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An International Criminal Court for Transnational Companies?

by Francois Rigaux

International jurisdictions which exist are not applicable except to States which have voluntarily submitted to them (the International Court of Justice) and to some individuals who have committed particularly serious crimes, as a consequence of decisions taken by the Security Council (the Courts relating to ex-Yugoslavia, Rwanda, etc.) Transnational companies (TNCs) are economic agents of private law and are subject in principle to rule of law and to the jurisdiction of its courts. The transnational group does not, in itself, possess an identity which can be distinguished from each of the entities that make it up, so that it can only be obliged to answer for its acts in a fragmented way, so that it benefits from the opposing interests of the States in which it operates. The recent tendency to consider legal entities as criminally sanctionable has not yet shown its efficiency.

The transfer of prohibited or regulated activities in one State to countries with less regulations allows them to escape their responsibilities. The transfer of industries or other very dangerous activities (such as in the case of Bhopal), as well as its transfer to countries with cheap labor and lower social protection levels in order to make production costs cheaper, are examples of abuses committed by TNCs.

In principle it is not illegal to take advantage of the disparities between States nor of the differences caused by the unequal development between different countries. However, the policies applied by TNCs through institutions such as the IMF and the WB, which led to poor countries becoming indebted and later to the imposition upon them of structural adjustment measures which impoverished many of them even further, and their peoples. These actions are violations of fundamental human rights, such as the right to health and the right to life.

Those States which are the most powerful are the least innocent and have more tools than they admit and protect their companies better. In those States the most protected right is that of property. In each State there are legal provisions to incriminate TNCs for damage to the environment, for non respect of labor norms in effect or for any crime carried out by companies, however, very little is done to enforce these provisions. Nor are international norms applied when it is a case of judging those who have served interests protected by the State. For example, in France the escape of an Algerian general accused of torture in Algeria was permitted. And the notion of “crime against humanity” accepted under French law, does not apply in France with respect to crimes in Algeria.

There are various systems for defining jurisdiction:

a) that of the State in which the Transnational has requested legal identity; b) that of the headquarters of the company or the place where decisions are taken; c) that of the State in which the company is registered. There is also an idea of control: when a company controls 100% of all the shares of another company it must answer for its actions or for crimes committed by the branch.

States can exercise jurisdiction on TNCs but they do not wish to do so. It is necessary to force them to do so. The existence of an international court could force them to use their prerogatives. Those international courts which exist can condemn States (the International Court of Justice in the Hague) or individuals (the Courts for crimes committed in the territory of ex-Yugoslavia or in Rwanda), but TNCs cannot be punished for the serious crimes they commit against the peoples of the whole world. An international court for TNCs should be created through a treaty between States, such as the International Criminal Court to be set up in Rome and must be competent to judge TNCs both civilly and criminally without excluding the responsibility of individuals. International law in effect regarding human rights should be applied, establishing a hierarchy of rights where priority is granted to the most essential of these rights, such as the right to life, to health, the right not to suffer torture or cruel, inhuman or degrading treatment, etc.

In the debate on this issue , the heterogeneous nature of international norms was talked of and its contradictions, for example in the case of intellectual property, which is allowed to prevail over the right to life (v. the case of the 39 TNCs which requested South Africa to pass a law which would promote the distribution of low-cost generic drugs to control AIDS and a complaint made by the United States against Brazil at the WTO for producing generic drugs). The right to property should not prevail over the right to life. For this reason it is necessary to establish hierarchies, giving priority to the common good, general interest and human dignity.

It was stated that the court proposed by Professor Rigaux was somewhat utopian, because in reality we are seeing the opposite taking place, such as in the NAFTA agreements between Canada, the United States and Mexico, where differences are dissolved by a court of decision which meets behind closed doors and which does not make known the reasons for its decisions. When the TNCs commit violations of the labor rights of workers, for example, it is the State which is obliged to compensate them for not having exercised sufficient vigilance. It is appropriate to consider that the State is responsible, because it is always responsible for the application of norms in its territory under its jurisdiction.

It was said that perhaps it was less utopian to incorporate a chapter on the responsibility of legal entities or of the TNCs in the Statutes of Rome for an International Criminal Court, but noted that it was possible to accuse before the Court individuals responsible for crimes against humanity, many of them being managers of TNCs or of international financial institutions.

There did exist, moreover, other mechanisms for the protection of human rights within the UN framework and that of the ILO (Committee against Torture, the Human Rights Commission, Committee for Trade Union freedom, etc.) and one should not forget that these violations could be invoked before national courts also.

Some participants considered that it was necessary to bring about the creation of a court for TNCs after the model of the International Court on the Law of the Sea. In this case it was necessary to have firstly a compulsory instrument applicable to such enterprises, which did not exist at present. To begin with it should be suggested that the United Nations enforce respect of norms enshrined in the Declaration of Tripartite Principles on TNCs and the Social Policy of the ILO in the Global Compact, establishing, for example, a list of TNCs which do not fulfil the labor rules indicated therein, although such companies have declared that they will only remain in the Global Compact provided such norms not be imposed upon them.

 
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