Towards an International Convention on Business and Human Rights (Part I)

[Carlos Lopez is a Senior Legal Advisor at the International Commission of Jurists.]

The first draft of one of the most important international human rights treaties of recent years, and instrument addressing on business and human rights has just been released in Geneva by Ecuador’s Ambassador acting as Chair of the process. The “zero draft” strongly focuses on the key issue of access to justice and remedy for those who allege harm by a business enterprise and it is likely to please many and displease others, but it will surely contribute to a change of tone and character of deliberations so far focussed primarily on political and procedural considerations. In this blog (in two parts) we carry out a preliminary broad analysis of the salient elements of the draft treaty.

The draft is published in the context of the establishment by the United Nations Human Rights Council in Geneva through resolution 26/9, in 2014 of an Intergovernmental Working Group created to elaborate a “legally binding instrument to regulate, in international human rights law, the activities of transnational corporations and other business enterprises” (a draft treaty on business and human rights). The Working Group has held three sessions, with its next session scheduled for October 2018.

At first glance the draft treaty adopts reasonable choices in some of its overarching aspects and its overall structure. The chosen model is a treaty focussed on access to remedy and justice by victims of corporate abuse and legal accountability of transnational corporations. Other options that had been proposed included a framework treaty that would basically provide for general principles, procedures and perhaps some institutional arrangements, or a treaty that would focus on creating or recognizing under international law direct human rights obligations for businesses. At the moment –in this project elaborated by the Ecuadorian Ambassador- business human rights obligations are only recognized as such in the preamble:

Underlining that all business enterprises, regardless of their size, sector, operational context, ownership and structure shall respect all human rights, including by avoiding causing or contributing to adverse human rights impacts through their own activities and addressing such impacts when they occur.

The Role of the State

Although the proposed treaty would create obligations only for States to take legislative and other measures to make business legally accountable and for victims to have access to remedy, the State role and the need of legal accountability and remedies also in the context of State commercial activity is generally overlooked. Very often, States enter into joint ventures with private investors (such as in Nigeria with Shell), or otherwise facilitate and support business operations in mining, oil and gas sectors, or provide security to the operational sites, and many of the abuses that are usually reported involve private business and State complicity. Regrettably the draft treaty pays scant attention to the role of the State and the need for accountability and remedy in that context. Further, some provisions seem to go in the opposite direction. For instance, Article 13 on consistency with international law presents astonishing wide-ranging and somewhat imprecise clauses that leave untouched existing obligations for States.

The focus on remedies and accountability for business enterprises’ abuses is commendable and reflects the desire of many of those advocating for a treaty to tackle what they consider the most pressing issues in the field of business and human rights: those that relate to the ability of society at large, and most concretely individuals and groups that are impacted by business operations, to hold businesses legally accountable for abuses that may be committed in their operations, and to provide effective access to justice and reparation to those who allege a harm. The structure, including the headings tackles head on some of those issues, among others: legal liability of corporations, victims’ rights, jurisdiction, and mutual legal assistance. However, the way the draft treaty deals with those issues is uneven, imprecise and at times obscure. In any case, having a full draft in front of our eyes undoubtedly helps in the debates and the eventual improvement of the draft.

Scope

In respect of the ratione materiae, the draft fails to provide clarity on what rights are to be covered under the treaty. The formulation in draft article 3.2 that the Convention is to apply to “all international human rights and those rights recognized under domestic law”, flies in the face of the principle of legality. “All international human rights” might have been delimited by reference to treaties or custom, or by reference on whether they are binding on the State Parties It is extremely difficult to see how a State could even go about implementing a treaty with as open ended an prescription as article 3.2.

Regarding scope of personal jurisdiction, pursuant to 3.1. the zero draft addresses only the conduct of transnational corporations and other business enterprises that have “transnational activities”. Actions or omissions by businesses acting only within domestic jurisdictions are omitted. The zero draft treaty defines “business activities of transnational character”, those for- profit activities that “take place or involve actions, persons or impact in two or more national jurisdictions”. In such way it implements a footnote that was inserted into resolution 26/9 of 2014 which limited the scope to transnational business operations to the detriment of a broader scope including all business enterprises advocated by some States and NGOs and reflected in the UN Guiding Principles on Business and Human Rights.

The limited scope adopted in the process and in the published draft has been a matter of contention since the start of the process. The scope obviously impacts on the reach and consistency of several sections and articles of a draft treaty whose focus is on the definition of grounds of legal liability for businesses (mainly civil and criminal) and access to remedy and reparation by the alleged victims of company abuse. Its disruptive effects can be seen for instance in the definition of corporate criminal offences that States Party are required to enact domestically. Under the current scope and definitions only criminal conduct (no matter its seriousness) that occurs in more than jurisdiction may be punishable, which may lead to the absurd outcome that egregious criminal conduct (for instance crimes against humanity) may not be punishable if committed by businesses acting only within one jurisdiction.

The draft could, for example, have inserted some mitigating clauses such as the one included in the UN Convention on Transnational Organized Crime (Article 34.2) with the intention to mitigate similar problems in the context of that treaty. An adapted provision would read:

The offences established in accordance with article 10.8 of this Convention shall be established in the domestic law of each State Party independently of the transnational nature of the business activity, except to the extent that the nature of the crime would require the transnational element.

The clause above may also be broadened to refer not only to corporate criminal liability but to other measures that are required from companies such as human rights due diligence (Article 9)

One thing is clear, the draft treaty, while clearly deficient here, will reassure those concerned that the operations of transnational corporations may not be properly addressed if they were to be embedded within broad and vague norms that would address “all business enterprises” without distinctively addressing the specific problems that arise in the context of transnational operations.

To be continued…