Memorandum submitted by Justice/International
Commission of Jurists
INTRODUCTION
1. The International Commission of Jurists
is an international human rights organisation based in Geneva.
Founded in 1952, the ICJ is dedicated to the primacy, coherence
and implementation of international law and principles that advance
human rights.
2. JUSTICE is the British Section of the
ICJ. Founded in 1957, it a UK-based human rights and law reform
organisation. Its mission is to advance justice, human rights
and the rule of law.
3. The ICJ and JUSTICE welcome the Joint
Committee's inquiry on this issue. The field of business and human
rights is an important and rapidly evolving area that is increasingly
relevant for the enjoyment of human rights by many in the UK and
in countries where UK companies operate.
4. This submission aims to provide an international
perspective based on the current debates in international human
rights forums, in particular within the United Nations, and on
the ICJ's own work on the legal accountability of companies. We
believe it is important to draw attention to the existing international
human rights obligations binding upon the UK and to the legislation
implementing those obligations. We hope that the Joints Committee's
inquiry will identify not only gaps in the current law but also
the areas for potential development. The emergence of global companies
that operate across borders and by way of an increasingly complex
web of subsidiaries, contractors, suppliers and joint ventures
poses a critical challenge to the adequacy of national legal frameworks
to protect human rights.
5. International law gives companies a significant
degree of protection for their activities , (eg through bilateral
investment treaties and trade agreements, access to international
arbitration, etc) but requires little in terms of accountability.
International efforts in recent years have yielded mixed results
but there is nonetheless a growing consensus at the international
level on the responsibilities that businesses have in respect
of human rights. The current debate takes place mainly at two
levels: (i) the clarification or development of substantive standards
and (ii) the establishment, or improved effectiveness, of enforcement
mechanisms.
DEFINING CORPORATE
HUMAN RIGHTS
RESPONSIBILITIES
6. Despite the hesitant progress made in
relation to enforcement mechanisms, there is at least broad agreement
within the international community that companies have a responsibility
to respect all human rights. Nor is the requirement on companies
to respect the full range of human rights (civil and political,
economic social and cultural) limited to those areas in which
grave violations occur or where government is weak: the obligation
applies to companies in the richest and most developed countries
as much as in the poorest.[477]
The fact that the UN Human Rights Council widely supported the
notion that corporations have the responsibility to respect all
human rights makes clear the universality and global extent of
the obligation. The corollary of this emphasis upon the universality
of human rights in relation to businesses is the requirement of
uniformity of approach: voluntary undertakings by businesses to
protect human rights are no longer sufficient. Companies are under
a duty to take positive action to respect human rights.
7. Central to this duty upon companies to
respect human rights is the concept of due diligence. Just as
under UK law, companies are required to undertake due diligence
to, for example, determine whether a particular transaction exposes
a company to unacceptable liabilities or risks, companies must
be mindful of the risks and implications of their proposed actions
for human rights. Just as businesses are required to act with
prudence in their everyday commercial activities, they also must
act with similar diligence in circumstances and jurisdictions
where governance is weak or non-existence. However, although particular
attention has been given to businesses acting in high-risk zones
and the dilemmas and risks that companies face in those situations,
and while those situations may require a particular degree of
prudence, they are by no means the only situations in which a
duty to be diligent is relevant.
THE ICJ PANEL
REPORT ON
CORPORATE COMPLICITY
AND LEGAL
ACCOUNTABILITY
8. A central problem for the legal accountability
for businesses in the field of human rights is the fact that most
trans-national companies operate through a web of subsidiaries,
contractors, suppliers, business joint ventures and other arrangements.
The opaque nature of these commercial structures have frequently
made it difficult to establish clear lines of responsibility,
especially where a parent company has been alleged to be complicit
in abuses committed by subsidiaries or partners. In 2006, the
ICJ established a special panel of eight legal experts to work
to clarify the meaning of corporate complicity in law and policy.
The final report of the Panel was released in September 2008.
A copy of the three volumes is enclosed.
9. The ICJ report analysed three main areas:
criminal law (especially international criminal law), civil remedies,
and public policy. The report made recommendations concerning
the kind of conduct a prudent company should ordinarily observe
as well as the appropriate standards of prudence in situations
of increased risk so to avoid the risk of liability for complicity.
In particular, the report suggested a series of questions the
management of a company should ask in the context of its operations.[478]
The report placed particular emphasis on the concept of the "reasonable
person". Just as the conception of the "reasonable person"
plays a central role in the law of torts and of contract, the
concept of the "reasonable person" also helps businesses
to identify what is expected of a responsible, careful actor in
the field of business and human rights. It is, of course, worth
noting that those expectations have evolved over time: what was
the norm of social expectations some years ago may no longer be
the norm today and, consequently, many companies that set policies
and practices under certain assumptions may fail to realize that
they are lagging behind from what is expected today from them.
