MAC: Mines and Communities

Vale handed tax amnesty at home, but brickbats abroad

Published by MAC on 2013-11-19
Source:, statement

The Brazilian Government has long supported its mining major, Vale. Recent arguments over taxation are likely to test that relationship, even as the Government has proposed a deal on the approximately $14bn in unpaid taxes.

Vale has faced opposition within Brazil (see for instance Brazil's Vale allegedly spied on social movements & Brazilian Indigenous groups block iron ore miner Vale's Carajas railway).

However, it is recently in trouble abroad. It has been charged with 10 counts of violating workplace safety (after having already been fined over CAN $1 million) following the death of workers at its operations in Sudbury & Thompson in 2011.

Activists are also criticising the Business for Social Responsibilitynetwork for giving Vale a change to 'greenwash' themselves in a panel entitled, "Voices of Rights Holders in the Extractives Industry."


Vale handed way out of $14bn tax dispute

Cecilia Jamasmie

18 November 2013

Brazilian mining giant Vale has until the end of this week to accept or reject the terms of a government's tax amnesty program that would allow the miner to almost halve a $14 billion debt and pay it back over the next 15 years.

According to Vox Populi, the deal would mean that the world's largest iron ore producer and a top nickel miner would only have to pay about $8.5bn to Brazil's tax agency, ending a dispute that began more than 10 years, which has weighed on the company's share price.

It would also open the door for the Rio de Janeiro-based company to find its way back into recently shelved projects, such as its $5.9 billion Rio Colorado potash project in Mendoza, Argentina.

The Brazilian tax authority claims Vale owes around $14bn in unpaid taxes on profits made from operations abroad, including the sale of some foreign subsidiaries between 1996 and 2008.

But Vale, which gets most of its revenue from outside Brazil, has repeatedly said it followed the law and that it expects the issue to be settled before the end of the year.

Brazil's finance ministry has estimated outstanding tax liabilities from all Brazilian companies operating abroad at $30 billion to $43 billion.

Vale Canada charged in fatal Thompson mine accident

Cecilia Jamasmie

18 November 2013

Brazilian miner Vale's Canadian unit has been charged with 10 counts of violating the workplace safety act of Manitoba, after a 51-year-old man died in one of the mining giant's operations in Thompson in 2011.

The accusations, laid by the province's Workplace Safety and Health division in October, include allegations that Vale did not provide a safe workplace, did not have safe work procedures and had unsafe equipment.

According to Canada's United Steelworkers Union, this is the first time a mine has been charged in Manitoba in connection to the death of a worker.

In September Vale Canada received the largest fine ever imposed by an Ontario court for violations of the province's workplace safety law.

Vale fined $1M in Sudbury miners' deaths

CBC News

17 September 2013

A Ministry of Labour investigation found that there had been a hang-up of wet muck in the ore pass that eventually gave way and killed two miners in June 2011 at Vale's Stobie Mine in Sudbury. The ministry said the wet muck was a result of Vale not dealing with water accumulation in the mine.

A Ministry of Labour investigation found that there had been a hang-up of wet muck in the ore pass that eventually gave way and killed two miners in June 2011 at Vale's Stobie Mine in Sudbury. The ministry said the wet muck was a result of Vale not dealing with water accumulation in the mine.

Mining giant Vale Canada has been fined more than $1 million in connection with a double fatality in 2011 in which miners were buried in a torrent of mud.

Jason Chenier and Jordan Fram were killed when wet mud and ore flooded the tunnel where they were working at Vale's Stobie Mine in Sudbury, Ont., on June 8, 2011.

Chenier and Fram were working in an ore pass at the 3000 foot level, transferring broken rock and ore upwards when there was a sudden release of muck, sand and water. The run of muck came through a transfer gate, burying one working and hitting another causing massive crush injuries.

The Ministry of Labour laid charges under the Occupational Health and Safety Act in the accident after finding there had been a blockage of wet muck in the ore pass. It also said Vale had failed to deal with earlier water issues in the mine.

The company was fined $1,050,000, the highest fine ever given under the health and safety act, by an Ontario court.

In a Sudbury courtroom on Tuesday, Vale pleaded guilty to three counts:

Vale was fined $350,000 for each count.

Keith Birnie, the supervisor of the deceased men, had also been facing six charges, but the Crown elected to drop its case against Birnie, saying there was a slim chance of conviction.

The fines come many months following a Steelworkers Local 6500 report that alleged nickel mining giant Vale failed to take all reasonable steps to prevent the deaths of Jason Chenier and Jordan Fram at Stobie Mine.

Chenier, 35, and Fram, 26, were killed by a run of muck, described by the union as an avalanche of wet rocks, gravel and sand.
Vale warned prior to tragedy

The union said there was too much water in the muck, making it sticky. It said the muck became lodged in what is known as an ore pass. When Chenier tried to assess the problem, the rock gave way and buried both men.

