The decision of the Legislative Assembly to not endorse the bill that seeks to approve the contract between the government and Minera Panamá, shows the fragility of the contracts between the Panamanian state and companies.
The obstacles to the mining project date back several years, since the legal dispute began in 2009, when the Environmental Impact Center (CIAM) filed an appeal of unconstitutionality against the contract granting a 20-year concession to exploit and commercialize the gold, copper and other mineral resources of Cerro Petaquilla.
In October 2018 the contract Law 9 of February 25, 1997 was declared unconstitutional by the Supreme Court of Justice and according to the judicial ruling, the concession would not represent the best interests of the State.
See “Judicial Ruling Against Mining Company” and “Fragile Legal Certainty”.
The issue recently returned to the discussion table, since last May 29, after the negotiation reached the National Assembly, the Legislative Commission on Economy and Finance rejected in its entirety the contract between the State and Sociedad Minera Petaquilla S.A, currently Minera Panamá, arguing that it is “harmful to the country.”
Nelson Jackson Palma, deputy president of this legislative body, said that the different communities in and adjacent to the mine are in extreme poverty and so far, have not been benefited, so it is necessary to review this contract more closely, explains a statement from the Assembly.
See full press release.
The president-elect, Laurentino Cortizo, will have to face this dispute. On the subject, he explained to Telemetro.com that “… It will be considered, the review should not take too long, are contracts that have their period. We consider it right that the new government should take on that responsibility, it is important, right now talking about beating the drum that contract is not good.
Cortizo added that “… the issue of legal security will be respected, but he warned that companies have to respect the right to review clauses by clauses in order to comply with contracts.”
The business sector rejects these decisions. On the matter Jorge Juan de la Guardia, president of the Cciap, said to Elcapitalfinanciero.com that “… One of Panama‘s main assets, and which has been a tool to attract international capital, is its legal security; but these decisions send the wrong message to local investors and particularly to those from other latitudes.”