Lithium in International Law: Trade, Investment, and the Pursuit of Supply Chain Justice

Abstract

Projected demand for renewable energy storage has underlined the importance of lithium-ion batteries, reflected in concern over ‘supply chain security’ for critical minerals. Yet, other voices have called for ‘supply chain justice’ among governments, firms, and communities affected by the social and environmental externalities of lithium extraction. To anticipate disputes and draw a baseline for further research, this article surveys the relevant rules of international law that presently regulate major operations of the lithium industry. First, the material dimensions of lithium are transformed into a workable object of international law, focusing on viable reserves (as opposed to all proven resources) and the analytical priority of territorial jurisdiction. Second, the regulatory regimes of four States with major reserves—Chile, Australia, Argentina, and China—illustrate recurring challenges, such as incentivizing investment in value-added production and the discontent of Indigenous communities. Third, the trade and investment treaties of these States help us to map an international legal framework for the lithium industry, focusing on the World Trade Organization, the Comprehensive and Progressive Agreement for Trans-Pacific Partnership, and the Regional Comprehensive Economic Partnership. But such treaties may be interpreted in light of a State’s obligations concerning human rights, environmental protection, and Indigenous peoples, giving legal form to the pursuit of supply chain justice in the energy transition.

Environmental impact of direct lithium extraction from brines

“…Starting in the early 2000s, environmental concerns have been raised about lithium mining from continental brines by local populations, non-governmental organizations and the press, first in Chile where operations started 10 years earlier and then in Argentina 18,[21][22][23][24][25][26] . Communities close to these operations are all rural, and environmental conditions are very poorly documented 26 .…”

Gobernanza del Litio en la región Puno: Oportunidades y Desafíos

“…Entre ellos se incluyen la propiedad, el acceso a los recursos, los métodos de extracción, el uso y la conservación. La mayoría de estas actividades se rigen por normativas mineras, que abarcan constituciones nacionales, leyes mineras y reglamentos específicos (Hailes, 2022). Sin embargo, la regulación y promoción del procesamiento de sales de litio con fines de fabricación entran en el ámbito de las políticas industriales o de producto y no son competencia de la normativa minera.…”

Łańcuchy wartości w przemyśle surowcowym na potrzeby nowoczesnych technologii – przykład litu

“…Furthermore, in the european context, lithium is the third most import-dependent raw material (import reliance: extraction -81%, processing -100%) (Grohol et al 2023). Therefore, it is highly vulnerable to a range of supply chain-related threats, as its production and processing are geographically concentrated and often dominated by local regulatory systems (Hailes 2022).…”