1 Introduction

Alongside transnational civil claims against MNEs, victims of business-related abuse and NGOs have sought justice by using the criminal system of home States. In France, 12 out of the 16 claims discussed in this book have been of a criminal nature. Various factors may influence the decision of victims to use national criminal proceedings instead of civil proceedings. First, from a moral viewpoint the criminal justice system may seem more suitable for holding companies accountable for their misconduct, in particular gross human rights abuses. The criminal sentencing of a company sends a stronger message of disapprobation about the corporate wrongdoing. Harm is done not only to the victim, but also to society. The symbolism that the criminal justice system conveys may be attractive to victims seeking formal punishment of corporate misbehaviour.¹ Furthermore, criminal punishment for misconduct may have a dissuasive effect on companies. This may be particularly relevant in strategic litigation where lawyers and NGOs are trying to bring about changes in the way companies behave. In this respect, criminal proceedings may be preferred in countries where the civil justice system does not impose exemplary or punitive damages, which is often the case in civil law countries. Finally, victims are more likely to use criminal proceedings to hold MNEs to account when they can play an active role in initiating criminal proceedings, for instance by triggering investigation into the alleged crimes or prosecution of the apparent perpetrator. This is the case in France where victims can request that the public prosecutor investigates the facts they bring forward or can launch a civil action before the examining magistrate in order to claim reparation for the damage suffered as a result of the criminal offence. They can also directly summon the alleged perpetrator in some instances.

However, choosing criminal law to hold MNEs accountable for their misconduct abroad is not necessarily easier for victims when compared to transnational civil claims against MNEs. Victims face similar obstacles that are likely to jeopardize their quest for justice. One obstacle is whether the criminal law of the home State applies to the extraterritorial offences in question and, therefore, leads to criminal courts having jurisdiction to judge these criminal offences. Furthermore, the impossibility for prosecutors or examining magistrates to have access to evidence in the host State may lead to a dead-end for victims. Another challenge for victims is the acceptation of their role and position in the criminal proceedings. Despite the growing recognition of the rights of victims of crime at international and national levels,² victims still struggle to be recognized as legitimate actors of criminal proceedings. This is partly due to the dichotomous nature of criminal trials, which traditionally pit the State against the accused. Within this context, victims are seen as a third party whose interests are difficult to accommodate and who may disturb the delicate balance of power between the prosecution and the defence. The private nature of victims’ interests is perceived by some to be at odds with the public character of the criminal justice system, whose main function ought to be the protection of the public interest.³ In addition, concerns have been voiced that victims’ participation in criminal proceedings threatens the guarantee of the rights of the defendant and may lead criminal judges to adopt harsher punishments.⁴

2 Prosecuting MNEs for extraterritorial crimes

In criminal law, jurisdiction concerns the reach which the State gives to its law, and addresses the question as to where and to whom that State’s law is applicable.⁵ Therefore, the application of criminal law and the exercise of criminal jurisdiction are intertwined. A court’s exercise of jurisdiction usually follows from the application of its State’s criminal law on the grounds of the ‘solidarity between jurisdiction and legislative competence’ principle (principe de solidarité des compétences législative et juridictionnelle).⁶

The territoriality principle is the cornerstone of jurisdiction in criminal law. The courts of the State on whose territory the criminal offence was committed have jurisdiction of the offence. Alternative extraterritorial jurisdictional principles also exist, such as the active and passive personality principles based on the nationality of the perpetrator or the victim, and the universal jurisdiction principle, which mainly applies to international crimes. Domestic courts tend to carefully apply some of these alternative principles in criminal matters as a result of their contentious nature and potential infringement on other States’ sovereignty. However, continental European countries put far less emphasis on the territoriality principle in criminal law compared with common law countries,⁷ and France and the Netherlands have, to some extent, accepted the application of alternative principles of jurisdiction.

Holding MNEs, and their parent companies in particular, accountable for crimes involving human rights violations or environmental crimes committed in the context of group activities raises complex questions from a jurisdictional perspective.⁸ This is partly due to the fact that MNEs’ global structure, management, and operations are intricate and lack transparency, which makes it difficult to identify the real entity that committed a criminal offence or to geographically situate the place where the crime was committed (locus delicti). Furthermore, attribution of jurisdiction may be problematic as a result of the criminal involvement of the MNE or the nature of the crime at stake. MNEs may be involved as direct perpetrators or accomplices of domestic crimes with an extraterritorial dimension or crimes under international law. In such a context, the jurisdictional principles mentioned above may be inadequate to grasp the reality of criminal activities within complex corporate group structures and ensure the prosecution of MNEs when they commit crimes with an extraterritorial or international dimension.

The territoriality principle

The principle of territoriality is the primary basis for the application of French and Dutch criminal law and the jurisdiction of their respective courts in criminal matters. Pursuant to Article 113-2 French Criminal Code, French criminal law applies to offences committed on the French territory, including the maritime and air spaces linked to it. Similarly, Article 2 Dutch Criminal Code (Wetboek van Strafrecht) provides that Dutch criminal law is applicable to anyone who is guilty of any offence within the Netherlands. Furthermore, Dutch criminal law applies to anyone who is guilty of any offence outside the Netherlands on board a Dutch vessel or aircraft.

The application of the territoriality principle raises important challenges in the context of transnational litigation against MNEs. Indeed, these cases often involve criminal offences committed on the territory of a host State. A strict interpretation of the territoriality principle would therefore result in the impossibility of applying the criminal law of the home State to a criminal offence committed outside its territory. However, French and Dutch criminal law allow a flexible interpretation of the territoriality principle which may allow for the prosecution of extraterritorial crimes in France and the Netherlands.

