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Detailed Disclosure Ruling over a Major Environmental Pollution Accident at a Zijinshan Gold & Copper Mine

Not long ago, Xinluo District People’s Court of Longyan City, Fujian Province pronounced the judgement of first instance regarding the major environmental pollution accident at Zijinshan Gold & Copper Mine of Zijin Mining Group Co., Ltd.

A reporter from the Legal Daily learnt from the court of first instance that the court had issued Zijinshan Gold & Copper Mine of Zijin Mining Group Co., Ltd a fine of RMB 30 million, the five responsible persons of Zijin Mining Group Co., Ltd. (including Chen Jiahong, former Vice President of the Group) to fixed-term imprisonment (36 months – 54 months) and fines amounting to RMB 200,000 to 300,000.

On February 13, the court of first instance revealed the detailes of the judgment of the case exclusively to the Daily.

Leak of Acidic Wastewater Containing Copper up to 9,176 m3

On December 22, 2010, Xinluo District People's Procuratorate of Longyan City, Fujian Province filed a lawsuit with the Xinluo District People’s Court regarding the major environmental pollution accident at the Zijinshan Gold & Copper Mine of Zijin Mining Group Co., Ltd. The court accepted the case on December 28, 2010 and thereafter formed a collegial panel and conducted a public trial of the case.

Xinluo District People's Procuratorate accused in the bill of indictment: in March 2008, the Prosecuted entity Zijinshan Gold & Copper Mine didn’t conduct any investigation and attestatioin in advance and got through No. 6 observation well to the drainage pool without authorization. In September 2009, Fujian Provincial Department of Environmental Protection carried out a suprise environmental protection inspection over Zijinshan Gold & Copper Mine and pointed out the problem that “the draining tunnel where the sump well is located had been gone through to the daily rainwater drainage pool to Ting River and if the wastewater cannot be pumped out sufficiently during the storm season, it could be drained into the Ting River together with the rainwater”. The department required the Mine to make a fundamental correction. However, the Mine did not attach enough importance to the problem, failing to take sufficient and thorough corrective measures. They only built a retaining 2.5m high inside the drainage pool rather than making a complete blockage, thus leaving hidden threats.

The bill of indictment described: In the middle and latter part of June 2010, the amount of precipitation reached 349.7mm in Shanghang County. On July 3, 2010, the impermeable membrane of the wastewater pit of the Copper Mine Hydrometallurgy Plant affiliated to the prosecuted entity Zijinshan Gold & Copper Mine (formerly known as Copper Dressing and Smelting Works of Zijinshan Gold & Copper Mine) cracked, leading to acidic wastewater containing copper to leak and flow into the No. 6 observation well. The wastewater flowed through the well into the drainage pool via the passage, having got through to the pool and breached the retaining wall inside the pool and into the Ting River. This caused the leak of 9,176m3 of acidic wastewater containing copper, resulting in a major environmental pollution accident – the water of the Ting River downstream of the Copper Mine Hydrometallurgy Plant of Zijinshan Gold & Copper Mine was contaminated and fish farmed downstream died in large amounts.

The prosecution accused five defendants, including Chen Jiahong, former Vice President of Zijinshan Gold & Copper Mine of Zijin Mining Group Co., Ltd, Zijin Mining Industry and Huang Fucai, former Section Chief of Environmental Protection and Safety Office of the Zijinshan Gold & Copper Mine, claiming that the five defendants had all committed the crime of causing a major environmental pollution accident.

“Person-in-charge” and Person Directly Responsible Sharing Liability of the Offense

Xinluo District People’s Court pointed out in the ruling issued against this major accident of environmental pollution that:

The prosecuted entity Zijinshan Gold & Copper Mine of Zijin Mining Group Co., Ltd violated national regulations, failed to attach sufficient importance to the problem of environmental protection and safety in the enterprise during production, and didn’t take effective measures to fundamentally remove hidden environmental protection problems. Consequently, dangerous waste leaked into the Ting River, thus contaminating the waters of the Ting River. The accident led fishery farmers to lose RMB 22.206 million due to the death of their fish, the urban area of Shanghang County, Fujian Province to cut off the water supply for one day, and 30.8444 million kilograms of fish to be killed. The consequences are very serious.

