Control needed: Wingti

Papua New Guinea

THE Papua New Guinea government will consider introducing legislation to place a limit on the aggregate of claims for damages by landowners.

The decision comes in the wake of legal action taken by Fly River landowners who are claiming damages for alleged environmental destruction by an Australian mining company.

In a statement issued last month, Prime Minister Paias Winti said the legislation would establish a compensation tribunal with the exclusive power

to deal with all compensation claims by the landowners. He said it would also have the resource project developers establish a fund progressively over a period of time or alternatively put up a bond from which all compensation claims are to be met. The legislation will give the state power to sue resource developers for environmental and other damage. Wind said it seemed that the writ had been filed at the Supreme Court of Victoria and that the claim was for 2.75 billion kina.

He said his government was concerned about the potential adverse effect which substantial claims by landowners against resource developers could have on inves tor confidence m PNG.

“At the same time, I recognise the need for achieving a proper balance by ensuring that landowners who are ad versely affected by environmental or other damage are fairly treated and compensated and the national interest is Protected in that investor confidence in apua New' Guinea is not destroyed by numerous or excessive claims for com pensation or by the threat of such claims.” The prime minister said he would not comment on whether the claim was justifiable or not. He said his country was a developing one and needed substantial investment capital if it was to develop its resources for the benefit of the nation. “It is in the national interest and in the interest of our

people, including the Fly River land

owners, that my government take reasonable steps to ensure against loss of investor confidence in Papua New Guinea.” But he said he recognised the need to ensure that landowners were fairly treated and adequately compen sated.

Wingti said other aspects relating to the recently filed writ, which were of concern to his Government were: • that a foreign court would be deciding on a claim which could have far reaching consequences on PNG; and • the involvement of a foreign law firm which w’as reported to have undertaken the case on a success fee basis and which therefore stood to profit substantially from the proceeds of the compensation claim should the claim be successful.

“In relation to a foreign court deciding the claim, my government will seriously consider under the proposed legislation, whether to abolish common law claims by landowners for compensation and instead give landowners claims a status tory basis under the legislation. My government will also consider making the legislation retrospectively effective. I am advised that this will raise serious doubts on whether the Supreme Court of Victoria or any other foreign court will have jurisdiction to hear the current

landowners’ claim. My government’s

intention is to ensure that all such claims are brought before a compensation tribunal set up in Papua New Guinea and comprised of people competent to deal with local issues.

“In relation to the involvement of any foreign law firm in any legal matter in

Papua New Guinea, my government is

concerned to prevent foreign law firms, whether through agreed fee structures or

otherwise, from unreasonably enriching

themselves at the expense of our citizens and especially at the expense of our grassroots people from remote areas.” □