Pascua Lama Case

Action to protect constitutional rights alleging failure to comply with environmental protection requirements.  Obligation to adopt measures to safeguard the environment in case of risk posed by development activities.  Relationship between pollution and right to life, right to health, right to preservation of the environment and to preservation of nature.

Date of the Ruling: 
Sep 25 2013
Supreme Court of Chile
Type of Forum: 

Diaguita communities and individuals living in the Huasco river's high basin, in the Atacama region of Chile, filed an action to protect constitutional rights against Compañía Minera Nevada SpA (a subsidiary of Canada-based Barrick Gold) and the Comisión de Evaluación Ambiental (Chile's government agency dealing with environmental issues).  The action argued that the right to life had been violated by the contamination caused by the Pascua Lama mining project, a binational project to develop open pit mining of gold, silver and copper reserves that straddle the border between Chile and Argentina.  The indigenous community argued that measures ordered by an Environmental Assessment Resolution had not been complied with.  The said measures were aimed at preventing pollution of the region's water and, particularly, of its glaciers, which supply the water sources on which the communities depend for their farming and livestock breeding activities, as well as to maintain their traditional way of life. The case was filed before the Copiapó Court of Appeals and was appealed before the Supreme Court to seek an injunction to stop the project.  This action is one of a series of constitutional and administrative actions filed against the project.

The Supreme Court of Chile decided in September 2013 that the measures ordered by the Court of Appeals provided enough protection for constitutional guarantees.  The Court then ordered that the Pascua Lama project be brought to a halt “until all works aimed to protect water resources have been completed.”  Furthermore, the Court ordered that the "Monitoring Plan included in the relevant Environmental Assessment Resolution..." be complied with "...and the creation of a control system to verify compliance with the Measures," including in respect of glaciers and cliff glaciers.  For procedural reasons, the Court did not accept the request to revoke the Environmental Assessment so as to have the project undergo a new Environmental Impact Survey including consultation with indigenous peoples, but the Court did open the possibility that consultations take place through a different process.

Enforcement of the Decision and Outcomes: 

The Pascua Lama project continues to be suspended one year after the decision, and it is estimated that it will take much longer until operations resume.  In a portal devoted to the project, Barrick has published that it expects to complete the water management system by late 2014 so as to be able to process extracted minerals by mid-2016.

In April 2014, Barrick shareholders filed a class action in Canada against the company and its major executives, alleging they have lost hundreds of millions of dollars due to failures in the Pascua Lama project and because Barrick failed to adequately report on problems.

At the same time, the Diaguita communities also appealed before the Environmental Court (Tribunal Ambiental, a new specialized court in Chile) against an administrative sanction imposed on the project by the control authority, Superintendencia del Medio Ambiente.  The Superintendencia imposed a fee of around 16 million dollars and stopped the administration of the project until certain environmental protection measures are complied with.  In this case, the communities succeeded in having the decision revoked, which should lead to the sanction procedure being resumed, but this is still pending.

Groups involved in the case: 

Diaguita communities and individuals from the Huasco valley

Significance of the Case: 

From the beginning, the Pascua Lama project has been highly controversial due to concerns related to the project's impact on the environment and human rights.  The Supreme Court resolution confirming the decision by the Court of Appeals is important, because, for the first time, a project under construction involving investments for more than 5 billion dollars was stopped until certain conditions related to preventing water pollution and other human rights violations are met.  It is also significant that the Court of Appeals based its decision on the failure to comply with the Environmental Assessment Resolution and the "threat" posed by such failure to comply on the environment and the health of the population, without seeing the need for verifying the actual existence of pollution.

The Court adopted a broader view of the environment and acknowledged the fact that the impact goes beyond a specific community and covers future generations, stating the need to ensure sustainable development.

The Court also recognized the indivisibility of life, health and the preservation of nature.

The project's halt has caused the company major losses and, consequently, problems with its shareholders, setting a precedent on the importance of fully complying with environmental regulations.