LACK OF THE SILVER BULLET: CORPORATE ACCOUNTABILITY FOR THE INFRINGEMENT OF INDIGENOUS PEOPLES RIGHTS ***

Transcription

1 LACK OF THE SILVER BULLET: CORPORATE ACCOUNTABILITY FOR THE INFRINGEMENT OF INDIGENOUS PEOPLES RIGHTS *** MASTER THESIS FOR THE COMPLETION OF THE MASTER INTERNATIONAL AND EUROPEAN PUBLIC LAW, TILBURG UNIVERSITY Name: Jeanette van der Weele ANR: Supervisor: A.K. Meijknecht

2 Table of contents Page List of abbreviations 4 Chapter 1: Introduction 5 Chapter 2: Indigenous people in international law 7 2.1: Defining indigenous people 8 2.2: Indigenous peoples rights in international human rights documents : Introduction of the case study 14 Chapter 3: Corporate complicity for indigenous peoples rights 17 Chapter 4: Accountability for multinational corporations at the national level : Host state accountability : Home state accountability : Alien Torts Claim Act : Duty of care principle : Unjust enrichment claim : Conclusion 38 Chapter 5: Accountability for multinational corporations through non-judicial measures : Soft law responses : UN Norms on the responsibility of transnational corporations and other business enterprises with regard to human rights : UN Draft code of conduct on transnational corporations : OECD Guidelines : ILO Tripartite Declaration : Corporate voluntary measures : UN Global Compact : Self-regulation : Arbitration as a possible route 57 2

3 5.4: Conclusion 60 Chapter 6: Conclusion 61 Annex 1: Camisea project components 65 Annex 2: Ownership Camisea Gas Pipeline 66 Annex 3: Indigenous territories, native communities and proposed protected Areas 67 Bibliography 68 3

4 List of abbreviations AC ACHR ACPHR ATCA ATS AU BIT CERD CoE ECHR ECtHR ECOSOC FDI GDP GRI HRC IACHR IACtHR ICCPR ICESCR ILO NGO NCP OAS OECD SRSG UDHR UN UNDRIP UNGC African Commission American Convention on Human Rights African Charter on Human and Peoples Rights Alien Torts Claim Act Alien Torts Statute African Union Bilateral Investment Treaty Committee on Elimination of Racial Discrimination Council of Europe European Convention on Human Rights European Court of Human Rights UN Economic and Social Council Foreign Direct Investment Gross Domestic Product Global Reporting Initiative Human Rights Committee Inter-American Commission on Human Rights Inter-American Court of Human Rights International Covenant on Civil and Political rights International Covenant on Economic, Social and Cultural Rights International Labour Organisation Non-governmental organisation National Contact Point Organisation of American States Organisation for Economic Co-Operation and Development Special Representative of the Secretary-General Universal Declaration of Human Rights United Nations United Nations Declaration on the Rights of Indigenous People United Nations Global Compact 4

5 1. Introduction In recent times more attention is being paid to human rights and the violations thereof. But when human rights have been violated or infringed most people look to the state for that state being held accountable. However due to globalisation and other factors, multinational corporations have gained more and more influence and have become bigger and bigger. It is stated in a report from the Institute for Policy Studies that of the 100 largest economies in the world 51 are corporations while only 49 are countries when you compare corporate sales with countries gross domestic product (GDP), and that the combined sale of the top 200 corporations is bigger than that of the combined economies of all countries minus the biggest 10 country economies. 1 The first question that arises is: what is a multinational corporation? For the purpose of this thesis multinational corporations can be described as a company with operations in two or more countries, generally allowing it to transfer funds and products according to price and demand conditions, subject to risks such as changes in exchange rates or political instability. 2 It is thus a corporation that has a base in country A, but has also activities in country B. It means the same as the term the United Nations (UN) uses, namely transnational corporation, which is described as an economic activity in more than one country or a cluster of economic entities operating in two or more countries whatever their legal form, whether in their home country or country of activity, and whether taken individually or collectively. 3 Since multinational corporations are so big and have so much influence they can influence the lives of people in both a positive and a negative way. But especially the weakest and poorest in society are often influenced in a more negative way by multinational corporations than others, and since indigenous people are particularly weak and poor they are hurt even more. The negative influence by multinational corporations can be seen in all sectors, as a report by Human Rights Watch puts it: the activities of all types of businesses large and small, domestic and international, public and private in all sectors can implicate human rights. 4 But with regard to 1 S. Anderson & J. Cavanagh, Top 200: the rise of corporate global power, Washington DC: Institute for Policy Studies, 4 December H.C. Black, Black s Law Dictionary, St. Paul: West Publishing Company UNCHR (Sub-Commission) (55th session), Norms on the Responsibilities of Transnational Corporations and Other Business Enterprises with Regard to Human Rights (26 August 2003) UN Doc E/CN.4/Sub.2/2003/12/Rev.2. 4 Human Rights Watch, On the margins of profit: rights at risk in the global economy, Human Rights Watch Pub, , p. 2. 5

6 indigenous people, most of the attention is given to the violations by multinationals in the extraction sector since there the most serious violations take place. In this thesis I shall therefore focus on these violations, which is not to say that rights of indigenous people cannot be violated by multinationals who operate, for example, in the clothing and apparel or food and beverage sector. Indigenous people have inhabited the grounds they live on for long periods of time and they use these lands for their traditional way of living. Multinational corporations, in their search towards new grounds with natural resources, are often taken to these indigenous lands. The valuable natural resources that are in these lands, multinationals would very much like to extract. And states often are more than willing to lodge these mining concessions, especially when it concerns poorer states, since this means a big financial win for that state. Because of these financial gains, the poor state in question will not ask the multinational corporations that many questions and this allows the multinationals to win resources without having solid regimes vis-à-vis human rights thus also including indigenous peoples rights. This growth of multinational corporations in their search for new areas follows the North-South trend, since, as pointed out by the UN Conference on Trade and Development (UNCTAD), some developing countries economies are the chief producers of numerous natural resources and the developed countries together with up and coming economies are the main consumers of these resources. 5 An example hereof is the Ogoni case were the Ogoni people who lived in Nigeria filed a lawsuit against Nigeria and Royal Dutch Shell for the infringement of their rights as an indigenous community. Even though allegations were brought against Nigeria and Royal Dutch Shell, Royal Dutch Shell escaped accountability and settled the case for 15.5 million US dollar. 6 This shows the power of the richer multinational corporation over the poorer state. For the Endorois people in Kenya almost the same story applies. Here the Endorois people were the victim of human rights infringement by having to move from their traditional lands since multinational corporations were allowed to extract the rubies in their traditional lands and a Kenyan 5 UNCTAD, World Investment Report 2007: Transnational Corporations, Extractive Industries and Development (16 October 2007), p Shell schikt Ogoni-zaak Nigeria, Trouw 9 juni

7 based company was allowed to build a wild life reserve for tourists. Here also, only the state was held accountable while the corporations escaped liability. 7 During the course International and National Protection of Minorities and the writing of my paper for that course on the Endorois case, I started wondering why no case was brought against the corporations that required the Endorois people to move from their traditional lands and only the state in question was found accountable for the indigenous peoples rights infringements that were made. To sum up, since multinational corporations have become such big and powerful economic actors, sometimes even bigger and more powerful than states, which is especially the case when it concerns a rich western-based company that is trying to expand its business in a developing country. The power of multinational corporations over such states poses threats to that state its commitment to protect human rights and indigenous peoples rights and thus to the people involved. After considering different topics for my thesis I found this problem particularly interesting and therefore the answering of the accountability of multinational corporations for indigenous people rights violations will be the base of my research. To answer this question I shall first give an introduction to indigenous people in international law and in this chapter I shall also introduce the case study I m going to use for testing different options for corporate accountability. After this first chapter I will go into corporate complicity, where I shall describe how corporations can violate indigenous peoples rights. In the next chapter I shall look at accountability for multinational corporations at the national level and I shall try these on my case study. A chapter describing non-judicial measures for accountability shall follow this chapter. And in my final chapter I shall reach a conclusion whether there is a possible route for corporate accountability and if this/these route(s) are effective for the indigenous peoples redress. 2. Indigenous people in international law Estimations say there are more than 300 million indigenous people worldwide who inhabit over 70 countries. They are spread over the entire world, every continent, 7 Centre for Minority Rights Development (Kenya) and Minority Rights Group International on behalf of Endorois Welfare Council v. Kenya, Communication , African Commission on Human and Peoples Rights. 7

8 every climate zone; all have indigenous people living within their borders. 8 Even though this data suggest that there are many indigenous people living nowadays, indigenous people are often marginalised in society and are discriminated against, because they live in inaccessible areas and therefore live an isolated life. The marginalisation and discrimination of indigenous people can mostly be seen in the way they are subject to domination and exploitation within national political and economic structures that are commonly designed to reflect the interests and activities of the national majority. 9 And this can lead to the threatening of their existence. As can be seen indigenous people are in need of protection and in this chapter I shall further explain some important international and regional instruments that offer protection to indigenous people. With regard to the regional instrument, I shall focus on the work of the Inter-American Commission on Human Rights (IACHR) and the case law of the Inter American Court of Human Rights (IACtHR). This will be followed by the case study of the Camisea Gas Pipeline Project. But first I shall define indigenous people for the purpose of this thesis. 2.1: Defining indigenous people As of this date, there is still no accepted universal definition of indigenous people. This is due to the inability of states to reach an agreement over what such a definition should entail, but it is also due to the indigenous representatives as they feel that a universally accepted definition could be more an inconvenience towards them then that it will truly benefit them. Since no indigenous community is the same they reason that an accepted definition might exclude some indigenous communities since they would not fulfil the prescribed criteria. 10 However, another reason is that the indigenous representatives fear that if a strict definition is adopted, this may mean that governments with indigenous communities living within their borders might use such a strict definition as a reason for not recognizing the indigenous communities living 8 S. Davis & W. Partridge, Promoting the Development of Indigenous People in Latin America, Finance & Development , p Report of the African Commission s Working Group of Experts on Indigenous Populations/Communities, adopted by the African Commission on Human and Peoples Rights at its 28th ordinary session (2005), p A.K. Meijknecht, Towards International Personality: the Position of Minorities and Indigenous Peoples in International Law, Antwerpen: Intersentia 2001, p

9 within their borders. Therefore a strict definition is not valued, but a preference is given to setting key characteristics to help identify indigenous people. 11 The most cited and most used description of indigenous people is by Jose Martinez Cobo, which reads as follow: Indigenous communities, peoples and nations are those which, having a historical continuity with pre-invasion and pre-colonial societies consider themselves distinct from other sectors of the societies now prevailing in those territories or part of them. They form at present nondominant sectors of society and are determined to preserve, develop and transmit to future generations their ancestral territories, and their ethnic identity, as the basis of their continued existence as peoples, in accordance with their own cultural patterns, social institutions and legal systems. 12 As can be seen, indigenous people differ from regular minorities, since to be seen as an indigenous community there must be a historical continuity with pre-invasion and pre-colonial societies and they are distinct from other sectors of society and must have a link with their ancestral land, which are all characteristics that do not apply to other national minorities. 13 The distinctiveness of indigenous people lies in their special way of life, which is connected with the ancestral lands they live on, and they want to preserve these traditional lands. Another criteria that is often used, is that of self-identification. Meaning that an indigenous community must see themselves as an indigenous community. This is for example included in Convention 169 from the International Labour Organisation (ILO) 14 and it was also used in the report of the African Commission s Working Group Report of the African Commission s Working Group of Experts on Indigenous Populations/Communities, adopted by the African Commission on Human and Peoples Rights at its 28th ordinary session (2005), p UNCHR (Sub-Commission), Report of the Special Rapporteur on the Problem of Discrimination Against Indigenous Populations (1986) UN Doc E/CN.4/Sub.2/1986/7/Add UNCHR (Sub-Commission), Report of the Special Rapporteur on the Problem of Discrimination Against Indigenous Populations (1986) UN Doc E/CN.4/Sub.2/1986/7/Add Convention concerning Indigenous and Tribal Peoples in Independent Countries (ILO No. 169), 72 ILO Official Bull 59 (adopted 27 June 1989, entered into force 5 September 1991) art 1 (2). 15 Report of the African Commission s Working Group of Experts on Indigenous Populations/Communities, adopted by the African Commission on Human and Peoples Rights at its 28th ordinary session (2005), p

10 2.2: Indigenous peoples rights in international human rights documents Since indigenous people were and still are marginalised and discriminated against in society, the international community has been trying to adopt documents that aim at strengthening the position of indigenous people. As individuals indigenous people are entitled to the same basic rights as other individuals on the basis of equality, universality and non-discrimination, but the texts that the international community is trying to adopt are intended to protect and recognise the rights indigenous people have as a community, thus meaning collective rights so as to protect their distinct way of living. 16 Various international human rights instruments have now recognised indigenous peoples rights, the most important one so far is the declaration adopted by the UN rights of indigenous people. 17 The UN Declaration on the Rights of Indigenous People (UNDRIP) has been long in the making. The drafting began on 1985 with the Working Group on Indigenous Populations under the Commission of Human Rights and this was completed in Two years later the Commission of Human Rights reviewed this draft and passed it to the General Assembly and on 13 September 2007 the Declaration was adopted by 144 states voting in favour, 4 votes against and 11 abstentions. 18 UNDRIP is an important document, even though it is a declaration and therefore not legally binding on states and hence does not impose any legal obligations on states, it does constitute a minimum standard that is necessary for the survival, dignity and well being of indigenous peoples of the world. 19 Besides it is a document that is not only drafted by the UN, it collaborated with indigenous peoples, states and non-governmental organisations (NGOs). A few key articles in UNDRIP that are of the utmost importance for indigenous peoples, is first of all the right to maintain and strengthen their distinct political, legal, economic, social and cultural institutions as stated in Article 5. Another important article is Article 10, which states that indigenous people shall not be forcibly removed from their lands or territories and that no relocation shall take place without free, prior and informed consent ( ) and ( ) agreement on just and fair compensation and where possible, with the option of return. A final important article is Article 26 that gives indigenous 16 UNDG Guidelines on Indigenous Peoples Issues (adopted 22 January 2008), p Declaration on the Rights of Indigenous People (13 September 2007 UNGA Res 61/295) UN Doc A/RES/61/ UNDESA Resource Kit on Indigenous Peoples Issues (27 August 2008) p Declaration on the Rights of Indigenous People (13 September 2007 UNGA Res 61/295) UN Doc A/RES/61/295 art

11 people the rights to the lands, territories and resources which they have traditionally owned, occupied or otherwise acquired and that states shall give legal recognition to these lands, territories and resources. Other articles emphasize the right of indigenous people to have their own culture, religion, language, history 20 but also the right to development 21 and the right to self-determination 22. As said before, the UNDRIP is non-binding, but it does contain a development for customary law, since the Declaration concerns the content of the rights of indigenous peoples, as they have been progressively affirmed in domestic legislation, in international instruments, and in the practice of international human rights bodies. 23 A second important document for indigenous people rights is ILO Convention 169. A first attempt was already made earlier with Convention , but due to its limitations and approach that indigenous people will gradually integrate with the majority of a state it was relinquished in favour of Convention Convention 169 also has some important Articles for indigenous people. The first is Article 14, which states that states have to recognise the rights of ownership and possession of the peoples concerned over the lands which they traditionally occupy. This includes the right to the national resources in that land. 26 In addition to these rights it Convention 196 too has the right of free, prior and informed consent in Article 16. Another important instrument is the International Covenant on Civil and Political rights (ICCPR) 27 and in particular Article 27 that reads: In those States in which ethnic, religious or linguistic minorities exist, persons belonging to such minorities shall not be denied the right, in community with the other members of their 20 Declaration on the Rights of Indigenous People (13 September 2007 UNGA Res 61/295) UN Doc A/RES/61/295 art. 11, 12, 13, 14, Declaration on the Rights of Indigenous People (13 September 2007 UNGA Res 61/295) UN Doc A/RES/61/295 art Declaration on the Rights of Indigenous People (13 September 2007 UNGA Res 61/295) UN Doc A/RES/61/295 art R. Stavenhagen, Statement on the Adoption of Declaration on the Rights of Indigenous Peoples Historic Moment for Human Rights, UN Expert Says, UN Press Release (14 September 2007). 24 Convention concerning the Protection and Integration of Indigenous and Other Tribal and Semi- Tribal Populations in Independent Countries (ILO No. 107) (adopted 26 June 1957, entered into force 2 June 1959). 25 Convention concerning the Protection and Integration of Indigenous and Other Tribal and Semi- Tribal Populations in Independent Countries (ILO No. 107) (adopted 26 June 1957, entered into force 2 June 1959) art. 2 and further. 26 Convention concerning Indigenous and Tribal Peoples in Independent Countries (ILO No. 169), 72 ILO Official Bull 59 (adopted 27 June 1989, entered into force 5 September 1991) art International Covenant on Civil and Political Rights (adopted 16 December 1966, entered into force 23 March 1976) 999 UNTS 171 (ICCPR). 11

