BackOpinion | Positives of the UN treaty on biz and human rights
The draft treaty on businesses and human rights gets fuzzier with due diligence
Premium
Here’s more on the proposed United Nations-shepherded treaty to hold transnational businesses accountable for human rights violations.
This week we address matters related to civil and criminal liability, due diligence, jurisdiction and reciprocity—a judgment in one country influencing litigation in a similar case in another.
The latest draft of the treaty, submitted in July, harks back to the UN Guiding Principles on Business and Human Rights of 2011. That’s toothless: Urging businesses to “respect human rights" and states to “guarantee" the right of victims and “investigate" human rights violations and charge offenders according to “domestic and international laws".
Businesses and states aren’t bound by UN declarations, even those that have signed the UN Global Compact—a fashionable public relations lever that even has as signatories some habitual corporate offenders who undertake to practice sustainable, responsible business and “respect the protection of internationally proclaimed human rights" and “make sure that they are not complicit in human rights abuses". Or bound by a resolution of UN’s Human Rights Council in June 2016, titled, “Business and human rights: improving accountability and access to remedy;" four A4 sheets’ worth of platitudes and “guidance" to businesses and states.
But there are some aspects of the latest draft treaty that are evidently worth appreciating. I was shown it by a fine observation, dated 26 July, by Julianne Hughes-Jennett, Peter Hood and Alison Berthet, associates of the business and human rights practice of the Washington D.C.- and London-based international law firm Hogan Lovells LLC.
In terms of legal minutiae, they are of the opinion, for instance, that while “private persons (natural or legal)" would not be directly bound by treaty, they would continue to “subject to civil and criminal liability under the jurisdiction of the State Parties" that sign on to the treaty. (That begs another question: what if a state chooses to not sign on? But enough cynicism.)
The matter of corporate liability has progressed, the Hogan Lovells team maintains, especially given the “lack of consensus on whether corporate liability exists for crimes under international law at all". The current draft “requires" states to provide criminal, civil and administrative liability for human rights violations by transnational businesses in their jurisdiction “for effective criminal and non-criminal sanctions, including monetary sanctions".
The draft now clearly proposes civil liability for business operations in which the transnational entity has direct control, or is connected “sufficiently closely"; or when there is evidence of “strong and direct" link to a human rights transgression.
Criminal liability in the draft treaty “specifically extends" to “principals, accomplices and accessories, as defined by domestic law", the Hogan Lovells analysis maintains. But this will likely prove tricky, it says, different states have different laws for primary and secondary liability: “The same conduct may constitute an offence in one state and not in another". As far as secondary liability goes, Article 25 of the Rome Statute of the International Criminal Court (ICC) may already have that covered.
It gets fuzzier with due diligence. The draft insists that states pressure businesses to undertake due diligence of “all contractual relationships which involve business activities of transnational character", and covers subsidiaries, associates, supply chain links from operations to products and services. But, as the Posco episode in Odisha showed—as did the Vedanta episode in that state’s Lanjigarh area—it took non-governmental activism to bring issues to a head.
The “state" was a facilitator of human rights violations with aggressive land acquisition using police and the administrative machinery.
The draft treaty also brings in the aspect of reciprocity. While states are free to apply their own laws, they would need to recognize precedence of a ruling or judgment in another state for a similar issue.
This is potentially dynamite. But so were several provisions in the formative years of the International Chamber of Commerce and the International Court of Justice. It is perhaps unrealistic to expect anything less from a proposed global treaty on business and human rights.
This column focuses on conflict situations and the convergence of businesses and human rights and runs on Thursdays.
Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!
