A global consensus on “due diligence” as a step towards strengthening the United Nations Security Council Sanctions on natural resources
Christian-jr Kabange Nkongolo (
[email protected])
1. Introduction
Sanctions by the Security Council have been instituted according to article 41 of the United Nations Charter to enforce measures not involving the use of force in order to give effect to its decisions. In respect of natural resources exploitation, several events have occurred where the Council has exercised this prerogative (Rhodesia, Angola, Liberia, Sierra Leone, Cote d’Ivoire, Démocratique République of Congo(RDC)). The general observation that arises in this regard is that outcomes have been often mixed. Despite relative success, shortcomings are still noticeable. Some of them were highlighted during the workshop organized in New York by the FES/ICC/UNGLS from March 21-22 2013. Concerning the failure to exercise “due diligence” in the natural resources field, it was observed that the lack of consideration of global cultural and political preferences have weakened the implementation of sanctions.1 This assertion was actually a confession of the absence of a global consensus as to the perception of the concept. In its 2010 report, the UN Group of Experts for DRC explicitly acknowledged that there is a need for additional guidance in global efforts towards the comprehension of due diligence.2 Though it is generally accepted that non-liability does not apply when the actor concerned has failed to show due diligence, the defining characteristics of the concept is still far from reaching a global agreement.3 This is simply because of the disparity and the flexibility with which the concept has evolved until now. The shortcoming in human rights due diligence in the course of natural resources exploitation is perceptible in the fact that it is not always clear what the exact obligations of each state and non-state actors are, and how far sanctions must go UN Security Council Sanctions on Natural Resources: Towards a more Global Approach Summary of FES/ICC/UNGLS Workshop from 21 and 22 March 2013, p.1. 2 Letter dated 26 October 2010 from the Group of Experts on the Democratic Republic of the Congo addressed to the Chair of the Security Council Committee established pursuant to resolution 1533 (2004) (S/2010/596) para. 315. 3 Benninger-budel C. Due diligence and its application to protect women from violence (2008) p.48. 1 1
whenever precautionary measures have not been taken. For instance, the failure to designate persons or entities for targeted sanctions of the Security Council or the fact that some were named whereas others were omitted, demonstrates how a high level of subjectivity in the implementation of the concept can lead to partiality and be detrimental, if not contained through a body of international regulations which defines standards of appreciation at a global level. It nowadays appears disproportionate that an organ of the largest multilateral organization (the UN Security Council) has to continue assessing due diligence in respect of standards which emanate from either national arrangements or regional organizations without global jurisdiction.4 In the context of DRC, the UN Group of Experts has developed due diligence guidelines,5 but which actually are merely an endorsement of the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High Risk Areas, adopted in 2010.6 Hence the question: should the OECD guideline continue to be the standard even for the majority of developing resource-rich countries which are not part of this organization?7 To stress the legitimacy concern raised by this approach, the observation made by some contributors during the workshop is noteworthy as it made the presumption that the reluctance of a state like China towards OECD rules could originate from the perceived Western imposition of standards that implicitly leaves no space for debate, choice or cultural preferences.8 Moreover, one contributor observed that the fact that some corporations are subjected to requirements of the OECD guidelines while others are not creates a differentiation of treatment with the consequence that the former ones are afraid to lose their market chair in Africa.9 At the national level, the review of practices reveals that many developed states have alternatively adopted extraterritorial legislation aimed at regulating activities of their
See the OECD Guidelines and the US Dodd-Frank Act. UN Group of Experts Due diligence guidelines for the responsible supply chain of minerals from red flag locations to mitigate the risk of providing direct or indirect support for conflict in the eastern part of the Democratic Republic of the Congo (2010). 6 Letter of the International Conference on the Great Lakes Region (ICGLR), the Organisation for Economic Co-operation and Development (OECD) and the UN Group of Experts on the Democratic Republic of the Congo to the US Chairman of Securities and Exchange Commission 7 Eleven African countries have endorsed the OECD Guidelines (Angola, Burundi, Central African Republic, Republic of Congo, DR Congo, Kenya, Rwanda, Sudan, Tanzania, Uganda and Zambia). But this is far from representing even the half of the 54 countries of the continent. 8 Summary of FES/ICC/UNGLS Workshop (n 1 above) p. 3. 9 Kabemba C. “A South-led path towards more equitable sanctions mechanisms and natural resource management” paper presented at the FES/ICC/UNGLS Workshop (New York, 21-22 March 2013) p. 2. 2 4 5
transnational corporations abroad, at times with the possibility for victims of human rights abuses to initiate lawsuits before their courts.10
Despite benefits that all these initiatives may have brought so far, it is clear that if the issue must continue to be dealt with exclusively at regional, sub-regional or national levels, it will not facilitate a common perception of the concept because of the multiplicity of initiatives11 and at times the lack of an appropriate legislation. On this latter point, it is noteworthy for instance that there is a legal vacuum in the African Union (AU) body of laws as regard this issue whereas Africa is one of the continents where human rights abuses have been significantly committed in the field of natural resources these last decades. Though the African Peer Review Mechanism is the tool the AU has established to assess the quality of governance in African countries in respect of the New Partnership for Africa’s Development, this instrument remains of a general scope and as such, is inappropriate to address specific problems that the natural resources sector poses in-depth. As will be observed below, all initiatives developed so far at international, regional and national levels have demonstrated their limits and this suggests that global reform is needed. The absence of a global standard will continue to accommodate the uncertainty brought by the disparity with which the due diligence has been interpreted and will persistently blurr the implementation of Security Council sanctions.
