Deep-sea mining report: Investor lawsuits threaten Pacific sovereignty

Pacific governments face a growing threat to their sovereignty from foreign investors, according to a new report by the Pacific Network on Globalisation (PANG). Investor-State Dispute Settlement (ISDS) mechanisms could empower mining companies to sue nations over decisions made to protect the environment or act in the public interest.

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Investor-State Dispute Settlement mechanisms could allow mining companies to sue governments over decisions made to protect the environment, regulate the industry or act in the public interest.

The report, authored by Professor Emeritus Dr. Jane Kelsey, identifies five ways ISDS commitments could impact Pacific governments. These include bilateral investment treaties, deep-sea mining contracts, sponsorship agreements under the International Seabed Authority, domestic legislation, and disputes linked to U.S. deep-sea mining permits. Dr. Kelsey warns that these tribunals often operate in secrecy, lack appeal processes, and their lengthy, costly proceedings can pressure governments into abandoning public-interest policies.

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The issue presents a serious and growing threat to Pacific sovereignty as interest in deep-sea mining increases.

Concerns are particularly high for Tonga, Nauru, the Cook Islands, and Papua New Guinea. Civil society representatives are calling for greater transparency regarding deep-sea mining agreements and the potential legal and financial liabilities they create. The report also scrutinizes U.S. efforts to secure critical minerals through deep-sea mining, noting the issuance of extraction permits without international backing.

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Mining companies are increasingly using ISDS provisions to challenge government decisions that may affect corporate profits.

PANG emphasizes that the ISDS issue requires urgent attention, not only concerning deep-sea mining but also within the broader context of climate action and climate justice across the Pacific. The findings underscore the complex challenges Pacific nations face in balancing resource development with environmental protection and sovereign rights.

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The tribunals operate largely behind closed doors, with no appeal process, and that the cost and length of legal battles could pressure governments into abandoning public-interest policies.