Canada: "Social Licence" Concepts And Canadian Mine Development

In this article, we examine two recent British Columbia court decisions that illustrate the growing body of environmental, social and cultural issues that must be considered and addressed in order to obtain the "social license" required for mine development.

Canadian Aboriginal Law

Existing Aboriginal and treaty rights are constitutionally protected in Canada, but are not absolute. Actions of Canadian governments that "infringe" on these rights by allowing companies to engage in exploration and development of mining properties can be judicially held to be justified in the right circumstances. Justification requires that the appropriate Canadian government (i) conducts legally appropriate "consultation" with the Aboriginal group alleging infringement, and (ii) where appropriate, effects accommodations to minimize the infringement.

The Supreme Court of Canada (the SCC) has held that appropriate consultation and accommodation may be effected in federal and provincial statutory environmental review processes. In its 2004 ruling in Taku River Tlinget First Nation v. British Columbia (Project Assessment Director) (Taku), such a review process (with extensive consultation with the proposed mine's Aboriginal neighbours) was held to justify road building ancillary to mine development despite Aboriginal objections. The SCC has provided, in the duty to consult, a sophisticated Aboriginal/administrative law answer to at least part of the key question facing all mining development in the world today: how to obtain the "social licence" to mine.

Social Licence

Mining companies globally can no longer rely only upon their mineral titles to proceed with mine development. Major mining companies know that unless they continuously demonstrate corporate social responsibility, they will fail to gain from mine neighbours the appropriate level of local support that constitutes the "social licence" to mine. The elements of such social licence are diverse and changing and are currently driven by international development of several key concepts.

Sustainability, Environmental Transparency and Reconciliation Worldwide

The concept of "sustainability" has gained world currency in application to mining development. The UN's Brundtland Commission defined sustainable development as "development that meets the needs of the present without compromising the ability of future generations to meet their own needs." The UN Economic Commission for Europe's Aarhus Convention, now ratified by more than forty countries, including all those in the EU, mandates public transparency with respect to environmental issues effectively opening mine development to thorough review by mine neighbours, including Aboriginal neighbours. As well, there are reconciliation movements, apparently inspired by the South African Peace and Reconciliation Commission, that are seeking to reconcile differences between groups competing for the same resources in many countries.

Two Troubling Decisions

Two British Columbia decisions made in 2007 demonstrate that such developing international approaches affect what constitutes the "social licence" to mine in Canada. These decisions, if not fully examined, seem to set back the cause of obtaining certainty in Canadian mine development. The first is the decision against mine development made by the joint environmental review panel on the proposed Kemess North mine in northern British Columbia. The second is the decision of the Supreme Court of British Columbia (SCBC, a trial level court) in Tsilhqot'in Nation v. British Columbia (Tsilhqot'in).

Kemess North

Northgate Minerals Corporation (NMC) was developing a copper-gold mine in northern British Columbia. Its mining plan required tailings to be stored in a lake with cultural significance for Aboriginal neighbours. A Canadian federal fisheries regulation allows the use of lakes for tailings storage in appropriate circumstances determined by the federal Cabinet.

For two years, ending in September, 2007, NMC's proposal underwent a comprehensive environmental review. However, while admitting that the development would "not likely result in significant adverse environmental impacts" and that federal and provincial permitting would otherwise be available, the review panel recommended against mine development based on the thousand-year-plus horizon of environmental pollutant containment required for the tailings. In effect, in the panel's view, Kemess North did not represent "sustainable development."

The Kemess North decision indicates the importance of considering the modern definition of "sustainable development" in the context of environmental impacts that are otherwise apparently innocuous. This definition must be considered when providing appropriate Aboriginal and environmental law advice to mine developers because it introduces into the consultation process criteria for approval that weighs environmental impacts of current technology against possibly reduced impacts obtainable from future technology.


In Tsilhqot'in, an Aboriginal group sought a judicial declaration of Aboriginal title over all of certain substantial parcels of land in western central British Columbia. The application for the declaration was denied. It is understood that Tsilhqot'in will be appealed.The trial judge opined, in effect, that provincial resource administration legislation (in Tsilhqot'in, the Forest Act (British Columbia)) does not apply to lands subject to Aboriginal title and so, by extension under the 2004 decision of the SCC in Haida Nation v. British Columbia (Ministry of Forests), to lands in respect of which such title is claimed. As Aboriginal title may include subsisting mineral rights, by extension, provincial mining legislation might also presumably be alleged not to apply to lands subject to such real or alleged rights. We believe the better view is that even if Aboriginal title is proven in respect of any lands, such lands remain subject to federal and provincial legislation, however, the federal government gains legislative authority regarding the regulation of Aboriginal title.

The trial judge also expanded upon the obligations imposed on Canadian governments by the principle of "reconciliation," a little-developed doctrine of Canadian law, and espoused the familiar judicial theme that, in effect, the courts are not good places to work out an equitable settlement of historic issues. His judgment supported an approach to reconciliation in Canadian law that would "acknowledge the historical rights of Indigenous peoples to their ancestral lands ... as the essential starting point for any modern settlement." However, we doubt there will be SCC support for a general acceptance of all alleged Aboriginal rights beyond the honourable approach to unproven claims adopted in Haida. Reconciliation, as discussed by the SCC, is a process carried on by governments in and out of the courts. In the courts, it is necessarily tied to the fact-specific rules of the common law and a balancing of Aboriginal and developmental interests. Out of the courts, it finds voice in such initiatives as the government of British Columbia's "New Relationship," which is an overt change of government policy in dealing with Aboriginal people based on reconciliation principles.


These two recent decisions demonstrate how emerging "social licence" theories influence Canadian courts and tribunals. Theories of "social licence" worldwide will not go away and will have material impacts upon Canadian law and government practice. Any advice as to what can be expected in any judicial or regulatory process relating to mining's impact on Aboriginal neighbours will have to bear in mind these ongoing developments.Sustainability, environmental transparency and stakeholder engagement are broad theories that must clearly be addressed in order to obtain the "social licence" to proceed with a mining project. There is no single uniform blueprint for satisfying these broadly characterized criteria. Rather, achieving certainty in dealing with mining's Aboriginal neighbours now requires investors in mining ventures in Canada to go beyond an inquiry of whether there has been appropriate consultation and to ask deeper questions, including:

  • Is the overall impact of the mine truly transparent?

  • Could the science of the mining plan be challenged as not 'sustainable' in that word's modern meaning?

  • Do the mine's dealings with its Aboriginal neighbours progress reconciliation by sustaining the dignity of both the mine and its Aboriginal neighbours?

All or none of those answers may be material in the determination of whether a mining company will be allowed to proceed with mine development, but there should also be no surprise if governments, courts, or tribunals are influenced by their own answers to those questions. As with any rapidly evolving area of the law, the best prospects for success will likely be enjoyed by those who not only fully understand the ramifications of past determinations by courts and administrative bodies but also have been well-informed and have considered at the earliest possible stage the specific circumstances of their project and any unique concerns of neighbouring Aboriginal groups. The best formula for success, therefore, requires the recognition that there is not, in fact, a "one size fits all" formula.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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