Through the trial, the court was of the opinion that: The defendants Chen Jiahong and Huang Fucai were the persons-in-charge and directly liable for the accident, and the defendants Lin Wenxian, Wang Yong and Liu Shengyuan were persons directly responsible for the accident. They were directly liable for the accident and their behaviors had constituted the crime of causing a major environmental pollution accident.

The court confirmed: After the occurrence of the accident, the prosecuted entity had, prior to the investigation by any judicial authority, reported to the competent government authorities in oral and written form, and before and after the case was filed by the judicial authority, the responsible persons and defendants of the prosecuted entity investigated and inquired all presented and stated the actual process of the case according to the facts. The prosecuted entity showed initiative and voluntarily appeared, so it could be ascertained as a confessing entity in the case. The five defendants stating the case facts could be ascertained as confessing persons under the law.

However, in view of the confessing fact of the prosecuted entity and the five defendants, the court was of the opinion: Considering the great impact and extremely serious consequences caused by the case, all defendants can not be sentenced to lighter punishment but can be given mitigation of penalty below minimum statutory prescript. Based on the roles in the crime of the case and repentance performances of all defendants, and considering the great impact and extremely serious consequence caused by the case, the defendants were all given mitigation of penalty below minimum statutory prescript. Considering that the prosecuted entity had compensated the economic loss of fish net cage farmers, the prosecuted entity and the five defendants were all punished to a lighter extent.

The Proposal of “Major Commendable Performance” was not Adopted

The journalist from Legal Daily learnt that the five defendants, including Chen Jiahong, former Vice President of the prosecuted entity Zijinshan Gold & Copper Mine of Zijin Mining Group Co., Ltd and Zijin Mining Industry and Huang Fucai, former Section Chief of the Environmental Protection and Safety Office of the Zijinshan Gold & Copper Mine all engaged attorneys to appear in the litigation as defenders.

The entrusted attorney of the defendant Chen Jiahong was of the opinion: Chen Jiahong was active rushing to deal with the accident after it happened, so he should be ascertained as having a major commendable performance.

As for the above proposal, Xinluo District People’s Court was of the opinion: active participation in handling the emergency was the duty of Chen Jiahong. His outstanding contribution in handling the emergency might only attest that the defendant Chen Jiahong had good repentance performance rather than a comendable performance in relation to criminal law. Therefore, the opinion of major commendable performance proposed by his attorney was not sufficiently prooved, and the court refused to accept this opinion.

The entrusted attorney of the defendant Lin Wenxian, former Factory Manager of the Copper Mine Hydrometallurgy Plant of Zijin Mining Industry argued that Lin Wenxian should only bear partial liability since he had only played an insignificant role in the accident. The attorney suggested the court to impose lighter punishment, and to allow him to apply for probation.

The entrusted attorney of the defendant Wang Yong, former Factory Vice Manager of the Copper Mine Hydrometallurgy Plant of Zijin Mining Industry argued a not guilty plee defense for him.

The entrusted attorney of the defendant Liu Shengyuan, former Director of the Environmental Protection Workshop of the Copper Mine Hydrometallurgy Plant of Zijin Mining Industry was of the opinion: Liu Shengyuan had, obviously, played an insignificant role in the accident, and he was the least guilty of the five defendants. Moreover he performed a comendable service.

In reference to the defending examples of the so-called “major commendable performance” and “commendable service”, Xinluo District People’s Court refused to accept such opinions on the grounds of evidence insufficiency and noncompliance with facts in the first instance.

RMB 30 million Fine Imposed in the Court of First Instance

Xinluo District People’s Court, in the ruling issued on January 30, imposed to Zijinshan Gold & Copper Mine of Zijin Mining Group Co., Ltd a fine of RMB 30 million which shall be offset against the administrative fine of RMB 9,563,130 paid previously.

