Govt will lose gold mine dispute due to Article 44 use: academics

[webfact]

Govt will lose gold mine dispute due to Article 44 use: academics

By PRATCH RUJIVANAROM 
THE NATION

 

File photo

 

BANGKOK: -- EXPERTS AND academics have warned that Thailand will lose an arbitral tribunal process regarding allegations that it violated the Thailand-Australia Free Trade Agreement (TAFTA), because of the exercise of special powers under Article 44 of the interim constitution that are not recognised by the international community.

Kannikar Kijtiwatchakul, coordinator of FTA Watch, warned that Thailand had a very small chance of winning the dispute regarding the closure of a gold mine, exposing the country to huge losses due to claims for compensation.

 

Early last December, the National Council for Peace and Order (NCPO) issued Order 72/2559 to suspend gold mining operations nationwide, including at the Chatree mine operated by Akara Resources. 

 

As a result, Akara’s parent company, Australia’s Kingsgate Consolidated Limited, has threatened to sue the Thai government in an arbitral tribunal for violating the TAFTA.

 

If the dispute between the government and Kingsgate does not end in negotiations, it would be resolved by an arbitral tribunal in line with the Investor-State Dispute Settlement (ISDS) process, Kannikar said.

 

She added that would almost certainly mean the government would lose the case, because the ISDS process was designed to protect corporations’ interests.

 

“The ISDS mechanism is designed to deal with a situation in which an authoritarian regime oppresses the foreign investors by taking over their businesses. However, this mechanism is pushed to the extreme, as investors ask for broader terms of business to benefit their bargaining power over the state,” she said.

 

“Although our government did not take over the gold mining business, Kingsgate can sue the Thai government over the allegation of indirect expropriation and violation of the TAFTA, which we are very likely to lose.”

 

She said the government’s major mistake was to use the special powers of Article 44 of the interim charter to order the suspension of mining operations without clear evidence regarding the environment and health impacts associated with the gold mine.

 

However, while she concluded that the government had erred by using Article 44, she added that the ISDS mechanism also posed a problem because companies can use it to leverage unfair advantage.

 

“What concerns me the most now is the secret deal that the government plans to provide to Kingsgate, as the company stated in its latest announcement that the Thai government might be willing to provide other meaningful benefits in consideration of the shutdown of its gold mine,” Kannikar said.

 

“Whatever the deal is, this should not be kept secret and people have the right to know what the government will provide to the benefit of the company.”

 

Piyabutr Saengkanokkul, a lecturer with the Faculty of Law at Thammasat University, said Article 44 could only apply domestically, while it would not carry force at the international level.

 

“The power under Article 44 is unacceptable on the international stage. If the government wants to shut down the gold mine, they have to conduct a full scientific inspection to prove the mine actually causes environmental problems and use the existing law to close the mine,” Piyabutr said.

 

“That would give Akara a fair chance to defend itself in Thai court and it would justify the government’s shutdown of the gold mine in a legitimate way.”

 

He added that if the government loses the case and has to pay compensation to Kingsgate, it would be a financial burden for the country incurred due to a government mistake.

 

However, Maha Sarakham University lecturer Chainarong Sretthachau said the exercise of special powers to close down the gold mine should not be used as a political weapon without referencing the real environmental and health problems that people in the area have suffered for more than a decade.

 

“The gold mine should be closed, and yes, without using the special power. Attacking the government only on the aspect that they used Article 44 will not help anything. We should focus on the real problem. The authorities tried to ignore the science that proves that the gold mine causes toxic substance contamination. ”

 

Source: http://www.nationmultimedia.com/detail/national/30325447

 

-- © Copyright The Nation 2017-09-01

[Samui Bodoh]

5 minutes ago, webfact said:

She said the government’s major mistake was to use the special powers of Article 44 of the interim charter to order the suspension of mining operations without clear evidence regarding the environment and health impacts associated with the gold mine.

 

So, Mr PM decided to shut down the mine using section 44 which was a mistake and the Thai government will almost certainly be sued and lose. And Thailand will almost certainly suffer a financial loss.

 

This sounds vaguely familiar... didn't a recent case allege that a PM should be held liable for the loss of funds due to her decisions?

 

BUT, Mr PM has already declared that he is not responsible and that he has immunity.

 

I get annoyed at the frequent cries of "double standards!" in Thai politics, but this seems to be a rather clear example.

 

If the PM had any sense of decency and/or courage, he would take responsibility.

