Canadian Extractive Companies Operating Abroad

Addressing Corporate Abuse Through the Right to Free, Prior and Informed Consent of Indigenous peoples

The purpose of this brief is to identify problems that Indigenous peoples face from Canadian extractive companies operating abroad and to present recommendations to ensure that Indigenous rights to territory and free, prior and informed consent (FPIC) are respected.

Since 2000, there has been a significant increase in social conflicts concerning mining operations, especially in Latin America and Africa. In 2012 and 2013, 167 mining-related conflicts were recorded involving mining companies headquartered in 33 different countries, the top two of which were Canada (30.3%) and the U.S. (8.6%). Such conflicts can be lethal. Between 2002 and 2014, Global Witness documented 908 killings of environmental and land defenders, with 115 of the victims being Indigenous and around 17% (150) of these deaths occurring in the extractive sector. As for Canadian mining companies operating in Latin America, the Justice and Corporate Accountability Project (JCAP) identified 28 companies involved in 44 deaths, as well as 709 cases of “criminalization” between 2000 and 2015. JCAP also found that “mining often affects Indigenous lands [and has identified] 10 conflicts in which Indigenous people have clearly been the victims of violence and criminalization.”

There is a clear link between Canada, extractive companies and Indigenous peoples abroad, and the relationships between them can lead to conflict. Furthermore, these relationships are exemplified by immense power imbalances and socio-economic disparities. What can be done to uphold Indigenous rights to prevent or solve conflicts between Canadian extractive companies and Indigenous peoples in other countries?

Background

• According to Global Affairs, in 2013 more than 50% of publicly traded mining companies worldwide were headquartered in Canada. This means that Canada is the largest player in the international mining industry. Natural Resources Canada reports the value of Canadian mining assets abroad in 2017 at $168.7 billion, more than half of which are in Latin America ($93.1 billion).
• Canada does not fully recognize the right of Indigenous peoples to FPIC in accordance with current international human rights law and the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP), among other instruments.
• International bodies have recommended that the GC adopt laws to ensure that corporations registered in Canada respect human rights while operating abroad. For example, United Nations bodies such as the Working Group on the issue of human rights and transnational corporations and other business enterprises (2018), the Committee on the Elimination of Racial Discrimination (2017), the Committee on the Elimination of Discrimination against Women (2016), the Committee on Economic, Social and Cultural Rights (2016), the Human Rights Committee (2015) and the special rapporteur on the rights of Indigenous peoples (2014) have stated their concerns about the inadequacy of consultations with Indigenous peoples potentially affected by extractive projects on their lands and non-compliance with FPIC norms.
• The Committee on Economic, Social and Cultural Rights (CESCR) recommends that Canada amend its legislation to require human rights impact assessments before any investments are made. This recommendation refers particularly to Export and Development Canada (EDC), which provides billions of dollars in extractive project financing. It also recommends that Canada strengthen legislation governing the conduct of Canadian companies operating abroad and require them to engage in pre-investment human rights due diligence.
• Additionally, the GC should create effective mechanisms to investigate complaints against Canadian corporations operating overseas and adopt legislation to facilitate access to justice in domestic courts by victims of corporate abuse abroad. Politically, Canadian officials should respect the primacy of human rights over investors’ interests before signing trade, tax and investment agreements.
• Indigenous communities are vulnerable because they lack the financial, material and human resources of the state and corporations. They tend to be the most economically, politically and socially marginalized sectors of society. Their ancestral lands and territories are located on and around natural resources that are highly valued by corporations, exposing them to greater violations of their rights. National frameworks reinforce power imbalances between different sectors of society. Under the constitutions of many countries, the extraction of natural resources is a national interest and takes precedence over the rights of Indigenous communities. In Canada, legislation or policies to address extraterritorial corporate abuses by Canadian companies are lacking, along with access to remedies for their victims.
• Despite promises by the current government to empower the newly created CORE to “independently investigate, report, recommend remedy and monitor its implementation,” relating to Canadian corporations operating abroad vis-à-vis human rights, it is still unclear to what extent it will differ from its predecessor, the Corporate Responsibility Counsellor, created under the Conservative government.
• In addition, the government gives the ombudsperson the mandate to “review a complaint that is submitted by a Canadian company that believes it is the subject of an unfounded human rights abuse allegation where the abuse allegedly occurred.” As a result, the ombudsperson, instead of prioritizing human rights, may instead act as a control mechanism for businesses to silence their critics. As it stands, the ombudsperson’s mandate is likely to create more mistrust than trust among communities affected by Canadian mining companies.
• Finally, the resignation of civil society representatives on the OCER advisory committee strongly suggests that the office could be an “ombudsmissed.”