The report said Chenier wrote an email to management in the days before he died, warning there was a buildup of water in the ore pass and saying all dumping and blasting should stop until the water situation was under control.

"Jason Chenier sent two emails to management warning them of the dangerous water levels, but nothing was done," Local 6500 president Rick Bertrand said. "We don't know why. Management failed to interview with our team."

Steelworkers, during a news conference in early 2012, called for a public inquiry.

The union also asked the Attorney General's Office to consider criminal charges against company officials, under what is known as the Westray bill. Named after a coal mining disaster in Nova Scotia, the bill makes workplace negligence a criminal offence.

How Responsible is Business for Social Responsibility?

Paul Paz y Miño

8 November 2013

We're all quite conscious of the fact that corporations in America grow more powerful each day. One merely has to look at the elections since the fateful Citizens United decision to see how lobbying power and wealth can crush popular movements such as GMO labeling in California and Washington. These two charts show the extent to which corporate power is concentrated and which industries already wield powerful influence in specific states and should serve as a wake up call to anyone not already seriously concerned.

In the face of growing corporate power, engaging with corporations to create a climate of social responsibility has never been more critical. Networks such as Business for Social Responsibility (BSR) can play an important role in how civil society relates to and educates corporations to agree on norms and practices that could actually help create a more sustainable future. But when the exchange is used to help corporations merely polish their image without truly participating in good faith, it can do more harm than good. Groups like BSR should be especially careful about associating and promoting certain corporate actors. Indeed, this could undermine their entire mission.

This week in San Francisco, BSR severely tarnished its image in such a manner. On Thursday the Brazilian mining company Vale was invited to present its perspective on a panel entitled, "Voices of Rights Holders in the Extractives Industry." This is like inviting the CIA to a panel on the rights of victims of torture. Last year Vale won dubious distinction as the 2012 Public Eye Award Winner - a prize given annually to the worst corporation in the world. Vale is the second largest iron-ore mining company on the planet and the largest private shareholder in the consortium that is building the disastrous Belo Monte dam in the heart of the Brazilian Amazon.

The notorious Belo Monte dam, now under construction, did not satisfy Brazil's own environmental standards, yet has been strong armed thru with support from Brazilian President Rousseff. The project will displace over 40,000 people, flood 668 km2, and dry out 100 kilometers of the "Big Bend" of the Xingu River, profoundly impacting two indigenous tribes who live there. In other words, the very "Rights Holders" that were presumably discussed on the BSR panel.

Vale owns part of the Belo Monte dam so it can purchase electricity to power the expansion of its iron mining and smelting activities at the Carajás Mines, the world's largest iron mines. The company has a long record of labor rights violations and human rights abuses at Carajás, and has amassed a history of human rights violations in 38 countries around the world, including Mozambique, Canada, Angola, Australia, and Colombia.

BSR does not exist to force Vale to respect human rights and the environment, that's the job of organizations like Amazon Watch, the government and other bodies. But why should Vale get a free pass? And worst of all, why place them in a position as a leader in one of the very areas where they've be singled out as not only a bad actor - but one of the worst (a two minute Google search is all it would have taken to uncover that).

Another disturbing fact is that this wasn't the first time that BSR has made such an offensive gaff. Back in 2011, BSR invited corporate criminal extraordinaire Chevron to speak on a panel about "community engagement." Of course, due to their extreme tactics of persecuting anyone critical of their actions in Ecuador and now attacking the victims of their own toxic pollution as criminals, Chevron should be barred from even participating in networks such as BSR indefinitely.

Why does this keep happening and how can we help prevent it from happening again? Did BSR13 keynote speaker Mary Robinson know Vale and Chevron were in the room when she said that climate justice means accountability for harms done but also steps to prevent future harms? Vale and Chevron are at the top of the list for both lack of accountability and with plans to refine tar sands oil in Richmond and building proceeding on Belo Monte, both are charging straight into a future of more climate chaos. I'd like to think her statement was meant for them to hear.

Let's make sure BSR hears our statement. I'd like an explanation from someone at BSR as to why they made the choices of featuring Chevron and Vale. Are they concerned that some of their members have major unresolved human rights and environmental issues? Are they encouraging those companies to demonstrate the values they espouse at BSR and respond in a way that values the communities affected by their work? Most importantly, will they establish a standard for future conferences that precludes corporations found liable for massive environmental and human rights crimes (who have not accepted responsibility and taken corrective action) from speaking? Or will they keep corporations from presenting as leaders on issues for which they have been publicly condemned?

I invite you to ask these questions of the BSR staff via Twitter. I have asked them, but am still awaiting a reply. Aron Cramer, President and CEO is @aroncramer, and Faris Natour, Human Rights Director is @FarisNatour. Please use #BSR13 and mention @amazonwatch in your tweets. Thanks!

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