The norm was promoted by convention delegate Ivanna Olivares of the Constituent People party and other independents, and passed in a tight vote with 11 delegates in favour with eight against.
Under the proposal, the president of Chile will have one year from the promulgation of the new Constitution to implement the provision.
Diego Hernandez, president of the National Mining Society (SONAMI), expressed extreme concern over the nationalization approval by the committee. "The decision adopted is barbaric, with clear and evident legal errors. The nationalisation of copper has been approved, but the copper currently belongs to the Chilean State. Thus, this measure only means nationalising the companies, not the natural resources, which is what they want to protect. With this measure, the Constitutional Organic Law of Mining Concessions is also repealed," said Hernández.
The rule states, "there will be no place for any compensation for the rights over mining and hydrocarbon assets, since by Constitutional mandate they belong to the State of Chile." It said the comptroller general of the nation would determine the indemnisation to be paid to the owners of the nationalised assets, 120 days from the date the new Constitution enters into force. However, the only compensation will be the book value as of December 31, 2021, according to IFRS regulations. "All or part of the excessive income obtained by the nationalised companies may be deducted from the amount of the compensation," reads the text.
Implementation of the norm would see the likelihood of Chile being locked in international arbitration in several countries. "A nationalisation would have serious consequences for our economy in a context of globalisation, since the affected companies will resort to these treaties to defend their legitimate interests, generating lawsuits in international courts. This will mean paying the companies the amounts that the international treaties and courts indicate, based on what the Constitution in force today indicates. This would be a terrible business for the country, to the clear detriment of the economic and social needs and the future of Chile," said Hernandez.