The few comments made here rest on an assumption that the improvement of the Security Council Sanctions regime necessarily passes by the development of a globalised conception of due diligence in which the necessary components and implications for actors bearing a responsibility in the natural resources sector has to be unequivocally clarified. To achieve this, any initiative of reform should forcefully take place within a multinational organization with much accreditation, to bring around a table the maximum states worldwide. For this purpose, the UN appears as the appropriate organization because it stands as the largest intergovernmental organization with powerful moral and legal authority to generate a global
De Jong A. Transnational Corporations and international law: Accountability in the Global business environment (2011) p.128. Australia, United States, Canada, New Zealand, Germany, Switzerland… 11 For instance, the Kimberley Process, the Extractive Industry Transparency Initiative, the Global Reporting Initiative, the OECD guidelines, and the UN Compact… 10
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regime of due diligence among nations. The assumption here is not that low level initiatives must be denied as if the UN will have to start afresh, but simply that the global regime of due diligence will devise as well as coordinate principles through which low level institutions will implement the concept and interact with the UN Security Council in the implementation process of its sanctions. Many principles laid down in low level initiatives can already serve as the foundation upon which global discussions can take place, the concern here being more to get a world wild adhesion and prevent difficulties that differences in cultures and views can raise. If a standard of due diligence has to work in every context, its conception must respond to the demand of legitimacy that emanates from every part of the globe and which can only be satisfied through a worldwide input rather than corpuscular efforts. Of course, this will be a challenging task for the UN. One would even legitimately express much pessimism when considering past failures of attempts to adopt an international code of conduct for transnational corporations. However, as will be seen throughout the analysis, recent developments within the UN prove that there have been some progress in efforts devoted towards the search for global responses to issues raised in respect of cross-cutting relations between business and human rights.
The core of these comments is construed on two main analyses. The first one (2) tries to highlight what are aspects of due diligence that need to be addressed in the search for a global and common understanding of the concept. The second section (3) analyses the pertinence of the UN as the appropriate forum to address this globalization issue. Because of the limited scope here, the comments will particularly take illustrations from activities of the Security Council in the DRC conflict where unlawful operations have been conducted in respect of mineral resources.
2. Due diligence
Due diligence generally represents the standard upon which is assessed the liability of actors from who a certain behavior is expected.
In international law, it has been developed
differently depending on the field in which it is applied (international environmental law, foreign investment law, diplomatic law). The main idea that initially emerged was that due 4
diligence corresponds with what a responsible state ought to do under normal conditions in a situation with its best practicable and available means, with a view to fulfilling its international obligation. This general principle has been progressively developed in respect of activities of transnational corporations, but yet in soft international guidelines.12
Because due diligence refers to an obligation of means rather than an obligation of result,13 the margin of appreciation in its application has often been too broad and has afforded huge flexibility to actors concerned to escape from their liability. By way of illustration, some personalities and many corporations designated in different reports of UN panel experts in DRC have never been punished,14 including at times some neighboring countries involved alongside these entities in the illegal exploitation of natural resources in the eastern part of this country. In order to improve the Security Council Sanctions regime, there is a demand for clarification and precision that needs to be satisfied on what the substance of due diligence and its implications in the natural resources field are.
As already mentioned above, recent developments within the UN in respect of cross-cutting relations between human rights and business can serve as the base to raise a global and uniform perception of due diligence to serve as a standard of appreciation in the Security Council Sanctions regime. Indeed, after several failures of past initiatives due to a vehement divergence between the business community and human rights advocacy groups, the UN Human Rights Council, through its resolution 8/7 of June 18 2008, adopted the "Protect, Respect and Remedy" framework for better managing of business and human rights challenges proposed by Professor John Ruggie, the Special Representative of the Secretary-General on the issue, who was appointed in 2005. This UN framework rests on three pillars: “the state duty to protect against human rights abuses by third parties, including business, through appropriate UN ECOSOC Res. 1913 (LVII) (5/12/1974); UN Code of conduct on transnational corporations, 23 I.L.M 626 (1984); International Labour Organization (ILO) Tripartite Declaration of Principles (ILO 1977); Organization for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises (OECD 2011); 13 For an obligation of result, the responsibility of actors is engaged once the expected outcome is not attained, while for an obligation of means, actors are free of any liability once they have demonstrated that that acted diligently to prevent the negative result. 14 Letter dated 13 June 2007 from the Group of Experts on the DRC addressed to the Chairman of the Security Council Committee established pursuant to resolution 1533 (2004) (s/2007/423) para.202. 5 12
policies, regulation, and adjudication; the corporate responsibility to respect human rights, which means to act with due diligence to avoid infringing on the rights of others and to address adverse impacts that occur; and greater access by victims to effective remedy, both judicial and non-judicial.”15 I share the view that this framework has enough potential to serve as the base upon which discussions on a global common perception of what should be the essence of “due diligence” in the natural resources area may be initiated.16 Indeed, this is simply because the three pillars on which it is construed, touch on aspects of the concept that need to be developed for strengthening the liability regime of actors in natural resources. Due diligence raises obligations for both states and multinational corporations and require that victims of actions or omissions which result from a default of its exercise be able to access quasi-judicial or judicial means to get reparation. These three elements are at the heart of discussions held under this section because of the presumption that they are relevant to improve the UN Security Council Sanctions.
2.1 States duty to protect as part of due diligence
It is noteworthy to observe that all guidelines developed thus far address what the behaviour of corporations should be,17 more often without any say about states responsibility. This is probably because states obligations are generally contained in international instruments on human rights, the conventional wisdom being that this system of law creates obligations or places duties only on states.18 This is what is known as the vertical application.19 Beside the fact 15
17 18
Guiding Principles on Business and Human Rights: Implementing the United Nations “Protect, Respect and Remedy” Framework (2010-2011). 16 In his final report to the UN Human Rights Council, Professor Ruggie made an important remark that “Council endorsement of the Guiding Principles, by itself, will not bring business and human rights challenges to an end. But it will mark the end of the beginning: by establishing a common global platform for action, on which cumulative progress can be built, step-by-step, without foreclosing any other promising longer-term developments”. Report of the Special Representative of the Secretary-General on the issue of human rights and transnational corporations and other business enterprises, John Ruggie UN A/HRC/17/31 (2011), para. 13. See Guidelines previously mentioned (n 4, 5 11 and 12 above). Knox JH. “Horizontal Human rights law” 120 (1) (2008) American Journal of International Law 1, Christoffersen J. “Denmark drittwirkung and conflicting rights-viewed from national and international perspectives” in (eds.) Oliver D. and Fedtke J. Human Rights and the private sphere (Routledge, 2007) 34; De Brabandere E. “Human rights considerations in international investment arbitration” in (eds.) 6
that the state should itself refrain from interfering in the enjoyment of all human rights, promote them and fulfill those that imply a positive obligation, what interests us more here is its obligation to protect rights-holders against violations by other subjects. This is simply because the legal aspect of due diligence in natural resources which is problematic today, is not the one in connection with human rights obligations arising directly out of the state own activities, for which legal means of enforcement already exist, but rather those related to third actors operating within its territory or jurisdiction.
