1. RTC GUATEMALA REPORT
I. Context
Guatemala is an ethnically and culturally diverse country bordered by Mexico to the north,
Honduras to the east, and El Salvador to the southeast. Commonly referred to as “the land of the
eternal spring,” Guatemala is characterized by its natural beauty and is home to the Maya
Biosphere Reserve and Tikal National Park, a UNESCO World Heritage Site. The country has a
population of approximately 15.83 million people.1
The total land area in Guatemala is 108, 889
square kilometers.2
Indigenous people comprise an estimated 51% of the overall population, the
majority being of Mayan descent.3
The main indigenous groups in the country include the Achi’,
Akateco, Awakateco, Chalchiteco, Ch’orti’, Chuj, Itza’, Ixil, Jacalteco, Kaqchikel, K’iche, Mam,
Mopan, Poqomam, Poqomchi’, Q’anjob’al, Q’eqchi’, Sakapulteco, Sipakapense, Tektiteko,
Tz’utujil, Uspanteko, Xinka and Garífuna.4
The government of Guatemala is a multiparty and democratic republic. The country’s executive
branch is currently led by President Otto Perez Molina and Vice President Roxana Baldetti.
Major landholders remain politically powerful in Guatemala. Economically, Guatemala has
experienced steady growth, particularly after signing the 1996 Peace Accords which has allowed
for the opening of international markets through a number of free trade agreements.5
In 2006,
Guatemala adopted the Central American Free Trade Agreement (CAFTA) which led to an
increase in investments in the export sector.6
In 2013, mine output reached $993.9 million.7
It is
estimated that mining in Guatemala supports the economic development of the country by
bringing in more than $7 million a year in royalties and taxes to the State.8
Finally, it is estimated
that more than $3.8 billion in investments in the mining sector are expected to be made in the
period of 2013- 2015.9
While the country has experienced considerable economic growth, the distribution of income
remains highly inequitable.10
Poverty rates for Guatemala remain high. It is estimated that 54%
of the population lives below the national poverty line.11
The illiteracy rate in Guatemala is
75.9%.12
In terms of health, while Guatemala has made quite some progress in the health of its
1
UN Data. https://data.un.org/CountryProfile.aspx?crName=Guatemala (retrieved on November 4, 2014).
2
CIA. “Guatemala” www.cia.gov/library/publications/the-world-factbook/geos/gt.gtml.
(retrieved on January 5, 2015).
3
World Directory of Minorities and Indigenous Peoples- Guatemala, Minority Rights Group International, July 2008,
http://www.refworld.org/docid/49749d163c.html (retrieved on November 4, 2014).
4
Ibid.
5
The World Bank. “Guatemala Overview,” http://www.worldbank.org/en/country/guatemala/overview (retrieved on November
24, 2014).
6
Princeton University. “The Economy of Guatemala,” http://www.princeton.edu (retrieved on November 24, 2014).
7
Invest in Guatemala. “Mining,” http://www.investinguatemala.org/en/areas-de-inversion/mining (retrieved on January 5, 2014).
8
Ibid.
9
Ibid.
10
UNICEF. “Guatemala,” http://www.unicef.org/infobycountry/guatemala_statistics.html (retrieved on November 24, 2014).
11
CIA. “Guatemala, https://www.cia.gov/library/publications/the-world-factbook/geos/gt.html (retrieved on January 4, 2014).
12
Human Development Reports. “Guatemala,” www.hdr.undp.org/en/countries/profiles/GTM (retrieved on January 5, 2015).