The French Criminal Code and courts have interpreted the territoriality principle in an extensive manner. Three situations are relevant in this study: theory of ubiquity, theory of indivisibility, and complicity. First, Article 113-2 French Criminal Code provides for the application of the theory of ubiquity (théorie de l’ubiquité). An offence is deemed to have been committed within French territory where one of its ‘constituent facts’ (faits constitutifs) took place in France.⁹ French courts have broadly interpreted the notion of constituent facts and have accepted that preparatory acts or even effects are sufficient.¹⁰ When the perpetrator is a company, the Court of Cassation takes into account the place of the statutory seat to locate the business decisions which constitute a criminal offence.¹¹ As a result, French criminal law may apply when the business decisions of a company whose statutory seat is within French territory, such as the French member of an MNE, are a constituent fact of the offence. The Court of Cassation recently ruled that the French courts had jurisdiction over the offence of bribing a foreign public official committed abroad where, on the one hand, the bribery of a foreign public official was decided and organized on the national territory where the amount of the remuneration due in this respect was also paid and, on the other hand, the registered office of the company that benefited from the proceeds of the offence was located in that territory and was used to domicile the account opened abroad that was intended for the transit of the kickbacks.¹² The French Criminal Code also applies the theory of ubiquity to accomplices.

Second, French courts have developed the theory of indivisibility which is relevant in the context of transnational litigation against MNEs.¹³ French law is applicable to a criminal offence committed abroad if this offence forms an indivisible whole with an offence committed on French territory.¹⁴ However, the foreign acts must have a link with France or must be tried in the French courts. The Court of Cassation recently interpreted the concept of indivisibility. Accordingly, French criminal law is applicable to an offence committed abroad where there is a link of indivisibility between that offence and another offence committed on French territory, the facts being indivisible when they are linked to each other by a connection such that the existence of one would not be understood without the existence of the other. If several offences are merely connected, French courts do not have jurisdiction over offences committed abroad by a person of foreign nationality against a foreign victim.¹⁵

Third, under Article 113-5 French Criminal Code, French criminal law is also applicable to any person who, within the French territory, is guilty as an accomplice to a felony or misdemeanour committed abroad if: (1) it is punishable by both the French and foreign law; and (2) if it was established by a final decision of a foreign court. The application of Article 113-5 presents a number of challenges. First, it applies only to accomplices to a criminal offence committed abroad. Second, it requires ‘double (or dual) criminality’ (double incrimination), which means that the criminal offence must be punishable under the legislation of both countries. Third, a foreign court must have rendered a final judgment. In general, French courts interpret these requirements strictly, thus limiting the application of Article 113-5.¹⁶

Victims in Rougier and DLH relied upon Article 113-5 to justify the criminal prosecution in France of French companies for criminal offences occurring abroad. However, the Rougier case demonstrates that Article 113-5 provides limited opportunities as a basis to apply French criminal law to crimes involving MNEs and gain access to justice. The victims alleged that, pursuant to Article 113-5, French criminal law was applicable to the French company Rougier for complicity in the commission of various criminal offences by SFID, its Cameroonian subsidiary. However, the Paris Court of Appeal dismissed their claim on the grounds that Article 113-5 requires a final ruling from a foreign court, which was missing in this instance.¹⁷ The Court of Appeal rejected the victims’ argument that they had been unable to gain access to justice in Cameroon because of corruption and lack of independence of local and judicial authorities.¹⁸ It found that they did not demonstrate that it was impossible to obtain a final ruling in Cameroon. The legitimacy of the requirement of a final ruling from a foreign court is questionable in situations where victims are unable to obtain justice in the host country, especially in States plagued by corruption or conflict.

Article 2 Dutch Criminal Code provides that Dutch criminal law is applicable to anyone who commits any criminal offence within the Netherlands. The determining factor is locus delicti, meaning the place where the criminal offence was committed. Unlike the criminal codes of some other European countries, the Dutch Criminal Code does not describe the place where an offence is committed.¹⁹ Therefore, Dutch courts have had to clarify the scope of locus delicti under Dutch law. On several occasions, the Supreme Court ruled that a criminal offence could be committed in more than one place.²⁰ Furthermore, it is not necessary that all the constituent elements of the criminal offence took place on Dutch territory to establish jurisdiction of the Dutch courts. They may exercise jurisdiction over a criminal offence when only one of its elements took place in the Netherlands.²¹ Therefore, a legal person who committed a criminal offence abroad may be prosecuted in the Netherlands when one element of the criminal offence took place in the Netherlands. Moreover, the Supreme Court ruled that Dutch courts could exercise jurisdiction over accomplices acting abroad in support of crimes that took place on Dutch territory.²² However, whether Dutch courts have jurisdiction over accomplices acting in the Netherlands for an offence committed abroad is not entirely clear.²³ Nonetheless, scholars assume that the location where the complicity takes place can be considered the locus delicti for the crime of complicity.²⁴ As for joint wrongdoing, scholars have inferred from case law that the location where the acts of joint wrongdoing took place could be seen as the locus delicti.²⁵ In addition, Dutch courts have jurisdiction over extraterritorial acts which aggravate the territorial offence, but not over extraterritorial acts that constitute separate crimes.²⁶

Alternative principles of jurisdiction

French and Dutch statutory law allows prosecution of extraterritorial crimes based on various alternative principles of jurisdiction. French and Dutch domestic courts are, however, usually reluctant to assert extraterritorial jurisdiction in criminal cases.

