Yelling Loudly and Carrying a Small Stick: The Nation State and the Enforcement of Global Human Rights

Nation states continue to jealously guard their authority to discipline the juridical persons subject to their control. Many of them also encourage the incorporation of human rights, environmental and other social concerns in the operation of multinational corporations. On that basis, some states have resisted the move to impose something other than voluntary frameworks of corporate obligations for activities that touch on international human rights standards. Other states resist the incorporation of international law directly within their territory, without at least some mediation by the democratically elected representatives of the people of the state. And many states are wary of the direct imposition of international standards, hard or soft, on corporations or other entities over which they seek to assert national law. But as Anna Triponel reminds us, the result is not necessarily a vigorous development of either national law that elaborates human rights standards applicable to corporate entities, or the inclination to enforcement international standards in their courts against corporations, especially with respect to activities occurring outside the territory of the nation states or involving actions of subsidiaries or other entities with which the defendant corporation might have had a relationship. Anna Triponel, "Business and Human Rights Law: Diverging Trends in the United States and France", 23 American University International Law Review 855 (2008).

The application of human rights standards to the activities of transnational corporations has become an increasingly prominent debate in the international law and business arenas. As the international community moves forward in elaborating a framework for accountability for corporate acts, it will be crucial that this framework reflect the existing differences between legal systems in applying human rights law to corporations' operations. This article sets out the differences between the United States and France as two examples of fundamentally different approaches in addressing corporate compliance of human rights. Ultimately, these two different state approaches towards the role of business, government interventionism, stockholders and shareholders, and international law, should be taken into account in tailoring a true international consensus on corporate responsibility, accepted by both sides of the Atlantic. Triponel, supra, abstract.

Triponel suggests the substantial distinctions between France and the United States--both in the conceptualization of corporate social responsibility and its its implementation in the courts and through law. Both start from similar jurisprudential positions. The United States and France are parties to the host of international treaties setting minimum human rights standards, plus a host of declarations and other soft law. It is bound to incorporate those that bind and to be mindful of those that don't. But in both cases that might be harder done than said. "Both France and the United States benefit from clear guidance by the international community of which human rights are to be specifically targeted when regulating corporate activity. In practice, however, it can be difficult for the state to assert the contents of certain rights and therefore protect them." Triponel, supra at 874.

Yet while both states have not been aggressive in implementing international obligations within their national legal orders, they have been much more aggressive in asserting their rights over their own entities wherever they might operate.

In the United States, the nationality principle, which applies to juridical as well as natural persons, enables it to regulate corporations’ activities abroad. The U.S. Congress has used this principle to enact laws regulating the overseas conduct of U.S. corporations, such as to prohibit these companies from complying with the Arab boycott of Israel and engaging in corrupt practices. As for France, international mandatory rules called “Lois de police” enable the application of French law to corporate activities abroad. Indeed, these laws are considered so important for the country that their extraterritorial application is necessary. Triponel, supra, at 857.

The territorial principal, even in its extraterritorial application, is tethered more to domestic than international legal frameworks. "It is primarily through domestic law suits that individuals will seek to hold TNCs accountable for abusive practices. The ways in which American and French TNCs can be held accountable for their human rights violations overseas varies widely." Id., at 904. But Triponel reminds us that while the approach to the extraterritorial application of domestic law is different in France and the United States, the effect is substantially the same. In both states, the use of domestic legal regimes to reach human rights abuses is quite limited. Id., at 904-912.

A vivid example is the difference in treatment afforded to Burmese plaintiffs complaining against the American company Unocal and those complaining against the French company Total. Total was one of the partners of the joint venture between Unocal and the Burmese government. Total was initially one of the defendants in the American lawsuit launched in California, but an amicus curiae brief from France convinced the judge of its inaptitude to involve Total in the litigation, namely due to the principle of sovereignty. As France does not have the equivalent of the American ATCA, the plaintiffs used French criminal law to bring a suit against Total in France. The difficulty is that the criminal code prohibits only certain crimes committed abroad and additionally requires that the perpetrator be French. Therefore, in contrast to the Unocal plaintiffs, who managed to create an incentive for the company to settle, plaintiffs in French courts have no similar remedy under the same set of facts. Id., at 909.

At the same time, both states set high bars to reaching corporate groups for the liabilities incurred by a juridically autonomous corporate person. Id., at 909-910. "Furthermore, in the United States, the doctrine of forum non conveniens allows judges to refuse a case when it deems itself not a suitable forum. Forum non conveniens is said to “shield multinationals from liability for injuries abroad.” Id., at 910 (quoting in part JAMIE CASSELS, THE UNCERTAIN PROMISE OF LAW: LESSONS FROM BHOPAL 144 (1993)).

