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Article

17 Dec 2014

Author:
Drew Hasselback, Financial Post

Canada: 3 lawsuits against Canadian parent companies over abuses by foreign subsidiaries show novel approach by lawyers

“Canadian mining companies face lawsuits over foreign activities” - December 10, 2014 

Vancouver-based Nevsun Resources Ltd. joined an interesting club last month when three plaintiffs said they are suing the company in a B.C. trial court, alleging forced labour and other human rights violations at the company’s Bisha gold mine in Eritrea.  Nevsun, which describes the allegations as unfounded, is the latest Canadian parent company to be sued over the alleged actions of a foreign subsidiary or contractor. Vancouver-based Tahoe Resources Inc. was named in a suit last June over an incident at the company’s mine in Guatemala. Then there’s Toronto-based Hudbay Minerals Inc., which has been sued in Ontario allegations that security personal assaulted women at its mine in Guatemala.  It was once believed that as separate legal entities, a Canadian parent company was distinct and therefore legally immune from the actions of its foreign subsidiary or contractors…But plaintiff lawyers have developed a work around that appears to be putting Canadian parent companies on the hot seat. Lawyers expect more such cases…So far the most important legal ruling to emerge in any of the actions has been a 2013 procedural decision in which an Ontario judge confirmed that the case against Hudbay raises a proper cause of action that can be tested in court…