Under Article 689 French Code of Criminal Procedure (Code de procédure pénale), perpetrators of, or accomplices to, offences committed outside French territory may be prosecuted and tried by French courts in two situations: (1) when French law is applicable under Book I of the French Criminal Code or any other statute; and (2) when an international convention or an act adopted pursuant to the treaty establishing the European Community gives jurisdiction to French courts to deal with the offence. Book I of the French Criminal Code contains the principles governing the application of French criminal law to offences committed outside French territory.

Articles 3 to 8d Dutch Criminal Code govern jurisdiction and the application of Dutch criminal law over criminal offences committed abroad. These provisions apply not only to all offences under the Dutch Criminal Code, but also to those defined in other statutes, unless the statute provides otherwise.²⁷ In addition, the International Crimes Act (ICA),²⁸ which came into force in 2003, contains specific rules concerning serious violations of international humanitarian law, including the crime of genocide, crimes against humanity, war crimes, and torture.²⁹ The ICA replaced fragmented legislation on international crimes and incorporated crimes under the Rome Statute of the International Criminal Court (Rome Statute)³⁰ into Dutch law. Under the ICA, Dutch criminal law applies to a number of criminal offences committed outside the Netherlands in three situations: (1) if the suspect is present in the Netherlands; (2) if the crime is committed against a Dutch national; or (3) if the crime is committed by a Dutch national.³¹ Criminal prosecution against a Dutch national may also take place if the suspect became a Dutch national after committing the crime.³² Pursuant to the scope of the ICA, the crimes must have been committed after its entry into force on 1 October 2003. To date, there has been one complaint against an MNE based on the ICA. In Riwal, Al-Haq accused several companies of the Riwal group, and two managing directors, of contributing to war crimes and crimes against humanity in the West Bank within the meaning of ICA.³³ Following a pre-investigation, however, the public prosecutor refused to initiate criminal proceedings against the MNE and the managing directors. It should be noted that the legal framework governing extraterritorial jurisdiction in Dutch criminal law has changed considerably since 2014.³⁴ Therefore, the analysis below focuses on legislation existing at the time of writing.

Active personality

Under the active personality principle, a State has jurisdiction over criminal offences committed by its nationals. The active nationality principle appears to be the most justifiable basis for exercising jurisdiction to regulate MNEs’ conduct abroad.³⁵

Pursuant to Article 113-6 French Criminal Code, French criminal law applies to criminal offences committed by French nationals outside the French territory. However, it distinguishes between felonies and misdemeanours. French criminal law applies to any felony without any further conditions,³⁶ while it is applicable to any misdemeanour if the conduct is also punishable under the legislation of the country in which it was committed.³⁷ Therefore, Article 113-6 requires the application of double criminality to misdemeanours committed by French nationals outside France. Another important aspect is that Article 113-6 only applies to French companies and, therefore, foreign subsidiaries are excluded. French legal experts suggest that the foreign subsidiary should be considered to be of French nationality when a number of elements, including the control that the French parent company has over the foreign subsidiary, demonstrate that, in reality, the foreign subsidiary is French.³⁸

The French prosecutor has absolute discretion to decide whether to pursue prosecution of misdemeanours in the cases set out under Article 113-6. This rule, which is stated under Article 113-8 French Criminal Code, has been a major obstacle to transnational criminal litigation against MNEs, especially when the French prosecutor is reluctant to sue companies. In Rougier, the victims used Article 113-6 as a basis for their claim. However, the prosecutor refused to initiate criminal proceedings against the French parent company. Both the Court of Appeal and the Court of Cassation respectively dismissed the victims’ appeal on the grounds that, pursuant to Article 113-8, only the prosecutor can initiate criminal proceedings based on Article 113-6.³⁹ Consequently, victims could not successfully use the active personality principle to establish the applicability of French law to misdemeanours committed by French companies abroad.

Moreover, the fact that the offence committed by a French national outside the French territory falls under the category of felony does not guarantee the application of Article 113-6. In Trafigura, victims filed a criminal complaint against two French executives of Trafigura for various criminal offences, including administration of harmful substances, manslaughter, active corruption, and violations of rules pertaining to the transboundary movements of waste. After conducting a preliminary enquiry, the prosecutor declined to investigate further. According to an NGO report, one basis for this decision was the lack of lasting attachment to the French territory of Trafigura’s executives, even though both individuals were of French nationality. Furthermore, the complaint was rejected on the grounds that the companies involved were established outside the French territory and that simultaneous criminal proceedings were ongoing in Ivory Coast and the Netherlands.⁴⁰

The rule under Article 113-8 requiring that only the prosecutor, and not a civil party, can launch prosecution is questionable in the context of transnational litigation against MNEs because it places significant power in the hands of one entity.⁴¹ This discretion is even more problematic in the French context where the independence of prosecutorial authorities is debatable. In 2010, the ECtHR ruled that the French public prosecutor did not meet the guarantees of independence from the executive required by Article 5(3) ECHR because the prosecutor is under the authority of the Minister of Justice, who is a member of the government and thus part of the executive branch.⁴² The Corporate Crime Principles highlight that, in some countries, prosecutors may be internally pressured into, or rewarded for, swiftly resolving corporate crimes cases.⁴³ In this context, one can legitimately ask whether French prosecutors should decide alone on the prosecution of cases involving French MNEs when one knows the potential political and economic pressure this type of case can produce.