What is expected from businesses today includes the respect to
human rights as defined in such international instruments as the
Universal Declaration on Human Rights, the International Covenant
on Civil and Political Rights, and the International Covenant
on Economic Social and Cultural Rights.
10. The corollary of the above is that,
since expectations evolve and include today the need to respect
all human rights and certain standards of respect and protection
for the environment, it is important that companies carry out
periodic review of their policies, methods and practices in relation
to human rights. In our view, consideration should be given to
the question of whether UK law should explicitly require companies
by way of legislation to undertake due diligence measures in relation
to their activities in the field of human rights. In our view,
this would be a major step forward in securing the compliance
of businesses, particularly those which operate on a transnational
basis, with fundamental human rights guarantees.
POSITIVE DUTIES
11. The responsibilities of businesses in
the field of human rights are not simply negative duties to refrain
from breaching human rights. Companies also have positive duties
also, particularly when a company performs a function that is
either explicitly public (eg operating a prison) or essentially
of public nature (eg providing residential care for patients funded
by a local authority). Even in cases where the state itself is
not directly implicated, private companies must not be allowed
to evade their own responsibilities in the field of human rights.
12. Companies are also generally required
to be diligent in identifying the risks of human rights violations
in their operations and take precautionary measures to avoid harm
or mitigate the effects .[479]
In this regard, they are required to take proactive steps to ensure
that harm to others is avoided.
ACCESS TO
JUSTICE: THE
RIGHT TO
AN AFFECTIVE
REMEDY
13. Article 2(3) of ICCPR requires States
party to "(a) ensure that any person whose rights or freedoms …are
violated (shall) have an effective remedy…", that "any
person claiming such remedy (shall) have his right thereto determined
by competent judicial, administrative or legislative authorities,
or by any other competent authority provided for by the legal
system of the State, and to develop possibilities of judicial
remedy", and "to ensure that the competent authorities
shall enforce such remedies granted". Article 13 of
the European Convention on Human Rights also requires that anyone
whose rights and freedoms are violated shall "have an effective
remedy before a national authority". Both treaties have been
ratified by the United Kingdom.
14. The increasing complexity of corporate
structures and operations worldwide poses an important challenge
for victims seeking to obtain justice. There are a number of obstacles
to access to justice in this field, including the application
of statutes of limitation to bar claims, the application of the
doctrine of separate legal personality, litigation costs and problems
obtaining of legal aid.
15. These problems are exacerbated in situations
where victims may not have access to justice in their own countries,
due to reasons ranging from the instability of the system or lack
of solid institutions to the lack of independence of the judiciary,
lack of enforcement of decisions in practice or insecurity for
the plaintiffs and their families. In such circumstances, the
obstacles to seeking justice in the jurisdiction of the parent
company become more relevant for victims when they cannot obtain
justice in their own country. At the international level, neither
the Global Compact nor the OECD system of National Contact Points
provide an effective remedy in this regard.
16. In the view of ICJ and JUSTICE, the
need to provide an effective remedy for victims of companies in
such circumstances is one of the central challenges raised by
the issue of business and human rights. As Canada Supreme Court
Justice Ian Binnie stated recently, "You cannot have a
functioning global economy with a dysfunctional global legal system.
There has to be somewhere, somehow, that people who feel that
their rights have been trampled on can attempt redress".[480] Proposals
to improve the legal framework applicable to claims for corporate
abuse occurring abroad or the accessibility of British courts
or other mechanisms should be given serious consideration. The
UK should also take a greater role in discussions at the international
level concerning new bodies and new legal mechanisms to fill existing
gaps.
RECOMMENDATIONS
17. The United Kingdom is an important player
in the global economy and international politics. As home to some
of the biggest transnational corporations, the United Kingdom
can do much to ensure those corporations respect human rights
wherever they operate. Action in this regard can be taken at the
global level, within the United Nations, the OECD, the European
Union and within the United Kingdom itself. The UK should:
— promote the adoption of global human
rights standards for corporations within the UN including a mechanism
for monitoring compliance.
— Promote the revision of the OECD Guidelines
for Multinational Enterprises and support efforts to provide the
Global Compact with a mechanism to ensure that member companies
do comply with the principles.
— The UN Working Group on the use of Mercenaries
visited the UK in 2008. The report contains a series of recommendations
to which the ICJ calls the Committee's attention, especially to
those relating to the need for better regulation for private security
and military companies domiciled in the UK. A parallel consultation
process by the Foreign and Commonwealth Office is currently underway
and the Committee should pay attention to any outcome of that
process within the sphere of its competences.
— The Joint Committee should include in
its scrutiny of legislation the need to ensure the legal accountability
of companies for their transnational activities, in particular
the implementation of the Company Act 2006
Justice
May 2009
477 See eg the UN Human Rights Council's reception
of the report of the UN Special Representative on Human Rights
(U.N. Doc. A/HRC/6/5). Back
478
Report on Corporate complicity, vol. 3, p. 16 Back
479
Report on Corporate complicity vol. 3, p. 19 Back
480
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