12 group to enjoy their own culture, to profess and practice their own religion, or to use their own language. This Article states that it applies only to minorities, but it is also used by many indigenous communities that have successfully filled a complaint by the Human Rights Committee (HRC) for the infringement of their rights. However, the question is how far Article 27 ICCPR reaches in the protection of culture. The HRC has extensive case law on this issue, which in general gives the indigenous people the right to their traditional lands and territories and sees the way in which they maintain their livelihood as part of that culture. 28 Besides these international instruments that protect indigenous people, there are also regional systems whose aim it is to protect indigenous people. Examples hereof are the American Convention on Human Rights (ACHR) 29 from the Organisation of American States (OAS), the African Charter on Human and Peoples Rights (ACHPR) 30 from the African Union (AU) and the European Convention on Human Rights (ECHR) 31 from the Council of Europe (CoE). These instruments have had a considerable impact on the protection of indigenous people in their respective region. On this issue the most extensive case law is of the IACtHR, which I will now shortly discuss by describing some of the most imperative cases. A significant case is that of the Awas Tingni community against Nicaragua. 32 In this case the state allowed logging concessions without the consent of the Awas Tingni people and they claimed that it was unconstitutional to not give them land rights and hence they saw this as a violation of Article 21 ACHR. On the other hand the state claimed that local remedies had not been exhausted and that, if there were no preliminary objections according to the Court, the Awas Tingni did not have an ancestral link with their territory as they moved around. The Court ruled that the Awas Tingni has: 28 See for example: Chief Bernard Ominayak and the Lubicon Lake Band v. Canada, Communication No. 167/1984 (26 March 1990) UN Doc CCPR/C/38/D/167/ American Convention on Human Rights (Pact of San Jose) (adopted 22 November 1969, entered into force 18 July 1978) O.A.S.Treaty Series No. 36, reprinted in Basic Documents Pertaining to Human Rights in the Inter-American System, OEA/Ser.L.V/II.82 doc.6 rev.1 at 25 (1992). 30 African Charter on Human and Peoples Rights (adopted 27 June 1981, entered into force 21 October 1986) (1982) 21 ILM 58 (ACHPR). 31 Convention for the Protection of Human Rights and Fundamental Freedoms (European Convention on Human Rights, as amended) (ECHR). 32 The Mayagna (Sumo) Awas Tingni Community v. Nicaragua, Merits, reparations and costs, Inter- American Court of Human Rights Series C No. 79 (31 August 2001). 12

13 Communal property rights to land and natural resources based on traditional patterns of use and occupation of ancestral territory. There rights exist even without State actions which specify them. Traditional land tenure is linked to a historical continuity, but not necessarily to a single place and to a single conformation throughout the centuries. The overall territory of the Community is possessed collectively, and the individuals and families enjoy subsidiary rights of use and occupation. And the logging concessions granted by the State were a breach of Article 21 as it endangered the economic interests, survival, and cultural integrity of the Community and its member. 33 A second important case is that of the Saramaka people versus Suriname. 34 The Saramaka people, who are part of the Maroons tribe, claimed that the mining concessions given by the Surinamese government on territory belonging to the Saramaka were in violation of their right to property as there was no full and effective participation with the tribe. However, the constitution of Suriname states that all natural resources belong to the state. The first answer the Court had to answer was whether the Saramaka people are indeed a tribe, which was answered in the affirmative. 35 Then the Court went on to examine if there was a violation of Article 21. In the light of the Surinamese constitution the Court holds that the right to property can me restricted when these restrictions are: a) Previously established by law, b) necessary, c) proportional and d) with the aim of achieving a legitimate aim ( ) and whether the restriction amounts to a denial of their traditions and customs in a way that endangers the very survival of the group and its members. 36 And in the end the Court found that Suriname had violated the right to property as they failed to fulfil these criteria 37 and the Saramaka should as well receive a 33 The Mayagna (Sumo) Awas Tingni Community v. Nicaragua, Merits, reparations and costs, Inter- American Court of Human Rights Series C No. 79 (31 August 2001) para Case of the Saramaka people v. Suriname, Preliminary objections, merits, reparations and costs, Inter-American Court of Human Rights Series C No. 172 (28 November 2007). 35 Case of the Saramaka people v. Suriname, Preliminary objections, merits, reparations and costs, Inter-American Court of Human Rights Series C No. 172 (28 November 2007) paras Case of the Saramaka people v. Suriname, Preliminary objections, merits, reparations and costs, Inter-American Court of Human Rights Series C No. 172 (28 November 2007) paras Case of the Saramaka people v. Suriname, Preliminary objections, merits, reparations and costs, Inter-American Court of Human Rights Series C No. 172 (28 November 2007) paras

14 reasonable part of the benefits made by the government by developing new projects on their traditional land. 38 In another case the principle of compensation was further recognised, by saying that when damage has been done there is the duty to provide the victims with appropriate compensation. 39 The African Commission who in its cases often draws inspiration from its American counterpart has followed this line of reasoning : Introduction of the case study As can be seen above, there are different ways for indigenous communities, who we have now characterized, to hold the state accountable for a violation of their rights; they can either go to the HRC or to their regional human rights court. But is it also possible to hold the multinational corporations accountable? This will be examined later on the basis of a case study, which I will now describe. The Camisea Gas Pipeline Project is one of the many situations in which an indigenous community is threatened in their existence by the presence of a multinational corporation. The Camisea Project in Peru is one of the largest energy projects since its discovery in 1986 by Royal Dutch Shell and is now considered as one of the most important gas reserves in Latin America. In the time of 1996 to 1998 Shell, together wit Exxon Mobil drilled three evaluation wells and drew up an exploitation report for the government. After Shell/Exxon Mobile decided not to go through with the project, it was picked up in 1999 with an international bidding for both the exploitation and transportation of gas and gas liquids from the Camisea region to Peru s coast (see annex 1) and production started in 2004 with 8 wells. 41 After this international bidding took place, Pluspetrol, an Argentine based company, is the majority shareholder for exploitation, Tecgas, an Italian based company, is the majority shareholder for transportation and US s Ener Ashmore International has all the shares for the distribution of gas and gas liquids (see for further shareholders 38 Case of the Saramaka people v. Suriname, Preliminary objections, merits, reparations and costs, Inter-American Court of Human Rights Series C No. 172 (28 November 2007) para Case of the Yakye Axa Indigenous Community v. Paraguay, Merits, reparations and costs, Inter- American Court of Human Rights Series C No. 127 (17 June 2005) paras See for example: Centre for Minority Rights Development (Kenya) and Minority Rights Group International on behalf of Endorois Welfare Council v. Kenya, Communication , African Commission on Human and Peoples Rights. 41 R.J. Orr & V. Vences, The Camisea Gas Project: a Multi-Stakeholder Perspective on Conflicts & Negotiation, in H.A. Davis, Infrastructure Trends: Trends and Techniques, London: Euromoney Institutional Investor Plc 2008, p

15 annex 2). 42 So the Camisea Gas Pipeline Project covers the extraction, transportation and distribution of gas from the Camisea region. And since this is one of the biggest projects for Peru and Latin America, it has the potential of earning a lot of money, but likewise it also costs a lot of money to have a pipeline from the Peruvian Amazon to the Peruvian coast. For example, the upstream project of the Camisea Project, which covers the extraction, is estimated to cost 730 million US dollar 43, while the whole project approximately costs the sum of 1.7 billion US dollar. 44 The benefit this project will bring to Peru is in the license agreement that allows the corporations to extract gas and gas liquids in exchange for royalties to be paid by the corporations to the government of Peru, which is set at 37% of the sales made. 45 Whereas the benefits from this pipeline are apparent to the economy and development of Peru, the Camisea Project is located in a region where indigenous people live, and have lived there on their ancestral land for centuries, some of which live in isolation and who want to continue living that way. But besides being inhabited by indigenous people this region of the Amazon is also known for its biodiversity and a part now used for the Camisea Project is also a buffer area for a wildlife reserve (see annex 3 for a map of indigenous territories and protected land). 46 The Nahua-Kugapakori Reserve that was established to protect the Yora, Nanti and Kirineri people has now three gas platforms within its borders. But also outside the reserve the peoples of the Yine and Machiguenga are suffering as a result of the Camisea Project. 47 A first problem is that most of these indigenous communities have voluntarily chosen to have no or limited contact with the outside world and their way of living is thus very linked to their lands. But due to the Camisea Project some indigenous 42 Apoyo Consultoria, Proyecto Camisea: Impacto Sobre el Mercado del Gas Natural y Estimación de los Beneficios Económicos (May 2007) <available at: p R.J. Orr & V. Vences, The Camisea Gas Project: a Multi-Stakeholder Perspective on Conflicts & Negotiation, in H.A. Davis, Infrastructure Trends: Trends and Techniques, London: Euromoney Institutional Investor Plc 2008, p Inter-American Development Bank, Camisea Fact Sheet <available at: p G.G. Gonzales, The Camisea Project: Developing Legal Frameworks for Avoiding Social and Environmental Conflicts in Sensitive Areas, Houston Journal of International Law 2008/ , p G.G. Gonzales, The Camisea Project: Developing Legal Frameworks for Avoiding Social and Environmental Conflicts in Sensitive Areas, Houston Journal of International Law 2008/ , p Cultural Survival, Stop Camisea Gas Pipeline - Peru <available at: 15

16 communities have come into contact with employees of the multinational corporations that are shareholders. Since these communities have chosen a life in isolation they are very sensitive to outsiders due to their high sensitivity even to common diseases and to their reduced demographic scale. 48 Yet with the Camisea Project there has been forced contact with outsiders, which deprives these people from the right to choose their own way of living and have exposed them to illnesses that they did not have before. 49 A second problem is the displacement and relocation of some communities. Even though most indigenous communities in this area have been previously recognised by the government and were seen as the owner of that ground. This was solved with a servitude contract that cannot be rejected or accepted it is simply compulsory without a solid compensation scheme. 50 This is clearly a violation of the indigenous right to property and set the door open for the corporations to build gas platforms and the pipelines. During the construction of these, property was damaged as was the infrastructure, but also industrial waste, increased river traffic, noise and deforestation that are already contaminating water and reducing fish stocks and wildlife and then there are also the spills from the pipeline. 51 For people who live in isolation and are dependent on their environment for their existence, this is a dangerous situation that can have grave impacts on their lives. As can be seen from the above, the negative results of the Camisea Project can clearly be seen for the indigenous populations there. The project may have a positive impact for the Peruvian economy; it has disastrous results for the indigenous people. As a Machiguenga song goes: Kobeni, Kobeni, Narotari, obambaroataka, narotari, niavagitacharina, okasanka, gitetapakira kobeni meaning: what would be about us without the nature? We would die we would not exist G. Gisset Chabaneix Portocarrero, The Camisea Gas Project in the Peruvian Amazon: the Promises and Perils of Hydrocarbon Exploitation (MPhil thesis Lund University 2010), p Amazon Watch, Peru: Camisea Natural Gas Project <available at: p G. Gisset Chabaneix Portocarrero, The Camisea Gas Project in the Peruvian Amazon: the Promises and Perils of Hydrocarbon Exploitation (MPhil thesis Lund University 2010), p Cultural Survival, Stop Camisea Gas Pipeline - Peru <available at: 52 R.J. Orr & V. Vences, The Camisea Gas Project: a Multi-Stakeholder Perspective on Conflicts & Negotiation, in H.A. Davis, Infrastructure Trends: Trends and Techniques, London: Euromoney Institutional Investor Plc 2008, p

17 3. Corporate complicity for indigenous peoples rights violations Multinational corporations have become bigger and bigger and have gained more influence than ever before. It was before thought that multinational corporations had no legal personality in international law and could therefore not be held accountable for misdoings. However, in recent times this perception is changing. It is more and more considered that multinational corporations have certain rights and to not see them as subjects of international law with rights and responsibilities is no more justifiable. 53 Multinational corporations have thus a responsibility in governing the world, and have to look for and live up to common ethical standards. 54 In sum, multinational corporations have international legal personality and since they now have legal personality they can be held accountable for the violation of indigenous peoples rights, but the question is how this can happen. There are situations imaginable where the multinational corporation is the perpetrator of indigenous rights infringements, but more likely is the scenario where another actor is the perpetrator of the abuse and the multinational corporation is implicated in this abuse. The expression: business complicity in human rights abuses is then often used. 55 The concept of complicity can be split in three categories. The first one is direct complicity, which requires intentional participation, but not necessarily any intention to do harm, only knowledge of foreseeable harmful effects. 56 The second category is that of beneficial complicity or indirect complicity. This category entails the situation where a company knowingly profits from the infringement of human rights. Then there is the last category of silent complicity that considers that companies should raise systematic or continuous human rights abuses with the appropriate authorities. 57 The report by the International Commission of Jurists explains it even more thoroughly. In this report a distinction is made in causation and contribution. For a multinational corporation to be causative to or to be 53 N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p W.J.M. van Genugten, The Status of Transnational Corporations in International Public Law, in: A. Eide, H.O. Bergesen & P.R. Goyer (eds), Human Rights and the Oil Industry, Antwerpen: Intersentia 2000, p International Commission of Jurists, Report of the International Commission of Jurists Expert Legal Panel on Corporate Complicity in International Crimes: Facing the Facts and Charting a Legal Path (Volume 1), (16 September 2008), p A. Clapham & S. Jerbi, Categories of Corporate Complicity in Human Rights Abuses, Hastings International Law and Comparative Law Review 2000/ , p A. Clapham & S. Jerbi, Categories of Corporate Complicity in Human Rights Abuses, Hastings International Law and Comparative Law Review 2000/ , p

18 contributing to human rights violations it has to have enabled, exacerbated or facilitated the abuses. A corporation can enable a violation when, without the help of the corporation, the human rights violation would not have happened. Then a corporation can also exacerbates a violation because the corporation s behaviour increased the range of human rights abuses committed by the principal actor, the number of victims, or the severity of the harm suffered by the victims. Lastly, a multinational corporation can also facilitate violations by making it easier for the perpetrator to carry out the violations or by changing the way in which the violation is carried out. 58 Enabling, exacerbating or facilitating the abuses can be seen as either a form of direct or indirect complicity, as described in the article by A. Clapham and S. Jerbi. Whether it would be direct or indirect complicity would depend on the further criteria described below. As to be legally accountable with regard to these violations and abuses the multinational corporation must also have the necessary state of mind, which means there must be an intention, knowledge or a foreseeability of the corporation to participate. It can be that a company wishes to participate in the violation, but the more likely is the case in which the corporation should have known that its behaviour was likely contributing to human rights violations. 59 The should have known criteria can be assessed by using objective features. 60 The last criteria, to be held legally accountable, is the proximity criteria that entails the sphere of influence of the corporation. Thus the closer a corporation is with the perpetrator the more likely it will be that it can influence the behaviour of the principal perpetrator or that the corporation could have foreseen what was happening. The closer a multinational corporation is with the perpetrator the more it could have foreseen the situation and the more likely it can be held legally accountable for complicity International Commission of Jurists, Report of the International Commission of Jurists Expert Legal Panel on Corporate Complicity in International Crimes: Facing the Facts and Charting a Legal Path (Volume 1), (16 September 2008), p International Commission of Jurists, Report of the International Commission of Jurists Expert Legal Panel on Corporate Complicity in International Crimes: Facing the Facts and Charting a Legal Path (Volume 1), (16 September 2008), p For example inquiries made by the corporation or the accession of publicly available information. See for more: International Commission of Jurists, Report of the International Commission of Jurists Expert Legal Panel on Corporate Complicity in International Crimes: Facing the Facts and Charting a Legal Path (Volume 1), (16 September 2008), p International Commission of Jurists, Report of the International Commission of Jurists Expert Legal Panel on Corporate Complicity in International Crimes: Facing the Facts and Charting a Legal Path (Volume 1), (16 September 2008), p

