Pro-bono lawyers have helped pave the way for a new certification scheme that campaigners say will give impoverished gold miners higher prices for their gold
LONDON (TrustLaw) – The world's first certified "Fairtrade" gold goes on sale in Britain on Monday, which campaigners say will boost the incomes and working conditions of impoverished gold miners worldwide.
Garrard, jeweller to the royal family, is among 20 leading British companies launching collections made from ethically sourced gold which, according to campaigners, has the potential to raise standards of living for many of the world's 15 million artisanal miners. The certification scheme will start in Latin America and later expand to Africa and Asia.
The launch of the "Fairtrade" and "Fairmined" gold is the result of a partnership between Fairtrade International (FLO) and the Alliance for Responsible Mining (ARM), a Colombia-based non-governmental organisation that works to improve miners' livelihoods.
ARM turned to pro bono lawyers at Hogan Lovells to help with the intellectual property aspects of the agreement.
"One of the major achievements of the agreement was negotiating the use of ARM's Fairmined mark as part of a joint label with FLO's Fairtrade mark," Mark Marfé, a lawyer from Hogan Lovells' London office, told TrustLaw. "We discussed the way in which their respective rights could be combined and used once the product was launched on the market."
Marfé started working on the project in the spring of 2009 and advised ARM during its negotiations with FLO on their cooperation agreement to launch the new product.
He said during the negotiations he was struck by how the participants always had the miners' best interests in mind.
"Regardless of each side's priorities, everybody's main objective was to make sure that the miners received the best possible deal from this," he said.
Artisanal mining is one of the world's most dangerous industries, Harriet Lamb, executive director of the Fairtrade Foundation, the UK member of FLO, said at a news conference in London.
"How conventional gold is mined is not a pretty story. Many of the miners ... too often live in poverty despite the high value of the product that they mine. Too often they face serious injury and risks [and] they are taken advantage of by unscrupulous middlemen," Lamb said.
Artisanal miners account for 10 percent of annual gold supplies and 90 percent of the labour force in gold extraction, according to ARM. They are typically individuals, family groups or members of co-operatives who mine and process gold using basic techniques.
Often, they are driven to artisanal mining because they cannot find employment elsewhere and some work illegally because they do not have legal rights to mine in a particular area.
Despite the price of gold rising from $320 per ounce in 1999 to more than $1,400 per ounce in 2010, many miners live on less than $2 a day, the Fairtrade Foundation said. They also face severe health risks from daily contact with toxic chemicals used to process gold, such as mercury, cyanide and nitric acid. Mining communities also usually lack clean drinking water, basic sanitation and access to medical facilities.
"Gold mining is a very dirty business on all levels - politically, economically, environmentally," said Greg Valerio, a jeweller and founding member of ARM who has worked to prepare the British market for the launch.
To become part of the Fairtrade and Fairmined system, miners' organisations have to comply with strict standards, including ending the use of child labour, providing health and safety training for all miners and regulating the use of chemicals. In return, miners receive a minimum price for their gold and an additional Fairtrade premium of 10 percent, which they must invest in their business or use for community development.
Gold produced by the certified mining organisations will carry the Fairtrade and Fairmined labels. It will be kept separate from non-certified gold during processing, refining and manufacturing which means it can be traced from the miner to the shop.
"Fair trade gold is going to radically change the landscape," Valerio said. "All of a sudden consumers will have a choice as to whether they want to purchase a Fairtrade certified, traceable gold product or not. In my experience, most human beings, particularly when spending a lot of money on fine jewellery, take a little bit more time and thought over it. Nobody wants to buy a piece of jewellery that comes from a hell hole."
After the UK launch, the initiative will be rolled out to other countries. The Fairtrade Foundation and ARM said the new product could account for 5 percent of the global gold jewellery market in the next 15 years.
Two mining organisations in Bolivia and Colombia have received Fairtrade and Fairmined certification and the Fairtrade Foundation expects seven more groups in Latin America to be certified by the end of the year. The scheme will be expanded to mining communities in Africa and Asia from 2012.
Juana Peña Endara, senior president of the Cotapata Mining Cooperative in Bolivia, the first group to be certified, said its members would use the Fairtrade premium to invest in machinery so they could increase their productivity.
One of the few female technicians in the cooperative, Endara said she decided to work in the mines to in order to support her four children after her husband left her. Although she was able to educate them with the money she earned, she said she had to make a lot of sacrifices.
"I had to work all the time," she told TrustLaw. "I suffered, but I managed to bring up my children. This is the compensation for all the suffering and all the hard work."
Our Standards: The Thomson Reuters Trust Principles.
