However, representatives on the Permanent Mandates Commission argued that the activities of the BPC on Nauru were exploitative and not to the benefit of Nauruans.
[2] In 1900, the German colonial administration of Nauru granted phosphate rights to British businessman John T. Arundel's Pacific Islands Company (PIC).
[3] Production commenced in 1906, largely relying on indentured labour, with Australia and New Zealand as the primary markets.
[6] From 1919 the responsibility for the welfare of the people of Nauru and Banaba, the restoring of land and water resources lost by mining operations and compensation for environmental damage to the islands was under the control of the governments of United Kingdom, New Zealand and Australia.
After more than a decade, the case finally came to an end, with the Banabans only being awarded £1 and were still made to pay their own legal fees of more than £300,000.
The first European to recommend mining of phosphate for commercial exploitation was Sir John Murray, a British naturalist, during the 1872–76 Challenger expedition.
[11] John T. Arundel and Lord Stanmore, directors of PIC, were responsible for financing the new opportunities and negotiating with the German company that controlled the licences to mine in Nauru.
[12] Following the Nauru Agreement of 2 July 1919 the interests of the PPC in the phosphate deposits in Nauru and Ocean Island were acquired by the governments of the United Kingdom, Australia and New Zealand, which carried out mining under the direction of the Board of Commissioners, which represented the three governments.