1

2. population, the country’s population is still experiencing numerous health-related problems such
as communicable diseases, malnutrition, maternal mortality, along with an increase in non-
communicable diseases and injuries due to external causes such as road traffic or violence.13
The
Guatemalan government invests only 2.8% of its GDP on education programs in the country.14
II. The Mining Sector and its Legal and Regulatory Framework:
Guatemala possesses vast and untapped mineral deposits, principally gold, silver, and nickel. The
Ministry of Energy and Mines is responsible for the formulation of the country’s mining policies
and programs. The Ministry grants mining licenses for three types of activities: 1)
reconnaissance, 2) exploration, and 3) exploitation.15
Guatemala experienced an upsurge in
mining activities after the signing of the Peace Accords in 1996 and with the introduction of the
Mining Law in 1997. In fact, metal exploration has grown by 1,000 % since the year 1998.16
In
2014, the Ministry of Energy and Mines issued a total of 359 mining licenses for exploration and
exploitation.17
And, there are more than 592 mining licenses currently under consideration.18
The
main mining companies in Guatemala are Goldcorp Inc., Nichromet Extractions, Hud Bay
Minerals, CGN/Canada, and BHP/Billiton. The companies of Goldcorp, Nichromet, Extractions,
Hud Bay Minerals, and CGN are Canadian companies, while the BHP/Billiton is an Australian
company.
References to mining are found in the Constitution with Article 125, which declares that “the
technical and rational exploitation of minerals to be useful and a public necessity.”19
Article 121
says that the State must establish “the appropriate conditions for its exploration, use and sale.”20
The legal framework is complemented by the Mining Law, Decree No. 48-97, which was
approved on January 7, 1997, and its implementing regulations were issued on January 12, 1998
under Government Regulation No. 8-98.21
The Mining Law (1997), which is implemented by the
Ministry of Energy and Mines, aims to create favorable investment and business conditions for
mining exploration and exploitation in Guatemala. It should be noted that the Mining Law
includes language which aims to provide an opportunity for citizens to express their opposition
to any mining activities.
13
World Health Organization (WHO). “Guatemala,” http://www.who.int/countries/gtm/en/ (retrieved on
14
Ibid.
15
The Ministry of Energy and Mining, the Republic of Guatemala. http://www.mem.gob.gt/quienes-somos/marco-legal/
(retrieved on December 1, 2014).
16
Doughtery, Michael. “The Global Gold Mining Industry, Junior Firms, and Civil Society Resistance in Guatemala,” Bulletin of
Latin American Research, October 2011.
17
Invest in Guatemala. “Mining,” http://www.investinguatemala.org/en/areas-de-inversion/mining (retrieved on January 5, 2014)
18
The Ministry of Energy and Mining, the Republic of Guatemala. http://www.mem.gob.gt/quienes-somos/marco-legal/
(retrieved on December 1, 2014).
19
“The Political Constitution of the Republic of Guatemala,” As amended by legislative decree no. 18-93 of November 1993.
http://www.right2info.org/resources/publications/laws-1/guatemala_constitution_eng. (retrieved on December 1, 2014).
20
Ibid.
21
International Business Publications. “Guatemala Mining Laws and Regulations Handbook,” 2013.
2

3. According to the mining law, the holders of licenses must pay annual royalties for the extraction
of minerals. The royalties are based on the volume of the mining products which are sold, based
on the market value of the product sold in the market place.
In December 2014, President Otto Perez Molina approved the increase in mining royalties from
1% to 10%.22
The Ministry of Energy and Mines has also introduced amendments of the
country’s Mining Act which would require 147 companies with operating licenses to pay new
royalty rates.23
One of the amendments aims to establish a mining fund which would distribute
incomes from royalties, such as 35% to the community where the mine is located and 20% to
communities located in the department in which the mines operate.24
In addition, Guatemala’s
Ministry of Social Development will receive 20% of the royalties, while the Ministry of
Environment and Natural Resources will receive 3% respectively.25
Additional legislation relevant to mining in Guatemala includes the Law on the Protection and
the Improvement of the Environment (Decree 68-86), the Protected Areas Law (Decree 4-89 as
amended Decree 110- 96), the Law for the Protection of Cultural Heritage of the Nation (Decree
26-97), and the Health Code (Decree 90-97).26
In the oil and gas sector, Guatemala approved the Law of the Fund for Economic Development
of the Nation in 2008—better known as Fonpetrol—which stipulates that a part of all funds from
royalties on petroleum should benefit local communities by being channeled into Community
Councils of Development (COCODES).27
In specific, the law established a 5% royalty on
petroleum to be distributed to COCODES along with a 3% royalty designated for environmental
protection projects.28
The law also allows for the extension, for up to 15 years, of current
petroleum contracts.29
In 2013, Guatemala joined the Extractive Industries Transparency Initiative (EITI), as part of a
larger global program aimed at setting standards to promote transparency within the natural
resources sector. Each implementing country, under the EITI Umbrella, aims to support a
coalition of companies and civil society working together to ensure the proper management of
their natural resources.30
As part of EITI compliance guidelines, Guatemala must regularly
22
Sean Taggart and Kenneth Green, “Guatemala Increases Mining Royalties to All Time High,”
http://www.miningfacts.org/Blog/Mining-News/Guatemala-Increases-Mining-Royalties-to-All-Time-High (retrieved on
December 2014).
