EBRD renounces its liability in Amulsar mine project – civil initiative
European Bank for Reconstruction and Development (EBRD) is one of the major shareholders of Lydian International, which invested 5.8 million CAD as of 2009 and 10.5 million CAD as of 2016 to purchase shares of the company, as well as financed study and construction works at the mine, Armenian Environmental Front (AEF) civil initiative reported on its website.
The civil initiative noted experts and environmentalists affirm that the project in Amulsar contradicts international environmental and social performance standards and the engagement of the Bank in this project actually contradicts its own principles. EBRD has a complaint mechanism and a civil society engagement department through which citizens can complain and present their demands related to projects financed by the Bank.
Back in 2013 citizens of Armenia raised the issue of Amulsar project with EBRD. In 2014, a complaint was registered both with the complaint mechanisms of IFC (which was among shareholders of Lydian until mid 2017) and EBRD. IFC Compliance Ombudsman’s Office proceeded with the complaints and examined it for 3 years.
Meanwhile, in February 2015 EBRD refused to proceed with the complaints claiming that these complaints refer to risks of mine exploitation, while the Bank is only financing the study phase and preparation works of the mine and not the mine exploitation. Moreover, EBRD concluded from the complaints that since complainants opposed direct dialogue with the company for solving the project related problems, therefore the complaint assessors considered both complaints as unfit for review.
In response to the letters sent by AEF civil initiative, on 12 December 2017 EBRD informed that it no longer wants to have a dialogue with AEF since the latter had got involved in an “unprofessional advocacy practices in relation to the EBRD’s investment in Lydian International and disclosed information about Lydian International employees, including their photos, alongside offensive and threatening message”.
AEF added they can only assume that EBRD is trying to avoid responsibility this way. Therefore, on January 16, 2018 AEF civil initiative responded to the Bank stating that its correspondence is not a friendly chat with the Bank. Instead the civil initiative filed a complaint with EBRD, which is a shareholder and investor and therefore does share responsibility for the risks and flaws of Amulsar project. The letter called for a serious investigation and for the Bank not to get involved in an environmental crime. The civil initiative also reminded the Bank that it is not the only signatory of the letter and there were other organizations and experts waiting for its response.