On the fourth day of talks on the UN binding treaty to regulate transnational corporations and other businesses, it all came down to remedy and liability, which seemed to split the room. In response, NGOs emphasized the need for ambition and strong language: we have no more carrots left, it’s time to use sticks.

Unfinished business

As the issue of prevention was not settled at yesterday’s session, civil society delivered their statements on article 6, which outlines the state duty to regulate due diligence obligations for companies. ActionAid Netherlands, Afrewatch, Al-Haq, ECCJ, FIDH, SOMO and others suggested the following changes:

• to delete references to mitigation of abuses, as this could imply accepting a certain level of abuse;
• to make clear that business enterprises should take into account all potential barriers to effective engagement, and that consultations should take place regularly at all stages of the due diligence process in a free, informed and timely manner;
• to address the role of the State as an economic actor with a duty to respect human rights when engaging in economic activities, granting export licenses or conducting commercial transactions.

NGOs also emphasized the need for strong language and to prevent corporate capture of the negotiations. 

Regarding free, prior and informed consent, open questions remain on the meaning of the term ‘meaningful’ in the context of consultations and on whether the same process should apply to local communities and indigenous peoples. One thing delegates could agree on is that the right to self-determination should be respected.

Access to remedy

The article on remedy seemed to split the room once again. Palestine proposed adding a new article 7.1 bis concerning the reparation process to include consultation with those affected and the facilitation of disclosure of information – a suggestion widely supported by civil society. Another positive proposal came from the Peruvian delegate on avoiding gender and age stereotypes during proceedings.

However, scepticism came from Russia and Brazil on the issue of reversing the burden of proof. They received backing from industry groups, arguing that the reversal would go against the principle of ‘innocent until proven guilty’. However, NGOs and some member states reminded delegates present that such provisions already exist in other international and regional instruments, such as the safeguards in the Escazú Agreement.

For the fourth day in a row, the US delegate followed the same script, arguing that this article is too prescriptive to accommodate the diversity of national legal systems and suggested a so-called “alternative approach”. 

In response, a group of civil society organisations, including ECCJ, intervened again to make their position clear and provide the following proposals:

• to strengthen provisions on access to information;
• to remove references on “allowing judges” and “where consistent with international law and its domestic constitutional law”;
• to integrate the principle of dynamic burden of proof, explaining that it should not be up to the judges’ discretion, but rather provided by legislation.

Some business representatives, including from the International Organization of Employers, argued that rules on disclosure of information ignore privacy rules and that forum non conveniens should be respected.

It all comes down to liability

In line with their previous suggestions on scope, Egypt argued in favour of limiting liability provisions to harms caused in the context of transnational business activities only.

Strong divergences arose with regard to article 8.4 on reparations for victims of business-related human rights abuses. Some countries like Mexico and Panama expressed reservations about corporate liability, while others like Brazil and China asked to delete it partly or entirely.

Brazil similarly proposed the deletion of article 8.5, which aims to require businesses to maintain financial security to cover potential claims of compensation. The justification? The measure would be “disproportionate”.

On the issue of civil liability, Mexico suggested separating the provision into the three key types of liability: direct liability, liability for omission to prevent, and liability for harms committed by third parties. This received only lukewarm support.

The US expressed its concerns that provisions on civil liability would not get wide support from member states, but failed to provide constructive suggestions on wording.

What about criminal law?

Some delegates expressed support for article 8.10 on criminal liability. Palestine even submitted two additional articles to secure the introduction of criminal liability for corporate abuse and to establish joint liability where several businesses are involved. Other delegations, however, expressed serious reservations on the basis of alleged incompatibility with their national legislation.

Access to justice… but not really

Brazil proposed a dangerous Article 8.bis, which would oblige victims to “exhaust all legal instances of domestic law where the human rights abuse occurred” before bringing a claim in a different country.

The suggestion raised questions, reservations, and blanket opposition from some states and civil society organisations, as it would dramatically hinder access to justice – especially if there is no fair and prompt process for exhaustion of local remedies in the country where the abuse occurred, as stressed by the Namibian delegate.

“Jurisdiction? No, thanks”

China had no love for article 9.3, which rejects the doctrine of forum non conveniens – a doctrine under which courts may decline jurisdiction by acknowledging that another forum or court is a more appropriate venue for a legal case.

Many opposed this, while Egypt wanted to meet in the middle by accepting forum non conveniens if an adequate alternative forum exists that would likely provide timely, fair and impartial remedy.

Article 9.5 is about a different doctrine with another complicated Latin name: forum necessitatis, which allows a court to be used as a last resort, should no other effective forum guarantee a fair judicial process. This was not China’s cup of tea either, and Brazil and the US expressed similar concerns.

Just as the session was wrapping up, the US raised concerns about article 10 on statute of limitations, given the lack of definition of ‘most serious crimes’.