The UN framework considers that states duty to protect against human rights abuses by third parties within their territory or jurisdiction requires that they take appropriate steps to prevent, investigate, punish and redress such abuse through effective policies, legislation, regulations and adjudication. Thus, a global conception of due diligence must include these four dimensions in the obligations of states in respect of persons and entities running activities in the natural resources sector. Whenever the state fails to take appropriate steps in this regard, its international responsibility for the breach of an international obligation should occur. Such a failure amounts in fact to a default of due diligence in the state concerned. Under international law, the authority of a sovereign state is appreciated not only in respect of its actions, but as well as its omission.20 In practice, the state will incur responsibility for omitting to take precautionary measures to prevent human rights abuses by third actors. At this level, what makes the appreciation difficult is the fact that states generally have discretion in deciding upon which steps to take.21 So, it can be difficult at times to prove or establish that a particular state is in breach of its obligations if there is not a minimum defined standard of actions expected from it.
To settle this difficulty, a global approach to due diligence must display some
preventing and reparative actions that states must perform, no matter the means chosen. The first step in this regard is necessarily to clearly set out the expectation that all business enterprises domiciled in their territory and/or jurisdiction must respect human rights throughout their operations.22 However, states must go beyond awareness and take Fitzmaurice M. And Merkouris P. The interpretation and application of the European Convention of Human rights: Legal and practical implications (2012) 183-2016. 19 Corrin F. “From horizontal and vertical to lateral: extending the effect of human rights in post colonial legal systems of the south pacific” 58 (2009) International and Comparative Law Quarterly 31. 20 Sonarajah M. International law on foreign investment (2010) 168. 21 Ruggies’ final report (n15 above), 7. 22 Id., 7. 7
appropriate measures especially in case the violations occur later in the process. In the DRC case, the UN Security Council has at several occasions called upon all states involved in the conflict to take appropriate steps to raise awareness of the due diligence guidelines referred to above, and to urge importers, processing industries and consumers of Congolese mineral products to exercise due diligence by applying the aforementioned guidelines, or equivalent guidelines, containing the following steps as described in the final report (S/2010/596).23 This is not really a satisfactory approach because as soft law, these guidelines do not often provide sanctions in case actors concerned do not abide. It is important to underline here that even though public international law is still reluctant to directly sanction third parties for human rights abuses,24 there are domestic mechanisms within national jurisdictions to make them accountable. This is where the obligation to punish becomes of particular relevance for a global concept of due diligence. It must include the obligation for states to punish actors that have violated human rights in the natural resources field. International law should be relevant to this national law option in clarifying, and where necessary, extending what the responsibility of the state is in this case. It is following this then that the obligation to punish could allow UN Security Council Sanctions against the state that failed to do it.
What are the states from which due diligence to protect should be required? This is an interesting issue to clarify in any attempt to define a global regime of due diligence. In the UN framework, two kinds of states appear at the frontline, namely the host state and the home state of the business operator. This is deduced from its reference to either the territory and or the jurisdiction. Indeed, the host state qualifies because activities are foreseen within its territory, while home states may be included based on an extraterritorial jurisdiction upon activities of its national abroad. Since the case for the host state is obvious, my comments should be made here more in respect of the home state. What seems interesting to discuss in respect of the host state is more its ability to exercise due diligence when itself is part of a business enterprise conducting activities in the natural resource area. But yet before doing so, it seems important to add to the list a third state, which is neither the host state nor the home one, but that may serve as a bridge to the international trade of natural resources.
2.1.1 The case of the host state: 23 24
Resolution 1952 (2010), para. 8. Except where crime against humanity, crimes of war and genocide are involved. 8
The orthodox vision in which international human rights law was originally conceived is a state-centred one in so far as the main concern was to protect individuals against human rights abuses that can derivate from the exercise of state power. Thus, if the UN Framework obligation to protect can be applied in this first dimension,25 it implies that the state has the duty to protect individuals who come under its jurisdiction against human rights abuses that may result from its own activities. A priori, this can appear paradoxical to contend that the protector must protect others against itself. An attempt to simplify the understanding could lead to the assumption that in this case, the obligation to protect becomes synonymous to the protector’s obligation to respect because it is compelled to refrain from violating human rights. This is well understood when the host state is involved itself as a co-partner with private investors in the corporation. Indeed, at times it happens that the host state is in a joint-venture with foreign investors as a shareholder. From a theoretical point of view, the UN Framework contends that: “the closer a business enterprise is to the state, or the more it relies on statutory authority or taxpayer support, the stronger the state’s policy rationale becomes for ensuring that the enterprise respects human rights. Where states own or control business enterprises, they have greatest means within their powers to ensure that relevant policies, legislation and regulations regarding respect for human rights are implemented”.26 However, in practice this ideal is not always achieved. The case of Social and Economic Rights Action Centre and the Centre for Economic and Social Rights v. Nigeria decided by the African Commission of Human and People’s Rights27 demonstrates that whenever the government is involved as a shareholder with a natural resource corporation, it may be utopian to expect that it will drastically enforce human rights standards against the joint-venture. In this context, Prihandono observes that, if a violation occurs, it is difficult to expect that national courts will maintain their impartiality.28 Fortunately, arrangements for human rights enforcement exist at both the universal and regional levels. But yet, more efforts should be made to grant citizens more access to
The secondary dimension being the obligation for the state to secure its citizens against human rights abuses by third parties. 26 UN Framework (n 15 above). 27 African Commission Communication 155/96 The Social and Economic Rights Action Centre and the Centre for Economic and Social Rights v. Nigeria (2002). 28 Pihandono I. “Barriers to transnational human rights litigation against transnational corporations (TNCs): the need for cooperation between home and host countries” 3 (7) (2011) Journal of law and conflict resolution 89-103. 9 25
