CEDHA vs Botnia S.A.

Date filed

18 April 2006

Keywords

Countries of harm

Uruguay

Current status

No resolution

Sector

Other

NCP

NCP Finland

Allegations

CEDHA’s complaint alleges that Botnia’s Orion pulp mill project will impact local communities’ economic livelihoods and human rights. The complainants maintain that the project is plagued with environmental problems, including the company’s failure to collect and provide reliable information about the project’s real and foreseeable impacts. The complaint also mentions problems regarding discloure and bribery and states that the project is straining regional diplomatic relations between Argentina and Uruguay.

Finnvera, the Finnish Export Credit Agency, is supporting Botnia’s Orion pulp mill project. Nordea is a Swedish-Norwegian financial institution that is set to provide Botnia with a multi-million dollar package to finance the project The Nordea complaint alleges that the bank violated the Guidelines in two respects: first, through its partial financing of the Orion paper mill, and second, by refusing to provide information about its dealings with Botnia. Apart from providing $300,000 of its own funds towards the pulp mill, Nordea also helped arrange finance from other banks and financial intermediaries.

The Botnia and Finnvera cases were filed with the Finnish NCP, while the Nordea case was submitted to the Swedish and Norwegian NCPs.

Relevant OECD Guidelines

Outcome

The Finnish NCP invited CEDHA to a meeting on 30 August 2006 in Helsinki to discuss all three complaints. In a December 2006 statement, the Finnish NCP concluded that the evidence presented did not prove that Botnia had failed to comply with the Guidelines. B

otnia S.A/Metsä-Botnia Oy was thought to be committed to enhancing sustainable development in all of its business operations, improving its operations on a continuous basis, and doing business in a responsible manner. The Finnish NCP Reasoned that because Botnia S.A has stated it adheres to the principles of the UN Global Compact it is ensured that the company will use acceptable methods and adhere to internationally acceptable practices also in the future work on the project.

Also, the NCP found it important that the Uruguayan Government has not questioned the investment and instead has supported it because of economic and other benefits. In response, CEDHA lodged two complaints with the OECD’s Investment Committee and Finland’s Parliamentary Ombudsman concerning the Finnish NCP’s decision to reject the complaint in January 2007. In February 2007, the Finnish NCP refused to review its decision.