BHP Group Limited has been found liable by the English High Court under Brazilian law for the 2015 Fundão dam failure. This landmark decision follows a five-month first stage trial of a UK group action filed by over 600,000 claimants seeking damages linked to the disaster. Despite this ruling, BHP plans to appeal the decision and continues to defend itself in the UK group action.
BHP Group Limited found liable by the English High Court for the 2015 Fundão dam failure
Extensive Remediation and Compensation Efforts in Brazil
Since the disaster, BHP Brasil, a subsidiary of BHP Group, along with Vale S.A. and Samarco Mineração S.A., entered into a comprehensive US$32 billion agreement with Brazilian public authorities in October 2024. This Brazil Agreement represents a full and final settlement of significant claims related to the dam failure. To date, over 610,000 people have been compensated, with approximately 240,000 claimants from the UK group action already receiving compensation in Brazil and providing releases for related claims.
Fundão Dam Site (pre- and post-failure comparison)
Legal Findings and Impact on Claims
The English High Court found BHP liable under Brazilian environmental law as a “polluter” and at fault under the Brazilian civil code. However, the Court dismissed claims of liability under Brazilian corporate law. Notably, waivers and releases signed by claimants compensated in Brazil remain valid, which is expected to reduce the size and value of claims in the UK group action. BHP views the UK group action as duplicative, pointing to the prior extensive remediation and compensation undertaken in Brazil under the Brazil Agreement.
Satellite image from 12 November 2015, one week after the Samarco Dam disaster
Next Stages of Legal Proceedings
The Court’s decision marks only the first phase. Subject to appeal, a second-stage trial is scheduled between October 2026 and March 2027 to assess the causation of losses claimed by the claimants. Following this, a third stage trial may be required, where individual claimants will need to demonstrate their damages before any payments are made by BHP. This third trial is not expected to occur before 2028 or 2029.
Financial Provisions and Updates
On 30 June 2025, BHP disclosed the UK group action as a contingent liability, with liability yet to be established. Following the Court’s decision, BHP updated its provision estimate to US$5.5 billion as of 31 October 2025. This reflects approximately US$1 billion spent from 1 July to 31 October 2025 on implementing the Brazil Agreement, revised obligations under that agreement, and adjustments relating to the UK group action decision and exchange rate movements. Previously, BHP had recognised a provision of US$5.8 billion for obligations under the Brazil Agreement.
BHP expects cash outflows for Samarco-related matters to largely align with prior forecasts, including US$2.2 billion for the fiscal year 2026 and US$0.5 billion for 2027. To share financial responsibilities, BHP and Vale agreed in July 2024 to each pay 50% of any amounts payable to claimants in the UK and Dutch group actions.
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Ongoing Implementation and Remediation
The remediation of the environment affected by the dam failure is substantially complete, with the resettlement of the communities of Novo Bento Rodrigues and Paracatu nearing 98% completion. BHP, BHP Brasil, and Vale continue to execute the provisions of the Brazil Agreement. This includes funding for water and sanitation, public health systems, economic recovery, local infrastructure, collective reparations for affected Indigenous and Traditional communities, Brazilian municipalities, and income support for vulnerable populations in the impacted regions.
BHP remains confident that the Brazil Agreement provides the most effective and timely mechanism to compensate persons affected by the Samarco dam failure. The company emphasises the importance of this agreement in managing and resolving claims in a comprehensive manner.
Summary
The English High Court ruling establishes BHP’s liability for the 2015 Fundão dam failure under Brazilian law but allows for further legal processes to assess damages. BHP continues to uphold its commitment to compensation through the Brazil Agreement and intends to appeal the UK court decision. The company has updated financial provisions accordingly and remains engaged in ongoing remediation and support efforts in Brazil. Future trials will further define individual claims and financial obligations related to this significant environmental disaster.
