What does the BHP Samarco deal mean?

Via USB:

Governance Agreement signed with prosecutors…

BHP Billiton, Vale and Samarco Mineracao today announced that they have reached an agreement with federal and state prosecutors regarding settlement of BRL20bn (US$6.2bn) in Civil Claims. The parties have established a Governance Agreement to renegotiate remediation and compensation programs over two years and to progress settlement of the BRL155bn (US$48bn) Civil Claim. Under the new agreement, the parties have agreed to file a petition with the 12th Federal Court to dismiss the BRL20bn, and agreed on a process to dismiss certain other public civil actions which cover the same claims as the BRL155bn Civil Claim. The new agreement will suspend the BR155bn Civil Claim for a period of two years if ratified. During the two-year period, the parties will work together to design a single process for the renegotiation of the programs and progress settlement of the BRL155bn Civil Claim.

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About the author

David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal. He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.