 

But, he won't.

 

World class hypocrisy  

 

 

 

[tracker1]

An S44 backfire thats better then most the backflips the PM manages

[rkidlad]

Those pesky farangs and their rules. 

 

Article 44 reminds me of when Homer Simpson bought a gun;

 

 

[yellowboat]

It would be nice to see the outside world hold the unaccountable accountable.  A44 may be able to bully and oppress Thai Citizens, but not the rest of the world.  Somebody is going to get a lesson in international law. 

[leeneeds]

3 hours ago, webfact said:

The authorities tried to ignore the science that proves that the gold mine causes toxic substance contamination. ”

This is still in dispute.

[mfd101]

3 minutes ago, leeneeds said:

This is still in dispute.

No doubt, but in politics - including international relations - it's often, even usually, the PROCESS which is in dispute. [If I & my people introduce a new policy, that's good. If you & yours introduce the same policy, that's bad.]

[bheard]

Don't think it will get to court. The big boss would lose face too mut. It'll come down to a hidden deal with Kingsgate where nobody can nail him.

[o2eZy]

so the PM has a new name ...must be Teflon ...nothing sticks to that 

[Chris Lawrence]

The gold company has the money and contacts to make a challenge on article 44. I don't think the General will want this as it could go pear shape. Chipping away at 44 may prove to show its flaws, which is the only trump card this administration has. Wasn't it to cease until a government was formed; and has a Government be formed?

[BuaBS]

Slam them with fines for polluting as high as the claims for compensation.

[Dave67]

Love to see some Junta bureaucrats in a real court of law

[Eric Loh]

Absolute Power Means 'I Can Do Whatever'

No you don't say the international community & the HRW.

Sure makes my day to see this man's arrogance put in place. Just hope that he will get his dues one day soon. 

 

 

 

[lapamita]

As an intrested investor , i  follow any article on this story from beginning.

 

1. there was10 local companyzs cant prove wrongdoing on KCG ,after the leader  hires 3 foreign companys , they can prove any wrongoing too

2. even  after the  "Npn fondings" licence was revoked

3.A suspicous take over Offer from a thaibuissensman , Natrunning Pan pacific pretorleum , a non working offshore company .related to the giverment make an take over offer, about 95% below fair value, with the staement of" if i get 50,1% of KCG , we is able to open mine again within 3 month.

4. The Goverment was palying on time, due to insufficend  funds from KCG for the case, but KCG survived and bring the caseto court

5. during the time The Goverment WAS NOT IN ANY NEGOCCIATION AND TALKS WITH KCN

6.Tonghka harbour another goldminie was sized during the last militray goverment in , i think 2008

7. KCG was as well able to pay back all depts to taimilitarybank until  mid 2017,so akara is free of depts

8.even now,they dont want pay cash compensation, but comfirmed "other benefits"..... i know what this means,................

 

Edited September 1, 2017 by lapamita

[JAG]

Love to see some Junta bureaucrats in a real court of law

The trouble is they're not beaurocrats though. Real beaurocrats would be far too careful (or timid) to pull a stunt like this. This is what happens when self appointed governments, who are unaccountable, (and whose qualifications for the highest office are networking influences and the amount of shirt bling accumulated) , thinking they know best, meet the real world.

[janclaes47]

5 hours ago, webfact said:

Kannikar Kijtiwatchakul, coordinator of FTA Watch, warned that Thailand had a very small chance of winning the dispute regarding the closure of a gold mine, exposing the country to huge losses due to claims for compensation.

As if they care.

 

Thailand has a history of losing court cases in International tribunals, and refusing to pay the compensations they are sentenced to for decades .................... until some sensitive Boeing's get confiscated

 

 

Edited September 1, 2017 by janclaes47

[YetAnother]

5 hours ago, webfact said:

The authorities tried to ignore the science that proves that the gold mine causes toxic substance contamination. ”

root causes in thailand are irrelevant to decision-makers here

[Sydebolle]

Invoke 44 again and close down Australia as a whole ........

The world's biggest playground in full swing again, not understanding that certain countries with Western common sense approach have no clue, why someone would need 44 in the first place 

[Ceruhe]

Totally expecting somle thought process along of "Article 44 used to extend power of Article 44 to exert power and effectiveness over other nations".

[zyxwv]

For whatever political reasons the mine was closed. People in areas far from the mine complained of sickness, and even though it was shown that the mine does NOT use mercury in their process.....the people clamored that the mine was causing the sickness.