Both states also approach the issue implementing corporate social responsibility in distinct ways. "CSR in France aims at “integrat[ing] social and environmental concerns” into business operations.110 However, in the United States, CSR has a larger scope and is aimed at enhancing “business decision-making linked to ethical values . . . and respect for people, communities and the environment” around the world." Id., at 877 (citing in part, Yale Global Online, http://yaleglobal.yale.edu/display.article?id=1339 (last visited May 15, 2008) (quoting Business for Social Responsibility’s definition)).

In the United States, this movement has resulted in an explosion since the late 1990s of voluntary corporate initiatives undertaken by companies themselves. The fact that there has been increased government regulation of corporate disclosure in the United States is not, however, a direct result of this second CSR movement, but instead has stemmed from the need to protect American investors in the wake of financial scandals. In France, this CSR movement has, on the contrary, resulted directly in increased regulation of French companies without an increase in voluntary corporate initiatives. . . . France passed a law which mandated the disclosure of social, environmental, and profit performance. This law applies to all French companies listed on the French Stock Exchange and therefore to TNCs as well. French companies now have the obligation to describe to all stakeholders the social and environmental consequences of their activities in their annual reports. However, the companies have no further obligation to act upon these consequences. Id., at 878.

But these changes have collided with the fundamental structure of national law, and the limits of the territorial principle applied to global enterprises. All of these are well known and well articulated, in accordance with their respective national legal cultures, by the French and the Americans. But despite cultural differences in the form of law, the principles applied, and the effects, are the same.

Triponel reminds us that though international actors have been attempting to change global legal culture to embrace the notion of state liability for complicity in the human rights violations of private actors, "it is improbable that France or the United States would be held liable under this standard." Id., at 879. On the other hand, French courts will enforce supra national law directly in French courts to a much greater extent than American courts. But those direct obligations generally extend to the specific obligations of France under the European Convention on Human Rights, and the legal framework of the European Union. For Americans, the pickings are slim. For example, Triponel points to "a NAFTA side agreement [which] allows individuals and NGOs to submit complaints to a national administrative office in each country when one of the countries fails to enforce its labor laws." Id., at 885. Beyond that there are voluntary codes., but enforcement is private and subject to substantial criticism among civil society actors eager to impose more direct obligations on corporate entities. Id., at 885-891.

More interesting is the emergence of a framework for liability stemming form corporate complicity in human rights abuse. ID., at 898-904. The National Contacts Point in the UK has taken this up recently under the OECD Guidelines for Multinationals. See Larry Catá Backer, Rights and Accountability in Development (‘Raid’) V Das Air and Global Witness V Afrimex: Small Steps Toward an Autonomous Transnational Legal System for the Regulation of Multinational Corporations, Melbourne Journal of International Law Vol 10 (forthcoming 2009).
Triponel notes that "plaintiffs increasingly use the theory of corporate complicity in domestic law suits against corporations. As such, defining the parameters of corporate complicity is especially important." Triponel, supra, at 904 ("The International Commission for Jurists, for example, was created in 2006 to 'develop the legal and public policy meaning of corporate complicity in the worst violations of international human rights and humanitarian law that amount to international crimes.'” Id (quoting in part Business & Human Rights Resource Centre, International Commission of Jurists - Expert Legal Panel on Corporate Complicity in International Crimes)).

Triponel nicely highlights both the movement toward an acceptance of corporate social responsibility by developed states. Though its meaning is different in the United States and France, the notion is taking root that corporations have to adhere to substantive behavior norms. But beyond that, translating these aspirations into either a national or international system of rules in the traditional manner--through positive law enforced by national courts--continues to founder on the territorial principle. In this context, it makes sense for people seeking such a framework to turn from a singular reliance of conventional positive law and state (or international) systems and focus on the construction of governance outside the state. Triponel reminds us that the construction of national legal approaches to the regulation of transnational human rights within national legal orders is a difficult task. Moreover, it is a task that is in some respect inconsistent with the fundamental principle on which national legal orders are founded. Much of the gyrations Triponel relates reflects efforts to work around these conceptual restraints without undoing the state. None of these are likely to succeed. Either states will lose control of multinational corporations, or national legal orders will have to become more receptive to harmonized or global systems for their regulation. In the absence of these changes, the current system, which has worked well enough for dominant economic public and private powers, may continue to provide the basis for legal recourse for some time.