international solutions whenever their human rights are marginalized due to the fact that their state that is supposed to protect them fails to do so because it involved itself in the exploitation of natural resources through the joint-venture.29
2.1.2 The case of the home state:
Besides the host state, it has become increasingly envisaged that the home state should bear some responsibility for business activities of its national abroad. This is what has led some countries to pass legislation with extraterritorial effects. Trying to answer why there should be state responsibility in these circumstances, Sonarajah observes that in respect of multinational corporations, it is a palliative to the lack of regulation for their conduct in modern international law and the deficiency of host states whose capacity and will to regulate corporation conduct within their borders is seriously undermined by the current economic globalisation.30 This scholar aptly concludes that “once the primary obligation to prevent harm abroad is accepted as applicable to the home state of the multinational corporation, then the law must be shaped to ensure that the home state provides a remedy”.31 These remarks by Sonarajah are very important in the conceptual process of a global due diligence because they display the existence of a double duty upon the home state which is correlative: the obligation to control the conduct of its nationals outside (1) engenders the obligation to provide a remedy once they have violated human rights abroad (2). The capture of this second element is particularly important to define the extent of the home state’s obligation in due diligence. For instance, in the case of DRC, most if not all corporations that were designated in the UN Group of experts reports have not been sanctioned by their home state, and no remedies have been afforded to victims.32 Thus, under an updated formula of due diligence, it can be suggested that the home state be sanctioned for its failure to provide remedies when its nationals operating in natural resources See for instance, the case of the African Court of Justice and Human Rights for which access is made conditional upon a declaration from the respondent state of its acceptance of the court’s jurisdiction thereto; the absence of a regional system of human rights in Asia which stands as an unjustified exception comparatively to the situation in other continents. 30 Sonarajh (n 20 above) 169. 31 Id. 170. 32 Letter dated 13 June 2007 from the Group of Experts on the Democratic Republic of the Congo addressed to the Chairman of the Security Council Committee established pursuant to resolution 1533 (2004) (S/2007/423) para. 202; Global Witness “Natural resource exploitation and human rights in the Democratic Republic of Congo 1993 to 2003” (briefing paper December 2009) pp. 22-23. 10 29
abroad have blatantly violated human rights. But what makes this solution difficult to apply in the current context is the fact that countries have different arrangements that it is not always predictable on how national courts will behave. For instance, the Canadian Supreme Court rejected a lawsuit by human rights advocacy groups trying to sue a multinational mineral corporation for human rights violations perpetrated in DRC.33 Since the multinational has offices not only in Canada, but also in Congo and Australia, the Court contended that it should be sued in one of these latter two countries. In the same vein, the US Supreme Court has rejected the previous position held by lower courts34 that the Alien Tort Statute of 178935 offers the possibility to aliens to bring a case before US federal courts for tort actions committed in violation of international law, such as for instance war crimes or crimes against humanity.36
To address this shortcoming, the UN should push its member states to accept it at least as a general principle of international law that the home state holds responsibility to oversee activities of its nationals abroad and provide remedies whenever human rights abuse occurred through their activities.37 Thus, an international legal instrument could be adopted to coordinate how states should implement the principle which obviously will be part of the globally defined concept of due diligence. For “if the need and will to achieve a pressing policy objective is to be placed at the centre of the evolution of international law, achieving it by adapting and extending existing law is a legitimate means to do so”.38
2.1.3 The case of a third state: Global Witness “No justice in Canada for Congolese massacre victims as Canada’s Supreme Court dismisses leave to appeal in case against Anvil Mining” (November 2012), available at http://www.globalwitness.org/library/no-justice-canada-congolese-massacre-victimscanada%E2%80%99s-supreme-court-dismisses-leave-appeal (accessed on 15/5/2013). 34 In re South African Apartheid Litigation, No. 02-MDL-1499 (S.D.N.Y. Apr. 8, 2009), Kadic v. Karadzic 70 F.3d 232 (2d Cir. 1995); Hilao v. Estate of Marcos (In re Estate of Ferdinand E. Marcos Human Rights Litigation) 25 F.3d 1467 (9th Cir. 1994); Filartiga v Peña-Irala 630 F.2d 876 (2d Cir. 1980) 35 The ATS is made of a single sentence in the Judiciary Act of 1789 which holds that "the district courts shall have original jurisdiction of any civil action by an alien for a tort only, committed in violation of the law of nations or a treaty of the United States." 36 Kiobel v. Royal Dutch Shell Petroleum Co., No. 10-1491 (U.S. 2012/2013). 37 For instance, the UN Group of experts suggested that countries whose companies are active in the mining sector in the Democratic Republic of the Congo to take appropriate legal measures to incorporate the due diligence guidelines into national legislation. Letter dated 26 October 2010 from the Group of Experts (n 2 above) 370 (b). 38 Sonarajah (n 20 above) 169. 11 33
In convening a global approach to due diligence, it is important to consider the possibility for third states to bear some obligations in the international trade of natural resources. This is simply because the international trade of these resources implies at times a transit of the cargo or freight through the territory of one or more states. In almost every resolution made by the UN Security Council in respect of the situation in DRC, they always made recommendations that neighbouring states should cooperate by increasing border controls to avoid illegal activities relating to both arms trafficking and illicit trade in natural resources.39 But paradoxically to this call for cooperation, some of these third countries were found previously and thereafter either involved in the plundering of mineral resources in DRC or serving through their territories as a base for their illicit trade.40 Actually, the duty to respect defined in the UN framework should be extended to the third countries obligation to exercise due diligence based on the principle of “international cooperation”. This principle which has been repeatedly mentioned in Security Council resolutions on DRC41 is actually a reflection of the general undertaking taken by member states to cooperate with the UN as emerged from a combined reading of articles 1 (3), 55 and 56 of the UN Charter. So when a third country fails to watch over its borders or actively supports illegal exploitation of natural resources in other countries and it results in human rights violations, it must be found in breach of the obligation to respect, as described in the UN framework, for not abiding to the due diligence standard, and should internationally be sanctioned for that.