As understood by the journalist of the Legal Daily, on September 26, 2010, Fujian Provincial Department of Environmental Protection imposed the administrative punishment of RMB 9,563,130 fine over the prosecuted entity Zijinshan Gold & Copper Mine of Zijin Mining Group Co., Ltd. After the accident happened on July 3, 2010, the prosecuted entity Zijinshan Gold & Copper Mine of Zijin Mining Group Co., Ltd respectively entrusted Shanghang County People’s Government and Yongding County People’s Government to compensate for the economic losses of the relevant fish farmers up to RMB 22.206 million in total.

Xinluo District People’s Court made the first instance judgment to the five defendants involved in the case. The court had sentenced Chen Jiahong, former Vice President of the Zijinshan Gold & Copper Mine of Zijin Mining Group Co., Ltd to fixed-term imprisonment of three years and a fine of RMB 200,000; Huang Fucai, former Section Chief of the Environmental Protection and Safety Office of the Zijinshan Gold & Copper Mine to fixed-term imprisonment of three years and six months imprisonment and a fine of RMB 200,000; Lin Wenxian, former Factory Manager of the Copper Mine Hydrometallurgy Plant of the Zijinshan Gold & Copper Mine to fixed-term imprisonmentof four years imprisonment and a fine of RMB 300,000; Wang Yong, former Factory Vice Manager of the Copper Mine Hydrometallurgy Plant of the Zijinshan Gold & Copper Mine to fixed-term imprisonment of four years imprisonment lasting and a fine of RMB 300,000; and Liu Shengyuan, former Director of the Environmental Protection Workshop of the Copper Mine Hydrometallurgy Plant of Zijinshan Gold & Copper Mine to fixed-term imprisonment of four years and six months imprisonment and a fine of RMB 300,000.

Background Link

Event

Zijin Mining Industry is the biggest gold manufacturer in China, known as the biggest gold mine in China, and is a Fortune Global 500 company. In December 2003, the company successfully listed on the HK stock market and returned to A share market in April 2008.

At 15: 50 on July 3, 2010, the water level of the wastewater pit of the Copper Mine Hydrometallurgy Plant of Zijinshan Gold & Copper Mine went down in an abnormal way and the acidic wastewater containing copper in the pit leaked out. Some wastewater entered the Ting River, contaminating the water in some reaches of the river killing a great number of fish. According to preliminary estimates, the amount of wastewater leaked was about 9,100m3.

After the accident, the Ministry of Environmental Protection, Fujian Provincial Department of Environmental Protection, and Longyan Municipal Government and the Environmental Protection Department established a joint investigation team. Based on the investigation of the Ting River contamination accident, due to the leak of wastewater from the pit of the Copper Mine Hydrometallurgy Plant of Zijinshan Gold & Copper Mine affiliated to Fujian Zijin Mining Group Co., Ltd, the joint investigation team was of the opinion that the accident was a major rapid environmental event because the impermeable membrane of the wastewater pit of the enterprise leaked, resulting in a large amount of wastewater flowing through the illegal passage into the Ting River.

The joint investigation team preliminarily found three causes leading to the accident by way of debriefing, reviewing materials, site investigations, investigation and evidence collection:

First, the damage to the impermeable membrane of the enterprise directly resulted in the leakage of wastewater. Second, the No. 6 observation well had illegally gone through the drainage pool, leading to leaked wastewater flowing into the Ting River. Third, the damage to the monitoring equipment resulted in the accident not being discovered in a timely manner.

Chen Jiahong, former Vice President of Zijin Mining Co., Ltd. and former manager of Zijinshan Gold & Copper Mine, male, 43 years old, graduated from the business administration specialty of China University of Geosciences. After he joined Zijin Mining Group in July 1994, he successively held Deputy Manager, Standing Deputy Manager, Mine Manager (and Deputy Commander in Chief of the Head Office of Technical Improvement Projects) of the Zijinshan Gold Mine, Deputy General Manager of Zijin Mining Group and Director and General Manager of Xinjiang Asele Copper Co., Ltd and Board Chairman and General Manager of Xinjiang Zijin Mining Industry Co., Ltd. He has worked as the Vice President of Zijin Mining Group since August 2006.

It is reported that the annual salary of Chen Jiahong was RMB 1,274,600 in 2009, and he purchased 2 million Zijin Mining Group shares through a block purchase in 2009.

(source: Legal Daily)