19 Complicity as described here is not in the sense of criminal law, where it means an accomplice. The definition of corporate complicity is rather a rich and multi-layered colloquial manner to convey the connotation that someone has become caught up and implicated in something negative and unacceptable. 62 The criteria described above for corporate complicity would mean in criminal law that the corporation was an aider and abettor and in civil law the laws of civil remedies would be applied. 63 Since multinational corporations can be held accountable for human rights violations as being complicit in these violations, the same also applies to the infringement of indigenous peoples rights. Thus in the case of the Camisea Gas Pipeline Project the corporations involved can be seen as complicit if they fulfil the criteria described. Meaning that they must have enabled, exacerbated or facilitated the violations and should have had the knowledge, foreseeability and proximity about the intentions of the principal perpetrator. The first hurdle for indigenous communities in their search for corporate accountability is thus taken since multinational corporations have international legal personality and hence can be held accountable when they are complicit to indigenous peoples rights violations. 4. Accountability for multinational corporations at the national level Since there is not yet a direct international way of holding multinational corporations accountable for human rights abuses, thus also no way of holding them directly accountable for indigenous rights infringements at the international level, corporations can only be held judicially liable through national courts. 64 But then the question arises which state should prosecute the multinational corporation that violated indigenous peoples rights. This can either be the state where the violation took place, also known as the host state or it can be the state where the corporation has its seat known as the home state. In this chapter I shall first explain the advantages and disadvantages of a prosecution by the host state. Thereafter I shall do the same 62 International Commission of Jurists, Report of the International Commission of Jurists Expert Legal Panel on Corporate Complicity in International Crimes: Criminal Law and International Crimes (Volume 2), (16 September 2008), p International Commission of Jurists, Report of the International Commission of Jurists Expert Legal Panel on Corporate Complicity in International Crimes: Facing the Facts and Charting a Legal Path (Volume 1), (16 September 2008), p N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p

20 with a prosecution in the home state of a multinational corporation. In that paragraph I shall also explain some domestic routes in specific states like the Alien Torts Claim Act (ATCA), the duty of care principle and the unjust enrichment claim Host state accountability When a multinational corporation violates either an indigenous right, as discussed in this thesis, or a human right, the first reaction would be to look at the jurisdiction where the violation took place, the host state. The host state can prosecute multinational corporations that violate rights on its territory as every state has jurisdiction over crimes committed on its territory by a national of any state based on the principle of territorial jurisdiction. 65 But the possibility to prosecute can also be derived from treaty obligations that state that states should respect, protect and fulfil human rights. In this case the duty to protect is especially important as it entails the duty on the state to take action when rights are violated by a private actor or by other states so as to protect their citizens and other nationals living within its territory and its jurisdiction. 66 For example Article 2(1) ICCPR states that states have to respect and ensure to all individuals within its territory and subject to its jurisdiction the rights recognised in the present Covenant. Besides the duty to protect that states have based on the ratification of international treaties, some international treaties also entail on the state to establish monitoring, regulatory and adjudication mechanisms. With regard to the monitoring of treaty obligations, this means that states must prohibit abuses of the treaty obligations by law, that suspected infringements are correctly investigated, that the perpetrator can be brought before a court and that the victims can be provided with an effective remedy. 67 Regulatory mechanisms are aimed at imposing an obligation on the state to adopt legislative measures as a means to ensure enjoyment of rights. This is often seen as a states minimum obligation so as to fulfil the duty to protect under that treaty. 68 For example the Committee on 65 P. Malanczuk, Akehurst s modern introduction to international law, New York: Routledge 1997, p D.M. Chirwa, The Doctrine of State Responsibility as a Potential Means of Holding Private Actors Accountable for Human Rights, Melbourne Journal of International Law , p Interim Report of the SRSG on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises, State Responsibility to Regulate and Adjudicate Corporate Activities under the United Nations Core Human Rights Treaties (13 February 2007) UN Doc A/HRC/4/35/Add.1, p Interim Report of the SRSG on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises, State Responsibility to Regulate and Adjudicate Corporate Activities under the United Nations Core Human Rights Treaties (13 February 2007) UN Doc A/HRC/4/35/Add.1, p

21 Elimination of Racial Discrimination (CERD) said in one concluding observation that: development objectives are no justification for encroachments on human rights, and that along with the right to exploit natural resources there are specific, concomitant obligations towards the local population. 69 States are thus obliged to take regulatory and administrative measures with regard to protecting indigenous and local communities and to prevent violations by multinational corporations when carrying out large infrastructure and mining projects that can affect those communities. 70 And this thus also applies to the Camisea Gas Pipeline Project. Adjudication is not mentioned as such in treaties. But the treaties do often mention the obligation for states to make sure there are ways to investigate possible infringements or to have a judicial, administrative or legislative way of sanctioning those who infringe the rights of the treaty and remedies to provide for the justification of victims. These measures are all linked so as to make sure there are effective remedies for human rights violations. 71 When a state does not fulfil these treaty obligations, the state may be in violation of the treaty depending on whether it took all reasonable measures that the state could be expected to take within this particular circumstance. But the state can also be held responsible for the violation of human rights by private actors when it failed to exercise due diligence to prevent and respond to the violations. 72 This was decided by the IACtHR in the landmark case of Velásquez Rodríguez v. Honduras. 73 Here the Court stated that: An illegal act which violates human rights and which is initially not directly imputable to a state (for example, because it is the act of a private person or because the person responsible has not been identified) can lead to international responsibility of the state, not because of the 69 CERD (64th Session), Consideration of Reports Submitted By States Parties under Article 9 of the Convention - Suriname (28 April 2004) UN Doc CERD/C/64/CO/9, para Interim Report of the SRSG on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises, State Responsibility to Regulate and Adjudicate Corporate Activities under the United Nations Core Human Rights Treaties (13 February 2007) UN Doc A/HRC/4/35/Add.1, p Interim Report of the SRSG on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises, State Responsibility to Regulate and Adjudicate Corporate Activities under the United Nations Core Human Rights Treaties (13 February 2007) UN Doc A/HRC/4/35/Add.1, p D.M. Chirwa, The Doctrine of State Responsibility as a Potential Means of Holding Private Actors Accountable for Human Rights, Melbourne Journal of International Law , p Case of Velásquez Rodríguez v. Honduras, Merits, Inter-American Court of Human Rights Series C No. 4 (29 July 1988). 21

22 act itself, but because of the lack of due diligence to prevent the violation or to respond to it as required by the Convention. 74 Unless the state has taken: Reasonable steps to prevent human rights violations and to use the means at its disposal to carry out a serious investigation of violations committed within its jurisdiction, to identify those responsible, to impose the appropriate punishment and to ensure the victim adequate compensation. 75 After this landmark decision by the IACtHR, other courts have followed this line of reasoning. The African Commission (AC) adopted this due diligence test in the Ogoni case 76 and the European Court of Human Rights (ECtHR) adopted it as well in the case of Osman v. United Kingdom. 77 Subsequently, the duty to protect human rights, that states have based on treaty obligations, can mean that they may be held responsible for human rights violations by private actors but only if they failed to meet the due diligence-test. It is thus only responsible if it has not taken the reasonable steps required to prevent a violation or to respond to it. This all sounds promising for indigenous peoples or communities who seek redress for the violation of their rights by multinational corporations through the host states national judiciary as it entails the possibility of a state being accountable if it does not respond properly. But nevertheless there have not been many cases filled against a state for a failure to take reasonable measures to prevent or to respond to human rights violations. 78 This is not the only problem with the host state being required to control multinational corporations. As said before multinational corporations have become bigger and bigger and have gained a lot of influence. This expansion of multinationals follows the North-South trend and this thus also implies that they may have more economic power than the state in question. That state would not like to see the 74 Case of Velásquez Rodríguez v. Honduras, Merits, Inter-American Court of Human Rights Series C No. 4 (29 July 1988), para Case of Velásquez Rodríguez v. Honduras, Merits, Inter-American Court of Human Rights Series C No. 4 (29 July 1988), para Social and Economic Rights Action Centre (SERAC) and the Centre for Economic and Social Rights (CESR) v. Nigeria, Communication 155/96, African Commission on Human and Peoples Rights, para Osman v. United Kingdom (App no 23452/94) ECHR 1998-VIII 3124, para S. Joseph, An Overview of the Human Rights Accountability of Multinational Enterprises, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p

23 multinational corporation leave as it can financially benefit from having such a corporation within its territory and might therefore be susceptible to threats made by the corporation about relocating to a more corporate friendly state and thereby terminating the business done in the state that might prosecute them. 79 This inequity in means can influence a state its willingness to prosecute the multinational; as to say the state lacks the political will to prosecute. Another problem with the host state approach is that home states are more likely to have the technical expertise and means to monitor and regulate corporate activities. 80 Connected to this problem is that these developing host states might also lack the legal machinery for the discovery of all the relevant documents and facts, such as unravelling the corporate veil. 81 With regard to indigenous peoples rights there might even be more problems than the ones described above. First of all the multinational corporation might be restricted in being held accountable as the state does not recognise indigenous peoples rights. 82 But even when regulation in the host state is in place there might still be other drawbacks that might limit accountability, for example corrupt officials or cooption of state officials. 83 In the case of the indigenous people affected by the Camisea Gas Pipeline Project, the indigenous people can start proceedings before a Peruvian court as Peru has jurisdiction over crimes committed on its territory. But the indigenous people also have a chance of trying to hold the multinational corporations involved accountable through a national procedure in Peru, as Peru, as other signatory states, has to fulfil its treaty obligations. When this does not happen, Peru might not have lived up to its duty to protect and can be held responsible for the violation of a private actor if it failed to exercise due diligence to prevent and respond to the violations. 84 However 79 S. Joseph, An Overview of the Human Rights Accountability of Multinational Enterprises, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p M. Lippman, Transnational Corporations and Repressive Regimes: the Ethical Dilemma, California Western International Law Review , p S. Joseph, An Overview of the Human Rights Accountability of Multinational Enterprises, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p L. Aponte Miranda, The U wa and Occidental Petroleum: Searching for Corporate Accountability in Violations of Indigenous Land Rights, American Indian Law Review 2006/ , p D.M. Chirwa, The Doctrine of State Responsibility as a Potential Means of Holding Private Actors Accountable for Human Rights, Melbourne Journal of International Law , p D.M. Chirwa, The Doctrine of State Responsibility as a Potential Means of Holding Private Actors Accountable for Human Rights, Melbourne Journal of International Law , p

24 this host state based approach might cause difficulties, with an unwilling state, a weaker legal machinery and less technical expertise. So the question whether this road will be successful remains questionable. A possible solution to these problems might be the home state approach that will be discussed in the next paragraph Home state accountability Since the host state approach is not without problems, the home state approach may be a better way for indigenous people seeking redress for the violation of their rights. Home state accountability usually refers to the state of incorporation of the multinational corporation and where it has its registered office. 85 Since the problem of infringing indigenous peoples rights by multinational corporations follows the North- South trend this would mean that the state of incorporation is in a developed state instead of a developing state which is the case with the host state approach. This approach would thus have its advantages, since the home state will be better equipped to deal with the powerful multinational corporation as it has a better legal machinery and more technical expertise. 86 However for the home state to be a good alternative in comparison to the host state, the home state must have jurisdiction over the crimes committed abroad. A first way the home state can claim jurisdiction is based on the active personality principle. Meaning that a state can prosecute when a crime is committed abroad by a national of that state. This principle is based on the notion that the sovereign independence of the state includes the nationals of that state and therefore it has the right to prosecute these nationals even if the crime is committed on the sovereign territory of another state. 87 Jurisdiction on the basis of nationality would thus entail that the home state would base its jurisdiction on the nationality of the parent company of the multinational corporation and therefore not on the nationality of the subsidiary. This could then lead to difficulties with regard to piercing the corporate veil and thereby settling the nationality in the first place. 88 Piercing the corporate veil is a difficult 85 Case Concerning the Barcelona Traction, Light and Power Company, Limited (Belgium v Spain) [1970] ICJ Rep 44, para S. Joseph, An Overview of the Human Rights Accountability of Multinational Enterprises, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p P. Malanczuk, Akehurst s modern introduction to international law, New York: Routledge 1997, p V. Engström, Who is Responsible for Corporate Human Rights Violations?, Åbo Akademi University, Institute for Human Rigts (January 2002), p

25 exercise as corporations use difficult and confusing structures to shield the parent company from liability by using subsidiaries and thereby creating an opportunity for the multinational corporation to escape accountability. 89 But the active personality principle is not the only way a home state can exercise its jurisdiction. Alternatively, it can use the protective principle whereby a state can prosecute violations committed abroad that harm the home state s vital interest or the objective territorial principle where a crime is commenced in one state and completed in the other, thus commenced in the home state and completed in the host state. 90 Another principle that can be used is that of universal jurisdiction, which gives every state jurisdiction over crimes committed in another state even if the offender is not a national of that state; there is no nexus necessary between the state and the offender, the victim or the crime. It is more the gravity of the crime that gives the state the power to prosecute. 91 As can be seen, there are several ways in which the home state can have jurisdiction over a multinational corporation that infringed indigenous peoples rights outside the territory of the home state. And since the trial will take place in a developed country there are certain advantages towards prosecuting a multinational corporation in the home state instead of the host state. Unfortunately, there are also some downsides by trying to seek redress as an indigenous community in the home state of the corporation. A first disadvantage is that the home state might not have the political will to regulate the behaviour of its multinational corporations and their subsidiaries that mainly operate abroad and thus have limited effect on the home state itself. 92 So far not many attempts hereto have been made, but for example Canada has made an attempt to regulate the behaviour of multinational corporations. 93 The Canadian Parliaments Standing Committee on Foreign Affairs and International Trade was concerned that Canada does not yet have laws to ensure that the activities of Canadian mining companies in developing countries conform to human rights 89 R. Meeran, Liability of Multinational Corporations; a Critical Stage in the UK, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p V. Engström, Who is Responsible for Corporate Human Rights Violations?, Åbo Akademi University, Institute for Human Rigts (January 2002), p N. Arajärvi, Universal Jurisdiction: End of Impunity or Tyranny of Judges, (LLM Thesis, University of Helsinki: 2006), p L. Aponte Miranda, The U wa and Occidental Petroleum: Searching for Corporate Accountability in Violations of Indigenous Land Rights, American Indian Law Review 2006/ , p L. Aponte Miranda, The U wa and Occidental Petroleum: Searching for Corporate Accountability in Violations of Indigenous Land Rights, American Indian Law Review 2006/ , p