2.1.3 How to prove the state default of due diligence?
An important issue to address in the process of globalising a common regime of due diligence is how to establish that a particular state is in breach of its obligation to exercise it. Several approaches under international law have been developed to establish state responsibility or By way of illustration see Resolution 1896 (2009) para. 10, Resolution 1807 (2008) para.7; Resolution1857 (2008) para. 7; Resolution 1856 (2008) para. 21, Resolution 15/59 (2005). 40 Letter dated 12 October 2012 from the Group of Experts on the Democratic Republic of the Congo addressed to the Chair of the Security Council Committee established pursuant to resolution 1533 (2004) concerning the Democratic Republic of the Congo (2012) pp. 43-46; 55-56; Final report of the Panel of Experts on the Illegal Exploitation of Natural Resources and Other Forms of Wealth of the Democratic Republic of the Congo (2002) pp. 14-19; Report of the Panel of Experts on the Illegal Exploitation of Natural Resources and other Forms of Wealth of the Democratic Republic of the Congo (2001) pp. 19-26. 41 By way of illustration, see Letter dated 13 June 2007 from the Group of Experts pp. 8-10. 12 39
liability.42 In this context, it has been contended that a demarcation needs to be done between state responsibility which forcefully implies a wrongful action and which amounts to a breach of an international obligation by the state, and the state’s liability which implies the duty to compensate in absence of an international law violation by the state itself.43 Though this distinction of regimes corresponds to the current situation under international law where states incur liability for human rights abuses perpetrated by multinational corporations, it can be contended that a global perception of due diligence should make the duty to exercise it as part of the international obligation of the state, with the consequence that the failure to exercise it should amount to a breach of this obligation and lead to the state responsibility, rather than simply to its liability. If this maximalist approach is to be embraced, then the question would be how to establish the responsibility of the state. Should the Security Council consider the approach based on “the fault” which is grounded on the intention (dolus) to harm or the negligence (culpa) to take necessary measures to prevent the injurious event?44 Because of the large discretion that due diligence naturally affords to states in terms of steps and means to achieve their obligations, it seems advisable to support an approach based on a presumption that the state concerned will have to reverse by providing evidence that it is not in breach of its obligations. This means that the burden of the proof should be put on the state. Otherwise, as aptly observed by Lysen, “if fault would have to be proven in order for international responsibility to come into play, states could possible quite often escape responsibility because of, example, procedural difficulties of providing culpa or dolus in the past.”45 This approach based on presumption is almost the same one developed by the UN Group of Experts in DRC in respect of individuals and corporations, contending that a standard of proof based on “reasonableness” or “sufficient cause” can at times be applied.46 A combined reading of articles 2 and 12 the International Law Commission’s Draft lead to the conclusion that fault is not a
Flemme M. Due diligence in international law (University of Lund 2004) p. 6. See Flemme’s arguments grounded on an interpretation of Chapter V of the International Law Commission’s Draft Articles on Responsibility of States for Internationally Wrongful Acts (2005). Flemme, Id. 44 Ibid., p. 7. 45 Lysén G. State Responsibility and International Liability of States for Lawful Acts: A Discussion of Principles (1997) as quoted by Flemme Ibid., p. 8. 46 Letter dated 15 October 2003 from the Chairman of the Panel of Experts on the Illegal Exploitation of Natural Resources and Other Forms of Wealth of the DRC addressed to the Secretary-General (S/2003/1027) para. 15. 13 42 43
precondition for an act or omission to be qualified as internationally wrongful.47 But the difficulty here, as observed by the UN group of experts, rests on the fact that auditing is an essential component of due diligence, but there is no agreed way to carry it out.48 This is where the diversity of existing initiatives can be of great assistance. The UN Group of Experts for DRC has not hesitated for instance to encourage the implementation of the Mineral Certification Scheme adopted by the International Conference on the Great Lakes Region (ICGLR) which makes auditing by third party compulsory.49 But to make different initiatives existing at low levels efficient will require adopting policy for monitoring and coordination. This is in line with professor Ruggie’s conclusion that the relationship between human rights and business is in need of greater policy coherence at the international level.50 Formal reporting from actors involved in the natural resources to states (both the home and host ones) and from states to supranational instances in charge of monitoring can really achieve this need for coherence. In this context, it is conceivable that the UN Security Council may enjoy some formal prerogatives to consolidate its appreciation process of whether or not due diligence was effectively exercised by (state and non-state) actors involved in natural resources exploitation.
2.2 Corporations duty to respect
Under international law, the question as to what responsibility multinational corporations should assume towards the society within which they operate, started to be formally discussed in the 1970s and until now, it is still a subject of divergence whether their behavior should be regulated under hard or soft international law. All guidelines existing at present are constitutive of soft law rather than hard law in so far as they are not binding upon corporations but simply serve for guidance. My comments here rest on the view that there is an argument that multinational corporations should be made liable under international law in certain situations. The argument is that initiatives developed at both transnational and national levels 47
48
49 50
International Law Commission’s Draft Articles on Responsibility of States for Internationally Wrongful Acts (2001). Letter dated 18 October 2011 from the Group of Experts on the DRC addressed to the Chair of the Security Council Committee established pursuant to resolution 1533 (2004) (S/2011/738) para. 418. Ss.3 (15) (25) (26). Report of the Special Representative of the Secretary-General on the issue of human rights and transnational corporations and other business enterprises, John Ruggie/Business and human rights: further steps toward the operationalization of the “protect, respect and remedy” framework (A/HRC/14/27) (2010) p.12. 14
thus far, namely international guidelines, host states and extraterritorial legal mechanisms of enforcement, having displayed their limits, the gap needs to be filled through some reforms to be coordinated under a global effort to adopted a general international law approach. The UN Framework can be of use in this regard in so far as it has been lauded by non-governmental organizations and endorsed by some major multinational corporations.51 As such, it can serve as the legal standing point from which efforts may be undertaken to persuade the business community that a constraining regime is unavoidable in certain situations of extreme gravity as regards the violation of human rights.
