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Stop Canadian company abusing UK jurisdiction

Friday, August 14, 2015

Stop Canadian firm using UK/Romania trade deal terms for £2.5 Billion compensation claim for mine turned down in Romania on health and safety grounds.

Gabriel Resources’ use of a mailbox company to seek compensation from Romanian taxpayers is undermining the sovereignty of Romania to protect the health and safety and well-being of its own people and is an outrage, says GMB.

GMB has asked Prime Minister David Cameron to intervene to stop Gabriel Resources, a Canadian mining company with no links or operations in the UK, using a UK/ Romanian bilateral trade treaty to demand £2.5 billion in compensation from Romanian taxpayers. Gabriel Resources were refused permission on health and safety grounds to mine 314 tonnes of gold and 1,500 tonnes of silver at a proposed Rosia Montana mine in the Transylvania region of Romania. See notes to editors for copy of letter to Prime Minister.

Gabriel Resources were opposed by Romania’s largest civil society movement in a 15 year campaign as the proposed mine would have led to the expropriation of hundreds of local properties and would have left behind a waste lake containing cyanide – a toxic chemical used in the process of gold extraction.

Gabriel Resources has filed a request for arbitration at the International Centre for the Settlement of Investment Disputes (ICSID) linked to the World Bank using a Jersey-listed subsidiary as a shell company to gain access to a bilateral trade deal between the UK and Romania, under which such corporate cases can be brought.

GMB is calling on Prime Minister Cameron to investigate the case and present evidence to ICSID that Gabriel Resources should not be covered by the provisions of the UK-Romania agreement. GMB also calls on the court to throw out the case based on the fact that Gabriel Resources is not a real British company.

Bert Schouwenburg, GMB International Officer, said “GMB is outraged on three grounds in this case and we want action from the Prime Minister on this. Firstly, this Canadian company, Gabriel Resources, in seeking compensation of £2.56 billion from Romanian taxpayers is undermining the sovereignty of Romania to make its own decisions to protect the health and safety and well-being of its own people.

Secondly, Gabriel Resources is abusing the UK jurisdiction in using a “shell” or “mailbox” company registered in Jersey which is not intended to be protected by UK/Romania trade agreement. It has no real business activities in the UK to make use of an investment agreement to launch claims before an ISDS tribunal.

Thirdly, the case is an example of the Investor-State Dispute Settlement (ISDS) or ‘corporate courts’ system that has received recent notoriety as a result of its controversial inclusion in the free-trade deal being pushed between the EU and USA, the Transatlantic Trade and Investment Partnership (TTIP).

Cheerleaders of TTIP, the toxic trade deal being pushed by the EU and the USA, have accused its many critics of exaggerating the threat that it poses to democracy. But this is a clear example of how we are leaving ourselves vulnerable to an enormous corporate power grab. Why should UK taxpayers in future foot the massive bills for compensating greedy corporations when the government rules that their operations are harmful to communities or the environment?"

End

Contact Bert Schouwenburg, Tel: 00 44 (0) 207 391 6757 or Mob: 00 44 (0) 7974 251764 or GMB press office 07921 289880

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