26 standards, including the rights of workers and of indigenous peoples. 94 Home states are unwilling to regulate their multinational corporations, as they are afraid that such regulation would put multinational corporations at a competitive disadvantage with other states corporations. 95 A second disadvantage is that most multinational corporations tried before a court of the home state appeal to the doctrine of forum non conveniens. Corporations abuse this doctrine to avoid accountability by barring the hearing of the case by saying that there is a more appropriate forum for this case. Some home states courts are more stringent with this doctrine than others, but again it poses an obstacle for indigenous people seeking redress. 96 Thirdly, for indigenous people it might be costly to start proceedings in the home state of the multinational corporation. It takes more financial resources to start proceedings in the home state than in the host state, for example there are more travel expenses but the procedural costs might also be more expensive. 97 A fourth disadvantage is the difficulty of piercing the corporate veil, as said above. But in this field, some progress has been made. Some national courts have started to pierce the corporate veil by examining the entire corporate group and thereby imposing accountability on the parent company for acts committed by foreign subsidiaries. 98 It has been said that if you look at a multinational corporation as A conglomerate of units of a single entity, each unit performing a specific function, the function of the parent company being to provide expertise, technology, supervision and finance. Insofar as injuries result form negligence in respect of the parent company functions, then the parent company should be liable Canadian Parliaments Standing Committee on Foreign Affairs and International Trade, Report 14: Mining in Developing Countries Corporate Social Responsibility (adopted by the Committee 20 June 2005, presented to the House 22 June 2005). 95 S. Joseph, An Overview of the Human Rights Accountability of Multinational Enterprises, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p S. Joseph, An Overview of the Human Rights Accountability of Multinational Enterprises, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p M. Lyon, A Case Study in Multinational Corporate Accountability: Ecuador s Indigenous People Struggle for Redress, Denver Journal of International Law and Policy 2003/ , p R. McCorquodale & P. Simons, Responsibility Beyond Borders: State Responsibility for Extraterritorial Violations by Corporations of International Human Rights Law, Modern Law Review , p R. Meeran, The Unveiling of Transnational Corporations: a Direct Approach, in: M. Addo (ed.), Human Rights Standards and the Responsibility of Transnational Corporations, The Hague: Kluwer Law International 1999, p

27 So if there is sufficient involvement in, control over and knowledge of the subsidiary operations by the parent company then there is no reason of not imposing accountability on the parent company for acts committed by foreign subsidiaries. 100 However, recent events have proven that home state accountability can happen. A Royal Dutch Shell subsidiary has accepted accountability for oil spills in Nigeria in 2008 during a recent class action suit at the UK High Court. Here, Shell accepted full accountability for the fracturing of a pipeline that pumped up to barrels of oil a day through the lands of the Ogoni community and by the fracture polluted their traditional lands and their water and food resources. With the acceptance of full accountability Shell faces compensation payments that can go into the hundreds of millions of dollars. 101 This proceeding might then open the door for other affected communities seeking redress against multinational corporations. In the case of the Camisea Gas Pipeline Project, the indigenous communities affected could try to start proceedings before a court of the home state of the multinational corporations involved. But still, there are some barriers when they seek redress through this way. There are obstacles for them to overcome will their claim be successful, but the chance on success might just be a little higher when compared with the host state approach, especially when you compare the differences in legal machinery. Although the latest events in the UK are hopeful for indigenous people who seek redress. There are also ways in which a claim made in the home state may be more successful, namely by using the Alien Torts Claim Act (ATCA), the duty of care principle or the unjust enrichment claim. These possibilities will be described in the following paragraphs Alien Torts Claim Act The ATCA is a statute passed by the first Congress as part of the Judiciary Act of 1978 and its original purpose was to provide redress for violations on American territory against foreign state nationals in the courts of America. 102 Since then the wording of the act has not changed and still reads as follow: 100 R. Meeran, The Unveiling of Transnational Corporations: a Direct Approach, in: M. Addo (ed.), Human Rights Standards and the Responsibility of Transnational Corporations, The Hague: Kluwer Law International 1999, p J. Vidal, Shell Accepts Liability for Two Oil Spills in Nigeria, The Guardian 3 August N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p

28 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. 103 In the past 200 years the act was not used, but in the 1980s the ATCA was revived. Since then, approximately 50 cases have been brought under the ATCA till the end of The appeal of the ATCA is that the alien does not have to be physically present in the US, the tort does not have to have happened on US soil and the defendant does not have to be an American either. 105 For the defendant to get served they only have to be physically present in the state they get served in, so someone visiting or passing though that state is thereby subject to that court s authority even if there is no further connection with that state. If this is satisfied the court has personal jurisdiction over the defendant. 106 If the defendant is a corporation it is presumed to be physically present whenever it conducts business in that state. 107 For the court to have jurisdiction over the subject matter, the case has to fall within any of the categories in which the federal court has authority. So the ATCA gives federal courts jurisdiction over the subject matter over all claims falling with the reach of the statute, without the need to show any additional connection to the US. 108 The first case in 200 years in which the ATCA was used, was in 1980 in the case of Filártiga v. Peña-Irala. 109 In this case the Filártiga family filled a lawsuit against Americo Norberto Peña-Irala for the kidnapping and torture of Joelito Filártiga that resulted in his dead. This all happened in Paraguay and both the Filártiga s and Peña-Irala are Paraguayan nationals. When in 1978 Peña-Irala moved to New York, Dolly Filártiga, then living in Washington DC, filled a complaint based on the ATCA. 110 The question was whether torture, as it was not contended by the appellants that their action aroused directly under a treaty of the US, was in violation 103 Alien's Action for Tort, 28 USCS L.G. Dunst, Human Rights Overseas, New York Law Journal 2009, p N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p B. Stephens, Corporate Accountability: International Human Rights Litigation Against Corporations in US Courts, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p B. Stephens, Corporate Accountability: International Human Rights Litigation Against Corporations in US Courts, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p Filártiga v. Peña-Irala, 630 F.2d 876 (2d Cir. 1980). 110 Filártiga v. Peña-Irala, 630 F.2d 876 (2d Cir. 1980), p

29 of the law of nations. 111 To establish if there is such a violation the court referred to the Paquete Habana Case 112 and reaffirmed that: Where there is no treaty, and no controlling executive or legislative act or judicial decision, resort must be had to the customs and usages of civilized nations; and, as evidence of these, to the works of jurists and commentators, who by years of labour, research and experience, have made themselves peculiarly well acquainted with subjects of which they treat. Such works are restored to by judicial tribunals, not for the speculation of their authors concerning what the law ought to be, but for trustworthy evidence of what the law really is. 113 So this means that it is thus clear that courts must interpret international law not as it was in 1789, but as it has evolved and exists among the nations of the world today. 114 And in this case torture was seen as a violation of the law of nations. 115 Since torture was perpetrated under the colour of the law it was a violation of the law of nations and therefore the defendant under ATCA must be a state. 116 In the following years the notion of defendant was expanded. But it was not until the case of Kadic v. Karadzic that the notion of defendants was expanded towards private parties. 117 Here it held that: We do not agree that the law of nations, as understood in the modern era, confines its reach to state action. Instead, we hold that certain forms of conduct violate the law of nations whether undertaken by those acting under the auspices of a state or only as private individuals. 118 Since this case, there have been cases where the defendant was a corporation and there is the possibility that the reach of the ATCA can be expanded to include human rights and indigenous peoples rights. However seeking redress by using the ATCA is still difficult. In one of the first cases against a corporation, namely the Texaco case 119, two appeals were consolidated, as both appellants were Indians from Ecuador and Peru who said that Texaco had damaged their natural environment and 111 Filártiga v. Peña-Irala, 630 F.2d 876 (2d Cir. 1980), p The Paquete Habana, 175 U.S. 677 (1900). 113 Filártiga v. Peña-Irala, 630 F.2d 876 (2d Cir. 1980), p Filártiga v. Peña-Irala, 630 F.2d 876 (2d Cir. 1980), p Filártiga v. Peña-Irala, 630 F.2d 876 (2d Cir. 1980), p N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p Kadic v. Karadzic, 70 F.3d 232 (2nd Cir. 1995). 118 Kadic v. Karadzic, 70 F.3d 232 (2nd Cir. 1995), p Jota v. Texaco, 157 F.3d 153 (2d Cir. 1998). 29

30 had threatened their way of living in the rain forest. They stated that their land was polluted and that members of the community had experienced physical injuries. 120 However in 2002 the US Federal Court dismissed the claim on the basis of forum non conveniens. 121 In the Unocal case 122 it survived the subject matter jurisdiction 123, but it did not survive a motion for summary judgement. The Ninth Circuit Court of Appeals found that there was enough evidence of clear human rights abuses and stated that Unocal could be responsible for those abuses when it had provided knowing practical assistance or encouragement that had a substantial effect on the perpetration of the crimes. 124 But the case did not go further on trial as Unocal settled the case in 2004 for an undisclosed amount of money. 125 This also happened in the case of Wiwa v. Shell 126, where the plaintiffs moved beyond the subject matter jurisdiction and won several other pre-trial rulings 127, but settled the case in 2009 for 15.5 million US dollar. 128 So the successes have been small and for indigenous people it is difficult to prove their subject matter. It has been ruled that environmental law claims, in certain circumstances, can be a violation of international customary law. 129 Other claims might be successful on the basis of the Universal Declaration of Human Rights 130 (UDHR) as parts of this declaration can be seen as customary law. 131 In the same article C.T. Salazar also states that indigenous people might bring a claim under the ICCPR or the International Covenant on Economic, Social and Cultural Rights 132 (ICESR) since both have been in force for numerous years and both have a high 120 Jota v. Texaco, 157 F.3d 153 (2d Cir. 1998), p Aguinda v. Texaco, 303 F.3d 470 (2d cir. 2002), p Doe v. Unocal, 963 F. Supp. 880 (C.D. Cal. 1997). 123 Doe v. Unocal, 963 F. Supp. 880 (C.D. Cal. 1997), p Doe I v. Unocal, 395 F.3d 932 (9th Cir. 2002) p K.R. Carter, Amending the Alien Tort Claims Act: Protecting Human Rights or Closing off Corporate Accountability, Case Western Reserve Journal of International Law 2006/ , p Ken Wiwa v. Royal Dutch Petroleum Co. No. 96 Civ (S.D.N.Y.1998). 127 Case Profile: Shell Lawsuit, < trenigeria> accessed 5 July Shell schikt Ogoni-zaak Nigeria, Trouw 9 juni N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p Universal Declaration of Human Rights (adopted 10 December 1948 UNGA Res 217 A(III) (UDHR). 131 C.T. Salazar, Applying International Human Rights Norms in the United States: Holding Multinational Corporations Accountable in the United States for International Human Rights Violations under the Alien Tort Claims Act, St. John s Journal of Legal Commentary , p International Covenant on Economic, Social and Cultural Rights (adopted 16 December 1966, entered into force 3 January 1976) 993 UNTS 3 (ICESCR). 30

31 number of ratifications. 133 This is reinforced when the HRC decided that some rights included in the ICCPR are ius cogens norms and no deviation is allowed from these norms. In this comment the HRC included Article 27 about minority rights on culture, religion and language. 134 Therefore it might be possible for indigenous people to use the ATCA and rely on Article 27 ICCPR, which allows them to let the court rule based on violations of their rights as indigenous people. However, there have not been any cases that rely on this Article. Advantages of a claim made in the US under ATCA is that in the US, when the plaintiff is unsuccessful in bringing a claim against the defendant, it does not have to pay for the defendant s costs. Secondly, in the US lawyers regularly act on a contingency basis, which lowers the costs dramatically and besides lawyers working on a contingency basis there are also a lot of lawyers in the US who work in the public interest legal sector. If the case has started, the US has the advantage of a discovery procedure that is lenient to the plaintiff as most information will be in the hands of the multinational corporation. And finally, if a case is successful, damages in the US tend to be higher than in other states. 135 But to get so far as to receive damages, there is a long way to go and most cases are dismissed. Courts have dismissed cases on different grounds; examples hereof are the lack of personal jurisdiction, forum non conveniens, failure to exhaust local remedies, international comity, the act of state doctrine and the political question doctrine. 136 The act of state doctrine is, in the case of human rights and indigenous peoples rights, not that relevant as such violations will almost never be official acts of state. 137 But the biggest hurdle that must be taken is only problematic since 2010, and that is the break with precedent when the court, in an ATCA case, ruled that: No corporation has ever been subject to any form of liability (whether civil, criminal, or otherwise) under the customary international law of human rights. Rather, sources of 133 C.T. Salazar, Applying International Human Rights Norms in the United States: Holding Multinational Corporations Accountable in the United States for International Human Rights Violations under the Alien Tort Claims Act, St. John s Journal of Legal Commentary , p W.J.M. van Genugten, The Status of Transnational Corporations in International Public Law, in: A. Eide, H.O. Bergesen & P.R. Goyer (eds), Human Rights and the Oil Industry, Antwerpen: Intersentia 2000, p S. Joseph, Corporations and Transnational Human Rights Litigation, Oxford: Hart Publishing 2004, p L.G. Dunst, Human Rights Overseas, New York Law Journal 2009, p N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p

32 customary international law have, on several occasions, explicitly rejected the idea of corporate liability. Thus corporate liability has not attained a discernable, much less universal acceptance among nations of the world in their relations inter se and it cannot not as a result, form the basis of a suit under the Alien Torts Statute (ATS). 138 In this sweeping decision the court ruled that Royal Dutch Petroleum Co. could not be held accountable for the aiding and abetting of human rights violations in Nigeria, as there is no corporate liability. In his concurring opinion only in judgement, Judge Leval argues that this: Majority opinion deals a substantial blow to international law and its undertaking to protect fundamental human rights and ( ) who earns profits by commercial exploitation of abuse of fundamental human rights can successfully shield those profits from victims claims for compensation simply by taking the precaution of conducting the heinous operation in the corporate form. 139 In October the plaintiffs filled a petition for a second hearing and a hearing en banc, but this was denied by the court of appeals. Now the appellants have petitioned the Supreme Court and we will have to wait what the Supreme Court decides. 140 Since this new decision it has become even more difficult, if not impossible, for indigenous people to use the ATCA as a way of seeking redress against the violations of their rights by multinational corporations. The indigenous people affected by the Camisea Gas Pipeline Project might have had a chance before the ruling in the Kiobel case, since environmental rights violations and possibly even violations with regard to Article 27 ICCPR might have been good enough to settle the subject matter jurisdiction and move forwards in the proceedings if there was no dismissal of the case based on the previous mentioned doctrines. If that were to happen redress might have happened, but with this new ruling it is questionable whether it would work. It is now a matter of waiting until the Supreme Court gives a final decision, and if ruled in the positive for the appellant, the indigenous people of the Camisea region might stand a chance. 138 Kiobel v. Royal Dutch Petroleum Co., 621 F.3d 111 (2n Cir. 2010), p Kiobel v. Royal Dutch Petroleum Co., 621 F.3d 111 (2n Cir. 2010), p Case Profile: Shell Lawsuit, < trenigeria> accessed 5 July

33 Duty of care principle Multinational corporations can be sued in the US under the ATCA, but in the UK, Canada and Australia corporations are also sued for human rights violations, but then under the duty of care principle. 141 The duty of care principle means that a private actor, including corporations, can he held liable if it had a duty of care towards the plaintiff and that the breach of that duty caused the injury of the plaintiff. 142 In this procedure a parent company can be held liable for violations within the family, meaning that it can be held liable if subsidiaries abroad do not live up to the standard of care that is the usual norm of the parent company at home. 143 Some cases have been tried on the duty of care principle, which I shall now discuss. An important case in Canada was the Cambior case 144 were the Canadian mining company Cambior faced litigation in Canada over the failing of the tailings dam at the Omai Mine in Guyana thereby polluting the Essequibo River. Approximately people are living close to the river and rely on it for their livelihood. In 1997 a claim was brought to the Quebec Superior Court for damages, as Cambior owned 65% of the shares in Omai Gold Mines Ltd. However the case was dismissed on the doctrine of forum non conveniens. 145 In Australia there is the case of Dagi v. The Broken Hill Proprietary Company Ltd. 146 In this case BHP was accused of destructing the environment, the traditional way of living of people living in that part of Papua-New Guinea and of polluting the Ok Tedi and Fly Rivers through the dumping of mine tailings waste. Judge Judge Byrne held that in his view: It is not at all impossible to suppose that the law imposes a duty of care in favour of persons who may use the water downstream as a food source or for a livelihood. The magnitude of the 141 H. Ward, Transnational Litigation Joining Up Corporate Responsibility?, Royal Institute of International affairs < accessed 6 July D.M. Chirwa, The Doctrine of State Responsibility as a Potential Means of Holding Private Actors Accountable for Human Rights, Melbourne Journal of International Law , p H. Ward, Transnational Litigation Joining Up Corporate Responsibility?, Royal Institute of International affairs < accessed 6 July Cambior inc. [1998] Q.J.No Case Profile: Cambior Lawsuit, < wsuitreguyana?sort_on=publication&batch_size=10&batch_start=2> accessed 6 July Dagi v. The Broken Hill Proprietary Company Ltd. (No. 2) [1997] 1 VR