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Limits of the guidelines strategy
Guidelines on due diligence suggest precautionary measures that corporations should take, especially when working in a context very critical to human rights. They provide guidance to multinational corporations as to how they should conduct their activities in the natural resources field. However they appear disproportionate to contain the power of multinational corporations because they are not assorted with a sanction regime in case of non compliance. Indeed, the huge cab of multinational corporations working in the natural resources field on infringed human rights has been demonstrated in several cases adjudicated worldwide52 that a soft law regime appears inadequate to contain their strike-force. My first fundamental question is why a soft law regime should be applied for instance where the corporation has blatantly participated in illegal operations and offered support to human rights violations? Such a scenario should be seen as the manifestation of a “deliberate” breach of due diligence. In the Anvil mining case that occurred in DRC, the heart of the allegations was that the company had provided logistical support to the perpetrators of the massacre of people in the town of Kilwa near the company's silver and copper mine. Why should good treatment be afforded to a multinational corporation in such a case where its good faith is undeniably compromised by the inexistence of a rational link between the main object of its activities which is the exploitation of mining, and the supply of military logistics? This single example is enough to contend that in
Business Ethics: The Magazine of Corporate Responsibility “Business and Human Rights: Interview with John Ruggie” (2011), available at http://business-ethics.com/2011/10/30/8127-un-principleson-business-and-human-rights-interview-with-john-ruggie/ (accessed o 16/5/2013). 52 By way of illustration, see Guerrero v. Monterrico Metals Plc [2009] EWHC 2475; [2010] EWHC 3228; Connelly v. RTZ Corporation Plc [1998] AC 854; OK Tedi litigation against BHP [1997] 1 VR 428. 51
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for human rights abuses and be sanctioned under international law when national mechanisms fail.53 Despite difficulties raised by the application of the mens rea criterion to juristic persons,54 developments under the International Criminal Tribunal for the former Yugoslavia and the Nuremberg Tribunal55 can offer grounds to at least support the proposal that the corporation criminal liability should be incurred by its representatives who made and executed the decision involving the entity in the criminal operation. The corporation itself should then respond with civil aspects of its responsibility which often raises the issue of adequate compensation for which it is presumably more solvable than its representatives. However, the implementation of this proposal is challenged by the fact that at times representatives of the corporation may be constrained to get involved in the abusive operation by officials of the host state. This seems to be one of the arguments in the Anvil mining case in so far as the governor of Katanga wrote to representatives of this corporation requisitioning the corporation logistic materials.56 Though such a power to requisition (people or materials) in times of emergency is somehow part of sovereignty, its exercise by the host state should not exempt corporation representatives from their due diligence obligation to refrain from engaging in operations bearing a high risk for human rights. Since as a juristic person, a multinational corporation acts through its representatives, initiatives to involve the entity into human rights abuse activities must be discouraged through a hard international law regime rather than a soft one. Thus, under a globalised approach to due diligence, one way to make multinational corporations accountable, could be for the UN Security Council to initiate criminal prosecution through the referral procedure57 before the International Criminal Court against representatives of these corporations whenever serious human rights offences like crimes against humanity, war crimes or genocide are involved. As will be demonstrated below, this is a logic deduction of the complementarity or subsidiary principle that governs the relationship between international mechanisms of enforcement and the national ones. 54 The criminal intention or knowledge that an act is wrong, that the accused must have had at the time of committing the offense. 55 The jurisprudence developed through these tribunals demonstrates that criminal liability can be incurred by juristic persons. By way of illustration, see Prosecutor v. Furundzija, ICTY Case No. IT-95-17/1-T (Trial Chamber Dec. 10, 1998); The Nuremberg Trials (U.S. v. Goering), 6 F.R.D. 69, 112 (Int’l Mil. Trib. 1946). 56 Letter No 10/0844/CAB/GP/KAT2005 from Urbain Kisula Ngoy, Governor of Katanga, to Anvil’s General Manager, Lubumbashi, dated 11 June 2005. But what was strange here is the fact that the letter of requisition was dated eight months after the events happened. See Global witness et. al. “Kilwa Trial: a Denial of Justice A Chronology (October 2004 – July 2007)” p. 7. Available at http://raid-uk.org/docs/Kilwa_Trial/Kilwa-chron-EN-170707.pdf (accessed 16/5/2013). 57 See articles 13 and 16 of the Statute of the International Criminal Court (1998). 16 53
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Limits of the host state legal system
Most investments in natural resources these past days have been taking place more in developing countries. This is a natural consequence of the high demand for private investments faced by these countries to revive their economies. In such a context, it has to be observed that national mechanisms of human rights regulation and enforcement may be heavily compromised by poor economic conditions within the host state in the context of which multinational corporations often appear to enjoy more power and influence than public instituions.58 For instance, it is noteworthy to recall here that in the Anvil mining case, Congolese soldiers and three expatriate employees of Anvil Mining were initially charged before a Congolese military court respectively with war crimes and complicity in war crimes in connection with human rights abuses that happened in Kilwa.59 But justice could not take its normal course because of interference and obstruction by high level business interests which led to all the defendants being acquitted.60 Thus, because the socio-economic context within some developing countries is still characterized by negative factors like corruption and clientelism which somehow affect the functioning of judicial institutions, it is rational to contend that international law should provide mechanisms to supply deficiencies in the host state legal system.