Rubbish....but the politicians saw political clout in closing the mine.

 

Now the company will get going again, hundreds will regain their jobs. The villagers will continue to be sick....and complain it was the mine's fault. But the gov't has done what they could to right this situation without being sued.....and without losing face....in the international community....which is important for the Thia people. They want investment but listen to rubbish.

 

 

 

 

[IAMHERE]

Replace the word 'gold' or 'mining' for 'rice' and the story seems to be about the same. 

[fxe1200]

1 hour ago, BuaBS said:

Slam them with fines for polluting as high as the claims for compensation.

It is well known, that the goldmine was polluting the water. Large amounts of arsenic has been found in the blood of the residents living close to the mine.The mine was poorly managed and not observing environmental laws, which are implemented within the law books, but as always they were not enforced.  To suspend the operation of this mine and others, is one of the rare decisions of the PM, I strongly approve.

[fxe1200]

2 minutes ago, IAMHERE said:

Replace the word 'gold' or 'mining' for 'rice' and the story seems to be about the same. 

BS. The production of rice does not pollute the environment with arsenic.

[IAMHERE]

4 minutes ago, fxe1200 said:

BS. The production of rice does not pollute the environment with arsenic.

Money is the same idea. Arsenic is a cover story BS

[Litlos]

1 hour ago, BuaBS said:

Slam them with fines for polluting as high as the claims for compensation.

The reason that article 44 was used is the pollution found in the area did not match the type of pollution potentially produced by the gold mine.  It was all a stunt so a hiso could get his hands on the gold mine at below market value.  Hence why the PM is now in a real pickle as Kingsgate is claiming compensation and have found a way to circumvent the normal corrupt Thai law using the trade agreement.  Local Thai shenanigans do not work to well on an international stage.  So slamming them with fines is not the answer.  Also if a Thai gets control the no pollution attributable tot he gold mine will change rapidly as money number one.

 

Cheers

[Cadbury]

1 hour ago, BuaBS said:

Slam them with fines for polluting as high as the claims for compensation.

There has been no evidence produced to prove the existence of any pollution. Some self-serving lobby group was simply trying to winkle some money out of the mining company. 

 

This company had been working on the mine at a break-even for some time and had finally turned the corner to make a profit. After all the hard work had been done the timing became right for Prayut and his cronies to steal the mine using Article 44.

 

One day after the dust settles you can bet it will have a new "well connected" owner who will buy it for a "peppercorn".

[CantSpell]

He might just offer them 1 or 2 submarines 

[farcanell]

2 hours ago, BuaBS said:

Slam them with fines for polluting as high as the claims for compensation.

That too, is arbitrary, and an abuse of power.... thailand would loose that case as well.

 

 

[Thechook]

Oops looks like Prayuth just lost billions of baht through negligence and incompetence.  Lucky he gave himself a blanket amnesty when he siezed power or he would be facing the same charges as Yingluk.

[farcanell]

1 hour ago, fxe1200 said:

It is well known, that the goldmine was polluting the water. Large amounts of arsenic has been found in the blood of the residents living close to the mine.The mine was poorly managed and not observing environmental laws, which are implemented within the law books, but as always they were not enforced.  To suspend the operation of this mine and others, is one of the rare decisions of the PM, I strongly approve.

 

IF the gold mine was polluting, it should have been shut down ( if only temporarily, to fix the problem)... can't really argue with that.

 

that said, approving of a government order, which is an abuse of power, is a disappointing position to be seen to be taken.

 

the mine should have been required to demonstrate its adherence to the mining lease contract requirements.... and if it was not adhering to set pollution parameters, it should have been ordered to comply ( with a suffient time allowance to comply), before being shut down.

 

if collusion was found, to circumvent requirements ( padded brown envelopes), then corruption charges should have been made, with envelope handlers removed from the food chain

 

i know, I know... TIT, if you don't like it, go home.... but here we are on the world stage with this example of 44's ability to indiscriminately screw people over, so the argument of "if you don't like it, go home" doesn't work... quite the opposite really, as in, if thailand wants foreign investment, play by the rules ( or don't seek foreign investment)

 

and.... this decision by mr p ( to abuse 44) is worse than yingunluckys transgressions against the people (should it result in compensation and loss of face internationally), as one was an oversight, whilst the other was deliberate.... the common theme, of course, is incompetence.