Article 7 Dutch Criminal Code provides that Dutch criminal law is applicable to a Dutch national who commits an offence outside the Netherlands. However, Article 7 distinguishes between two situations. First, Article 7(1) provides that Dutch criminal law applies to Dutch nationals who are guilty of an offence committed outside the Netherlands which is considered a criminal offence under Dutch criminal law and which is punishable by the law of the country where it was committed.⁴⁴ Therefore, Article 7(1) requires the condition of double criminality. However, this condition is not interpreted strictly.⁴⁵ Double criminality is determined in abstracto, which means that it is sufficient that the act falls within the scope of a foreign criminal provision.⁴⁶ Second, pursuant to Article 7(2), Dutch criminal law applies to Dutch nationals who commit certain crimes outside the Netherlands. These include crimes against the security of the State or against royal dignity, human trafficking, crimes harming the International Criminal Court (ICC), sexual abuse of minors and genital mutilation, and crimes forcing someone to act under violence or the threat of violence. If the Dutch Criminal Code restricts the application of the active personality principle to crimes, specific statutes nevertheless allow for the exercise of jurisdiction over misdemeanours.⁴⁷

The Supreme Court held that the Dutch Criminal Code applies to every Dutch legal person who commits a crime outside the Netherlands, where this act constitutes a criminal offence according to the law of the State on whose territory the crime is committed.⁴⁸ When the offender is a legal person, it is assumed that the legal person must have a link with the Netherlands, such as incorporation or registration under Dutch law.⁴⁹ The fact that a legal person is not recognized as such in the other country does not bar prosecution in the Netherlands.⁵⁰ Furthermore, it is not relevant whether the law of the State where the crime is committed recognizes the criminal liability of natural persons for crimes committed by legal persons.⁵¹

In the case against Trafigura in 2008, the Dutch prosecutor declined to prosecute Trafigura BV, Puma Energy International BV (Puma) (another Dutch company), and Claude Dauphin (Trafigura’s chairman) for the criminal offences related to toxic waste dumping in Ivory Coast. The main reason was that it appeared impossible to conduct an investigation in Ivory Coast, most notably due to the lack of cooperation of the Ivorian authorities.⁵²

In 2009, Greenpeace lodged a complaint with the Court of Appeal of The Hague against the Dutch prosecutor’s decision.⁵³ It claimed that the Netherlands had jurisdiction to prosecute Trafigura BV and Puma under then-Article 5(1)2° (now Article 7(1)):

In 2011, the Court of Appeal rejected Greenpeace’s complaint,⁵⁵ concluding that the Dutch courts did not have jurisdiction for several reasons. First, the facts did not take place in the Netherlands. Second, although Trafigura BV had its formal establishment in the Netherlands, the actual business of the company was carried out in the UK and Switzerland. Therefore, Trafigura BV could not be considered a Dutch legal person under Article 5 Dutch Criminal Code. Third, none of the natural persons targeted by the complaint had Dutch nationality or resided in the Netherlands. Fourth, the Court of Appeal questioned the feasibility of both an investigation and a prosecution, and raised the impossibility of conducting a proper criminal investigation in Ivory Coast. Fifth, it held that the toxic waste was dumped by Tommy Company, and not by Trafigura BV. In the court’s view, Greenpeace did not demonstrate that Trafigura BV knew that Tommy Company would commit such acts.⁵⁶ Overall, there was insufficient evidence justifying an investigation into, and prosecution of, the alleged criminal offences.

Article 2(1)(c) ICA also provides that Dutch criminal law applies to Dutch nationals who commit any of the crimes defined in ICA outside the Netherlands. Therefore, Dutch courts have jurisdiction to apply Dutch criminal law to the commission of genocide, crimes against humanity, war crimes, and torture by a Dutch company in a foreign country after 2003. Importantly, it does not matter if the suspect became a Dutch national only after committing the crime.⁵⁷ In Riwal, Al-Haq argued that Article 2(1)(c) ICA conferred extraterritorial jurisdiction on the Dutch court, as the natural and legal persons being the subject of the report lived or resided in the Netherlands or had their principal place of business in the Netherlands. However, as mentioned above, the prosecutor refused to prosecute Riwal and the managing directors.

In the Netherlands, no Dutch company has been tried for the commission of international crimes abroad. However, two Dutch businessmen have been prosecuted for business activities directly related to international crimes.⁵⁸ In both cases, the Dutch courts held they had jurisdiction based on the active nationality principle.

In Public Prosecutor v Van Anraat,⁵⁹ Frans van Anraat, a Dutch businessman, was accused of complicity in genocide and war crimes before the Dutch criminal courts. From 1985 until 1988, van Anraat delivered large quantities of thiodiglycol, a chemical used in the production of chemical weapons, to the regime of Saddam Hussein. Later, the Iraqi regime deployed chemical weapons against Kurdish civilians in northern Iraq as part of a larger genocidal campaign to annihilate the Kurdish population.⁶⁰ In 2005, the District Court of The Hague found van Anraat guilty of complicity in war crimes, but acquitted him of complicity in genocide.⁶¹ In 2007, the Court of Appeal of The Hague upheld the District Court’s ruling, also acquitting van Anraat in respect of genocide, albeit for different reasons.⁶² Ultimately, in 2009 the Supreme Court confirmed the conviction.⁶³

During the trial, van Anraat challenged the jurisdiction of the Dutch criminal courts. He argued that, because of the accessory character of complicity to genocide and war crimes, the District Court was not competent as it lacked jurisdiction over the main offences. However, the District Court dismissed van Anraat’s argument. First, it held that complicity in a crime, even if it concerns genocide or war crimes, is an independent indictable offence. Second, given that van Anraat was staying in the Netherlands and was a Dutch national, and that the indicted offences of complicity were considered to be criminal offences, the District Court found that van Anraat could be prosecuted in the Netherlands pursuant to Article 5 Dutch Criminal Code.

