[From the article by Gus Van Harten:]
Whether it concerns oil drilling or gold mining, sometimes a government, facing new circumstances, must change its mind.
This reality creates a tension in law between encouraging stability and allowing adaptation to new information and new situations. The “gold rush” CAFTA lawsuits against El Salvador reveal this tension.
Pacific Rim, a Canadian-based mining firm, has brought one of two gold mining lawsuits against El Salvador under CAFTA.Since the early 2000s, Pacific Rim has spent money looking for gold in El Salvador. It did so under exploration (but notably not exploitation) licences that were issued in 1996 and that Pacific Rim acquired in 2002. A few years later, after Pacific Rim decided where it wanted to dig, the government had adopted a more cautious position on gold mining.
So, Pacific Rim has invoked its privilege – uniquely available to foreign investors under international law, via investment treaties – to sue El Salvador. It argues that the government should have allowed it to mine for gold; the government responds that Pacific Rim failed to satisfy steps in the approvals process, including an acceptable environmental assessment. Pacific Rim seeks at least $77 million for its costs and hoped-for profits…. Read the full article here.