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Limits of the extraterritorial solutions
Where claimants were unable to gain satisfaction in the host states legal system, they have at times used the highway of extraterritorial jurisdiction of the home states to pursue human rights abuses by multinational corporations. Though at times, they have reaped relative success,61 the extraterritorial solution has also demonstrated considerable limitations. As
Kinley D. and Tadaki J. “From talk to walk: the emergence of Human rights responsibility for corporations at international law” 44 Virginia Journal of International Law (2003-2004) p. 938. 59 Global business (n 33 above) pp. 23-24. 60 Id. p. 23-24. 61 In the Ogoni case, although the violence decreased after the decision by the African Commission, victims received a compensation of 15.5 million from Shell in 2009 following a lawsuit initiated before a USA court (Wiva v shell. Center for Human Rights, Réceuil Africain des décisions des droits humains 2001, University of Pretoria Law Press (2001) p.10. 17 58
observed previously this has been characterized by a narrow interpretation of legal provisions with potential extraterritorial implications.62 The US Alien Tort Act which was long contemplated as a worldwide reference in terms of extraterritorial legislation based on which multinational corporations could be sued for human rights violations, has now become quasiobsolete to that effect since the US Supreme Court has recently curtailed its scope, contending that granting an extraterritorial effect to this Act could raise unintended clashes with laws of other nations and result in international discord.63 This case demonstrates that despite the existence of legislation with possible extraterritorial effects, the way foreign courts will behave cannot always be predictable. This is particularly true when extraterritoriality is not unequivocally expressed in provisions of the law and that claimants must rely on presumptions. The uncertainty as to the direction that the home state courts can take is particularly perceivable in the Anvil mining case in which the Canadian Supreme Court refused to grant the application for leave to appeal the judgment of the Quebec Court of appeal64 that had refused to hear the case on the grounds that it had no jurisdiction because of a lack of “real and substantial connection” between allegations and activities of the corporation in Quebec.65 Despite the fact that proceedings initiated previously in 2007 in Australia where Anvil is incorporated did not progress because lawyers were unable to establish that they had received instructions from victims to act on their behalf,66 the evocation of the forum of necessity doctrine by the claimant was not enough to overcome the Quebec Court’s decline of jurisdiction.67 It is also relevant to underline the opposite theory of forum of conveniens as it represents an important limitation to extraterritorial options. This doctrine gives the court a discretionary power to refuse to hear a case on the ground that it is in the interests of all parties and of justice that the case be decided in some other forum.68 Therefore, no matter the inputs of the extraterritorial jurisdiction, the
See the Kiobel and Anvil mining cases (n 36 above and 65 below). See the Kiobel case, Id. 64 Association Canadienne contre l’impunité c. Anvil Mining Ltd (Application for leave) SCC. 34733 (2012). 65 Anvil Mining Ltd. c. Association canadienne contre l'impunité 2012 QCCA 117. 66 Pierre v. Anvil Mining Management NL, [2008] SCWA 30. 67 The forum of necessity doctrine inspired by the Swiss 1987 Loi fédérale sur le droit international privé (Private International Law Federal Act). suggests that when the foreign forum that usually has jurisdiction (Australia for jurisdiction ratione personae or DR Congo for jurisdiction ratione materiae) is inaccessible to the litigant for exceptional reasons, such as an almost absolute impossibility in law or a practical impossibility; the forum before which the case is brought must accept to hear the case because of the necessity to render justice. Anvil Mining Ltd. c. Association... (n 65 above) paras. 96-103. 68 Kinley and Tadaki (n 58 above) 943. 18 62 63
solution has its limits. Thus, international law should be allowed to supply the shortcomings through global reformative initiatives on due diligence.
2.3 The victims’ need for more access to remedy
Access to remedy is a fundamental element in any system that seeks to grant human rights protection. As such a due diligence regime where corporations are called upon to respect human rights in their natural resources operations cannot afford to not address this issue. Professor Ruggie aptly observes that access to remedy is critical “because even the most concerted efforts cannot prevent all abuse.”69 All human rights that are entrenched without any possibility of remedy should they be violated, are rendered meaningless. Thus, in the context of my comment an open question is whether the UN Security Council sanctions on natural resources has been efficient to offer remedy to victims of human rights abuses in the natural resources so far? Obviously, the answer is negative because, as observed at the opening of the discussion, the results have been often mitigated. Actually, efforts by the Security Council must be inscribed within the huge chain of efforts that exist to remedy human rights abuses through judicial and non-judicial means. This is why the conceptualization of its sanction system should be broadened. Direct sanctions by the Security Council should be regarded as part of the nonjudicial attempt to remedy, while on the judicial note, this body sometimes has the ability to seize an international instance like the ICC. This is in line with the UN Framework conception of greater access to remedy for victims which includes non-judicial and judicial avenues.70 Regarding non-judicial remedies, beside stringent measures like embargoes on import and export, freezing of funds and assets, restriction on the movement of persons and mechanisms like friendly settlement or reconciliation commission, can be acceptable.
But for criminal aspects of responsibility, it is clear that this has to be dealt with mainly by judicial bodies. As already mentioned, domestic legal systems in many states allow lawsuits against multinational corporations, but with considerable limitations.71 Under current international law as well, judicial mechanisms of human rights enforcement are limited to obligations pending on states. Therefore, the question that my comments want to address here Ruggie final report (n 16 above) para. 6. Guiding Principles on Business and Human Rights (n15 above). 71 See the limits of host and host states legal systems as described in the previous section. 69 70
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is, if due diligence can generate an international obligation, why multinational corporations should not be constrained to respond under international law whenever the national system of enforcement has failed to make them accountable? Indeed the necessity to make international law mechanisms pending on the failure of domestic mechanisms should be regarded as consecutive to the principle of subsidiarity (or complementarity in criminal law)72 which has become part of international customary law. It is the legal ground on which the exhaustion of the local remedies rule rests. This principle determines the domain of competence between larger communities and small ones, commanding that the former ones should refrain from intervening in matters which may be efficiently administered and decided by the latter ones, and that interventions by the larger ones will be justified only in case smaller units fail to fulfill their mission properly.73 Therefore, if the intervention of the international legal system is supposed to complement or support the deficiency of the national legal system, the contention that multinational corporations should respond on human rights abuses before transnational jurisdictions should be regarded as a continuation of the demand for justice that originates from victim’s expectations raised by the existence of national law and courts protecting human rights in the first instance. Thus, the acceptance of adjudication on corporation’s human rights’ liability at national level and its rejection at the international level constitute a gap in the common objective that both systems seek to achieve. It is an unnecessary break and irreconcilable paradox in the process of satisfaction of the demand for justice by victims.