34 potential danger to the environment may be caused by such conduct imposes a heavy responsibility on the defendant in such a case in terms of the ambit of the duty of care. 147 But eventually the case was settled for 40 million Australian dollars. However, in 2000 the plaintiffs sued BHP again for allegedly breaching the terms of the settlement. In 2002 BHP Billiton (a merger between BHP and Billiton took place in 2001) withdrew form the mine and transferred its stake to the Sustainable Development Ltd. and at the same time signed Mine Continuation Agreements with most local communities in which they gave permission on continuing the mining activities while releasing BHP Billition from any liability. 148 But on January 2007 the Ningerum indigenous people lodged a lawsuit against the corporation for 5 billion Australian dollars in damages for the destruction of their traditional lands, as they did not sign the Mine Continuation Agreements. The defendants appealed to the court to have the proceedings struck. 149 However the most cases based on the duty of care principle are in the UK. The courts there have a three-prong test to check whether a duty of care exists. First of all the harm must be reasonably foreseeable then there most be a sufficiently close relationship which refers to the proximity of the plaintiff to the defendant and lastly it must be fair, just and equitable to impose liability on the defendant. 150 With this test and the existing case law, courts can make a decision. However it remains a balancing act in which, according to the House of Lords, in special cases an exception can be made when justice requires it. 151 In the case of Connelly v. RTZ Corporation plc 152 a claim for compensation was made by Edward Connelly who worked at RTZ s Rossing uranium mine in Namibia and through his work there got throat cancer. Mr. Connelly argued that a British court was the appropriate forum as it was the UK based parent company that developed and applied the safety, health and environmental policies. Lower courts first dismissed the case by saying that Nigeria was the proper place for this case, but eventually the House of Lords decided that the case should be tried in England as it would pose great 147 Dagi v. The Broken Hill Proprietary Company Ltd. (No. 2) [1997] 1 VR 428, p Case Profile: BHP Lawsuit, < repapuanewguinea> accessed 6 July PNG Villagers Sue BHP, Ok Tedi Miners, The Sydney Morning Herald 19 January M. Badge, Transboundary Accountability for Transnational Corporations: Using Private Civil Claims, Working Paper Royal Institute of International Affairs 2006, p McFarlane v. Tayside Health Board [1999] 3 WLR 1301, p Connelly (A.P.) v. RTZ Corporation plc, [1996] WLR

35 difficulty on Mr. Connelly to litigate in Namibia. But later the case was dismissed on limitation grounds. 153 The case of Lubbe v. Cape plc 154 was one of 3000 claims against Cape plc, the UK parent company of the South-African subsidiary. Mr. Lubbe worked for this mining company, but conditions at this mine were particularly bad and miners, millers, people involved in the transportation as well as people living within reach of the mine were injured from the asbestos present in the mine. The appellants stated that the parent company breached its duty to care. Cape plc referred to the doctrine of forum non conveniens, but the Court of Appeal agreed with the plaintiff that the defendant company was alleged to have controlled the operation of the mines and mills in South Africa, the alleged breaches of duty occurred essentially in England, although their effects were felled in South Africa. 155 In 2000 the House of Lords finally ruled that the case could proceed in the UK. 156 It is possible to sue British corporations for human rights violations, but in Canada and Australia it is more difficult. The main obstacle in all these proceedings is that the plaintiff must prove that the home state is a better forum than the host state. In the UK this doctrine is more lenient than in Canada and Australia as the House of Lords has accepted the lack of means in the host state as a reason to prosecute in the home state. 157 But in the case of the Camisea Gas Pipeline Project there are no parent companies incorporated in Canada, Australia and the UK (see annex 2). So this route, for the indigenous communities affected by the Camisea project, is not an option Unjust enrichment claim By the law of nature it is fair that no one become richer by the loss and injury of another. 158 The principle of unjust enrichment stems from Roman law and might be a tool for indigenous people seeking redress. Originally, unjust enrichment was a way of dealing with new solutions to old problems and it filled gaps that were not covered 153 R. Meeran, Liability of Multinational Corporations: a Critical Stage in the UK, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p Lubbe v Cape Plc [1998] CLC P. Muchlinski, Corporations in International Litigation: Problems of Jurisdiction and the United Kingdom Asbestos Cases, International and Comparative Law Quarterly , p Lubbe v. Cape Plc [2000] UKHL D.M. Chirwa, The Doctrine of State Responsibility as a Potential Means of Holding Private Actors Accountable for Human Rights, Melbourne Journal of International Law , p Cicero as cited by D. Hall, The Spirit of Reparation, Boston College Third World Law Journal , p

36 by the traditional categories of law. 159 D. Fagan therefore argues that the unjust enrichment claim can play a role for indigenous people seeking redress as other areas of law might not cover the problem of the exploitation of their traditional lands and hence an extraordinary solution might be necessary. 160 A claim based on unjust enrichment must however fulfil certain criteria. Namely: (a) an enrichment must accrue to the defendant; (b) the enrichment must occur at the expense of the plaintiff; (c) the enrichment must be unjust and; (d) the unjust enrichment claim must survive any countervailing defences or considerations. 161 Some questions however do arise with regard to the interpretation of these criteria. First of all being what constitutes enrichment? Normally this would be seen as something positive, namely the accumulation of wealth in either assets or property. But this is not always as easy to identify and then you have to look at the characteristics of wealth. This means for example looking at transferability, exchange value and capacity to produce income. But it can also occur indirectly when the defendant receives its wealth from a third party while still being responsible towards the plaintiff. 162 To see whether the enrichment was occurred at the expense of the plaintiff you have to look at the process in which the enrichment was gained and to see if it is unjust you have to look whether the enrichment was of fairness or equity. 163 If indigenous people can satisfy these criteria they might be able to successfully find redress. However in certain cases it will be easier to fulfil these elements than in other. For example in the Texaco case described above, it was calculated that Texaco approximately saved 3 US dollar per barrel by dumping it in the river instead of using the right technology that would not pollute the environment. 159 J. Beatson, The Use and Abuse of Unjust Enrichment: Essays on the Law of Restitution 209, Oxford: Clarendon Press 2002, p D.N. Feegan, Achieving Restitution: the Potential Unjust Enrichment Claims of Indigenous Peoples against Multinational Corporations, New York University Law Review , p D.N. Feegan, Achieving Restitution: the Potential Unjust Enrichment Claims of Indigenous Peoples against Multinational Corporations, New York University Law Review , p D.N. Feegan, Achieving Restitution: the Potential Unjust Enrichment Claims of Indigenous Peoples against Multinational Corporations, New York University Law Review , p D.N. Feegan, Achieving Restitution: the Potential Unjust Enrichment Claims of Indigenous Peoples against Multinational Corporations, New York University Law Review , p

37 Hereto Texaco saved a rough 5 billion US dollar in a period of 20 years. 164 In the case of the indigenous people living in Peru that are affected by the Camisea Gas Pipeline Project the enrichment is not as clear, but the Peruvian government in December 2005 had already earned 263 million US dollar in royalty fees of 37%, meaning that the total revenue was then about million US dollar, while oil spills polluted the environment and the construction of the pipeline influenced the lives of the indigenous people negatively. 165 But there are no exact numbers as in the Texaco case. Multinational corporations can defend themselves against an unjust enrichment claim. Most defences try to deny the existence of an enrichment or deny the injustice of the enrichment. In most cases the injustice of the enrichment is denied. Corporations can do this in a real economic way by saying that yes the violations of indigenous peoples rights is unfortunate, but for the entire state the results are not unjust and even improved the state economy. However such a claim would not take away the unjustness done to the indigenous people. 166 Another argument made by corporations can be that they tried to minimise the effects on indigenous people, for example by setting up trusts intended to help the indigenous people. This would be a stronger claim, but as D. Feegan puts it the reality of indigenous experience demonstrates that MNC claims of assistance would seldom defeat the unjustness element. 167 By using the unjust enrichment claim the indigenous people of the Camisea region can make a claim against the multinational corporation in its home state. The state of incorporation of the multinational corporations involved, whether it is a common law or a civil law country, will probably have the possibility for an unjust enrichment claim. Whether such a claim would be successful remains the question as no such claim has been made. But such a claim would focus more on the behaviour of the multinational corporation than on the indigenous victims, which might be attractive for indigenous people. Such a claim can also work as a deterrent for 164 L. Fielding, The Indigenous People of Ecuador and their Fight for Human and Environmental Rights New England International and Comparative Law Annual , p R.J. Orr & V. Vences, The Camisea Gas Project: a Multi-Stakeholder Perspective on Conflicts & Negotiation, in H.A. Davis, Infrastructure Trends: Trends and Techniques, London: Euromoney Institutional Investor Plc 2008, p D.N. Feegan, Achieving Restitution: the Potential Unjust Enrichment Claims of Indigenous Peoples against Multinational Corporations, New York University Law Review , p D.N. Feegan, Achieving Restitution: the Potential Unjust Enrichment Claims of Indigenous Peoples against Multinational Corporations, New York University Law Review , p

38 multinational corporations and since there is not yet any case law on this issue, the judges in question can mould the claim in such a way, as justice requires. 168 But no definite answer towards the effectivity of this claim can yet be given Conclusion Accountability for the infringement of indigenous peoples rights by multinational corporations on a national level can either happen at the home or host state. At the host state level, the state in which the violation took place has jurisdiction based on the principle of territory, but can also be obliged to prosecute based on its treaty obligations. However this approach is not without its downsides. The developing state that is the home state would like to be a corporate friendly state and may therefore lack the political will to prosecute a multinational corporation. But it might also lack the legal machinery necessary for discovery, the technical expertise and regulative bodies to monitor corporate activity and even the presence of corrupt or cooption of officials. When the host state, thus the state of incorporation and where the multinational corporation has its registered office, enforces accountability on the multinational corporation this will most likely be done on the basis of the active personality principle. The host state approach has its advantages, as it will be in a developed state that will have a better legal machinery and more technical expertise and less chance on corrupt or co-opting officials. But even the host state would not like to prosecute its multinational corporations, as this would set those corporations at a competitive disadvantage with others. Other problems are the piercing of the corporate veil, the doctrine of forum non conveniens and the extra costs for the plaintiffs. Recently, the home state approach has however been successful in the UK in the case of Shell. This route may however still be difficult. Therefore there are other possibilities in some host states that might be more successful. In the US there is the ATCA where foreign nationals can bring a claim to a US court even if the defendant is not an American and the tort has not happened on US soil. This is a difficult proceeding, but could have been successful if not for the break with precedent in the Kiobal case. In the UK, Canada and Australia there is the duty of care principle where a private actor can be liable if it had a duty of care towards the plaintiff and that the breaching of that duty caused the injury of that plaintiff. This 168 D.N. Feegan, Achieving Restitution: the Potential Unjust Enrichment Claims of Indigenous Peoples against Multinational Corporations, New York University Law Review , p

39 route is difficult as most cases are dismissed on the basis of forum non conveniens. Lastly there is the possibility of a claim bases on unjust enrichment. This doctrine can be found in most states, but has never been used in the case of indigenous peoples and multinational corporations and therefore its success is uncertain. Hence both the home state approach and the host state approach can be used for indigenous people seeking redress against a multinational corporation and therefore can also be used by the indigenous people from the Camisea region. It is however questionable if these routes will be successful as both routes have their downsides. The situation of indigenous people seeking redress looks pretty grim at the national judicial level, but events in the UK might make that picture a little less grim. 5. Accountability for multinational corporations through non-judicial measures Since there is no international judicial way of holding multinational corporations accountable and the path of national judicial accountability is not without its downsides, one can wonder what the international community is doing to close this gap in international law. As of the late 1970s the international community has adopted several soft law responses towards increasing the accountability of multinational corporations in regard to human rights violations. Likewise, the corporate world has taken measures to close this gap in international law. Even though these voluntary measures might not have any legal status, they may have legal consequences. 169 Some of the most important of these soft law and corporate voluntary measures will be discussed in this chapter. However, judicial, soft law and corporate voluntary measures are not the only way to possibly deal with the accountability question, another way is in the form of arbitration and this route shall therefore be discussed as well Soft law responses UN Norms on the responsibility of transnational corporations and other business enterprises with regard to human rights 169 J.G. Ruggie, Business and Human Rights: the Evolving International Agenda, American Journal of International Law , p

40 On 26 August 2003 the UN Sub-Commission on the Promotion and Protection of Human Rights adopted the UN Norms. 170 Together with the UN Global Compact (as discussed later) the UN Norms signal the willingness of the UN to take action against a world in which not only states are the violators of human and indigenous peoples rights. 171 The UN Norms require states to promote, secure the fulfilment of, respect, ensure respect of and protect human rights and urges multinational corporations to do the same within their sphere of activity and influence. 172 The term sphere of influence was put there to limit the accountability of corporations to their capacity and competence, but actually puts a higher burden on corporations than on states as the Norms include, as binding, standards that can be found in international instruments that not all states have adopted and ratified or even standards that have not been adopted in an international instrument at all. 173 The UN Norms might be written as a treaty thereby setting out binding obligations upon both the state and the corporation, but the Norms are meant as a soft law initiative that in the future can be the basis of hard international law. 174 Therefore the UN Norms are a non-binding instrument for corporate accountability. The Norms do have useful elements as they give a summary of the rights that corporations can infringe and gives reference to the Charter of the UN, the UDHR and other relevant international treaties. 175 But since it did not only make an accumulation of these rights with a set of benchmarks, the Norms instead became engulfed by its own doctrinal excesses ( ) through a largely symbolic proposal to monitor firms and provide for reparation payments to victims, its exaggerated legal claims and conceptual 170 UNCHR (Sub-Commission) UN Norms on the Responsibility of Transnational Corporations and Other Business Enterprises with Regard to Human Rights (26 August 2003) UN Doc E/CN.4/Sub.2/2003/12/Rev S. Deva, UN s Human Rights Norms for Transnational Corporations and Other Business Enterprises: an Imperfect Step in the Right Direction?, ILSA Journal of International and Comparative Law 2003/ , p UNCHR (Sub-Commission) UN Norms on the Responsibility of Transnational Corporations and Other Business Enterprises with Regard to Human Rights (26 August 2003) UN Doc E/CN.4/Sub.2/2003/12/Rev.2, art UNCHR Interim Report of the Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises (22 February 2006) UN Doc E/CN.4/2006/97, paras L.C. Backer, Multinational Corporations, Transnational Law: the United Nations Norms on the Responsibility of Transnational Corporations as a Harbinger of Corporate Social Responsibility in International Law, Columbia Human Rights Review , p L.C. Backer, Multinational Corporations, Transnational Law: the United Nations Norms on the Responsibility of Transnational Corporations as a Harbinger of Corporate Social Responsibility in International Law, Columbia Human Rights Review , p

41 ambiguities. 176 The most problematic, according to J.G. Ruggie, is first of all the legal authority that is placed on the Norms and second of all the allocation of human rights responsibilities to both states and corporations; these contradict each other as the Norms are said to only reflect or restate existing international law, but at the same time stating that this is the first initiative that is non-voluntary and therefore directly binding on corporations. 177 Albeit the Norms are making reference to the Charter of the UN and the UDHR, which contain ius cogens norms and it might be said that these norms are therefore directly applicable to corporations, one has to bear in mind that those documents were never drafted with the aim to directly apply to corporations. 178 When the Sub-Commission adopted the UN Norms, advocates of the Norms were in favour of these Norms as they considered them a big step forwards, but states and corporations merely stressed the radical form the Norms had taken with the mandatory approach. But far out the biggest element of the Norms is that it fundamentally changes corporate governance, because: Substituting a public for a private law basis for corporate governance alters not only the focus of regulation, but also the division of power over the corporate entity. If everyone is a stakeholder, and everyone has an ownership interest in the corporation, then the focus of governance shift. The direction of corporate activity, as well as the objects to which these organisations are directed, changes. 179 For indigenous communities there is also the problem that the Norms failed to address the special situation of indigenous people and the activity of multinational corporations on their indigenous lands and territory UNCHR Interim Report of the Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises (22 February 2006) UN Doc E/CN.4/2006/97, paras UNCHR Interim Report of the Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises (22 February 2006) UN Doc E/CN.4/2006/97, paras S. Deva, UN s Human Rights Norms for Transnational Corporations and Other Business Enterprises: an Imperfect Step in the Right Direction?, ILSA Journal of International and Comparative Law 2003/ , p L.C. Backer, Multinational Corporations, Transnational Law: the United Nations Norms on the Responsibility of Transnational Corporations as a Harbinger of Corporate Social Responsibility in International Law, Columbia Human Rights Review , p UNCHR (Sub-Commission) UN Norms on the Responsibility of Transnational Corporations and Other Business Enterprises with Regard to Human Rights (26 August 2003) UN Doc E/CN.4/Sub.2/2003/12/Rev.2. 41

