Weekly Series – Corporate Respect for Human Rights #4: Extraterritorial Jurisdiction

Excerpt from Business, Human Rights, and Uganda’s Oil

Part II: Protect and Remedy: Implementing State duties under the UN Framework on Business and Human Rights

The following is the second in a series of four reports exploring business and human rights issues in Uganda’s oil sector. This series is a collaboration between IPIS vsw and ActionAid Uganda.

In accordance with the UN Guiding Principles on Business and Human Rights, this second report assesses the duty of the Ugandan, British, French and Chinese States to prevent, investigate, punish and redress human rights abuse by businesses.

Gabriella Wass & Chris Musiime

(c) Khalil Bendib

UN Guiding Principle: The Home States’ Duty to Ensure Human Rights Protection from the Adverse Impacts of Business Activity, and Facilitate Access to Effective Remedy.

In addition to Uganda’s obligations towards human rights in the country, some responsibility arguably falls upon the “home” State of the companies operating there – Britain (Tullow), France (Total) and China (CNOOC).226

The specific definition of home States in the Guiding Principles is left open. Essentially, the home State is the nationality of the transnational corporation. Under public international law, this is generally the country in which a business has been incorporated (i.e. legally formed into an entity that is separate from its owners / shareholders) or the country from which control over the corporation’s activities is primarily exercised.227

The scope of State jurisdiction with regards to human rights was a key point that the Maastricht Principles sought to clarify,

“A State has obligations to respect, protect and fulfil economic, social and cultural rights in any of the following:

a. Situations over which it exercises authority or effective control, whether or not such control is exercised in accordance with international law;

b. Situations over which State acts or omissions bring about foreseeable effects on the enjoyment of economic, social and cultural rights, whether within or outside its territory;

c. Situations in which the State, acting separately or jointly, whether through its executive, legislative or judicial branches, is in a position to exercise decisive influence or to take measures to realize economic, social and cultural rights extraterritorially, in accordance with international law.”233

In short, home states have two overarching obligations relevant to corporate activities abroad. Firstly, they must regulate corporations with the aim of ensuring they do not commit human rights abuses abroad. Secondly, they must provide access to effective remedies to the victims of any such abuses that do occur.234

Exercising extraterritorial jurisdiction

Dr Jennifer Zerk, who contributed to the Harvard Corporate Social Responsibility Initiative to help inform Special Representative John Ruggie’s mandate, describes extraterritorial jurisdiction as

“the ability of a state, via various legal, regulatory and judicial institutions, to exercise its authority over actors and activities outside its own territory.”261

With regards to the obligation of States to protect human rights extraterritorially, the Guiding Principles take a guarded stance:

“States should set out clearly the expectation that all business enterprises domiciled in their territory and/or jurisdiction respect human rights throughout their operations… At present States are not generally required under international human rights law to regulate the extraterritorial activities of businesses domiciled in their territory and/or jurisdiction. Nor are they generally prohibited from doing so, provided there is a recognized jurisdictional basis.” 262

Whereas the Guiding Principles encourage home States to set an expectation, and acknowledge the permissibility of regulating extraterritorial activities, the Maastricht Principles place a deeper responsibility on States,

“All States must take necessary measures to ensure that non-State actors which they are in a position to regulate… such as private individuals and organizations, and transnational corporations and other business enterprises, do not nullify or impair the enjoyment of economic, social and cultural rights…”

The Maastricht Principles highlight that bases for protection include circumstances where (amongst others): the non-State actor has the nationality of the State concerned; where the corporation, or its parent or controlling company, has its centre of activity, is registered or domiciled, or has its main place of business or substantial business activities, in the State concerned; where there is a reasonable link between the State concerned and the conduct it seeks to regulate; and where any conduct impairing economic, social and cultural rights constitutes a violation of a peremptory norm of international law.

Regarding the latter, the Mastricht Principles state that, “Where such a violation also constitutes a crime under international law, States must exercise universal jurisdiction over those bearing responsibility or lawfully transfer them to an appropriate jurisdiction.”263

Given that the Maastricht Principles advocate for the necessary (and therefore limited) regulation of transnational corporations and other business enterprises extraterritorially, and the Guiding Principles do not object to such regulation, this will be taken as the reasonable standard hereafter. Some of the ways in which France, the UK and China are, and/or could, exercise extraterritorial jurisdiction follow. States may chose to pass domestic measures with extraterritorial implications. However it should be noted that States are limited in their ability to exercise of direct extraterritorial jurisdiction over private actors or activities abroad, as international law places limits on the use of direct extraterritorial jurisdiction.264 If doing so, it must be possible to rely on one or more established jurisdictional principles (e.g. relevant territorial connections, nationality connections etc.). Moreover, such jurisdiction must be “reasonable” – a vaguely defined concept in international legal discourse.265

Issues encountered when exercising extraterritoriality

When States chose to extend their jurisdiction extraterritorially, they can be subject to controversy and criticism. Territorial sovereignty – the idea that every state should be able to regulate activities within its own territory in accordance with its own policies and priorities – lies at the heart of international law.285 Some States therefore oppose the extraterritorial jurisdiction of others on the grounds that it constitutes interference in their own domestic affairs, including their ability to implement their own policy choices.286 Meanwhile companies oppose State measures to regulate extraterritorially due to the perceived extra risk, uncertainty, and expense that it may create.287

However, when States chose lighter methods, such as simply advising businesses, they can be met with defiance. For example, the UK oil company SOCO has continued operations in the DRC’s Virunga Park – a World Heritage Site – despite the EU, the UK government, Belgian politicians, and the German government expressing sincere apprehension over the sanctity of the park.288

Source: IPIS Research

More Information on the Maastricht Principles:

Maastricht ETO Principles

The Maastricht Principles on the Extraterritorial Obligations of States in the Area of Economic, Social and Cultural Rights are the outcome of an expert meeting which was convened by the Maastricht Centre of Human Rights and the International Commission of Jurists in September 2011. This normative set of Principles aims at defining and clarifying the extraterritorial human rights obligations of States in an era characterized by economic globalization. More information

Source: MU