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The complementarity principle has been more developed in respect of the relationship between the ICC and national courts in the prosecution of crimes defined in the Rome statute. The former Chief Prosecutor of the ICC, Mr Moreno-Ocampo has described the principle in the following terms: “The Statute recognizes that States have the first responsibility and right to prosecute international crimes. The ICC may only exercise jurisdiction where national legal systems fail to do so, including where they purport to act but in reality are unwilling or unable to genuinely carry out proceedings. The principle of complementarity is based both on respect for the primary jurisdiction of States and on considerations of efficiency and effectiveness, since States will generally have the best access to evidence and witnesses and the resources to carry out proceedings.” ICC “Informal expert paper The principle of complementarity in practice”, available at http://www.icc-cpi.int/iccdocs/doc/doc656350.PDF, (accessed on 24/5/2013). Jirásek J. “Application of the principle of subsidiarity on decision making of the ECJ in the area of Fundamental rights protection” Dny práva – 2009 – Days of Law: the Conference Proceedings, (Masaryk University, 2009); Available at http://www.law.muni.cz/sborniky/dny_prava_2009/files/prispevky/mezin_soud/Jirasek_Jan __1118_.pdf [accessed on 9/4/2013]; Carroza GP. “Subsidiarity as a structural principle of International Human Rights Law” (2003) 97 (38) The American Journal of International Law pp. 39-40. 20
Greater access to remedy as proposed in the UN Framework should embrace the possibility for multinational corporations under certain conditions to be sued before an international judicial body for grave violations of human rights. The global standard of due diligence will help to appreciate the responsibility of the corporations and its representatives and determine if there is enough cause to proceed with the case under international law after exhaustion of local remedies. The broadening of this remedial perspective will surely back up the work of the UN Security Council in the search for possible avenues to obtain actors’ compliance with its sanctions.
3. The UN as the appropriate forum for global efforts devoted to a common perception of due diligence
At the end of the workshop, participants left an open-question to be reflected: “Which multilateral organization can credibly bring together all actors whose compliance with any sanctions outcome is indispensable?” Since the adoption of a global and common perception of due diligence and its implication is part of the efforts to increase compliance with sanctions, the contextualization of this question into my comment leads to the subsidiary question of which inter-governmental organization can credible undertake this task? My proposal is the UN. The reason is that it is the largest multilateral organization with both the greatest number of states and with considerable authority worldwide. As such, it has the potential to serve as the forum where governments from different regions of the world can address a common perception of due diligence in a context where legitimacy will not be challenged by their cultural differences and non-participation to the process. However, the past experience with the attempt to adopt an international Bill of Rights has ended up in two international Covenants because of the different viewpoints between some skeptics. However, it is my view that the UN Framework as a standing point/the ground as a normative platform upon which discussion may be initiated, can help to address this challenge. This is because in the process of its conception, the special representative has undertaken to consult with representatives from all regions of the world, including not only government representatives, but also private actors like multinational corporations and civil society organizations.74 Though it would be too daring to claim that this Framework represents a global consensus, the simple fact that it is the result
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Report of the Special Representative of the Secretary-General… (2010) pp. 4-5. 21
of a worldwide participatory approach, should rationally lead one to look at it as an instrument which has somehow transcended cultural barriers and differences. Nevertheless, despite the suitability of the UN, caution needs to be underlined here. First of all since the concern is the search for global consensus, the issue should not be discussed within the UN Security Council because only a few states (5 permanents and 10 non-permanents) are part of this organ. The UN General Assembly where all member states take part equally seems to be the appropriate organ of the UN to attempt the globalization of “due diligence”. Contrarily to the UN Security which is an organ whose membership is still highly dominated by political considerations, the UNGA appears as the appropriate platform to do this assignment. This is not to contend that the UNGA is free from the influence of political and socio-economic interests which dictate the behavior of states in the international forum considerably; but the simple fact that each member participates in discussion and has one vote is a guarantee for equal treatment. Thus, developed countries and developing countries have to mitigate their own interests and let the global concerns prevail in these discussions. This is one of the preconditions in reaching a global consensus. To further support this process, the UN can grant observer status to a caucus of non-state actors made up of representatives of multinational corporations and CSOs, to allow their participation in the discussion. In closing this point, it is important to underline that despite the possibility to agree on a global standard of due diligence within the UN, the Security Council should remain aware that the successful application of such a standard will require that its sanctioning actions in the natural resources field be kept within the objective of balancing global interest,75 of which human rights are part.
4. Conclusion
The limits of solutions developed in national laws as well as in international law, call for a reform whereby a new international perspective should be developed to sanction actors in the natural resources field whenever they are in breach of the human rights due diligence in natural resources. For such a purpose, it will be less difficult to have appreciation of their responsibility, if a global standard of what should be their behavior and the precautionary measures that they should take is globally defined. As demonstrated, the application of Carisch E. and Rickard-Martin L. “Sanctions and the Effort to Globalize Natural Resources Governance” (Dialogue on globalization 2013) p.2.
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different rules and standards creates a disparity of treatment and damages the fair competition environment within which market participants should operate. A global standard of human rights diligence should help to dissipate this unbalanced situation in the natural resources field,76 but provided that it clearly displays which burden non-state actors like multinational corporations will support at any time they are involved in human rights’ violations. This latter requirement can be a matter of degree as suggested by Manzella who distinguishes direct complicity, from indirect complicity and silent complicity.77 To this list must be added the case when beside aiding and abetting human rights violations, the non-state actor is directly the perpetrator of the abuse itself (see the case of multinational corporations in respect of labor rights). In all these scenarios, my argument is that there is an argument nowadays to accept that in certain circumstances non-actors like multinational corporations should incur direct responsibility under international law at least through their representatives. This should help to dissuade high-risky decisions on human rights from the board of directors. In such a context where due diligence and its implications would enjoy a global acceptance, it must become less difficult for the Security Council to apply its sanctions on natural resources and get more compliance. This is provided that it acts beyond political and socio-economic influences that can emanate from both the public and private spheres and preclude its performance.
Baltimore, the 2th of September 2013
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Carisch and Rickard-Martin (n 75 above) 9. Manzella et. Al. International Law Standard for Corporate Aiding and Abetting Liability (Presented to the U.N. Special Representative to the Secretary General on Human Rights and Transnational Corporations and other Business Enterprises (Earthrights international, 2006) 6-9. 23
