Report considers legal feasibility of introducing into UK law a corporate duty to prevent human rights harms

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13 February 2020

Companies seek bolder human rights legislation

Author: Jonathan Ames, The Times (UK)

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British companies have faced strict criminal law sanctions for failing to prevent bribery and corruption for the past decade, but instead of chafing at the bit of tighter legislation they seem to want more.

A survey of UK-based multinational companies published yesterday found that they would prefer tougher human rights and environmental laws, which would mirror corruption provisions in the Bribery Act 2010.

Nearly 70 per cent of the large companies surveyed by the British Institute of International and Comparative Law said that existing legislation does not provide sufficient certainty about the procedures required to avoid legal risks over human rights abuses...

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11 February 2020

A UK Failure to Prevent Mechanism for Corporate Human Rights Harms

Author: BIICL (Peter Hood, Julianne Hughes-Jennett, Dr Irene Pietropaoli, Lise Smit)

...The study included a survey of businesses to understand their experiences... The vast majority of business indicated that additional regulation may provide benefits to business: through providing legal certainty (82.14%); through levelling the playing field... (74.07%); and by facilitating leverage with third parties... (75%)...

The study also provides a legal analysis as to whether and how the legal elements of section 7 of the Bribery Act could be transposed into a failure to prevent mechanism for corporate human rights harms...

A failure to prevent mechanism should establish a duty to prevent human rights harms... A failure to prevent such harms would result in possible civil liability for damages to those affected, unless the company could show that it has undertaken the due diligence required in the circumstances. This would not affect any criminal liability which could otherwise arise...

We recommend that the mechanism includes a defence of procedures “reasonable in all the circumstances”... This should be accompanied by Guidance elaborating on the meaning of “reasonable” due diligence, with reference to the UNGPs, the concept of leverage, and clarifying that due diligence is accordingly not a “check-box” exercise or a “safe harbour”...

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