By Rhia Bakshi, Intern, International Labor Rights Forum
With the unprecedented growth of multinational corporations in recent years, protective measures like the Alien Tort Claims Act are not only desirable, but also necessary. For several decades, the ATCA has enabled victims of international human rights abuses to bring their perpetrators to trial in U.S. courts. As a result, several MNCs have been brought to court for condoning gross human rights violations including torture, forced labor and extrajudicial killings. The ATCA has thus played an important role in building corporate accountability and preserving human rights. However, recent attempts by powerful organizations representing MNCs to limit the scope of the ATCA poses a serious threat to the future of international human rights.
The issue came to fore in August, when New-York based Second Circuit Court of Appeals ruled that corporations, unlike individuals, may not be held accountable for violations of international law. The case, Kiobel v. Royal Dutch Petroleum, involved complaints by Nigerian nationals against Royal Dutch Petroleum for aiding and abetting in the torture of local villagers who were opposed to the company’s destructive oil exploration operations. The three-judge panel ruled 2-1 that the company could not be found guilty, on grounds of the notion that “individual liability for violations of international law is limited to natural persons.” What this essentially means is that the plaintiff must first prove a corporate or government official personally responsible for negligence, a process that could be both tedious and unfeasible. In addition, this argument seems rather ironic, considering the court’s recent decision in the Citizens United case, in which it granted corporations the same political speech rights as individuals under the First Amendment. The prevalence of such hypocrisy in our legal system is disturbing to say the least.
The court’s decision in Kiobel v. Royal Dutch, which was widely welcomed by multinationals, undermines the original 1789 law aimed at upholding universally accepted and obligatory norms of human rights. By eliminating the binding responsibility of corporations to engage in socially responsible business, it is likely to foster a culture of impunity and a lack of accountability, which in turn will seriously jeopardize the state of human rights around the world. In the past, the ATCA has been successful in addressing irresponsible corporate behavior. The notorious case of Doe v. Unocal, involved charges made by Burmese villagers against MNC Unocal’s involvement in human rights abuses including forced labor, rape and murder. The court ultimately determined that the company could be held responsible for aiding the Burmese military in its abusive practices. So, in the face of overwhelming evidence against the company, Unocal agreed to compensate the Burmese victims. In this manner, the ATCA has served as an effective deterrent, causing companies to closely monitor the social and environmental impact of their practices and leading to more responsible business. With the attack on the ATCA, this effective system of corporate accountability is eliminated. Moreover, the prospect of finding an individual responsible for human rights violations on a massive global scale is not likely to yield substantive results.
As a pioneer in the movement for corporate liability, ILRF strongly opposes the decision to limit the Alien Tort Claims Act. As multinational corporations expand their operations abroad, we consider the ATCA an essential tool in protecting the interests of the massive workforce employed by these companies in foreign countries. As a world leader, the United States must uphold high standards in the promotion of human rights, ensuring that anybody in need has access to the U.S. judicial system. ILRF further stresses the importance of moral liability in the corporate world, both in domestic and in foreign operations. As concerned individuals, we must stay informed about the impact of the corporate world and take action against abusive business practices.
The OECD Guidelines for Multinational Enterprises, which is a set of normative standards aimed at governing multinational practices, could serve as a potential measure in preserving the importance of corporate accountability, an issue that has failed to receive the attention it deserves. The guidelines can serve as a point for negotiation with companies that fail to uphold fair business practices. However, since “soft law” measures like the OECD guidelines are not mandatory, they are likely to yield minimal, if any, concrete results.