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Article

UN treaty on business and human rights: Working Group publishes draft instrument

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Would the treaty apply to all businesses or just those of a “transnational” character?
...The draft treaty adopts the more restrictive approach, limiting the scope of its application to “business activities of a transnational character”...This restrictive approach risks creating an uneven playing field for domestic and transnational enterprises...It may also deprive victims of a means to access a remedy against a domestic enterprise...

How would the treaty bind companies?
...[T]he treaty is intended to be signed by States and envisages that the provisions regulating business activity will be enforced by the State Parties...[P]rivate persons (natural or legal) would not be directly bound by the provisions of the treaty...

What is the nature and extent of corporate liability?
The draft instrument requires State Parties to provide...for criminal, civil and administrative liability for violations of human rights in the context of transnational business activities and for effective criminal and non-criminal sanctions...

Due diligence requirements
...[D]raft Article 9 defines due diligence as including monitoring, identifying, assessing, preventing and reporting on the human rights impacts of business activities...The draft instrument requires states to ensure that businesses incorporate these due diligence requirements in “all contractual relationships which involve business activities of transnational character“...

Where can claims be brought?
...[T]he draft instrument vests jurisdiction in the courts of the State where either (1) the alleged acts or omissions occurred or (2) the natural or legal person(s) alleged to have committed the acts or omissions are domiciled (Article 5). It also requires states to incorporate...appropriate provisions for universal jurisdiction over human rights violations which amount to crimes...[T]he draft treaty also includes provisions requiring State Parties to mutually recognise and enforce domestic judgments made in another State Party...

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