When one thinks of gourmet food, wine, and spirits, images of natural green fields, with ancient organic practices, pasture-raised animals, and hand-made products spring forth. People highly value these products for their reputation for quality and wholesomeness. Thousands of food and wine lovers travel to each of these specific regions annually to tour and taste these products in the very place they are produced.

In addition to being highly profitable, artisanal foods are valuable from a cultural heritage and national identity perspective. Artisanal food producing communities are typically situated in agricultural areas and have a deeply held cultural identity. The products from these communities have come into existence through hundreds of years of carefully developed methods and cultural practices which rely heavily on unique local environmental factors, including soil, water and micro-climates, the health of agricultural livestock, and even the prevalence of microorganisms. This delicate combination of human and environmental factors is referred to as ‘terroir’ and there are regions all around the world that produce these special products based on their own terroir. Terroir is what gives these products their unique flavour profile, and many of these regions have protected their terroir through an intellectual property mechanism called Geographical Indications (GI) through the World Intellectual Property Organization.

Threats from Extraction

Like food production, humanity has been extracting minerals out of the earth using various techniques since time immemorial. The desire and need for these minerals have shaped our economies, provided fuel for our energy needs, underpinned our technological advances, and even helped us to find new ways to cook and process food. Without resource extraction, humanity would be nowhere near as advanced, and we would not have artisanal foods that we love so much. However, accessible mineral deposits are often found directly under or adjacent to agriculturally significant areas, and their extraction is then either conducted concurrently with existing above-ground agricultural operations or displaces those agricultural operations altogether.

Extraction is often environmentally destructive and contentious within local communities. One can find communities around the world galvanised in protest of projects and filing court actions to halt real or perceived environmental destruction, and threats to culture and way of life. Mineral extraction contributes to pollution, changes in air, soil, and water quality, brings noxious weeds, causes community fracture, worker attrition, chemical spills, and health issues. These threats are particularly destructive to the delicate terroir, and once the unique and sensitive local environment that provides the raw material and suitable conditions for artisanal food production is disrupted, these distinct, culturally significant items may be lost forever.

For example, there is a 37.2 million tonne, battery grade, lithium deposit set to be open pit mined by Tecnología Extremeña Del Lito (TEL), in Extremadura, Spain. This delicate terroir produces 12 GI-protected foods, including Iberico ham, lamb, honey, cheese, olive oil, and Jerte cherries. The community was not consulted before the government granted mining licences to TEL, and the community has already started filing law suits against the company and challenging government decision making.

The global energy system is in the midst of a major transition to clean energy that will rely on critical minerals such as lithium to build massive windfarms, solar panels, battery storage capacity, electric car fleets, computers and communications grids. Thus, extraction will increase significantly in the future, bringing with it a massive increase in associated environmental destruction, community upheaval, protest and litigation. How can we protect the delicate terroir required for artisanal food production while facilitating the requisite extraction of minerals? Moreover, which institutions are best suited to resolving the conflicts that will inevitably arise?

Protracted conflicts demonstrate serious failures on the part of governments and extractive companies in protecting community interests and winning over stakeholder approval. Court actions are often contentious and demonstrate an unnecessary and preventable breakdown of stakeholder relationships. From a community perspective, litigation may occur too late, when damage might already have been done to these fragile industries and the environments they rely upon. From a company perspective, court actions pose some of the more serious risks to project capital and viability by halting projects, due to the loss of a social licence to operate, which then have cascade effects, including massive litigation costs, company defaults on offtake and supply agreements, an upward pressure on commodity prices, demand from creditors, and the breakdown of joint venture relationships. So how can we mitigate these risks?

A way forward

Community consultation with GI producers prior to extraction may help to avoid these problems. While community consultation is not legally mandated as part of most government licensing regimes (except in relation to indigenous communities), when extractive companies engage in community consultation ethically, honestly and well in advance of commencing a project, those efforts mitigate many of the aforementioned risks to the community and the project itself. When conducted properly, consultation often provides stakeholders with a deeper understanding of the impact of the project on their community, environment, and way of life. Consultation mechanisms allow local stakeholders to meet with company representatives, voice their concerns, and negotiate so that clear common aims can be realised and serious risks can be mitigated by re-designing certain aspects of the project.

This approach can not only protect communities and preserve the local environment, it can also establish a partnership community and result in a properly negotiated agreement. Such agreements set out expectations in advance, clearly delineate each party’s responsibilities, and include mediation or arbitration mechanisms to amicably solve any potential disputes that may arise once production commences. In cases where parties end up in litigation, courts will typically restrict themselves to ensuring parties conform with the agreement. Thus, the unpredictability inherent in administrative challenges, injunctive action, civil litigation, and protest can be avoided. Ultimately, the courts are not well-suited to protecting the delicate terroir required for artisanal food production while facilitating critical resource extraction, and should be seen as a last resort.

More than 120 scholars from all over the world will share their findings and views on 8 and 9 July 2022 at Leiden Law School during the conference Courts as an Arena for Societal Change. Several blogs will be published on the Leiden Law Blog on the themes of the conference.