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ArticleName Compensation for environmental damage in the economy of mining
DOI 10.17580/gzh.2017.08.11
ArticleAuthor Tulupov A. S.

Institute for Market Problems, Russian Academy of Sciences, Moscow, Russia:

A. S. Tulupov, Head of Laboratory, Doctor of Economic Sciences,


The mechanisms of compensation for the mining-induced environmental damage under the existing legal framework are discussed: pollution charges; administrative, property, disciplinary and criminal liabilities; cost recovery method and a methodological support. It is shown that the current mechanism of the environmental damage compensation is of the fiscal nature, effective incentives to reduce environmental pressure are absent and the money compensation is not answerable to the actual damage value. It is found that the legislation in effect imposes fines provided by all indemnification tools on a mining company in case that it violates the environmental laws and charges the company with the duty to eliminate the damage of the environmental impact, which leads the mining company to a significant financial stress in excess of the factual value of the caused damage. The revealed contradictions reinforce the need for improving the current system of compensation of harm due to the violations of the environmental legislation. However, even given the existing system of the environmental charges nonconforming with the actual damage, mining companies should know all features of the compensation mechanism in order to prevent their activities from extra money sanctions and to develop appropriate nature-conservative measures to reduce the cost loading.
The study has been supported by the Russian Foundation for Basic Research, Projects No. 17-02-00010a.

keywords Mining, environmental damage, environmental economics, sustainable development

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