Over 200 organizations denounce multimillion-dollar suit brought by US mining firm against Guatemala

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April 24, 2019 - Today, a letter signed by 227 Guatemalan and international networks and organizations was delivered to Guatemalan authorities and the US Embassy in Guatemala. The letter denounces the US$300 million-dollar suit that the US mining company Kappes, Cassiday & Associates (KCA) is bringing against the Central American country as a shameless attempt to undermine the will of the communities affected by its project and the decision of the courts. The company filed the suit in December 2018 at the International Centre for Settlement of Investment Disputes (ICSID) for alleged violations of the Central America–Dominican Republic Free Trade Agreement (CAFTA-DR).

Community members from the peaceful resistance of “La Puya” presented the letter to government authorities during a congressional hearing on the ICSID process, including representatives from the Ministries of Energy and Mining, Environment and Natural Resources, and Economy, as well as the Human Rights Section of the Public Prosecutor’s Office and others.

In the letter, organizations argue that the suit “represents a further attack on Guatemala’s judicial system.” They point to mounting pressure on the Constitutional Court from President Jimmy Morales over to the Court’s rulings on mining projects, as well as efforts by the executive branch to put the brakes on corruption investigations involving high level officials.

“We fear that the company is using this suit to pressure Guatemalan authorities into an agreement that would remove the multiple obstacles blocking the restart of the Progreso VII Derivada gold mine, including legal processes and social opposition. This would be yet another example of the ‘chilling effect’ that agreements like CAFTA-DR have on public and regulatory policies,” remarked Manuel Pérez-Rocha of the Institute for Policy Studies in Washington, DC.

The Guatemalan Supreme Court of Justice suspended the mine in 2016 for lack of prior consultation with Indigenous communities in the municipalities of San Pedro Ayampuc and San José de Golfo, north of Guatemala City. The suspension remains in effect, pending a final decision from the Constitutional Court.



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