The case could act as a warning to foreign companies working with regimes accused of human rights abuses
* Canadian miner in legal battle over Eritrea workers
* Nevsun denies claims that forced labour used at Bisha mine
* Legal experts see it as test case of responsibility to workers
TORONTO, Sept 17 (Thomson Reuters Foundation) - Hundreds of men drafted into Eritrea's army were used as forced labour to build a Canadian company's copper-gold mine in central Eritrea, according to a former construction official, in a case testing the global responsibility of foreign firms to workers.
Claims of forced labour at the Bisha mine, jointly owned by Nevsun Resources Ltd and state-owned Eritrean National Mining Corp, date back to 2008 but are now the subject of a class action lawsuit at British Columbia's Supreme Court.
Eritrean plaintiffs, living in exile in Ethiopia, say in the lawsuit filed last November they were forced to build the only operating mine in the Horn of Africa nation during national service, enduring filthy conditions, little food or barely paid.
Although Nevsun was not directly responsible for hiring local staff - that was done through local contractor firm Segen - plaintiffs argue the Canadian company was complicit in their servitude, a claim the Vancouver-based company denies.
Lawyers representing the plaintiffs would not discuss how much money they are seeking from the company.
Although accusations about Bisha date back seven years, this is the first time workers have tried to take legal action outside Eritrea, which lawyers say could act as a warning to foreign companies working with regimes accused of human rights abuses.
"The case is still in its preliminary stages .. (but) if the plaintiffs win, it will set a precedent," University of Ottawa law professor Penelope Simons, a human rights legal specialist, told the Thomson Reuters Foundation.
"So far very few of these types of cases have proceeded to trial ... Where a government systematically uses forced labour and a corporation goes into business with that government, there is a significant risk the corporation will become complicit."
Nevsun has repeatedly stated that none of the workers at Bisha, which started operations in 2011, were army conscripts and said it will "vigorously defend itself" against the lawsuit. The next court hearing is set for January.
But the former construction official, a citizen of another African country, told the Thomson Reuters Foundation by phone that Eritreans conscripted into the military were forced to work at Bisha, 180 kms (110 miles) from the capital Asmara.
"There were as many as 500-600 conscripts working in the first round of construction," the former official said in his first interview since leaving Eritrea, requesting anonymity.
"The heavy machinery operators wore military uniforms in the beginning," he said, adding that they lived in a separate camp.
The Thomson Reuters Foundation could not reach exiled Eritrean plaintiffs for comment.
Eritrea's Ministry of Energy and Mines, the body responsible for overseeing the Eritrean National Mining Corporation, did not respond to interview requests.
CONFLICTING REPORTS
Eritrea introduced compulsory military service in 1995, saying it would benefit the nation, which won independence from Ethiopia in 1993 after years of war and deep-rooted poverty.
But human rights campaigners argue the open-ended programme - the average service lasts more than six years, according to a 2014 study - constitutes forced labour and thousands of Eritreans flee every year to avoid the draft.
The Eritrean ministry of defence, which is responsible for the conscription programme, could not be reached for comment.
The use of conscripted labour in mining in Eritrea was first reported by campaign group Human Rights Watch in 2013.
A United Nations Commission of Inquiry in June this year also said it had found evidence during a year-long investigation that forced labour had been used in the construction of the Bisha mine under Eritrea's national service programme.
"We were under the control of our direct commanding officers," a former conscript who worked at Bisha told U.N. investigators, adding he was paid about $43 per month.
Nevsun has repeatedly denied the claims and described the U.N.'s human rights allegations as "sensational", saying U.N. investigators had not even visited the mine and based the report on interviews with Eritreans outside the country.
U.N. officials behind the report refused interview requests.
The legal battle over workers at Bisha comes as Eritrea's weak economy banks on revenues from its resource sector and attracting mining firms from Australia, Canada and China.
The involvement of Eritrean state-backed contractor Segen Construction in these projects has come under scrutiny, with the company accused of using conscripts in harsh working conditions and suggestions the government insists Segen is involved.
Segen Construction did not respond to calls or emails.
The Canadian court case centres on Bisha's use of Segen.
Joe Fiorante, the lawyer representing alleged Eritrean victims, said Nevsun was negligent in partnering with Segen as the main sub-contractor building the mine from 2008 to 2010 and should pay damages under Canadian law.
"The risk of forced labour being used in Eritrea was well known prior to the construction of the mine," Fiorante told the Thomson Reuters Foundation.
"That crosses the line from operating in a challenging environment into something unlawful for a Canadian company."
But Nevsun, which runs only the Eritrea project, recently released an independent 70-page human rights audit stating that "national service workers are not permitted at the Bisha Mine" and that screening ensures subcontractors were not using conscripts.
INVESTMENT FOR BENEFIT
Nevsun spokesman Todd Romaine could not comment on the former construction official's specific allegations because of ongoing litigation, but defended the human rights monitoring of the company and its subcontractors.
"The Eritrean government has taken proactive steps to make sure their mining environment is conducive to international business," Romaine told the Thomson Reuters Foundation.
"The government indicated right from the get-go that national service was never to be used in the mining sector."
Asked if Nevsun could have worked with another construction firm due to concerns about forced labour at Segen, he said: "Eritrea has rules on supply chain and localization efforts and we have to adhere to the government's wishes."
Romaine stressed the benefit of foreign investment in one of the world's poorest nations. Eritrea is ranked 182 of 187 nations on the U.N.'s Human Development Index.
He said he has seen progress in Eritrea's labour record during his visits, with foreign investment helping to create more stable jobs and critical infrastructure which should make Eritreans less likely to board overflowing boats for Europe.
But the former site official and a former U.S. ambassador are not convinced that Nevsun could accurately verify who had completed national service and who was forced to work.
"Can you operate in Eritrea without benefiting from forced labour? Probably not," Ron McMullen, the former U.S. ambassador to Eritrea, told the Thomson Reuters Foundation. "No company working there can claim to be lily white."
(Reporting By Chris Arsenault, Editing by Belinda Goldsmith; Please credit the Thomson Reuters Foundation, the charitable arm of Thomson Reuters, that covers humanitarian news, women's rights, trafficking, corruption and climate change. Visit www.trust.org)
Our Standards: The Thomson Reuters Trust Principles.
