The company behind three South Island gold mines is suing the El Salvador government for refusing to grant it a mining permit.

OceanaGold owns the Reefton, Macraes and Frasers gold mines in the South Island and is listed on the New Zealand, Australian and Canadian sharemarkets.

It is using a clause in a free trade agreement to take El Salvador to international arbitration in a bid to force the country to reverse a seven year ban on mining. It is also claiming $US301 million in lost profits as a result of the mining ban.

El Salvador banned all new metal mining after toxins from decades of extraction polluted 90 percent of its water.

OceanGold’s Pacific Rim wants to dig for gold and silver near the country’s last clean water source.

The case was going to international arbitration in the United States this week.

There were protests outside OceanaGold’s offices in Toronto, Sydney and in San Salvador last week, with 30 NGOs and trade unions calling for the lawsuit to be dropped.

The lawyer representing El Salvador Luis Parada said OceanaGold is trying to bully the government into changing its mind.

He said the case has already cost El Salvador more than $10 million and shows how free trade agreements can impinge on national sovereignty.

New Zealand could face similar action

There are claims New Zealand could face similar prosecutions if it signs up to the Trans-Pacific Partnership which is currently being negotiated.

The Council of Trade Unions says foreign investors could sue the government if their profits or assets were affected by law changes.

CTU economist Bill Rosenberg said the number of such lawsuits are growing exponentially and the risk New Zealand could be sued under the proposed Trans-Pacific Partnership is high.

“You’re introducing many large corporations who are known to be very litigious, they’re very keen, very willing to take legal action in their own interests which makes it considerably more dangerous than some of the revisions we’ve signed up to in the past.”

University of Auckland law professor Jane Kelsey agrees. She said international arbitration tribunals created to settle disputes can overrule a nation’s own courts.

“The judges are actually mainly investment lawyers themselves who also act for investors bringing disputes and that’s been part of the controversy that these are not proper courts that operate through due process.”

Jane Kelsey said the El Salvador case could have direct implications for New Zealand.

“The government has been issuing a range of licenses to mining companies without putting an effective regulatory mechanism in place. Trying to do that later once you have made commitments to investors and once you have signed up to these agreements lays yourself open to potentially billions of dollars in claims before these investment tribunals.”

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This is a clear example of why the Trans-Pacific Partnership (TPPA) poses such a threat to New Zealand. The exact same thing could be happening here if we decided it was in our country’s best interest to ban mining, introduce plain package cigarettes or enforce our GMO labelling laws. This agreement is a direct threat to our sovereignty as a nation if we are in fear of being taken to Kangaroo courts and fined for corporate giant’s loss of profits for introducing certain unfavorable legislation.

To find out more information regarding the TPPA please watch this video or visit the It’s Our Future website .

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Wake Up NZ is a team of dedicated truth-seekers from all over New Zealand. We are committed to disseminating information that the mainstream media fails to bring to you.

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