42 As the debate over the Norms was deeply divided between NGOs and the multinational corporations who were supported by most governments, the HRC in the end rejected the Norms and confirmed that as a draft proposal, it has no legal standing, and that the Sub-Commission should not perform any monitoring function in this regard. 181 However the HRC did not dismiss the issue of human rights and corporations as it requested the Office of the High Commissioner for Human Rights to write a report setting out the standards and existing initiatives concerning human rights and corporations. 182 And after this report 183 it appointed J.G. Ruggie as Special Representative of the Secretary-General (SRSG). 184 In its final report he comes up with the Guiding Principles on Business and Human Rights, a non-binding document which normative contribution lies not in the creation of new international law obligations but in the implications of existing standards and practices for states and businesses; and identifying where the current regime falls short and how it should be improved. 185 In these Guiding Principles he did not try to establish an evolution of international law, but he tried to make a framework based on international law as it currently stands. 186 The Guiding Principles rests on three pillars. First there is the duty of the state to protect against human rights abuses by third parties ( ) through appropriate policies, regulation, and adjudication. Secondly, there is the corporate responsibility to respect which combines due diligence to avoid infringement of rights with the addressing of unfavourable effects with which they are involved. And the third pillar addresses the need for better access to effective remedies by victims UNCHR Decision 2004/116: Responsibilities of Transnational Corporations and Related Business Enterprises with Regard to Human Rights (20 April 2004) UN Doc E/CN.4/RES/2004/ UNCHR Decision 2004/116: Responsibilities of Transnational Corporations and Related Business Enterprises with Regard to Human Rights (20 April 2004) UN Doc E/CN.4/RES/2004/ UNCHR (Sub-Commission) Report of the United Nations High Commissioner on Human Rights on the Responsibilities of Transnational Corporations and Related Business Enterprises with Regard to Human Rights (15 February 2005) UN Doc E/CN.4/2005/ J.H. Knox, The Ruggie Rules: Applying Human Rights Law to Corporations, in: R. Mares (ed.) Corporations and Human Rights 2012 (forthcoming), p UNCHR Report of the Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises (21 March 2011) UN Doc A/HRC/17/31, para J.H. Knox, The Ruggie Rules: Applying Human Rights Law to Corporations, in: R. Mares (ed.) Corporations and Human Rights 2012 (forthcoming), p UNCHR Report of the Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises (21 March 2011) UN Doc A/HRC/17/31, para

43 The duty to protect for states is further explained in Article 3 of the Guiding Principles, which reads as follow: In meeting their duty to protect, States should: (a) Enforce the laws that are aimed at, or have the effect of, requiring business enterprises to respect human rights, and periodically to assess the adequacy of such laws and address any gaps; (b) Ensure that other laws and policies governing the creation and ongoing operation of business enterprises, such as corporate law, do not constrain but enable business respect for human rights; (c) Provide effective guidance to business enterprises on how to respect human rights throughout their operations; (d) Encourage, and where appropriate require, business enterprises to communicate how they address their human rights impact. The duty to respect for corporations is embedded in Article 11 and states that corporations should avoid infringing on the human rights of others and should address adverse human rights impacts with which they are involved. Question then is what human rights are meant by this? J.G. Ruggie included hereto the core international human rights treaties that together make up the International Bill of Human Rights meaning the ICCPR, ICESCR and UDHR and the core conventions of the ILO as referred to in the Declaration on Fundamental Principles and Rights at Work. 188 The corporate responsibility to protect applies to all business enterprises, but there is a sliding scale with regard to its responsibility based on the size, sector, operational context, ownership and structure of the company. 189 This henceforth means that the bigger the corporation is, its commitment towards human rights should be more thorough as it runs the risk of a severer human rights impact. 190 By stating that corporations have a responsibility to respect, he did not base his second pillar on human rights law but on the expectations of society and therefore this base is less controversial than that of the UN Norms. It does however make the 188 UNCHR Report of the Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises (21 March 2011) UN Doc A/HRC/17/31, art. 12 and commentary. 189 UNCHR Report of the Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises (21 March 2011) UN Doc A/HRC/17/31, art. 14 and commentary. 190 R.C. Blitt, Beyond Ruggie s Guiding Principles on Business and Human Rights: Charting an Embracive Approach to Corporate Human Rights Compliance, The University of Tennessee Legal Studies Research Paper Series , p

44 Guiding Principles softer law in comparison with the UN Norms. 191 But this does make the Guiding Principles more acceptable for corporations and governments and less acceptable for human right groups who would like a legally binding agreement. Nevertheless, the Guiding Principles may be softer law, but with accepting and implementing the Guiding Principles the opportunity is there to change the current political climate and thereby paving the way for a legally binding document with direct corporate obligations. Corporations and governments might become more at ease with these obligations and might therefore in the future be willing to apply these obligations directly. 192 For now the UN Norms and the Guiding Principles cannot help the Camisea indigenous people as both instruments are not legally binding and in the end the UN Norms were not adopted by the HRC. But they might pave the way for a legally binding instrument with direct obligations for multinational corporations. Since the Guiding Principles makes reference to the International Bill of Rights and the core conventions of the ILO, this is a step forward from the UN Norms as these treaties contain important Articles that deal with indigenous people. And this is an important step forward as the UN Norms had no specific provision dealing with indigenous peoples rights UN Draft code of conduct on transnational corporations The UN Draft Code of Conduct started in 1972 when the UN Economic and Social Council (ECOSOC) requested the establishment of a group of distinguished scholars who were to study the impact multinational corporations had on the world economy and to come with recommendations. In its report the group proposed the setting up of an institution whose aim it was to study multinational corporations behaviour. As a result ECOSOC adopted a resolution that established the UN Center on Transnational Corporations and the UN Commission on Transnational Corporations. These two worked together on what is now know as the UN Draft Code which most recent draft stems from J.H. Knox, The Ruggie Rules: Applying Human Rights Law to Corporations, in: R. Mares (ed.) Corporations and Human Rights 2012 (forthcoming), p J.H. Knox, The Ruggie Rules: Applying Human Rights Law to Corporations, in: R. Mares (ed.) Corporations and Human Rights 2012 (forthcoming), p S.D. Murphy, Taking Multinationals Corporate Codes of Conduct to the Next Level, Columbia Journal of Transnational Law 2004/ , p

45 The aim was an international code of conduct as this was in accordance with the very nature of multinational corporations who work beyond national and regional borders. Another favourable result of such a code would be that developing countries did not have to compete with each other to get a multinational corporation to set up a seat in that state and in such a competition the state might offer-higher-thannecessary inducements to that particular corporation. 194 The most important aims however are the need for a better cooperation between governments towards the behaviour of multinational corporations in the host state and to help development in the developing states. 195 The Code of 1990 can be divided into four parts, the first part is on the activities of multinational corporations, the second on the treatment of multinational corporations, the third part is about governmental cooperation and the last part deals with how the code should be implemented. 196 This meant that multinational corporations had to comply with certain rules, for example to respect local laws and human rights, but also to accept the ILO Tripartite Declaration and follow the rules of disclosure of information. 197 The aim was that through cooperation with the governments of the host states a contribution was made to the development process there. Likewise the governments had to implement and promote the Code within its territory and jurisdiction and to report to the UN Commission. The UN Commission would internationally supervise the implementation of the Code and had to assess the periodic reports that the governments had to write. 198 The UN Draft Code was however never adopted, as there were major disagreements on the nature and the contents of the Code. The developed countries and their corporations were in favour of having international guidelines, but they preferred a more liberal framework that focused predominately on foreign direct investment (FDI), while the developing countries wanted a framework that focussed 194 P. Lansing & A. Rosaria, An Analysis of the United Nations Proposed Code of Conduct for Transnational Corporations, World Competition: Law and Economics Review , p P. Lansing & A. Rosaria, An Analysis of the United Nations Proposed Code of Conduct for Transnational Corporations, World Competition: Law and Economics Review , p S.D. Murphy, Taking Multinationals Corporate Codes of Conduct to the Next Level, Columbia Journal of Transnational Law 2004/ , p S.D. Murphy, Taking Multinationals Corporate Codes of Conduct to the Next Level, Columbia Journal of Transnational Law 2004/ , p Comparing the Norms on the Responsibilities of Transnational Corporations and Other Business Enterprises with Regard to Human Rights with the Draft United Nations Code of Conduct on Transnational Corporations < accessed 16 September. 45

46 on corporate behaviour and therefore would not address governments. 199 The addressing of governments in the Code was seen by the developing states as a sort of neo-economical colonisation and they stressed that the Code should rely on national law and regulation instead of imposing constraints on host governments. 200 Therefore the Code does not significantly help indigenous people who seek redress from the infringement of their rights by multinational corporations. But still the development in itself is important as it suggests a growing interest of the international community in solving this gap in international law OECD Guidelines In 1976 governments of the member states of the Organisation for Economic Co- Operation and Development (OECD) adopted a package deal that included the Declaration on International Investment and Multinational Enterprises, four other instruments and annexed to this were the OECD Guidelines for Multinational Enterprises. 202 Since 1976 the OECD Guidelines have been revised numerous times, but it was not till 2000 that the Guidelines made a reference to human rights. This has to do with the original aim of the Guidelines which is to: Ensure that the operations of these enterprises are in harmony with government policies, to strengthen the basis of mutual confidence between enterprises and the societies in which they operate, to help improve the foreign investment climate and to enhance the contribution to sustainable development made by multinational enterprises. 203 In the revised edition of 2000 the first reference towards human rights was made, as multinational corporations now had to respect the human rights of those affected by their activities consistent with the host states international obligations and commitments. 204 However this reference to the human rights obligations of the host 199 N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p S.D. Murphy, Taking Multinationals Corporate Codes of Conduct to the Next Level, Columbia Journal of Transnational Law 2004/ , p P. Muchlinski, Human Rights, Social Responsibility and the Regulation of International Business: the Development of International Standards by Intergovernmental Organisations, Non-State Actors and International Law , p N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p OECD, Guidelines for Multinational Enterprises (adopted 27 June 2000), preface para OECD, Guidelines for Multinational Enterprises (adopted 27 June 2000), II general policies para

47 states is criticised as the only reference made to which human rights this entails is the UDHR and other human rights obligations. 205 But it also leaves a gap because not all states have adopted and ratified all international human rights instruments or otherwise might not be willing to enforce them; this problem is especially problematic in the weak governance zones 206 of the OECD. 207 For indigenous people the general recommendation on environment could benefit them as that states that multinational corporations should engage in adequate and timely communication and consultation with the communities directly affected by the environmental, health and safety policies of the enterprise. 208 Technically, they can thus benefit from this policy, but their rights are curtailed to communication and consultation, which is a retrograde step from the concept of free, prior and informed consent. In the 2011 revised edition of the Guidelines even more attention is being paid to human rights as it now has its own Article. 209 States now have a duty to protect human rights and multinational corporations should respect human rights within the framework of internationally recognised human rights, which is now clarified as meaning the International Bill of Rights, and an effective remedy must be available. 210 This Article shows that the new OECD Guidelines follow the UN s concept of protect, respect and effective remedy that are also the three pillars of Ruggie s Guiding Principles. Since it is now also recognised that some human rights may quicker be at risk than others, multinational corporations might sometimes have to impose additional measures. The commentary belonging to the OECD Guidelines thereby refers to indigenous people and states: Enterprises should respect human rights of individuals belonging to specific groups or populations that require particular attention, where they may have adverse human rights 205 OECD, Guidelines for Multinational Enterprises (adopted 27 June 2000), commentary general policies para A weak governance zone is defined as an investment environment in which governments are unable or unwilling to assume their responsibilities. These government failures lead to broader failures in political, economic and civic institution that, in turn, create the conditions for endemic violence, crime and corruption and that block economic and social development as described in: OECD, Risk Awareness Tool for Multinational Enterprises in Weak Governance Zones (9 June 2006), preface. 207 J.G. Ruggie, Business and Human Rights: the Evolving International Agenda, American Journal of International Law , p OECD, Guidelines for Multinational Enterprises (adopted 27 June 2000), V environment para. 2(b). 209 OECD, Guidelines for Multinational Enterprises (adopted 25 May 2011), IV human rights. 210 OECD, Guidelines for Multinational Enterprises (adopted 25 May 2011), IV human rights. 47

48 impacts on them. In this connection, United Nations instruments have elaborated further on the rights of indigenous people. 211 Albeit this being a big step forwards for indigenous people, the Guidelines are still voluntary principles and can therefore not be explained as an effective instrument for imposing human rights and indigenous peoples rights obligations on multinational corporations. 212 It can be argued that the Guidelines pose obligations on states of a procedural nature with the supervising National Contact Points (NCPs) and the Investment Committee. 213 The role of the NCPs is to further the effectiveness of the Guidelines whereby it also assist in the solving of problems that occur and thereby has a correction function when the Guidelines have been infringed, but its conclusion then is not legally binding. 214 However, this procedure is generally to be found weak and NGOs who have presented cases to NCPs have found the procedure unsatisfactory. This is due to the fact that NCPs have no investigative powers, that the procedures are non-transparent, that the NCPs, belonging to the governmental system, can neither be seen as impartial and independent and due to fact that the NCPs cannot impose sanctions on those corporations that are unwilling to cooperate with them or have been found in violation of the Guidelines. 215 The only inducement for companies to comply lies in the adverse publicity they will be subjected to if they keep uncooperative, then the OECD can use the concept of naming and shaming. 216 With the revision of the OECD Guidelines the position of human rights has be given a more prominent place and reference is even made to the precarious position of indigenous people. However, indigenous people seeking redress for the infringement of their rights shall not be successful when they base their claim on these Guidelines. The procedure before a NCP is still weak and unsatisfactory and conclusions are not legally binding while the only remedy being naming and shaming. 211 OECD, Guidelines for Multinational Enterprises (adopted 25 May 2011), IV human rights commentary. 212 OECD, Guidelines for Multinational Enterprises (adopted 25 May 2011), preface para OECD, Guidelines for Multinational Enterprises (adopted 25 May 2011), implementation procedures. 214 N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p O. De Schutter, Transnational Corporations and Human Rights: an Introduction, Global Law Working Paper , p O. De Schutter, Transnational Corporations and Human Rights: an Introduction, Global Law Working Paper , p

49 ILO Tripartite Declaration Almost concurrently with the OECD Guidelines the ILO adopted the Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy in 1976 and revised it in 2000 and The aim of the Tripartite Declaration is to encourage the positive contribution multinational enterprises make to economic and social progress and to minimise and resolve the difficulties to which their various operations may give rise. 218 Just like the OECD Guidelines the Tripartite Declaration exists of recommendations that multinational corporations, governments and employers and workers organisations are recommended to observe on a voluntary basis. 219 In this Declaration reference is made to human rights. Paragraph 1 of the preamble makes a first reference to human rights that is elaborated in paragraph 8 that states that: All the parties concerned by this Declaration, ( ) should respect the Universal Declaration of Human Rights and the corresponding Covenants adopted by the General Assembly of the United Nations as well as the Constitution of the International Labour Organisation. ( ) They should contribute to the realisation of the ILO Declaration on Fundamental Principles and Rights and Work and its Follow-up. Hence, it makes reference to the important international human rights instruments of the UN and the ILO. In the following paragraph governments are urged to adopt and ratify other ILO Conventions, but no reference is made to ILO Convention 169 that deals with the special position of indigenous people. 220 Although the Tripartite Declaration is not legally binding, it does create a political and moral obligation towards the member states to follow these obligations as the Governing Body of the ILO adopted them with consensus. 221 The supervisory procedures have been strengthened over time, and consist of a review function carried 217 ILO, Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy (4 th edition, 2006). 218 ILO, Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy (4 th edition, 2006), para ILO, Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy (4 th edition, 2006), para ILO, Tripartite Declaration of Principles Concerning Multinational Enterprises and Social Policy (4 th edition, 2006), para A. Gatto, Multinational Enterprises and Human Rights: Obligation under EU Law and International Law, Cheltenham: Edgar Elgar Publishing Ltd. 2011, p

