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ESCR-Net Statement on the Second Revised Draft of the Binding Treaty

"Statement: Second Revised Draft Binding Instrument on Corporate Accountability – Corporate Impunity Must End", 31 August 2020.

...We emphasize the urgency of proceeding with adopting a legally binding instrument, and further call on States to ensure the meaningful and effective participation of human right defenders, affected communities, workers, social movements and civil society organizations from around the world in all aspects of this process...We have seen corporate actors taking advantage of this moment of crisis to maximize on profit, expand their operations by displacing communities, altering, or abandoning State-issued human rights and environmental regulations, and much more. In the meantime, the domestic legislative and judicial systems in the majority of countries around the world too often sacrifice public interest to serve the narrow interests of corporate elites and investors...

In several ways, the second revised draft binding instrument has positively addressed some of our demands and introduced recommended language that ESCR-Net members shared last year in a collective position paper in a step towards strengthened corporate accountability. Yet, we are concerned that some key elements remain missing from the revised text and key issues regarding transnational accountability have been weakened or are less clear as before.

Positive developments

We commend the inclusion of the UN Declaration on Human Right Defenders that allows for an expansion on the protection of human rights defenders, victims and individuals impacted by corporate activity in the new text (preamble, Art 2.1, Art 4)...On corporate liability, it is relevant to note that the current draft provides that human rights due diligence shall not automatically absolve liability for causing, contributing to or failing to prevent human rights abuses (Art. 8.8)...We also acknowledge an improved approach to the primacy of human rights in relation to trade and investment agreements – though it is not clear how this would be realized in practice (Art 14.5.a)...

What concerns us?

State obligations must be clearly fleshed out in the LBI, particularly pertaining to State-owned enterprises and the consequences of failing to comply with the legally binding instrument (Art 8). While the inclusion of informed consent of indigenous Peoples is a positive development in compliance with international law, this consent must be continuous in all stages of a corporate project, including prior to the commencement of a project (Art 6.3.d)...Reversal of the burden of proof should be mandated directly in the text of the LBI and not depend on the domestic laws of each country (Art 7.6). Environmental impact assessments should be continuous and schedules for consultations should be timely publicized (Art 6.3)...

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