PHM-Exch> STATEMENT OF THE GLOBAL CAMPAIGN ON THE THIRD REVISED DRAFT OF THE BINDING TREATY ON TRANSNATIONAL CORPORATIONS AND HUMAN RIGHTS

[Claudio Schuftan]

STATEMENT OF THE GLOBAL CAMPAIGN ON THE THIRD REVISED DRAFT OF
THE BINDING TREATY ON TRANSNATIONAL CORPORATIONS AND HUMAN
RIGHTS
7th of September 2021

Re: Release of the "third revised draft" during the negotiation by the
Open-ended
Intergovernmental Working Group on the elaboration of an international
legally binding
instrument to regulate the activities of transnational corporations (TNCs)
and other business
enterprises with regard to human rights

The Global Campaign to Reclaim Peoples' Sovereignty, Dismantle Corporate
Power and Stop
Impunity (Global Campaign) notes the release of the third revised draft of
the binding treaty,
published on August 17, 2021. It is the result of the negotiation process
started in 2014 with the
adoption by the Human Rights Council of Resolution 26/9. This new draft
emerges after the
discussions held during the 6th negotiation session of October 2020 and the
subsequent Matrix
process of February 2021.

We are deeply concerned about the continuing hollowing out of key content,
i.e., content that social
organisations and affected communities view as critical. We hereby share
our first impressions on
the new draft and raise some procedural questions concerning the
negotiation of successive "drafts".
Although we note some positive changes in the third revised draft, these
are mostly cosmetic,
rhetorical and ineffectual. These superficial changes seek to increase the
legitimacy of the proposed
text, but, in reality, fail to solve the structural problems repeatedly
highlighted by social movements
and affected communities.

A change of direction in both content and procedure will thus be necessary
to meet the objectives
set out in Resolution 26/9 and to respond to communities subjected to human
rights violations. It is
unacceptable that the innumerable proposals for improving the draft
presented throughout the
negotiation sessions by representatives of the affected communities, social
movements, as well as
many experts and States to be omitted. The third revised draft is basically
similar to the previous
draft, despite the high number of concrete proposals that were made to
improve it. This gives us the
feeling of a lost year.

Moreover, the methodology used to revise the draft transparently
considering the contributions of
States and civil society organizations is a must. We appreciate the
synthesis and mediation efforts of
the Ecuadorian Chair Rapporteur. Nonetheless the negotiation has reached a
point of maturity that
requires a Member driven, open and transparent negotiation process
facilitated by the Chair
Rapporteur. This must ensure that the voices of civil society and affected
communities are heard
and taken into consideration by including the diverse text proposals in
brackets during the session
of negotiation. The objective of the session should be to achieve a new
draft proposal of the IGWG
and not just of the Chair. In short, to be true actors in the process,
civil society must have both voice
and influence.

In terms of content, we note once again that, following the approach
presented in the previous drafts
released by the Chair Rapporteur after the robust Elements Paper in 2017,
and despite some positive
elements, the new draft continues to present an ineffective and "toothless"
instrument. We also note
the use of vague, indeterminate and even non-legal concepts that may
compromise the future
interpretation and application of key articles.

As it stands, the draft instrument fails to meet the objectives established
by Resolution 26/9, namely
to regulate the activities of transnational corporations within the
framework of international human
rights law (in order to prevent human rights violations by TNCs and stop
corporate impunity) and to
ensure effective and comprehensive access to justice for affected peoples,
individuals and
communities. Furthermore, the current draft would not close the existing
legal loopholes that allow
and will allow TNCs to violate human rights with impunity and to escape
liability for their actions.

Without more innovative and ambitious provisions, the treaty risks becoming
a new futile
instrument aligned with voluntary frameworks that have already demonstrated
their ineffectiveness.
Furthermore, the new text unacceptably continues a logic centered
exclusively on States’
obligations, and fails to establish the direct obligations for
transnational corporations, necessary to
hold them directly accountable for the human rights violations they are
responsible for. We are also
concerned about the continued extension of the scope of the text to all
business enterprises,
including small and medium-sized enterprises. This dilutes the raison
d'être of the binding treaty
and the purpose set out in Resolution 26/9 (to address the particular
obstacles to holding TNCs
accountable), which clearly refers to transnational corporations and other
business enterprises “with
transnational character”.

Another element is the scope of prevention and legal liability of TNCs
which focuses on weak
provisions linked to due diligence, an inherently limiting concept. This
risks a situation where
TNCs escape liability as soon as they comply with due diligence processes.

We call attention to the lack of an unequivocal reaffirmation of the
primacy of international human
rights law over corporate, trade and investment law, the absence of a
strong international
enforcement and monitoring mechanisms (including an international tribunal)
that would guarantee
the effective implementation of the treaty, as well as the several
remaining gaps in terms of
inclusion and definition of global value chains, the piercing of the
corporate veil, and addressing
the bottom line of transnational corporate impunity.

At this stage, it seems clear that the Chair of the Working Group is
steering the process towards the
elaboration of a treaty emptied of its core content and focus on
transnational corporations, with only
generic provisions that rely on the capacity and political will of the
States for their implementation
and in line with corporate self-regulation. This confronts us with a text
overly accommodating to
the requests and interests of the corporate sector and their political
allies.

This being said, the Global Campaign will continue its strong engagement in
the negotiations with
the unyielding intention to com up with a truly binding treaty worthy of
its name and capable of
becoming a bulwark against the power of transnational entities that lay
claim to being the engines of
our economies while they violate human rights and destroy our natural
environment with impunity.
In line with these commitments, the Global Campaign will, if necessary,
oppose the adoption of a
treaty whose content has been watered down and risks becoming a “normative
trap” that closes the
door on truly effective reforms in the coming years.

Contact:
Júlia García, facilitation at stopcorporateimpunity.org
Raffaele Morgantini, contact at cetim.ch
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