In Public Prosecutor v Kouwenhoven,⁶⁴ Guus Kouwenhoven, a Dutch businessman, was accused of complicity in war crimes and illegal supply of arms to Charles Taylor, the former president of Liberia, in violation of UN and Dutch embargos prohibiting arms trade with Liberia. After more than 12 years of criminal proceedings, in 2017 the Court of Appeal of ’s-Hertogenbosch eventually found Kouwenhoven guilty of the above-mentioned crimes and sentenced him to 19 years’ imprisonment.⁶⁵ In this instance, the Dutch courts based their extraterritorial jurisdiction on the active nationality principle. However, as will be seen later, the practical exercise of this jurisdictional basis presented difficulties regarding the collection of evidence abroad, mutual legal assistance, and the complexity for Dutch judges in forming a judgment based on the facts.⁶⁶

Passive personality

Under the passive personality principle, a State has jurisdiction over criminal offences committed by foreign nationals that affect its own citizens.

Article 113-7 French Criminal Code provides that French criminal law applies to any felony, and any misdemeanour punishable by imprisonment, which is committed by a French or a foreign national outside French territory where the victim is a French national at the time the offence took place. In transnational criminal litigation against MNEs, Article 113-7 enables French courts to exercise jurisdiction over criminal offences committed by foreign and French companies against French nationals abroad. This provision presents various advantages, as it confers automatic and exclusive jurisdiction to French criminal courts⁶⁷ and does not require double criminality. However, the above-mentioned Article 113-8 French Criminal Code also applies to Article 113-7, which means that the French prosecutor has absolute discretion to initiate criminal proceedings in cases alleging misdemeanours.

Dutch criminal law applies to anyone on foreign soil who commits certain criminal offences against a victim of Dutch nationality. The passive personality principle can apply on two main bases. First, the Dutch Criminal Code allowed, until 2014, the application of the passive personality principle to certain criminal offences, such as human trafficking and offences relating to minors, on the condition that the conduct constituted a criminal offence in the foreign state as well (double criminality). However, Article 5(1) Dutch Criminal Code now provides that Dutch criminal law applies to anyone who is guilty of a crime outside the Netherlands against a Dutch national, a Dutch civil servant, or a Dutch vehicle, vessel, or aircraft, insofar as this crime is legally punishable by at least eight years’ imprisonment under Dutch law and is punishable by the law of the country where it was committed. The rationale regarding the eight year rule is that passive personality jurisdiction should only be justified for crimes of a certain gravity.⁶⁸ Second, the ICA provides that Dutch domestic law shall apply to anyone who commits the crimes it describes outside the Netherlands if the crime is committed against a Dutch national.⁶⁹ The ICA does not require double criminality.⁷⁰ In both situations, the passive personality principle extends to corporations as, under Dutch law, a ‘person’ is also understood as a ‘legal person’.⁷¹

However, the usefulness of the passive nationality principle in the context of transnational criminal litigation against MNEs is limited in practice. First, victims of MNE conduct in host States are often nationals of these countries. Unless the victim has dual nationality, this aspect limits the use of legislation based on the passive nationality principle to prosecute French, Dutch, and foreign companies of MNEs. Second, the passive personality principle is the most controversial of the five accepted bases of jurisdiction in international law.⁷² In France, Article 113-7 has been criticized for being an incongruous basis on which to prosecute extraterritorial crimes, as it is usually seen as intruding on the sovereignty of other nations and subjecting foreign nationals to an indeterminate threat of criminal responsibility in dealings with French nationals.⁷³ In the Netherlands, by virtue of a long-standing tradition, domestic courts are particularly reluctant to apply jurisdiction based on the passive personality principle, thus limiting its potential benefits.⁷⁴

Universal jurisdiction

Under the universal jurisdiction principle, a State has jurisdiction to prosecute and punish foreign nationals who commit crimes abroad against foreigners.⁷⁵ Universal jurisdiction can be regarded as the broadest ground for establishing jurisdiction.⁷⁶ In theory, it does not operate on the basis of a connecting factor linking up a situation with a State’s interests.⁷⁷ Therefore, universal jurisdiction can be advantageous in establishing criminal jurisdiction in cases where the perpetrator is a foreign company with no territorial link with France and the Netherlands. However, the application of the universal jurisdiction principle is accepted only in relation to a limited number of core crimes under international law, such as war crimes, genocide, crimes against humanity, and torture. The reason for this is that jurisdiction is based solely on the egregious nature of these crimes.⁷⁸

Both French and Dutch law provide for the application of the universal jurisdiction principle in criminal law. The French Code of Criminal Procedure provides for the exercise of universal jurisdiction through the application of a domestic enabling clause (Article 689-1) combined with international conventions enumerated in subsequent articles (Articles 689-2 to 689-14). First, Article 689-1 provides that a person guilty of committing, or attempting to commit, any of the offences listed by the international conventions quoted in Articles 689-2 to 689-14 outside France and who happens to be in France may be prosecuted and tried by French courts. Second, Articles 689-2 to 689-14 list the criminal offences, which are attached to various international conventions, over which French courts have criminal jurisdiction under the universality principle. In the context of transnational criminal litigation against MNEs the most relevant offences and conventions are as follows:

For all these offences, France nonetheless requires some territorial link in the form of the presence of the suspect on its territory. However, it is possible to judge the suspect in absentia if the proceedings were validly instituted when the accused was on national territory.⁸⁴

The exercise of French jurisdiction over international crimes under the Rome Statute based on the universal jurisdiction principle is only possible if several conditions are met: (1) the suspect must habitually reside in France; (2) the public prosecutor has absolute discretion to prosecute; (3) no international or national court requests the surrender or extradition of the person; and (4) for crimes against humanity and war crimes and misdemeanours, the acts must be punishable under the law of the State where they were committed, or that State or the State of which the suspected person is a national is a party to the Rome Statute. NGOs have criticized the way France applies the universal jurisdiction principle to international crimes under the Rome Statute. They argue that the four conditions attached to the application of universal jurisdiction are so restrictive that it is almost impossible to use this jurisdictional ground.⁸⁵