23
Mineweb. “Guatemala Introduces Sweeping Mining Law Reforms,” June 25, 2012.
24
Ibid.
25
Ibid.
26
International Business Publications. “Guatemala Mining Laws and Regulations Handbook,” 2013.
27
Central American Data. “Petroleum Contracts in Guatemala Extended for 15 Years,”
http://www.centralamericadata.com/en/article/home/Petroleum_contracts_in_Guatemala_extended_for_15_years (retrieved on
January 5, 2014).
28
Ibid.
29
Ibid.
30
Extractive Industries Transparency Initiative. “Guatemala Recognized as EITI Compliant,” https://eiti.org/news/guatemala-
recognised-eiti-compliant (retrieved on January 5, 2014).
3

4. disclose the government’s earnings from the natural resource sector.31
On March 19, 2014,
Guatemala was found to be EITI Compliant by the international EITI Board.32
III. Citizen Participation
Civil society participation is recognized in the Constitution, Guatemala’s laws, and in the 1996
Peace Accords. In terms of the Guatemalan constitution, requirements are that reforms to the
constitution be approved by a popular referendum.33
Reference to participation is also found in
the 1996 Peace Accords. The Accords called for the creation of mechanisms for public
participation in policy-making, as well as the establishment of new institutions aimed to increase
the visibility of citizens in politics.34
In 1996, the constitutional court of Guatemala adopted ILO
Convention 169 on indigenous peoples into the country’s Constitution.35
In sum, ILO
Convention 169 states that indigenous peoples should be consulted prior to the approval of any
development projects on their lands. Articles 6 and 15 of the Convention state that national
governments must consult with indigenous peoples before undertaking any exploration and
exploitation of minerals,36
while Article 7 says that “the peoples concerned shall have the right to
decide their own priorities for the process of development as it affects their lives, beliefs,
institutions, and spiritual well-being and the lands they occupy.”37
Guatemala has a relatively robust legal framework for citizen participation, with specific
reference to the engagement of indigenous peoples. For example, there is the Municipal Code
(Decree 12- 2002), which proposes referendums at the request of indigenous communities who
would like to discuss issues that affect the rights and interests of their communities.38
The Urban
and Rural Development Councils Act (Decree II- 2002) states that there should be citizen
participation in local development, respectful of the different indigenous cultures in Guatemala.39
Finally, the Decentralization Act (Decree 14- 2002) seeks to promote citizen participation in
local and regional policy-making.40
However, research studies find that although these laws are
in place, the participation of indigenous peoples in municipal/national politics remains quite
low.41
For example, of the 158 deputies elected to Congress, only 18 were indigenous, while of
the 333 mayoral races, there was no representation from indigenous communities.42
31
Extractive Industries Transparency Initiative. “Guatemala Recognized as EITI Compliant,” https://eiti.org/news/guatemala-
recognised-eiti-compliant (retrieved on January 5, 2014).
32
Ibid.
33
William Stanley and David Holiday. “Broad Participation, Diffuse Responsibility: Peace Implementation in Guatemala,” from
Ending Civil Wars the Implementation of Peace Agreements,” Edited by Stephen Stedman, Donald Rothchild, and Elizabeth
Conseneus, Lynne Rienner Publishers 2002.
34
Ibid.
35
Survival International. “Guatemala Adopts Indigenous Rights into the Constitution,”
http://www.survivalinternational.org/news/5613 (retrieved on December 3, 2014).
36
Ibid.
37
Ibid.
