Santiago (March 21, 1997) --Yesterday, the Chilean Supreme Court overturned the Chilean government's approval of the Rio Condor Project, a $350 million logging project in Tierra del Fuego proposed by the US based Trillium Corporation. In two separate decisions, the Supreme Court ruled that the National Commission for the Environment (CONAMA) and the Regional Commission for the Environment of Tierra del Fuego (COREMA) did not have enough evidence to declare the Trillium project environmentally sustainable. The Supreme Court cited Chile's 1980 Constitution which ensures every Chilean the right to live in an environment free of contamination.

Although Trillium conducted an environmental impact assessment and submitted this report for approval voluntarily, CONAMA and COREMA violated the Chilean Law on the Environment by arbitrarily endorsing the project without adequately studying possible adverse impacts. This is due in part to the three-year delay in drafting a final set of regulations which dictate what type of projects CONAMA can or cannot approve.

The Chilean Law on the Environment was passed by Congress in 1994 and authorizes CONAMA to evaluate and monitor new development projects for their environmental impacts. Unfortunately, the absence of environmental guidelines has caused CONAMA and COREMA to use less than appropriate methods of judging a project environmental friendly.

The Rio Condor Project is based in the pristine forests of Tierra del Fuego at the southern tip of the continent and involves 270,000 hectares of forest. Trillium Corp. has already invested $60 million in the initial preparations and the studies regarding the project.

The Supreme Court's decision carries important implications for other major development projects recently approved by CONAMA, including the $430 Million Ralco hydroelectric dam proposed by ENDESA, SA. The Supreme Court's decision indicates the urgency for a clear system of regulations to evaluate environmental impacts of development projects in Chile.