French courts have agreed to exercise universal jurisdiction over the commission of criminal offences by foreigners abroad in a few cases only. For instance, in July 2005 a Mauritanian army officer was sentenced to imprisonment for committing acts of torture and barbarity in Mauritania in the 1990s.⁸⁶ Pursuant to Articles 689, 689-1, and 689-2, and Article 7(2) Convention against Torture, French courts held that they had jurisdiction to try the case and apply French law. They also overrode a Mauritanian amnesty law, as application of that law would have resulted in a breach of France’s international obligations and rendered the principle of universal jurisdiction totally ineffective.⁸⁷

To date, France has not used the universal jurisdiction principle to assert jurisdiction over international crimes committed by companies. However, the requirement of presence on French territory is likely to create problems when prosecuting companies based on the universal jurisdiction principle. The law provides no guidance on how to characterize the presence of a foreign legal person on French territory. A solution may be to require that the company possesses property or has an economic activity in France. To date, there has been no illustration of a corporation’s prosecution under the universal jurisdiction principle.⁸⁸ Whether such a rule may apply to legal persons, and under which conditions, needs to be clarified.

In the Netherlands, the legal rationale underlying the principle of universal jurisdiction is the fulfilment of the State’s international obligations, combined with the nature of the crime directed against the interests of the international community as a whole. As a result, the international community has an interest in repressing the crime.⁸⁹ Both the Criminal Code and the ICA provide for the exercise of universal jurisdiction. First, Article 4 Criminal Code provides for the exercise of universal jurisdiction for a limited number of criminal offences, such as piracy, terrorism, or counterfeiting currency. Most of these crimes are, however, irrelevant in the context of this study. Second, under Article 2(1)(a) ICA, Dutch domestic law applies to anyone who commits the crimes it describes outside the Netherlands if the suspect is present in the Netherlands. In the same way as in France, the ICA requires that the alleged offender be present in the Netherlands. Furthermore, Dutch courts will only exercise universal jurisdiction if neither the territorial courts nor the ICC is exercising jurisdiction. Dutch courts have, on several occasions, been confronted with the application of universal jurisdiction. In the notorious Bouterse case, the Dutch Supreme Court rejected the application of universal jurisdiction based on the Convention against Torture. It opined that prosecution and punishment in the Netherlands of a person suspected of an offence under the Dutch Act Implementing the Torture Convention was only possible if one of the links mentioned in the Convention existed, for example when the offender or victim is a Dutch citizen, or when the suspect is present in the Netherlands at the time of their arrest.⁹⁰ Since Bouterse, a number of cases have nonetheless been successfully prosecuted in the Netherlands based on universal jurisdiction.⁹¹

To date, there has been no prosecution of a company using universal jurisdiction. In Riwal, Al-Haq argued that Article 2(1)(a) ICA conferred extraterritorial jurisdiction on Dutch courts. However, the prosecutor did not address this point, as he refused to prosecute the companies and managing directors for expediency reasons. Just as in France, the application of the transitory presence requirement to companies is nonetheless likely to create problems. Notably, scholars have argued that companies are more likely to be prosecuted under the territoriality or personality principle.⁹²

3 The participation of victims and NGOs in criminal proceedings

More recently, it has become increasingly accepted that justice cannot be administered effectively without due recognition of the rights and interests of victims during criminal proceedings.⁹³ The ability of victims and NGOs to participate in the proceedings is now crucial to guarantee their rights and interests in the context of transnational criminal litigation against MNEs.

In France, victims have traditionally been able to play a significant role in the initial phases of criminal proceedings. However, this participation has produced limited outcomes in the context of transnational criminal claims against MNEs. In the EU, the acknowledgement of victims’ rights through the adoption of various directives has led to changes in French and Dutch legal frameworks governing the participation of victims in criminal proceedings. In theory, such changes should help victims in the context of criminal proceedings against corporations.

Initiating criminal proceedings

The French and Dutch criminal systems recognize the principle of opportunity, under which the public prosecutor has discretion whether to initiate criminal proceedings. This principle applies to all criminal offences.

In France, the Code of Criminal Procedure distinguishes between public action (l’action publique), which is the legal action brought before a criminal court for the application of criminal law to offenders, and civil action (l’action civile), which is a legal action brought before a criminal court for compensation of the damage resulting from the commission of a criminal offence. Under Article 1 Code of Criminal Procedure, judges and prosecutors have the power to initiate and exercise public action for the imposition of penalties. However, this power is not exclusive, as the injured party may also initiate public action under the conditions determined by the Code of Criminal Procedure. This form of action is an important way of getting around unwilling prosecutors and its use has increased in France in recent years.⁹⁴ As a result, victims of corporate abuse have been able to directly initiate criminal proceedings against MNEs.

Generally, victims have three options to initiate criminal proceedings. First, they can file a criminal complaint with, or denunciate alleged crimes to, law enforcement authorities or the public prosecutor.⁹⁵ In general, the prosecutor decides whether it is appropriate to prosecute, to implement an alternative procedure to prosecution, or to discontinue the proceedings if the particular circumstances relating to the commission of the facts justify it.⁹⁶ The prosecutor enjoys a significant discretion in that decision. However, when the prosecutor decides to discontinue the proceedings, they must notify the victims of the decision and indicate the legal or expediency reasons for doing so.⁹⁷ When the criminal complaint is dismissed or no action is taken by the prosecutor, victims can file a criminal complaint and bring a civil action at the same time (dépôt de plainte avec constitution de partie civile). In this situation, an examining magistrate will take over the case and open an investigation to decide whether prosecution is possible, which may result in a judicial enquiry (information judiciaire). This procedure prevents the case from being closed without immediate follow-up.

