New Rio Doce Basin settlement: more resources, stronger protections for families, states, municipalities, the environment

Signed on October 25 by the Federal Government, the state governments of Minas Gerais and Espírito Santo, the offices of Public Prosecutors and Public Defenders, and the mining companies that caused the damage that resulted from the collapse of the Fundão Dam in Mariana, the 2024 Settlement replaces the 2016 Conduct Adjustment and Settlement Agreement (Termo de Transação e Ajustamento de Conduta / TTAC) and the 2018 Conduct Adjustment Agreement on Governance (Termo de Ajustamento de Conduta relativo à Governança / TAC-GOV). This new settlement results from intense negotiations resumed by the current federal administration since the beginning of 2023.

On Wednesday, November 6, 2024, the Federal Supreme Court of Brazil (Supremo Tribunal Federal, STF) unanimously ratified the settlement agreement concerning the Rio Doce Basin. This agreement, signed in October 2024 by the Federal Government, the states of Minas Gerais and Espírito Santo, Public Prosecutors, Public Defenders, and the mining companies, aims to address the damages caused by the 2015 Mariana dam disaster.

The text of the ratified agreement will now be forwarded to all countries with ongoing legal proceedings related to the case. The 2024 settlement represents a significant improvement over the 2022 proposal, both in scope and quality. It includes BRL 132 billion in new funding from the companies involved, with BRL 100 billion designated for transfer and management by public authorities and an additional BRL 32 billion allocated for direct implementation of remedial measures by the companies.

BENEFICIARIES — According to the 2024 settlement, the value of individual compensations and the potential number of beneficiaries have increased. If a victim chooses to accept the compensation and submits the required documentation, they will receive the payment directly within a few months. The fulfillment of individual compensation obligations will be overseen by the Public Prosecutor's Offices and Public Defenders' Offices.

RECOVERY — According to the 2024 settlement, the environmental recovery measures that must be implemented by the companies are more encompassing and include the removal of rejects, reforestation, basin recovery, and management of specified areas. These measures will be supervised by environmental agencies. Furthermore, the companies must conclude a series of measures underway, referred to as transition measures from the previous 2016 agreement.

DRAFTING — Since 2023, the Federal Government actively participated in the drafting of parts of the agreement regarding its competencies. Some enclosures were redacted by technicians and public lawyers from the ministries, as was the case of the Economic Recovery Program and Income Transfer Program (Programa de Retomada Econômica e do Programa de Transferência de Renda). In this way, the process aimed to ensure rights and confer legal security to the policies that will be managed by the Federal Government. The agreement seeks to provide greater legal certainty and clarity in its language, minimizing interpretations that could be unfavorable to the Government and the public intended to benefit from the Federal Government's actions.

SOCIAL PARTICIPATION — The settlement signed in 2024 creates the Federal Social Participation Board of the Rio Doce Basin (Conselho Federal de Participação Social da Bacia do Rio Doce). Managed by the Federal Government and with civil society participation, this board will monitor the implementation of the Settlement and make decisions regarding the use of resources for community projects. Overall, since 2023 the Federal Government has been acting in favor of the expansion of social participation in the settlement negotiation process and its future implementation.

FOCUS — The new settlement ensures that resources managed by government authorities (from the federal government and the states of Minas Gerais and Espírito Santo) are invested exclusively in areas directly impacted by the dam collapse. It prohibits the arbitrary use of resources in other regions within these states that were not affected by the disaster. However, there is an exception allowing a small portion—20% of the resources allocated to socio-environmental projects—to be used outside the Rio Doce Basin.