50 out by the ILO Governing Body 222 that provides a survey on a four-year basis that governments have to fill in, in consultation with the employers and workers organisations, on the implementation of the principles of the Declaration. 223 Then there is also a procedure for when disputes arise over the interpretation of the Tripartite Declaration. Here governments, and in special cases the workers or employers organisations, can ask for a principle to be interpreted by the International Labour Office. 224 The difficulty with the ILO Tripartite Declaration, as with the OECD Guidelines, is the lack of a solid monitoring process, the lack of an implementation instrument and its non-mandatory nature. Also, all the principles are drafted in the term of should which enforces the non-mandatory nature of the norms. In addition to that, the Body interpreting the Tripartite Declaration s norms has a very limited role to play when there is a disagreement. Therefore, the Declaration ends up being a mere aspirational declaration without any legal mandate, or even the possibility of market coercion. 225 And as a result hereof the Tripartite Declaration cannot help indigenous people whose rights have been violated, as it is a non-binding instrument that makes no specific reference to indigenous people Corporate voluntary measures Besides international effort to develop soft law initiatives for corporate accountability, other voluntary measures are also developed by different actors at different levels. For example the UN set up the Global Compact and the corporations themselves have been working on self-regulation through their codes of conduct. Even though these measures might not have any legal status they may have legal consequences. 226 And can therefore still be important for indigenous peoples whose rights are violated. 222 A. Gatto, Multinational Enterprises and Human Rights: Obligation under EU Law and International Law, Cheltenham: Edgar Elgar Publishing Ltd. 2011, p N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p S. Deva, Human Rights Violations by Multinational Corporations and International Law: Where from here?, Connecticut Journal of International Law , p J.G. Ruggie, Business and Human Rights: the Evolving International Agenda, American Journal of International Law , p

51 UN Global Compact The UN Global Compact (UNGC) is the result of a speech then UN Secretary- General Kofi Annan made on 31 January 1999 at the World Economic Forum in Davos. In his speech he called for a Global Compact that aimed to increase and diffuse the benefits of global economic development through voluntary corporate policies and actions. The UNGC was a chance for the UN to ascertain its relevance in a changing world. Kofi Annan therefore saw the Compact as a chance for the UN to renew itself from within, and to gain greater relevance in the 21 st century by showing that it can work with non-state actors, as well as states, to achieve the broad goals on which its members have agreed. 227 Initially, the UNGC was launched on 26 July 2000 with nine principles the tenth principle got added in 2004 after lengthy consultation. 228 The principles are accepted on the basis of consensus and are drawn from the UDHR, the ILO Declaration on Fundamental Principles and Rights to Work, the Rio Declaration on Environment and Development and the UN Convention against Corruption. 229 Simply said the UNGC is there to promote good business practice and therefore businesses are asked to embrace, support and enact, within their sphere of influence, a set of core values in the areas of human rights, labour standards, the environment and anti-corruption. 230 The UNGC is needed in this changing international landscape. Due to globalisation the economic order is changing with corporations that are sometimes wealthier than states and therefore those corporations are gaining political influence. To address these changes from the state-centric approach, it is necessary that governments, corporations and civil society come together and establish a steady institutional structure that supports good business practices under the umbrella of globalisation. 231 Besides, as said in the progress report, the UNGC is an experiment that is aimed at filling the space between regulatory regimes on the one hand and 227 Global Compact Office, The Global Compact: Report on Progress and Activities (July 2002) < > (accessed 20 September 2011), p O.F. Williams, The UN Global Compact: the Challenge and the Promise, Business Ethics Quarterly , p UNGC, The Ten Principles < (accessed 20 September 2011). 230 UNGC, The Ten Principles < (accessed 20 September 2011). 231 A. Rasche, A Necessary Supplement: what the United Nations Global Compact Is and Is Not, Business and Society , p

52 voluntary codes of conduct on the other hand. 232 As a result the UNGC can contribute to sustainable development and can achieve a fairer distribution of wealth. 233 In spite of this, there is still a lot of criticism related to the UNGC. A first argument against the Compact is that it can back the capture of the UN by big corporations. A discrepancy can exist between the policies pursued by developing states in the UN and the multinational corporations that partner with the UN in the UNGC. It is feared by some that through this close relationship of the UN with the business world, the UN as the supposed rule setter, wittingly or otherwise begins to adopt the agenda of business partners without debate and due democratic procedure. 234 Thereby it is also feared that this closer relationship between public and private institutions might in the end lead to a privatisation of the development process, since governments will no longer be the primary institutions to deal with the poverty problem. 235 Nevertheless the UNGC is not the first time businesses cooperate with the UN. Immediately after the establishment of the UN, partnerships aroused between the UN and the business world, it is only due to media coverage that these partnerships become more known. It is true that there is an increase in partnerships nowadays, but this derives from a changing attitude at the UN from confrontation to cooperation as in this interdependent world the UN needs to work with the business world to achieve its goals. This partnership can work, as both want a stable global market that is founded on shared good practices. 236 Secondly, critics say the principles enshrined in the UNGC are too vague and too compact in its language and that it are merely one-liners. This can consequently lead to difficulties with what is expected of the corporations that sign up; the general language of the principles can lead to insincere corporations implementing the UNGC but thereafter not complying with it and for sincere corporations the general language of the principles make them hard to 232 Global Compact Office, The Global Compact: Report on Progress and Activities (July 2002) < > (accessed 21 September 2011), p J. Thérien & V. Pouliot, The Global Compact: Shifting the Politics of International Development, Global Governance , p J. Nonan, The United Nations Compact with Business: Hindering or Helping the Protection of Human Rights, The University of Queensland Law Journal , p J. Thérien & V. Pouliot, The Global Compact: Shifting the Politics of International Development, Global Governance , p A. Rasche, A Necessary Supplement: what the United Nations Global Compact Is and Is Not, Business and Society , p

53 implement. 237 However, it was never the intention that the UNGC would be a clearly defined code of conduct. The aim was to provide corporations with a sort of moral compass of how best to interpret and implement the principles of the UNGC and to achieve that by opening up a dialogue between the different actors involved in a nonbureaucratic way. The idea was to show responsibility through dialogue. 238 Thirdly, critics accuse the UNGC of not holding the corporations that behave poorly accountable due to missing mechanisms for verification and monitoring. Corporations that sign the UNGC have to make an annual report in which they give information on how it implements the principles and how it supports development, but with no verification and monitoring mechanism the corporation can choose what it reports and the general public has no chance of knowing what is really happening. 239 Besides, to enter into the UNGC corporations only have to submit a letter of intent as the Compact wanted to have an open-door policy. The easiness of aligning your corporation with the UNGC and the limited reporting that has to be done also make it an ideal marketing tool for corporations who therefore might misuse the UNGC, this is the so called bluewash. 240 However, with more then 6000 business being part of the UNGC monitoring is almost impossible, to monitor all these businesses in all the different industries and countries is both beyond the logistical and financial resources available. Moreover, the UNGC has no mandate to monitor these corporations, as it was never intended to accredit the corporations that showed good practice. 241 With regard to the annual reporting requirement, this has been improved by forming an alliance with the Global Reporting Initiative (GRI). The GRI guidelines will help corporations with information on how to report on the achieved results and how to be transparent about this. 242 Fourthly, the UNGC has a nebulous role for the state. Governments have not been given a role in ensuring that corporations respect the 237 S. Deva, Global Compact: a Critique of the U.N. s Public-Private Partnership for Promoting Corporate Citizenship, Syracuse Journal of International Law & Commerce , p A. Rasche, A Necessary Supplement: what the United Nations Global Compact Is and Is Not, Business and Society , p O.F. Williams, The UN Global Compact: the Challenge and the Promise, Business Ethics Quarterly , p J. Nonan, The United Nations Compact with Business: Hindering or Helping the Protection of Human Rights, The University of Queensland Law Journal , p A. Rasche, A Necessary Supplement: what the United Nations Global Compact Is and Is Not, Business and Society , p UN Global Compact and Global Reporting Initiative Form Strategic Alliance < (accessed 22 September 2011). 53

54 principles of the Compact while they are stakeholders in this. 243 And lastly, critics comment on the number of corporations that have signed up so far. The website of the UNGC states that more then 6000 corporations have signed up 244, but if you compare this with the multinational corporations and its affiliates 245 and the estimated 27 million corporations in the US 246, the number of participants is very low. The number of participants to the UNGC is still increasing, but it is still only a drop in the ocean. To sum up, self-regulation can play an important role in promoting human rights to multinational corporations, but to be effective it has to meet certain minimum requirements and it is questionable whether this is true for the UNGC. 247 And as a result the UNGC cannot help indigenous people. Nevertheless, the UNGC has a role to play in helping corporations that are willing to put regulation in place, but are having trouble with putting regulation in place; the Compact can learn them about implementation. In addition to this, the UNGC can further development as it stimulates dialogue, and when new problems arise, discussion can take place so as to develop temporary measures that can eventually lead to binding regulation. 248 Hence can be said that the UNGC is more about corporate responsibility than corporate accountability Self-Regulation Since the 1970s corporations started with self-regulation in the form of corporate codes of conduct. They realised that to be a first-class corporation you could not have a bad human rights record. 249 One of the first and best-known corporations with a code of conduct is Levi Strauss in 1991, followed in the same year by Nike and later 243 S. Deva, Global Compact: a Critique of the U.N. s Public-Private Partnership for Promoting Corporate Citizenship, Syracuse Journal of International Law & Commerce , p UN Global Compact Participants < (accessed 20 September 2011). 245 UNCTAD, Development and Globalization: Facts and Figures 2008, p US Census Bureau, State & Country Quick Facts < (accessed 22 September 2011). 247 J. Nonan, The United Nations Compact with Business: Hindering or Helping the Protection of Human Rights, The University of Queensland Law Journal , p A. Rasche, A Necessary Supplement: what the United Nations Global Compact Is and Is Not, Business and Society , p C. Avery, Business and Human Rights in a Time of Change, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p

55 The Body Shop. 250 As of the 21 st century a vast amount of codes of conduct have been established, but there is a huge variety between all these codes of conduct. For example, the code can be drafted for a specific corporation or for a group of corporations working in the same field; it can be drafted exclusively by private actors, or in cooperation with governments and international organisations. 251 The codes of conduct for certain industries are particularly established for industries that have had to deal with hard criticism regarding their human rights standards. In case of the extractive industry, that has a huge impact on the local communities, the Voluntary Principles on Security and Human Rights were established. 252 A first question that arises is what codes of conducts are? The ILO has referred to it as a written policy, or statement of principles, intended to serve as the basis for a commitment to particular enterprise conduct. By their very nature, voluntary codes contain commitments often made in response to market incentives with no legal or regulatory compulsion. 253 And the OECD described it as commitments voluntarily made by companies, associations or other entities, which put forth standards and principles for the conduct of business activities in the marketplace. 254 These two definitions show two key characteristics of a code of conduct, namely that it is voluntary and has non-binding commitments for the corporation. Hereto many critics of codes of conduct refer to the voluntary notion of it. Corporations can adopt a code of conduct but due to the voluntary nature of it, it depends on the corporation on how serious the code is used in everyday practice. 255 The seriousness of the corporation with the code can coincide with the fact that most corporations key reason for adopting a code comes from public pressure. 256 This is supported by an OECD survey in 2001 were it was said that the protection or enhancement of an organisation s reputation and stronger customer loyalty is often 250 F. McLeay, Corporate Codes of Conduct and the Human Rights Accountability of Transnational Corporations a Small Piece of a Large Puzzle, Global Law Working Paper , p S.D. Murphy, Taking Multinational Corporate Codes of Conduct to the Next Level, Columbia Journal of Transnational Law 2004/ , p S.D. Murphy, Taking Multinational Corporate Codes of Conduct to the Next Level, Columbia Journal of Transnational Law 2004/ , p ILO, Overview of Global Developments and Office Activities Concerning Codes of Conduct, Social Labelling and Other Private Sector Initiatives Addressing Labour Issues, GB.273/WP/SDL/1(Rev.1) (November 1998), para OECD, Codes of Corporate Conduct: Expanded Review of their Contents, Working Papers on International Investment , p S.D. Murphy, Taking Multinational Corporate Codes of Conduct to the Next Level, Columbia Journal of Transnational Law 2004/ , p N. Jägers, Corporate Human Rights Obligations: in Search of Accountability, Antwerpen: Intersentia 2002, p

56 an important factor in the decision to adopt and implement a code. 257 Other criticisms relate to the variety of different codes. Almost every corporation and industry has a different code of conduct, but this variety in codes and thus also in human rights included in codes can have the effect of reducing these human rights to the lowest denominator, making them almost quasi-human rights that are the easiest achievable. 258 And just as with the UNGC, the critics point to the lack of monitoring the implementation and usage of the codes of conduct. In spite of the criticisms on codes of conduct, others are in favour of the flexibility of codes as they can be adapted to the specific situation and industry of the corporation involved. 259 This may lead, when well drafted, to real improvements of the human rights of those involved, especially when the host state is a developing state that does not have real commitments to these rights; a code of conduct can help to create acceptance of these norms by the host states that where so far unwilling or unable to enforce them. 260 However, when codes of conduct are voluntary and include non-binding commitments, the question is what their significance is for the accountability question of multinational corporations and indigenous peoples rights violations? In principle, as they are voluntary and contain non-binding commitments one cannot hold a corporation accountable for the infringement of its code of conduct. However, in national law a non-binding code can gain legal force in private law. It can be possible to bring a claim against a corporation that has adopted a code of conduct on the basis of failure to comply with the code in question thereby being evidence that the sponsoring firm or organisation is not meeting industry standards of conduct and is, therefore, not exercising reasonable care and due diligence. Furthermore, a failure to live up to a code of conduct can also result in a breach of contract. 261 But to breach a contract the corporation must have violated a specific and controllable obligation enshrined in the code. If this is the case the violated provision in the code becomes a 257 OECD, Codes of Corporate Conduct: Expanded Review of their Contents, Working Papers on International Investment , p F. McLeay, Corporate Codes of Conduct and the Human Rights Accountability of Transnational Corporations a Small Piece of a Large Puzzle, Global Law Working Paper , p F. McLeay, Corporate Codes of Conduct and the Human Rights Accountability of Transnational Corporations a Small Piece of a Large Puzzle, Global Law Working Paper , p F. McLeay, Corporate Codes of Conduct and the Human Rights Accountability of Transnational Corporations a Small Piece of a Large Puzzle, Global Law Working Paper , p P. Muchlinski, Human Rights, Social Responsibility and the Regulation of International Business: the Development of International Standards by Intergovernmental Organisations, Non-State Actors and International Law , p