Until now, in most cases filing a complaint with the public prosecutor has been an unsuccessful strategy in bringing transnational litigation against MNEs. The majority of the complaints submitted to public prosecutors have eventually been dismissed. In some cases, however, examining magistrates have continued criminal proceedings in spite of the prosecutor’s refusal to prosecute MNEs. In Amesys, the prosecutor dismissed the complaint on the grounds that the alleged acts did not qualify as crimes. However, an examining magistrate of the Crimes against Humanity Unit subsequently ordered a criminal investigation. The prosecutor appealed this decision, but the Paris Court of Appeal rejected this appeal.⁹⁸ The prosecutor’s reluctance to investigate an MNE was also visible in Total where the prosecutor sought the dismissal of the complaints even though victims had brought these complaints directly before an examining magistrate. After an examining magistrate rejected the initial request of the prosecutor to dismiss the civil action, the prosecutor appealed the decision before the Versailles Court of Appeal. The Court eventually rejected the prosecutor’s appeal on the grounds that the prosecutor did not have jurisdiction to request the dismissal of the case at the judicial enquiry stage.

As a second option, victims may initiate criminal proceedings by bringing a civil action directly before the examining magistrate. One advantage of this procedure is that victims can trigger formal criminal investigation by a judge while simultaneously claiming financial compensation. In several cases, victims have used this procedure after a prosecutor had dismissed their complaint. In such a situation, bringing a civil action directly before the examining magistrate offers a second chance to trigger the public action as well as an opportunity to get around prosecutors’ reluctance to try MNEs. In DLH, the plaintiffs initiated new criminal proceedings before the examining magistrate for Montpellier after the first complaint with the prosecutors for Nantes and Montpellier was unsuccessful.⁹⁹ Plaintiffs in the cases against Auchan and Vinci adopted the same strategy. To date, victims’ claims have been more successful with examining magistrates than with prosecutors.

Third, victims can directly summon the alleged perpetrator to court for misdemeanours or crimes where there is sufficient evidence and where the court can try the case without prior investigation (citation directe).¹⁰⁰ In that situation, the victim must provide the evidence necessary to establish the alleged perpetrator’s guilt and to demonstrate the extent of the harm suffered. Furthermore, the victim must bear the costs of the deposit, in order to guarantee the possible payment of a civil fine in the event of abuse proceedings, and the bailiff’s fee, which will be reimbursed by the perpetrator if they are found guilty. To date, this situation has not occurred in the context of transnational claims against MNEs.

In the Netherlands, victims cannot initiate criminal proceedings. Contrary to the French system, the Dutch public prosecutor holds a monopoly on prosecution and is not obliged to prosecute. The prosecutor may decide not to prosecute under the expediency principle, as laid down in Article 167 Code of Criminal Procedure (Wetboek van Strafvordering). Accordingly, they may waive prosecution for reasons of public interest.¹⁰¹ The Dutch prosecutor tends to deal with some criminal offences – such as environmental offences – through transaction, settlement, or dismissal.¹⁰² Furthermore, the Code of Criminal Procedure does not provide the criteria for the exercise of this power, and no other authority will check whether discretion by the prosecutor was properly used. Nonetheless, the prosecution service is still bound by its own policies.¹⁰³

However, Article 12 Code of Criminal Procedure gives victims and NGOs a right to appeal the prosecutor’s decision not to initiate criminal proceedings. Accordingly, parties with a direct interest in the prosecution of criminal offences can apply to the Court of Appeal against the prosecutor’s decision. Article 12 is ‘the only way in which a private person (natural or otherwise) can formally influence the decision on prosecution’.¹⁰⁴ The Court of Appeal’s decision is final. If it considers the complaint to be reasonable, it will order the prosecutor to launch the prosecution, but this is done only in exceptional cases.¹⁰⁵

NGOs used this approach in the Dutch proceedings against Trafigura, but it produced unsuccessful results. In 2009, Greenpeace appealed the prosecutor’s decision not to prosecute Trafigura BV, as well as the chairman and various employees of the Trafigura group. In 2011, the Court of Appeal of The Hague rejected Greenpeace’s complaint on the grounds that the NGO lacked standing. Greenpeace had an insufficient direct interest to request prosecution of Trafigura BV, and the criminal acts in question were beyond the scope of Greenpeace’s purpose as an organization. In addition, the Court of Appeal held that the prosecutor had a margin of discretion in deciding which offences are in the public interest to investigate and prosecute, and that they had sole authority to decide which cases to pursue.¹⁰⁶

The rights of victims of crimes under EU law

The EU recently adopted a number of instruments that aim to support and protect victims of crime.¹⁰⁷ The most significant one is Directive 2012/29/EU (Victims’ Rights Directive), which aims ‘to ensure that victims of crime receive appropriate information, support and protection and are able to participate in criminal proceedings’.¹⁰⁸ The Victims’ Rights Directive acknowledges that ‘[c]‌rime is a wrong against society as well as a violation of the individual rights of victims’.¹⁰⁹ Therefore, Member States must ensure that during criminal proceedings, victims are recognized and treated in a respectful, sensitive, tailored, professional, and non-discriminatory manner in all contacts with victim support, or restorative justice services, or a competent authority.