38
Peace Brigades International. “Metal Mining and Human Rights in Guatemala: The Marlin Mine in Guatemala,” September
2006, http://www.pbi-ee.org/fileadmin/user_files/projects/guatemala/files/english/PBI-mining-human-rights-guate.pdf (retrieved
on November 25, 2014).
39
Ibid.
40
Ibid.
41
U.S. AID. “Guatemala Country Report: Trends in Decentralization, Municipal Strengthening, and Citizen Participation in
Central America: 1995- 2003,” August 2004.
42
The National Democratic Institute (NDI). “Guatemala,” https://www.ndi.org/guatemala (retrieved on December 2, 2014).
4

5. The main international institutions providing financial support for sustainable development
projects in Guatemala include the World Bank, the European Parliament, U.S. AID, the United
Nations Development Programme (UNDP), and the Inter-American Development Bank. UNDP
provides a significant amount of funding for projects in Guatemala, particularly for peace-
building and public participation activities. For example, UNDP introduced a program called
“Strengthening of Civilian Power and the Role of the Armed Forces in a Democratic Society
(1996)” which acts as a bridge between civil society and the Guatemalan government.43
UNDP
also provides funds and support for community mobilizations with the aim to influence
government events.44
The German organization GIZ has also introduced a number of programs in
Guatemala with the aim to institutionalize forms of non-violent conflict management, improve
local government services, and to support climate adaptation initiatives.45
There are also a number of non-governmental organizations that have been involved in
promoting public participation in Guatemalan policy-making. These include the Association of
Investigation and Social Studies, Citizen Action, the Guatemalan Association of Indigenous
Mayors and Authorities, and the National Association of Municipalities of Guatemala.46
Civil
society organizations monitoring mining activities in Guatemala include Cordaid, Oxfam,
Friends of the Earth International, Mining watch Canada, and Amnesty International.
IV. Mining Conflicts
Over the years, Guatemala has experienced a growing number of disputes between indigenous
communities and mining corporations. One of the most notable disputes has been an ongoing
campaign against the Glamis Gold (now Gold Corp) Marlin Gold Mine, a $250 million dollar
mining project which was the first project authorized by the Guatemalan government after the
adoption of the 1997 Mining Law.47
In 1999, Glamis Gold, a Canadian owned mining company,
collaborated with its subsidiary Montana Exploradora to develop the Marlin gold mine. In
November 2006, Goldcorp Inc. merged with Glamis in a 21.3 billion transaction, with Glamis
Gold changing its name to Gold Corp.48
Public protests against the Glamis Gold mine first took place in 2004, in the municipality of
Sipacapa. Many of the protesters received death threats from Glamis Gold.49
According to the
residents of Sipacapa: “We publicly declare at the national and international level, that the
granting of the license for open pit metal mining violates the collective rights of the indigenous
43
United Nations Development Program (UNDP). “A Case Study in Guatemala: Evaluation of UNDP Assistance to Conflict
Affected Communities,” http://web.undp.org/evaluation/documents/thematic/conflict/Guatemala.pdf (retrieved on November 28,
2014.
44
Ibid.
45
German GIZ. “Guatemala,” http://www.giz.de/en/worldwide/395.html (retrieved on January 14, 2014).
46
Ibid.
47
Ibid.
48
Shina Amai and Jennifer Sander, “Breaching Indigenous Law: Canadian Mining,” Indigenous Law Journal, Volume 6, Issue 1,
2007.
49
Shina Amai and Jennifer Sander, “Breaching Indigenous Law: Canadian Mining,” Indigenous Law Journal, Volume 6, Issue 1,
2007.
