Hyundai in Nošovice
In September 2005, Hyundai Motor Company announced that the Czech Republic was among countries considered as the location of the company’s new production plant. The hottest candidate was Nošovice, a small town close to Žilina, Slovakia, where Hyundai’s affiliate KIA had already completed its own factory. It offered some 260 ha of farmland used at that time by a cooperative of small owners who produce the well-known Nošovice sauerkraut. Although the Region of Moravia and Silesia offered other locations, including Mošnov (and an offer from Holešov appeared later as well) the Nošovice location was the most popular with Hyundai’s management, not least because of its beautiful setting under the Beskydy mountains.
The pressure to sell land was enormous but the hard core of Nošovice landowners, headed by the cooperative’s managers, was firmly against for a long time. However, the region then came up with an idea that put the negotiations and the overall atmosphere in Nošovice and the surrounding area to a completely new dimension. All families in Nošovice and Nižní Lhoty were offered CZK 100,000 in compensation for the negative effects of construction works. To top it off, Prime Minister Paroubek ”warned” that land would be expropriated if owners don’t sell it voluntarily.
However, the cooperative insisted on conditions that would allow it to farm in the future and demanded compensations worth hundreds of millions of korunas. However, the potential agreement with the cooperative was a crucial factor that other landowners would base their attitude on. These and other citizens of Nošovice who opposed the idea to build a Hyundai factory in the town at first wrote a petition against the zone, collected the signatures of more than 360 locals and eventually founded an association called Land for Life. Lawyers of the ELS’s GARDE – Global Responsibility program helped them write a letter to Huyndai asking the company to stand up to its declared principles of social responsibility and reconsider its decision to place its investments in Nošovice in the light of the negative environmental and social consequences.
Due to the endless talks with the cooperative and landowners, the Region announced on December 12, 2005 that it would stop pre-construction work in the zone. Nevertheless, Governor Tošenovský set a new deadline (December 16) for securing the acquisition of land from all owners. On Wednesday December 14, the Region reached a compromise with the cooperative and the farmers agreed to sell their land. On December 15, 2005, one day before the new deadline, key landowners received anonymous letters threatening to kill them and their families due to their decision not to sell. In this tense atmosphere, all the remaining landowners eventually decided to give up their property. The Region had no scruples to sign this agreement although the Law of the Czech Republic clearly states that contracts signed under death threat are null and void in their entirety.
As soon as the land was sold, the car plant’s EIA procedure began focusing on all three locations under consideration (Nošovice, Mošnov, Holešov) without comparison of their respective environmental conditions. This goes against the very principle of the EIA process as defined by law and EC Directive 85/337/ES. A number of permits for the zone have been granted even before the EIA process was completed.
Negotiation with Hyundai
Declaration of understanding is the name of an agreement signed by Hyundai Motor Manufacturing Czech, s.r.o. (HMMC), the Region of Moravia and Silesia, the Ministry of Industry and Trade and CzechInvest on the one hand and the Environmental Law Service and other NGOs - Deti Zeme, Beskydcan and Puda pro zivot on other hand. After more than three months of very complicated talks initiated by HMMC in November 2006 a Declaration was signed in the hope of removing, mitigating and compensating for the negative effects of the new HMMC factory and the Nosovice industrial zone.
- the Region of Moravia and Silesia, the Ministry of Industry and Trade and CzechInvest have promised to stop work on new strategic industrial zones in the region - Dolní Lutyne and Silherovice and focus instead on regeneration of unused areas in existing vacant industrial areas (known as brown fields) and in the future give preference to regeneration over creation of new green field industrial developments.
- HMMC has promised to develop a traffic plan that would limit negative effects on the environment, restrict the number of heavy vehicles over 7.5 tonnes on weekends and public holidays, adopt such landscaping activities inside the factory compound that would mitigate countryside changes orto establish a foundation supporting civic society and community programmes near the Nosovice zone, invest CZK 20 mln in the foundation and then add several millions each year, adopt the EMAS II environmental management and audit system or report on long-term sustainability according to the Global Reporting Initiative standards.
- NGOs have promised to respect all previously granted permits and opinions regarding the Nošovice industrial zone and the HMMC plant and to settle all their objections against project documents and administrative decisions directly with HMMC and the Region without further legal appeals and complaints.
- furthermore, the agreement includes a sanction mechanism that requires the publication of an announcement regarding a violation of Declaration obligations.
This is the first time a complex agreement with a multinational corporation was achieved in the Czech Republic even before construction of a new plant begins. At the same time, it represents an important step in the dialogue with representatives of public administration and local governments.