Ottawa and Toronto – A coalition of Canadian organizations is condemning the threatened use of NAFTA by Blackfire Exploration to extract 800 million dollars from the impoverished Mexican state of Chiapas. The Calgary-based mining company is embroiled in accusations of corruption of Mexican public officials and the murder of a prominent environmental activist in the Mexican State of Chiapas. Now, according to a recent report in the Mexican press, Blackfire is also threatening to sue the government of Chiapas for $800 million in compensation under NAFTA (North American Free Trade Agreement) Chapter 11 for the closure of its barite mine in December 2009.

In response to this development Rick Arnold of Common Frontiers states, “You’d think that Blackfire, mired as it is in controversy, would seek to mend fences with the affected communities in Chiapas by offering compensation. Instead the company is proceeding to bully Mexican public authorities by threatening a mega-million dollar NAFTA Ch. 11 action that the country could ill afford to pay.”

“NAFTA Chapter 11 offers extensive foreign investor privileges and their private enforcement in undemocratic trade tribunals outside the domestic court system. It should be abandoned as an unfair trade practice,” said Janet Eaton, Trade and Environment Campaigner, Sierra Club Canada. “It is time for NAFTA Chapter 11 to go.”

For its part, REMA (the Mexican Network of People Affected by Mining) is demanding that the Mexican Federal Government act immediately to cancel all mining concessions given to Blackfire, and to expel the company from Mexico for violating fundamental human rights. REMA charges the Canadian mining company with masterminding the murder of Mariano Abarca Roblero in November, 2009, for which some of Blackfire’s workers have been arrested.

REMA members point out that Blackfire has not lived up to its development promises of roads and water storage tanks, and has instead created a negative environmental impact, fostered a climate of threats, murder, and corruption, and further impoverished the local population.

Blackfire’s misdeeds in Chiapas and its unrepentant attitude exemplify the need for a strong regulatory framework that the government of Canada should put in place right away to deal with cases where human rights, labour rights and environmental standards are trampled on by Canadian corporations operating beyond our borders.

“These Canadian companies investing in the mining, oil and gas sectors in developing countries are the face of Canada abroad. Self-regulation through a ‘corporate social responsibility’ framework is clearly not working,” said Ken Neumann, Canadian director of the United Steelworkers.

Blackfire’s blatant attempt to coerce lawmakers in Mexico with the very mention of a NAFTA Ch. 11 action raises once again the specter of private corporations thwarting government decisions made in the public interest. According to Jamie Kneen, of MiningWatch Canada, “It just flies in the face of reason that even the most minimal actions by a local government to protect its own people and environment can be called ‘expropriation’ and subject to legal action under NAFTA.”

“The threatened Blackfire NAFTA lawsuit proves how trade rules have given corporations far more rights to profit than they allow communities to develop sustainably and protect human rights. If there was ever a glaring opportunity for the governments of Canada, Mexico and the United States to remove Chapter 11 from NAFTA, this must be it.” said Maude Barlow, national chairperson, Council of Canadians.

The Canadian organizations are demanding that Blackfire cease and desist in its NAFTA Chapter 11 threats against the government of Chiapas, and that the Canadian government begin a thorough investigation into Blackfire’s activities in Mexico. The coalition also calls on all MPs to recognize that Canadian mining company abuses in the Global South are endemic. Passing Bill C-300, the Responsible Mining Bill, will be a step in the right direction to ensure government oversight of Canadian mining activities abroad.

Investor-state dispute mechanisms, such as NAFTA’s Chapter 11, must be removed from all existing bilateral and multilateral trade agreements and not included in any future agreement. There is no justification for protecting investment and the profit drives of multinational mining companies to the detriment of basic human and ecological rights.

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For more information please contact:

• Common Frontiers – Rick Arnold (905) 352-2430 – comfront [at] web [dot] ca
• Sierra Club Canada – Michael Bernard (613) 241-4611×230 (office) (613) 302-9933 (cell) -michaelb [at] sierraclub [dot] ca
• United Steel Workers – Judith Marshall (416) 544-5963 – jmarshall [at] usw [dot] ca

• Council of Canadians – Dylan Penner (613) 795-8685 – dpenner [at] canadians [dot] org

Background:

1. English translation: REMA-CHIAPAS statement on the threat of a lawsuit by Blackfire Exploration and the attitude and involvement of Chiapas State authorities. (Original on line.)
2. English translation and original February 9, 2010 article in Milenio.