5

6. peoples who inhabit our territories.50
In 2005, the campaign escalated with thousands of
indigenous peasants blocking a crossroads of the Pan-American Highway with the aim to stop a
milling cylinder for use in the Marlin Mine.51
Also, in March of 2005, Sipacapa residents filed a
complaint to the Office of Compliance and Advisor (CAO) of the World Bank, claiming that the
Marlin mine project was developed “without adequate consultation and in violation of the rights
of indigenous peoples.”52
In June of 2005, the community of Sipacapa unanimously voted to
reject mining in their area.53
Despite years of protest, the Marlin mine continues to operate. In
2012, open pit operations at the Marlin mine ceased and the mine is an underground operation
only.54
In addition to these protests, civil society groups have taken legal action against mining
companies. In 2006, the Center for Legal Environment and Social Action launched a court
challenge against the existing mining law, claiming that it did not provide sufficient protection to
indigenous communities living in close proximity to mining operations.55
In addition, the group
claimed that the government did not abide by Convention 169 of the International Labour
Organization (ILO).56
In 2007, the community of Sipacapa, with assistance from local NGO’s, filed a petition with the
Inter-American Commission on Human Rights. In sum, the petition states that the Guatemalan
government has not lived up to its obligation to consultant with the Mayan communities of the
municipality of Sipacapa regarding the grant mining licenses to the Montana Exploradora.57
Indigenous communities claim that the Guatemala government violated various articles in the
Constitution, ILO 169, and the Municipal Code, Decree 12 of 2002. The petition is still
pending.58
In 2013, the Western People’s Council filed a petition with the Inter-American Commission on
Human Rights alleging that the country’s mining law was approved without their prior
consultation. They challenged the constitutionality of the 1997 Mining Law in a July 2012 law
suit filed with Guatemala’s constitutional court. In March 2013, the Constitutional Court upheld
the mining law, contradicting Guatemala’s legal obligations to consult with indigenous peoples
before the approval of policies that will significantly impact their territories.59
50
Amanda Fulmer, Angelina Snodgrass Godoy, and Philip Neff. “Indigenous Rights, Resistance, and the Law: Lessons from a
Guatemalan Mine,” University of Miami, 2008.
51
Ibid.
52
Office of the Compliance Advisor, International Finance Corporation. “Assessment of a Complaint Submitted to CAO in
relation to the Marlin Mine in Guatemala,” September 7, 2005.
53
Shina Amai and Jennifer Sander. “Breaching Indigenous Law: Canadian Mining,” Indigenous Law Journal, Volume 6, Issue 1,
2007.
54
Be Mining. “Gold Corp – Marlin Mine: Guatemala’s Gold Standard,” March 26, 2014.
55
The Center for Excellence on Corporate Social Responsibility. “Corporate Social Responsibility,”
http://web.cim.org/csr/menuPage.cfm?menu=67 (retrieved on November 24, 2014).
56
Ibid.
57
Cordaid. “Mining Conflicts and Indigenous Peoples in Guatemala,” September 2009,
https://www.cordaid.org/media/publications/Mining_Conflicts_and_Indigenous_Peoples_in_Guatemala.pdf (retrieved on
January 14, 2015).
58
Ibid.
59
Mining Watch Canada. “Guatemalan Indigenous Organizations File Complaint over Mining Law with Inter-American
Commission on Human Rights,” http://www.miningwatch.ca/news/guatemalan-indigenous-organizations-file-complaint-over-
mining-law-inter-american-commission, September 3, 2013
6

7. V. Does the Legal Framework Recognize the Right of Communities to
be Consulted in the Evaluation or Approval of Mining Projects
Overall, the Guatemalan state is considered to be weak.60
Guatemala is categorized as a country
of “very high warning” on the fragile states index, with a ranking of 80.3.61
The Fragile States
Index is an annual report published by Fund for Peace which uses 12 factors to determine the
rating for each nation including indicators such as security threats, human rights violations, and
refugee flows.62
In terms of political participation, vast numbers of Guatemalans do not
participate in the formal political system.63
Taxation in Guatemala is low and as a result, the state
is underfunded with little capacity to carry out poverty alleviation and environmental protection
programs.64
Municipal governments are also under-funded, given that much of their funding
comes from the state.65
It is estimated that only 10% of revenue from the state is transferred to
municipalities.66
Additional challenges which weaken the country’s institutional capacity include
mistrust between political parties, crime, and corruption.67
Guatemala’s Mining Law (1997), which is implemented by the Ministry of Mines and Energy,
includes language which aims to provide citizens with an opportunity to express their opposition
to any mining activities. However, it should be noted that overall, the main goal of the Mining
Law has been to create more favorable conditions for mining exploitation in Guatemala. For
example, the new law reduced the percentage of royalties that mining companies are required to
pay to the government while removing limits on the foreign ownership of mines.
