Kiev delegates will take up protocol to rein in trans-boundary polluters, such as the Baia Mare mine By Alexios Antypas and Stephen Stec   Photo: REUTERS/ TIBOR KOSSIS DISASTER'S WAKE: Workers in Hungary remove dead fish killed by the Baia Mare cyanide spill, which ran into the Tisza River in February 2000 The disastrous cyanide spill at the Aurul S.A. gold mine in Baia Mare, Romania, in January 2000 exposed troubling weaknesses in international environmental regimes meant to prevent and deal with the effects of industrial accidents. Analysing the institutional and legal contexts within which the accident occurred has made it possible to identify two key areas of international law and governance that are in greatest need of urgent development: the international civil liability regime for environmental harm resulting from industrial accidents and the norms and institutions for environmental responsibility of foreign direct investors. Need for liability At the time of the accident no international legal regime existed to hold the mine operators liable for the trans-boundary consequences of the accident. That has made it much more difficult to make sure that Aurul S. A. will pay for trans-boundary damages, which have been estimated in the tens of millions of euros. In 2001 Switzerland submitted a proposal to the UN Economic Commission for Europe to craft a civil liability protocol for damage caused to international waters from industrial accidents. The first in international law, the protocol would be under two conventions, the Convention on the Protection and Use of Transboundary Watercourses and International Lakes and the Convention on the Trans-boundary Effects of Industrial Accidents. After 15 months and seven meetings of an intergovernmental working group in Geneva the negotiations on the civil liability protocol ended successfully in February. The protocol will now be presented to ministers for adoption and signing at the Environment for Europe conference in May in Kiev. The protocol covers large industrial accidents that harm transboundary watercourses or lakes, and gives affected parties such as fishermen and tourism operations a legal claim to financial compensation for lost income directly related to use of the affected watercourse, loss or damage to property, and injury or loss of life. Importantly, the protocol also includes compensation for environmental restoration, defined as "the cost of measures of reinstatement of the impaired transboundary waters." Claims can be made up to 15 years after the accident. Operators are required to provide financial security, which will provide a strong incentive for them to avoid accidents in the first place. Operators in signatory states will now know that they cannot avoid liability for transboundary damages they cause to international waterways. All told, the civil liability protocol is a victory for the environment and people in the region. The focus now is on encouraging states to sign and ratify the protocol. The second weakness highlighted by the Baia Mare accident is rules and norms that govern foreign investors in transition countries. The recognition that foreign investors should bear significant social and environmental responsibility for their activities in host countries is not new. From 1995 to 1998 the Organisation for Economic Cooperation and Development (OECD) hosted negotiations for what was called the Multilateral Agreement on Investment which would have applied investor responsibility in a host of areas, including the environment. The negotiations failed, due to other problems with the document, leaving in place only weak OECD guidelines that have little industry support and minimal implementation. Recognising that the Baia Mare accident provided an opportunity to put investor responsibility back on the political agenda, the Regional Environmental Center for Central and Eastern Europe (REC)has developed a comprehensive set of draft principles for foreign investors engaged in potentially hazardous activities. Global audience Called "Governance Principles for For eign Direct Investment in Hazardous Activities," this proposal was first introduced to a global audience at the World Summit on Sustainable Development in Johannesburg last year. A revised version will be presented at a side event in Kiev. The principles cover all manner of environmental responsibility, including the requirement to meet international operational standards even if host countries do not require this. Provisions for public participation, community relations, and fostering environmentally responsible corporate cultures are intended to ensure that foreign investors consider stakeholders and take steps to make environmental considerations central to their planning and operations. The REC is currently developing a strategy to disseminate the governance principles and establish a network of key allies, including corporate partners, who will support translating the principles into a voluntary code for investors. While not having the impact of legal instruments, voluntary codes often serve as a starting point for developing more comprehensive governance regimes. The Baia Mare accident was a tragedy. More than 100, 000 tonnes of toxic wastewater was spilled into the Tisza River. The cyanide killed hundreds of thousands of fish and other wildlife, contaminated drinking water, and undermined the livelihoods of already economically stressed people. The legacy of economic damage and environmental degradation is one that the region will not soon forget. As has now become evident, the response to the accident has been proportional to its severity. International institutions, NGOs, and the public have taken up the call to make sure that such an accident is far less likely to occur again, and that if it does those responsible will be held liable.   - Alexios Antypas is a professor in environmental policy at Central European University, Budapest. Stephen Stec heads the REC's Environmental Law Programme.

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