Oral arguments held in ICJ dispute over pulp mills on the River Uruguay

By Fernando Cabrera Diaz
2 October 2009

Oral arguments have been held at the International Court of Justice (ICJ) in the dispute between Argentina and Uruguay over the latter’s authorization of paper mills on their shared River Uruguay.  As per its custom, the ICJ released daily transcripts of the hearings which took place between 14 September and 2 October at The Hague.

The dispute centers on two pulp mills that Uruguay authorized in 2003 and 2005 to be built on its side of the River Uruguay, which forms part of the border between the two nations.

The pulp mill projects are intensely unpopular in Argentina, and on several occasions Argentinean protesters blockaded the important General San Martin Bridge joining the two countries, crippling two-way trade. The protests caused Spanish company ENCE to scrap its plans to build one of the two mills in 2006; however, Finnish company Oy Metsä-Botnia AB constructed the second mill, which it began operating in 2007.

Uruguay insists that it could be liable for damages under the Finland-Uruguay bilateral investment treaty if it shut down the Botnia project, according to press reports.

Argentina opposes the mills on the grounds that they threaten the health of the river in violation of the Statute of the River Uruguay, a 1975 bilateral agreement governing the river’s management. After repeated attempts to resolve the dispute, including a failed mediation by Spain’s King Juan Carlos, Argentina took Uruguay to the ICJ in May of 2006.

In her opening (September 14th) remarks to the ICJ on behalf of Argentina, Ms. Susana Ruiz Cerutti argued that the Statute of the River Uruguay requires that both sides inform each other, consult and ultimately make decisions by mutual agreement in regards to any work that is likely to cause damage to water quality, or the environment of the river and the areas affected by it.

Ms. Ruiz told the court that Uruguay authorized the construction of the ENCE pulp mill without properly notifying Argentina or the bilateral agency (CARU) charged with administering the Statute of the River Uruguay in “flagrant violation” of the Statute. Uruguay aggravated the situation in February 2005 when it again unilaterally authorized construction of the Botnia mill without proper notification, she added.

The result, according to Ms. Ruiz, is the largest pulp mill in the history of the river being placed near one of the most populated areas of the river, where it discharges large amounts pollutants into the water and air.

On the following day, Argentina’s expert, Philippe Sands QC, a Professor of International Law at the University College London, summarized Argentina’s view, saying:

“Argentina would like to be absolutely clear on one point: it has no a priori objection to a pulp mill as such and would almost certainly not have objected if the plant were located in a place where liquid effluents would be easily diluted and dispersed and air emissions would not interfere with daily life on Argentine territory. Argentina objects to the siting (sic) and operation of this plant at this location, since it is these waters and this environment that cannot cope with this kind of pollution at these levels.”

Other Argentinean experts presented evidence suggesting that the Botnia mill was indeed polluting the river with toxic substances including dioxins, Lindane and nonylphenols, and that it had caused a rapid increase in the river’s algae content in February.

Uruguay began its oral arguments on September 21, with Mr. Carlos Gianelli, Uruguay’s Ambassador to the United States, telling the court that “because of its much larger territory, population, agriculture and industry, it is Argentina not Uruguay that makes by far the greatest use of the Uruguay river with its related environmental consequences.”

According to Mr. Gianelli, independent environmental consultants hired by the International Finance Corporation, which help finance the Botnia mill, clearly established that the mill is operating to the highest international standards, and that it is not polluting the river.

With respect to Argentina’s claims regarding a lack of a consultation by Uruguay, Mr. Gianelli responded that his country had in fact provided Argentina with massive amounts of information before any construction began, and that both sides met 12 times over a six-month period between 2005 and 2006.

In response to Argentina’s specific pollution claims, Mr. Gianelli told the Court that the Lindane and nonylphenols found in the river were in fact a product of Argentina’s farming and industry, rather than the Botnia mill, which did not use these chemicals (Uruguay banned Lindane over 20 years ago). He said that although dioxins were used in older pulp mills, new mills such as the Botnia plant no longer used them, which tests of the Botnia mill’s effluent confirmed. Finally, Mr. Gianelli argued that the algal bloom was a normal event and had developed well upstream of the Botnia plant.

After hearings are completed on October 2, the ICJ will begin its deliberations. A decision may not be rendered until early next year.

As reported previously by ITN, Uruguay had asked the ICJ for provisional measures to require that Argentina “…take all reasonable and appropriate steps at its disposal to prevent or end the interruption of transit between…” the two countries in response to protests and blockades erected by Argentinean protestors which were and continue to disrupt two-way trade. In January of 2007, the ICJ rejected that request finding that the protests posed no imminent risk of irreparable harm to Uruguay’s rights.


Oral and written arguments available on the ICJ website at:  http://www.icj-cij.org/docket/index.php?p1=3&p2=1&code=&case=135

Previous ITN Reporting:

“ICJ rejects Uruguay request for provisional measures in pulp mills dispute,” By Fernando Cabrera Diaz and Luke Eric Peterson (http://www.IISD.org/pdf/2007/itn_feb1_2007.pdf)

“First hearings held in Uruguay-Argentina pulp mill dispute,” By Damon Vis-Dunbar (http://www.iisd.org/pdf/2006/itn_june15_2006.pdf)