Publication Name

46 / 120

28 MINING FOR CLOSURE
also included in accordance with the United Nations
Convention of 25 June 1998 on Access to Informa-
tion, Public Participation in Decision-Making and
Access to Justice in Environmental Matters (Aarhus
Convention) to which the EU is a signatory.
Importantly, all these measures will apply to those
waste management facilities that present a high ac-
cident risk but will not fall under the provisions of
the revised Seveso II Directive.
2.3.4 the equator principles52
A potentially important development at the supra-
national level is encompassed within the Equator
Principles, an initiative led by the International
Finance Corporation and the World Bank. This
initiative aims at the very financing mechanisms
of the industry. Project financing plays an impor-
tant role in financing development throughout the
world. Further, the financing of projects, particu-
larly in emerging markets, is central to the rise of
environmental and social policy issues. In recogni-
tion of the fact that financiers have significant op-
portunities to promote responsible environmental
stewardship and socially responsible development
(International Finance Corporation, 2003), the
Equator Principles seek to ensure that the projects
financed by signatories are developed in a man-
ner that are socially responsible and reflect sound
environmental management practices. As part of
adopting the principles, financiers undertake to
carefully review proposals and to refuse loans di-
rectly to projects where the borrower will not, or are
unable to, comply with the required environmental
and social policies and processes (International Fi-
nance Corporation, 2003).
A large group of leading banks already support the
initiative (33 institutions as of August, 2005). Fur-
ther, and relevant to earlier discussion of financial
surety, the signatory international banks undertake
not to finance any project over US$ 50 million un-
less it meets World Bank and International Finance
Corporation environmental policies, standards and
guidelines,53 which include a requirement for clo-
sure funding (Miller, 2005 p.6 & p.17). Indeed, the
principles include a requirement for fully funding
a mine’s closure plan by appropriate instruments
so that the cost of closure can be covered at any
stage in the mine life, including premature and un-
foreseen cessation of activities.
While the key focus of the principles are upon de-
veloping countries, the guidelines may eventually
also apply to mines in developed countries (Inter-
national Finance Corporation, 2003; Miller, 2005).
As a potentially negative aspect, Miller (2005) re-
ports the guidelines may act against discretionary
leeway currently utilised by many governments,
including a number of those in developed coun-
tries, when setting the amount and nature of the
required financial assurance.54
The Equator Principles are included as Appendix C
to this document.
2.3.5 governance principles for
foreign direct investment
in hazardous activities
While not of the scale and visibility of the Equator
principles presented above, the Regional Environ-
ment Center for Central and Eastern Europe has
also worked on a set of principles. Again these seek
to ensure that projects – particularly projects in ar-
eas such as mining – financed in jurisdictions such
as those in SEE, are developed in a manner that are
socially responsible and reflect sound environmen-
tal management practices.
The REC submitted Draft Governance Principles
on Foreign Direct Investment in Hazardous Activi-
ties on the occasion of the fifth Ministerial Confer-
ence “Environment for Europe” in Kiev, Ukraine
which took place from the 21 – 23 May 2003.55 A
revised and updated version of these principles
was also made available at the Cluj-Napoca confer-
52. See .
53. Since 1998, the World Bank has included in its “Pollution
Prevention and Abatement Handbook” (World Bank, 1999) provi-
sions to ensure that any project financed by the Bank or the related
IFC (International Finance Corporation) anywhere in the world
includes appropriate standards of mine closure and reclamation,
including the nature and amount of financial assurance. These
requirements are currently stated in general terms. If a country
does not have corresponding requirements, then the World Bank/
IFC measures govern the project.
54. He indicates that unforeseen side effect of these undertakings
could be to frustrate the deliberate policies of governments. If a state
demands less than full coverage of potential reclamation liabilities,
as a calculated policy designed to attract mining, bank financing may
not be available for projects there. As a result, the government’s con-
scious policy may be nullified. The legislation of many jurisdictions
gives the responsible minister some discretion in setting the nature
and amount of required financial assurance (Miller, 2005, p24).
55. These activities are reported at
duction/Kiev2003/. The draft document presented is also avail-
able at
ence/inf.18.e.pdf