57 supportive argument as well as a source of law. 262 Cases have been brought before courts, especially in the US by using the ATCA but have so far been unsuccessful, as the same problems described previously occurred. The most important case in this respect has been the case of Mark Kasky v. Nike. 263 In this case, Kasky, on behalf of the citizens of California, brought litigation against Nike for allegedly breaching competition and false advertisement laws. Kasky based this on misleading statements made by Nike with regard to the working conditions and practices in its factories in Vietnam and Indonesia. 264 Nike denied the allegations and filed a demurrer to the complaint as the case was barred by the US constitution s First Amendment guarantee to free speech. 265 Several months after the Supreme Court issued a decision in this case by saying that it granted certiorari improvidently and thereby dismissing the case 266 Kasky and Nike settled the case for 1.5 million US dollar and the improvement of workplace monitoring by Nike. 267 Whether codes of conduct can help promote the human rights accountability of multinational corporations cannot be answered with a simple yes or no. When provisions of a code are precise and controllable, a violation of one provision might be a breach of contract. It is however difficult to hold the multinational corporation accountable as the home state approach, as discussed before and again apparent in the Kasky v. Nike case, is not without its difficulties. For indigenous peoples rights it might be even more difficult as most codes of conduct do not refer to indigenous people and focus more on labour and environmental rights. Again, codes of conduct focus more on corporate responsibility than on corporate accountability. Arbitration is: 5.3. Arbitration as a possible route A device whereby the settlement of a question, which is of interest for two or more persons, is entrusted to one or more persons the Arbitrator or Arbitrators who derive their powers 262 W.J.M. van Genugten, The Status of Transnational Corporations in International Public Law, in: A. Eide, H.O. Bergesen & P.R. Goyer (eds), Human Rights and the Oil Industry, Antwerpen: Intersentia 2000, p Nike Inc. v. Kasky, 539 U.S. 654 (2003). 264 Nike Inc. v. Kasky, 539 U.S. 654 (2003), p Nike Inc. v. Kasky, 539 U.S. 654 (2003), p Nike Inc. v. Kasky, 539 U.S. 654 (2003), p Case Profile: Nike Lawsuit < KaskyvNikeredenialoflabourabuses> (accessed 27 September 2011). 57

58 from a private agreement, not from the authorities of a State, and who ( ) decide the case on the basis of such an agreement. 268 Thus for arbitration to be applicable parties must have entered into an agreement which entails an arbitration clause. For multinational corporations this will mostly happen through a Bilateral Investment Treaty (BIT). A BIT is an agreement that establishes the conditions for private investment by a private party of one state in another state, such an investment is known as FDI. 269 Since individuals of the state where the FDI takes place, thus the host state, are not signatories to a BIT, they cannot use the arbitration clause; it is an agreement between a multinational corporation and a host state. 270 International investment arbitration does take human rights law into account. But this is mostly by analysing procedural and substantive rules that need interpreting. There have been cases in which there was a conflict between investment law and human rights law, but they have been exceedingly limited in numbers. 271 Only four cases have aroused so far. In two cases the arbitration panel said that the human rights arguments were valid, but that the conflict with investment law was spurious and thereby human rights law was not in violation with investment law. 272 And in the other two cases the arbitral tribunal dismissed the human rights arguments completely. 273 Scholars have been writing articles on the need for more attention to human rights law vis-à-vis BITs. A first idea is that the host states should raise human rights concerns before the arbitral tribunal. The UN High Commissioner for Human Rights encourages this, as this would interconnect investment law with human rights. If states would raise their human rights obligations in the proceeding this would attempt tribunals to secure interpretations of investment agreements and tribunal 268 R. David, Arbitration in International Trade Deventer: Kluwer Law and Taxation 1985, p R. Dolzer & M Stevens, Bilateral Investment Treaties The Hague: Kluwer Law International 1995, p J.D. Fry, International Human Rights Law in Investment Arbitration: Evidence of International Law s Unity, Duke Journal of Comparative and International Law , p J.D. Fry, International Human Rights Law in Investment Arbitration: Evidence of International Law s Unity, Duke Journal of Comparative and International Law , p International Centre for the Settlement of Investment Disputes Azurix Corp. v. Argentine Republic (2006) Case No. ARB/01/12 & International Centre for the Settlement of Investment Disputes CMS Gas Transmission Co. v. Argentine Republic (2005) Case No. ARB/01/ International Centre for the Settlement of Investment Disputes Tradex Hellas S.A. v. Albania (1996) Case No. ARB/94/2 & UNCITRAL Biloune and Marine Drive Complex Ltd. v. Ghana Investment Centre and the Government of Ghana, 95 ILR. 183 (1989). 58

59 decisions that take into account the wider legal and social context. 274 However, so far states have been reluctant with including human rights arguments. This might stem from the negative repercussions that could occur when host states place human rights obligations over the interests of the investors who then might look to invest in other host states that do not place human rights over investors. 275 A second idea is to allow NGOs to bring human rights complaints before the arbitral tribunal, but NGOs normally do not have an arbitration clause in their agreement with the host state. And the inequality in legal personality makes the bargaining position between NGOs and states in BITs unrealistic. 276 A third idea is to include individuals to sue investors for human rights violations. If an enforcement mechanism were inserted in BITs for the prosecution of human rights violations committed by the investor and individuals would be able to sue, this would address the weaknesses of corporate codes of conduct and other soft law initiatives as BITs would then be enforceable through arbitration. 277 An added advantage of international arbitration is also that BITs usually provide both parties with a choice of at least one arbitrator. An investment claimant would choose an economic law scholar and a human rights claimant could choose a human rights scholar. 278 However: The inclusion of investor responsibilities in investment treaties, would necessarily require that investment tribunals grapple more frequently and at an ever-greater level of sophistication with human rights norms. This presupposes ever-greater human rights expertise on the part of arbitrators, and invest these Tribunals with greater authority as fora where human rights concerns will be elaborated and interpreted. It must be stressed that investment tribunals would not become and adjudicative forum for human rights norms. Rather, they would only adjudicate investor rights, but in a manner which conditioned these investor rights on compliance of the investor with minimum human rights responsibilities. 274 UNCHR Report of the High Commissioner for Human Rights (2 July 2003) UN Doc. E/CN.4/Sub.2/2003/9, para J.D. Fry, International Human Rights Law in Investment Arbitration: Evidence of International Law s Unity, Duke Journal of Comparative and International Law , p G.W. MacKenzie, ICSID Arbitration as a Strategy for Levelling the Playing Field Between International Non-Governmental Organizations and Host States, Syracuse Journal of International Law & Commerce , p T. Weiler, Balancing Human Rights and Investor Protection: a New Approach for a Different Legal Order, Boston College International and Comparative Law Review , p T. Weiler, Balancing Human Rights and Investor Protection: a New Approach for a Different Legal Order, Boston College International and Comparative Law Review , p

60 Naturally, it should be asked whether these ad-hoc Tribunals can be expected to have the legitimacy to be entrusted with such a critical task. 279 This would mean that a specific international human right instrument would be better suited. Besides this argument against arbitration a second argument against focuses on the transparency issue of arbitration as investment arbitration is mostly done in confidence. 280 A third argument against arbitration is that there is, most of the time, not a clear winner. Arbitration is predominantly based on the so-called splitting the baby between two parties principle. 281 Hence, arbitration is not a possible route for corporate accountability for the violation of human and indigenous peoples rights. There is not yet the possibility for individuals to sue an investor on the basis of a BIT and the indigenous people of the Camisea region therefore cannot use arbitration to get redress. If arbitration would be possible it would be questionable if it would be a good route to take, as specific human rights instrument would be better suited to deal with the problem and international investment arbitration cannot be an adjudicative forum for human rights norms. Consequently, it is highly unlikely that BITs would entail, in the future, an enforcement mechanism that can be used by individuals, especially when keeping in mind how multinational corporations are against directly binding human rights regulation Conclusion Since the 1970s the international community has adopted multiple soft law instruments that tried to close the gap of corporate accountability for human rights violations in international law. This development coincided with the rapid globalisation and the emerging influence of multinational corporations. Those corporations also started to realise that to be seen as a first-class corporation they could not have a poor human rights record, therefore introducing their corporate codes of conduct. Although being good developments, both soft law initiatives and voluntary codes of conduct have no legal status in law. J.G. Ruggie stated that albeit 279 L.E. Peterson & K.R. Gray, International Human Rights in Bilateral Investment Treaties and in Investment Treaty Arbitration, IISD Research Paper 2003, p L.E. Peterson & K.R. Gray, International Human Rights in Bilateral Investment Treaties and in Investment Treaty Arbitration, IISD Research Paper 2003, p J.D. Fry, International Human Rights Law in Investment Arbitration: Evidence of International Law s Unity, Duke Journal of Comparative and International Law , p

61 they have no legal status they might have legal consequences. But to link legal consequence to these instruments is very difficult. Most instruments are voluntary, contain non-binding commitments and lack enforcement and monitoring mechanisms, or when included are not of the solid kind. The only instrument that can have legal consequences is the code of conduct of a corporation. One can bring a claim against a corporation for failure to comply with its code when it is not living up to industry requirements and thereby failing to exercise reasonable care and due diligence. But one can also base a claim on the concept of breach of contract if a specific and controllable obligation included in the code of conduct is violated. Yet tried, one runs into the problems that come with litigation in either the home or host state. This might even be more difficult for indigenous people as their specific rights might not be included in corporations codes of conduct. With regard to arbitration, no possibility so far exists of individuals suing investors for human rights violations and it is unlikely that this might be done in the future. Regardless, if arbitration would be possible, it can never be an adjudicative forum for human rights violations as it is based on international investment law and not human rights law. The role soft law and voluntary initiatives have is not in holding corporations accountable, but in creating corporate responsibility that has the possibility to create acceptance of human rights norms it might pave the way for a legally binding document in the future. 6. Conclusion After the emerging regime of human rights, more attention is being paid by the international community to protect specific groups of people whose lives and rights are still not protected properly by the existing human rights instruments. One of these groups of people is indigenous people who carry the disproportionate cost of the rapid globalisation taking place nowadays. This stems from their distinct and traditional way of living that is connected with the ancestral lands they live on. Since these grounds can hold valuable natural resources that multinational corporations would like to extract these resources and thereby the specific way of living of indigenous people is threatened. How this implicates the traditional way of living of indigenous people and how this violates their rights as indigenous people can be seen in the example of the indigenous peoples living in the Camisea region where the presence of multinational corporations disrupts their living situation and has ruined their lands. 61

62 The international community has tried to strengthened their position by the adoption of UNDRIP, ILO Convention 169, ICCPR and regional instruments adopted by regional systems. Nevertheless, multinational corporations have often raised the policy of noninterference when it comes to the violation of both human rights and indigenous peoples rights. But perception is changing and acts of multinational corporations can, when fulfilling the requirements, be seen as complicit in the violation of these rights. With regard to indigenous people, the violation of their specific rights can lead to their cultural extinction by threatening their traditional way of life. Regardless of the instruments adopted by the international community, there is not yet an instrument that provides an effective and efficient mechanism to impose corporate accountability on multinational corporations for the infringement of human rights and indigenous peoples rights. Ideally, there would be such an instrument that poses direct obligations on multinational corporations. For such an instrument to succeed multinational corporations do not need to have full international legal personality as states have, but it is sufficient that they have limited rights and responsibilities, such as the right to sue and be sued, the ability to assert a right, and the acceptance of legal responsibility in judicial forums. 282 Preferable would be the adoption and ratification of a multilateral treaty that would specify the human rights and indigenous peoples rights obligations of corporations and at the same time require the state parties to adopt civil, criminal or administrative remedies for the violation of those obligations. But with enforcement mechanisms based on domestic law significant variations can arise in the enforcement of the treaty obligations. 283 To counter the variations in domestic enforcement, the World Development Movement proposed the establishment of an international tribunal that regulates the behaviour of multinational corporations. While this could provide for a more uniform interpretation of such a treaty, such a tribunal will likely be swamped with cases and thereby rendering the tribunal ineffective. 284 If such a treaty, in whatever form possible, will ever come into existence is however the biggest question, as there is currently not the political will 282 D. Kinley & J. Tadaki, From Talk to Walk: the Emergence of Human Rights Responsibilities for Corporations at International Law, Virginia Journal of International Law 2003/ , p Developments in the Law: International Criminal Law, Harvard Law Review , p S. Joseph, An Overview of the Human Rights Accountability of Multinational Enterprises, in: M.T. Kamminga & S. Zia-Zarifi (eds.), Liability of Multinational Corporations under International Law, The Hague: Kluwer Law International 2000, p

63 from all parties involved to assume direct international corporate accountability on multinational corporations. This gap in international law should therefore now be filled with the existing regimes that often lack sensitivity to indigenous peoples rights, lack effective monitoring and enforcement mechanisms or have no legal status and contain nonbinding commitments. To strengthen accountability for multinational corporations in the host state, host states should first of all refrain from being implicated in the violations of these rights. Secondly, host states should negotiate with multinational corporations about minimal standards for the protection of human rights and indigenous peoples rights. In such an agreement a safety clause should be implemented in case of a violation of one of the standards. And to make sure such a safety clause is effective, host states should strengthen their judicial system so as to provide an effective and efficient enforcement mechanism. The home states should advocate standard setting for behaviour irrespective of where business is taking place: whether in Rome or at home. 285 As the judicial system in the home state has not got the restrains of that of the host state, home states should strengthen or develop fora for the victims of multinational corporations abroad, not only for serving justice to the victims but also for sharing responsibility. This can be done, for example, by strengthening legislation similar to the ATCA and the duty of care principle. Nonjudicial voluntary measures can be reinforced by including clear and specific rights, including indigenous peoples rights, thereby making reference to the International Bill of Rights and the important documents concerning indigenous people. Referencing these legal documents will make codes of conduct more consistent and uniform. Reviewing compliance shall become easier as the meaning of the obligations becomes more clear and in doing so it will be easier to give legal consequence to the infringement of a voluntary measure. Hence moving away from corporate responsibility to corporate accountability. Arbitration can be strengthened by including a clause stating individuals can sue the investors for the violation of human rights and indigenous peoples rights. So far, the international community is not yet there. It has taken measures trying to close this gap in international law, but hitherto there is not yet that one silver 285 S. Deva, UN s Human Rights Norms for Transnational Corporations and Other Business Enterprises: an Imperfect Step in the Right Direction?, ILSA Journal of International and Comparative Law 2003/ , p

64 bullet that will provide an efficient and immediate solution for this problem. And it will probably take a while for such a silver bullet to arise, as the political will for a solution is currently absent. For the indigenous people of the Camisea region this means that it will be difficult to find redress for the infringement of their rights by multinational corporations somewhere in the world. The chance for successful redress is restricted. This conclusion is astonishing as indigenous people have their rights that are entailed in various human rights documents and in documents focussing solely on indigenous peoples rights. But what is it worth to have those rights if you cannot hold the violators of those rights accountable? Rights that only exist on paper, which can be trodden on in practice, as they are unenforceable cannot be what the international community had in mind when drafting and adopting these instruments. It is time all actors involved in this problem get engaged in closing this gap in international law. It might not be easy to come up with that silver bullet solution, ideally in the form of a multilateral treaty that will be implemented. But the aforementioned proposals and recommendations can and should be taken into account and implemented by those involved while working on that one clear-cut solution. Hence, closing this gap in international law a bit, before it can be fully closed, and thereby already making it easier for the indigenous people of the Camisea region to find redress. 64

65 Annex 1: Camisea project components Source: ICF International, Informe Final de la Auditoría Ambiental y Social Independiente (AASI) del Proyecto Camisea (May 2007) < (accessed 16 May 2011). 65

66 Annex 2: Ownership Camisea Gas Pipeline Company Origin Consorsio Transportadora Gas Natural Camisea de Gas del Perú de Lima y (TGP) Callao (Cálidda) Exploitation Transportation Distribution Hunt Oil US 25,2% 22,4% Tecpetrol/ Italy 10% 23,6% Tecgas Pluspetrol Argentina 27,2% Sonatrach Algeria 10% Tractebel Belgium 8% SK South Korea 17,6% 11,2% Corporation Grana y Peru 1,2% Montero Repsol YPF Spain/ 10% Argentina Sipco Peru Cayman 21,2% Pipelines Corporation Islands Carmen Corporation Argentina 12,4% Ener Ashmore International US 100% Source: Apoyo Consultoria, Proyecto Camisea: Impacto Sobre el Mercado del Gas Natural y Estimación de los Beneficios Económicos (May 2007) < (accessed 16 May 2011) p

67 Annex 3: Indigenous territories, native communities and proposed protected areas. Source: IBC/SICNA, Comunidades natives titulades, reserves territoriales para pueblos indígenas en aislamiento creadas y propuestas, áreas naturales protegidas y lotes de hidro carburos (2009) < (accessed 16 May 2011). 67