Pablo Méndez Alvidrez
Managing Partner
EC Rubio
/
Expert Contributor

The Invalidity of Mining Concessions and its Implications

By Pablo Méndez | Tue, 04/05/2022 - 17:00

On Feb. 16, 2022, during the plenary session held by the First Chamber of the Mexican Supreme Court of Justice, the Constitutional Court issued a ruling by means of which it ordered the Mining Authority to declare null and void two mining concessions owned by Minera Gorrion, a Mexican subsidiary of the Canadian company Almaden Minerals.

The judicial decision arose from the protective/constitutional trial (juicio de amparo) filed in 2015 by the Ejido de Tecoltemi, in the state of Puebla, with the support of the Organization, Development, Education and Research Project (PODER), against the current Mining Law and two mining concessions granted in favor of Minera Gorrion.

By means of this amparo, the ejido requested the Court declare the unconstitutionality of the Mining Law as a result of not contemplating, within the procedure for granting new mining concessions, the prior and informed consultation of the Indigenous communities living in the territories where the mining lots are located, as provided in ILO Convention 169. Likewise, the ejido requested the cancellation of two mining concessions owned by Minera Gorrion, whose surface lots were located within its territory, as such concessions were granted without conducting the aforementioned consultation procedure contemplated by international legislation.

Consequently, the First Chamber of the Supreme Court limited itself to rule only on the request to cancel the mining concessions, and ordered the mining authority to declare null and void the two concessions granted to Minera Gorrion; however, the mining authority is still entitled to grant such lots again as long as the right to prior and informed consultation of the Ejido de Tecoltemi is guaranteed.

Thus, the ruling of the Supreme Court of Justice of the Nation is limited to declaring null and void two mining concessions of Minera Gorrion, without studying or ruling on the conventionality of the Mining Law.

Therefore, it is necessary to analyze the possible implications of the foregoing ruling.

First, and as I previously mentioned in my article, "The Right of Indigenous Communities to Prior Consultation", the lack or regulation of the right of Indigenous communities to prior and informed consultation may eventually cause several consequences, such as in this case, the nullity of the mining concessions that, from a legal and corporate perspective, could be considered as the most serious of the consequences.

Furthermore, the annulment of mining concession due to issues that are not expressly contemplated by the Mining Law and its regulation, such as the lack of previous and informed consultation procedures in this case, reflects unreliability before the international community and potential foreign companies seeking to invest in our country; while, on the side of the Indigenous communities, it does not really provide a solution to its problem, since the mining legislation, as of today, remains intact, and therefore, that community’s fundamental right to prior and informed consultation is still not implemented in the procedure for granting mining concessions.

We must not ignore the fact that, although it is true that the decision of the Supreme Court allows the mining authority to restart the procedure for granting mining concessions, it is also true that it will be difficult to guarantee the ejido’s right to prior and informed consultation, since, in the absence of specific norms regulating the procedure, the consultation will be conducted at the full discretion and will of the mining authority, which means that once again the fundamental rights of the ejido and its members will be at risk of being violated.

In this regard, we can conclude that the ruling of the Supreme Court, more than solving the violation of the fundamental rights of the ejido, and of the Indigenous communities in general, only provokes a state of legal uncertainty since it did not (i) rule on constitutionality of the Mining Law, so the procedure for granting mining concessions remains intact, nor (ii) determined a mechanism or procedure to protect the fundamental rights of the ejido that the mining authority must respect when reissuing the mining concessions.

In addition, the ruling allows us to conclude that as long as prior and informed consultation is not duly regulated within the Mining Law, the Indigenous communities will only be able to exercise and defend their rights by means of costly and time-consuming jurisdictional procedures, as the Ejido de Tecoltemi did.

There is no doubt that the ruling of the Supreme Court fails to solve the problems that the absence of a prior and informed consultation procedure implies, but rather only raises important questions within the mining industry and generates legal uncertainty for both the private sector and the indigenous communities.

In conclusion, as long as the prior and informed consultation right is not properly regulated within the procedure for granting mining concessions, the mining companies, and the mining authority, will never be fully able to comply with such obligations, since the way in which the consultation must be carried out is not clear and, pursuant Mexican law, it is not possible for the mining authority to overstep its powers and one-sidedly implement an extra requirement to grant a mining concession, nor to order a procedure to be carried out that is not expressly contemplated in any law or regulation.