Considerations

1. It is important to challenge governments’ dependency on extractivism and the economic model that sustains it. Governments are failing to address and protect vulnerable groups, particularly Indigenous peoples, and thereby deepening existing structural problems. Inspired by Indigenous knowledge and experiences across the planet, post-extractivism offers ways to think and move beyond the “extractivism trap.”
2. The asymmetrical structure of power relationships also affects the protection of the environment, culture and livelihood of Indigenous peoples. For example, while many Indigenous communities do not have access to safe drinking water, the environmental risks produced by extractive projects endanger their rights to health and life.
3. Canadian resource extraction policies are often inconsistent and leave gaps in foreign, trade, and aid policies. For example, Canada’s commitment to the protection of human rights defenders (HRDs) contradicts its current economic diplomacy policy, which could have a major human rights impact. Privileging trade policy to the detriment of human rights has come at great cost to Indigenous peoples in Canada and abroad. In documented cases, the GC has defended, via its embassies, companies accused of complicity in criminalizing, attacking, killing, and raping HRDs abroad.
4. The issues at hand fall directly under the mandate of different federal institutions, such as the newly appointed CORE, Global Affairs, Natural Resources and EDC.

Recommendations

For the federal government

1. Fully implement the UNDRIP and recognize Indigenous jurisdiction and the right to self-determination and FPIC abroad. The GC must harmonize foreign, trade, and international development policies. To address and reduce power inequalities amongst rights holders, Indigenous rights must be respected by states and private corporations. Even though the GC cannot enforce Indigenous rights in other countries, it can influence the behaviour of corporations operating abroad.
2. Take action against corruption. Companies tend to use corporate law rules, like the corporate veil, to avoid liability for the actions of subsidiaries or affiliates. The GC must enforce the Corruption of Foreign Public Officials Act (CFPOA) and adequately fund the RCMP to investigate cases of bribery. Finally, Canada should review its tax agreements with countries known as tax havens to put an end to legalized tax evasion by transnational companies.
3. Enact extraterritorial criminal and civil liability. The GC needs to adopt criminal and civil legislation that extends to the conduct of corporations abroad.  This must be in line with the 2018 UN Working Group recommendation that Canada address “barriers for individuals and communities affected by the overseas operations of Canadian businesses to seek effective remedies in Canada in appropriate cases” and to implement the policy recommendations of the United Nations High Commissioner for Human Rights to improve accountability and access to remedy for victims of business-related human rights abuse.
4. Integrate Indigenous and human rights in tax, trade and investment agreements. Canada’s economic policies must include express recognition of Indigenous peoples’ rights to self-determination and FPIC. Such agreements must recognize the primacy of Canada’s international human rights obligations over investor interests by making impact assessments mandatory prior to carrying out extractive projects. These assessments should include impacts on women, Indigenous peoples and local communities. The same obligations must apply to EDC by making Human Rights Impact Assessments mandatory before allocating funds, insurance or loans, and establish clear mechanisms to prevent the use of resources in contexts where human rights could be violated.
5. Support the UN Declaration of the Rights of Peasants and Other People Working in Rural Areas. The declaration would provide greater legal certainty to these vulnerable groups often affected by extractive activities.
6. Provide victims of human rights violations access to the Canadian judicial system. The GC should adopt specific legislation addressing the domestic legal obstacles encountered by foreign victims of human rights violations related to Canadian extractive activities abroad.
7. Improve access to information, transparency, and accountability. The GC should ensure that all public entities, including Canadian diplomatic missions, that handle issues related to Indigenous Peoples and extractive projects comply with access to information norms.
8. Establish “no-go” zones. Canada’s foreign policy should contain a blanket prohibition on new Canadian extractive investments if the conditions for recognizing Indigenous peoples’ rights do not exist or if it is likely that these rights might be violated.