There are also a number of laws, such as the Municipal Code (Decree 12- 2002), the Rural
Development Councils Act, and the Decentralization Act (Decree 14- 2002), which recognize the
importance of including indigenous peoples in decision making processes on projects which
affect the interests of their communities. While these laws do not specifically refer to
consultations related to the approval and evaluation of mining projects, they do recognize the
importance of engaging indigenous peoples in local and national policy processes in Guatemala.
Finally, in 1996, Guatemala adopted ILO Convention 169 on indigenous peoples into the
country’s Constitution. ILO Convention 169 says that indigenous peoples should be consulted
prior to the approval of any development projects on their lands. In specific, Articles 6 and 15 of
the Convention state that indigenous peoples should be consulted prior to the undertaking of any
exploration and exploitation of minerals.
60
William Stanley and David Holiday. “Broad Participation, Diffuse Responsibility: Peace Implementation in Guatemala,” from
Ending Civil Wars the Implementation of Peace Agreements,” Edited by Stephen Stedman, Donald Rothchild, and Elizabeth
Conseneus, Lynne Rienner Publishers 2002.
61
Fragile States Index. http://ffp.statesindex.org/rankings-2014 (retrieved on January 7, 2014).
62
Ibid.
63
United Nations Development Program (UNDP). “A Case Study in Guatemala: Evaluation of UNDP Assistance to Conflict
Affected Communities,” http://web.undp.org/evaluation/documents/thematic/conflict/Guatemala.pdf (retrieved on November 28,
2014.
64
The Hunger Project: Participatory Local Democracy. “Guatemala,” http://localdemocracy.net/countries/south-
america/guatemala/ (retrieved on November 28, 2014).
65
The World Bank. “Towards Better Expenditure Quality: Guatemala Public Expenditure Review,” 2013.
66
The Hunger Project: Participatory Local Democracy. “Guatemala,” http://localdemocracy.net/countries/south-
america/guatemala/ (retrieved on November 28, 2014).
67
Ibid.
7

8. Overall, Guatemala has not recognized the right of their indigenous communities to give Free,
Prior, and Informed Consent (FPIC) to mining development projects. This is particularly evident
in the case of the Marlin Mine conflict. At the heart of this conflict was the fact that the
Guatemalan government did not consult with indigenous communities before the granting of the
exploration and exploitation licenses for the Marlin Mine.
In 2012, Guatemala introduced a series of reforms to the country’s legal framework. During this
time, the Ministry of Energy and Mines introduced amendments to the country’s Mining Act.
One of the amendments aims to establish a mining fund which would distribute incomes from
royalties, such as 35% to the community where the mine is located and 20% to communities
located in the department where the mines operate.
While civil society organizations such as Friends of the Earth International and Mining Watch
Canada provide support to anti-mining campaign groups in Guatemala, they do not directly
support community consultations and negotiations related to mining developments. I also found
that organizations such as UNDP, German GIZ, the World Bank, U.S. AID, and the Inter-
American Development Bank provided financial support for environment/development/public
participation projects in Guatemala. However, these are not targeted to projects in the mining
sector.
Thus, there is certainly a need for a funding mechanism which would support local communities
to negotiate on their behalf of their needs. The Guatemalan state is weak and underfunded and
does not have the ability to fund social development/environmental protection programs for local
communities affected by mining projects. Municipalities are equally as underfunded and
Guatemala’s institutional capacity is considered to be weak. Finally, research studies have found
that the participation of indigenous peoples in municipal/national politics remains quite low.68
For example, of the 158 deputies elected to Congress, only 18 were indigenous, while of the 333
mayoral races, there was no representation from indigenous communities.69
Thus, there is a need
for communities to negotiate directly with mining companies to ensure that these companies
integrate sustainable development provisions into company policies and practices.
68
U.S. AID. “Guatemala Country Report: Trends in Decentralization, Municipal Strengthening, and Citizen Participation in
Central America: 1995- 2003,” August 2004.
69
The National Democratic Institute (NDI). “Guatemala,” https://www.ndi.org/guatemala (retrieved on December 2, 2014).
8