Will of the people • Focus: Mining consultations

THE ECUADORIAN AUTHORITIES SEEK TO TIGHTEN UP THE MINING SECTOR.

MINING OPERATORS IN ECUADOR as of late have had a sword of Damocles dangling over their heads, under whose ambiguous regulations their contractual rights could be voided at seemingly any moment. The Constitutional Court has recently handed down several decisions which, while ratifying that the constitution provides for consultations that could terminate a mining concession, could have very specific consequences. These rulings have had the effect of unleashing local courts that in general have been sympathetic to anti-mining activists.

In its first article, Ecuador’s 2008 constitution holds that authority is based on the people’s will and exercised through its organs of political power or through direct participation. Given this precedent, it was President Moreno himself who first called for a referendum (i.e. consultation) to change what the constitution permitted regarding mining in February 2018. The aim of this was to prevent former president Correa from running again for president and wresting control from him over the constitutional and supreme courts, the electoral bodies, and the state’s oversight institutions. Embedding these core questions with others that could convince voters into casting a "Yes" vote for the full plank of questions, the consultation also asked people whether they were “in agreement with amending the constitution… so as to ban metallic mining in all its stages, without exception, in protected areas, intangible zones, and urban centers.”

Though the constitution already banned oil and mining in protected areas and intangible zones (Article 407), every question was overwhelmingly approved, including that on mining. Anti-mining activists then followed the presidential example, though the constitution also required prior consultation with indigenous communities and nationalities for mining and oil activities, starting with prospecting (Article 57). Yaku Pérez, an attorney-at-law, filed a suit against Ecuagoldmining, which holds the Río Blanco concession in Azuay, on grounds that it had not carried out said consultation.

On June 1, 2018, the Azuay justice ruled on the motion submitted by Pérez and ordered the suspension of mining activities at Río Blanco. On August 3, the civil and commercial chamber of the Azuay Provincial Court ratified the Río Blanco judgment. To the request that a consultation be carried out, the court indicated it was no longer necessary, as Molleturo, where the project is

located, “was already consulted on February 4, 2018 with question 5 of the referendum.” As it turns out, the Superior Court of Azuay interpreted a Yes vote on question 5 of the February referendum as a No vote on industrial mining. Given that the Yes vote on question 5 won in most of the country’s counties, if the decision of the Azuay court held, Ecuador would effectively be cut off from mining.

Next in line was another first-generation project in Azuay, INV’s Loma Larga in Quimsacocha. Attorney Pérez obtained the forms from the National Electoral Council (CNE) to collect signatures for a consultation in Girón county, where some of the facilities of the Loma Larga project are located, with the question: “Do you agree that mining activities should be allowed to be carried out in the moorland and water sources of the Quimsacocha hydrological system?” Instead of sending the case up to constitutional court to decide on the constitutionality of the consultation once the signatures were submitted, CNE proceeded to call for a vote on March 24, 2019. 87% of the electorate voted overwhelmingly No, and Loma Larga was forced to relocate the tailings dam in Girón to Cuenca county, where the mine is.

In May 2019, a group of citizens requested authorization from the constitutional court to hold another consultation in several counties in Carchi and Imbabura provinces, where Solgold’s

Cascabel property is located, which the constitutional court dismissed on technicalities. Meanwhile, though, Pérez ran for and won the Azuay prefecture and requested authorization from the constitutional court for a province-wide consultation on industrial mining. The court agreed that “in principle there is no constitutional disposition that clearly and expressly bans the citizenry from proposing for consultation matters related to … mining activities” (Opinion No. 9-19-CP/19 of September 17). However, those consultations had to meet certain criteria, which Pérez’s request did not, and were therefore thrown out.

As things stand, the court holds that consultations must be fair and feature documented questions. Leading questions such as asking whether “one agrees to mining that affects water sources” are inadmissible. The consultation should also explain the consequences that its approval would have. Nor can the consultation be far-ranging; asking for a ban in the entire Azuay province, for instance, is inadmissible. A consultation may only pertain to a specific mine. In the words of former Vice Minister of Mines Fernando Benalcázar, the court “established that only if there are conditions that justify a violation or possible constitutional damage would the request be granted. With that, the court gave a clear message that it is not only a matter of wanting mining or not.” ✖