.

BC does not Jurisdiction to hear the case. The Plaintiffs and the company have a

collective agreement.

Nevsun Response Cont.

The action should be dismissed as a representative action.

Ask for dismissal because the claims are not justifiable and contrary to the state immunity act.

Next for Araya v. Nevsun

The Preliminary application(s) (estimated time 10-15 days) will be heard on January 4, 2016.

Other Test Cases

Choc v. Hudbay Minerals (2013 ONSC 998) Opens door to assert a duty of care of

subsidiaries Adolfo Agustin Garcia et al v. Tahoe Resources

inc.Suing over the Corps claims of Corporate

Social Responsibility.

#open4Justice

AI has already launched the Open for Justice Campaign. They suggest: Phoning or lobbying your MP (there is a kit for

this) Email bhr@amnesty.ca before you go speak to

your MP so that your talking points will be accurate and up-to-date.

Support the UN treaty for business and human rights.

Thank You!

“In our globalized world we can’t hide behind the idea that the harm is happening somewhere else and is someone else’s problem. Canadian companies need to be held to account in Canadian courts.”

- Alex Neve, Secretary General, Amnesty International Canada.

Resources

If you would like to find out more about Corporate Accountability in Canada, please visit: Canadian Network on Corporate Accountability

http://cnca-rcrce.ca/ Mining Watch Canada

http://www.miningwatch.ca/openforjustice/ Canadian Labour Congress

http://canadianlabour.ca/issues-research/issues/corporate-accountability

Amnesty International http://www.amnesty.ca/our-work/campaigns/open-for-justice