The Victims’ Rights Directive is directly relevant in the context of transnational criminal litigation against MNEs for several reasons. First, the rights it sets out apply to victims in a non-discriminatory manner, regardless of their residence status.¹¹⁰ The Victims’ Rights Directive does not require victims of crime to reside in, or to be a national of, EU Member States. Therefore, Member States should ensure that the rights set out in the directive are not made conditional on the victim’s residence status, citizenship, or nationality.¹¹¹ Second, the Victims’ Rights Directive applies to criminal offences committed in the EU and to criminal proceedings taking place in the EU. It confers rights on victims of extraterritorial offences in relation to criminal proceedings that take place in the EU.¹¹² As a result, the Victims’ Rights Directive is directly applicable to transnational criminal litigation against MNEs. Finally, the Victims’ Rights Directive deals with various aspects of criminal proceedings which have posed significant obstacles to victims in past and ongoing claims against MNEs. Importantly, it recognizes and strengthens the rights of victims in order to guarantee their effective participation in criminal proceedings against MNEs.

The Victims’ Rights Directive lists several rights that Member States must guarantee to victims of crime in relation to provision of information and support, participation in criminal proceedings, and protection of victims and recognition of victims with specific protection needs. The implementation of a large number of these rights is significant in the context of transnational litigation against MNEs, including the right to interpretation and translation, the right to be heard, or the right to protection. However, the analysis below pays particular attention to the rights to receive information about the case; the rights in the event of a decision not to prosecute; the rights to legal aid and to reimbursement of expenses; and the right to decision on compensation from the offender during criminal proceedings. It should be mentioned that ‘victims’ within the scope of the Victims’ Rights Directive means natural persons who have suffered harm and family members of a person whose death was caused by a criminal offence and who have suffered harm resulting from that person’s death.¹¹³ As a result, NGOs are excluded from the scope of the Victims’ Rights Directive. This means that, despite the preponderant role NGOs have so far played in criminal proceedings against MNEs, they cannot enjoy the guarantees provided by this directive.

Victims’ right to receive information about their case

In the context of transnational litigation against MNEs, access to information about the progress of criminal proceedings is often strewn with obstacles. In DHL, it was difficult for complainants to obtain information on the status of their case from prosecutorial authorities. The complainants were given little information about the reasons for the prosecutor’s decision to dismiss the complaint. As a result, Sherpa repeatedly requested the case documents to understand the prosecutor’s decision. However, it was refused access to such documents without explanation.¹¹⁴

The Victims’ Rights Directive acknowledges that providing information to victims means that:

Article 6 provides various rights of victims to receive information about their case. One of the most relevant rights in the context of this study is that of victims to receive, upon request, information on any decision not to proceed with or to end an investigation, or not to prosecute the offender.¹¹⁶ In this situation, information must include the reasons or a brief summary of reasons for the decision concerned.¹¹⁷ However, the benefits conferred upon victims by this rule are limited by the fact that victims must request this information. There is no obligation on Member States to automatically provide this information. Furthermore, where the reasons are confidential, Member States are not obliged to provide them as a matter of national law. Another important right is that victims should receive, upon request, information enabling regarding the stage that the criminal proceedings have reached.¹¹⁸ Similarly, the added-value of this provision is restricted by the fact that victims must expressly request such information. Moreover, they will not be able to receive this information where the proper handling of the case may be adversely affected by such notification. This provision also depends on the role of victims in the criminal justice system of the State. Where victims are not provided a legal status as a party to criminal proceedings or a legal entitlement to participate in the proceedings, it should be inferred that this provision does not apply.

In France, the prosecutor had the obligation to notify victims of the decision to discontinue proceedings and to provide the legal or expediency justifications for this decision prior to the adoption of the Victims’ Rights Directive. Furthermore, since around 2010 France has opened victim support offices (bureau d’aide aux victimes, or BAV) in each regional court (Tribunal de Grande Instance). Among their missions, BAVs are charged with providing information about the status of criminal proceedings to victims. Despite the existence of this framework, victims still experience difficulties in accessing information about their case.

In the Netherlands, Article 51ac(2) Code of Criminal Procedure provides that victims are automatically notified when a case starts, and then of its progress when they request this information. Furthermore, they should be contacted if criminal investigations are discontinued or stopped and the alleged offence is not prosecuted.

Victims’ rights in the event of a decision not to prosecute

Pursuant to the Victims’ Rights Directive, Member States must ensure that victims, in accordance with their role in the relevant criminal justice system, have the right to a review of a decision not to prosecute.¹¹⁹ Where the role of the victim in the relevant criminal justice system is established only after a decision to prosecute the offender has been taken, the Member States must guarantee that the victims of serious crimes have the right to a review of a decision not to prosecute.¹²⁰ In this event, EU criminal legislation and international criminal justice standards may be taken into account to interpret the term ‘serious crimes’.¹²¹ Generally, Member States should develop a clear, transparent, and simple procedure that ensures victims are able to ask for a review.¹²²

In France, persons who have denunciated facts to the prosecutor may lodge an appeal with the General Prosecutor against the decision of dismissal taken as a result of this denunciation. The General Prosecutor may enjoin the prosecutor to institute proceedings or reject the appeal if they consider the appeal unfounded, in which case they must inform the person concerned.¹²³ Similarly, a civil party may file an appeal against the investigative judge’s orders of non-investigation, dismissal, and orders adversely affecting its civil interests.¹²⁴ A special judicial body called the Investigating Chamber will then review the appeal.

In the Netherlands, as already mentioned, Article 12 Code of Criminal Procedure gives victims and NGOs a right to appeal the prosecutor’s decision not to initiate criminal proceedings.

Victims’ rights to legal aid and reimbursement of expenses

There are no judicial costs for criminal proceedings in France and the Netherlands. Unlike civil proceedings, victims do not have to pay for court fees when they bring a civil action (France)¹²⁵ or join criminal proceedings (Netherlands) against an MNE. However, France allows that a civil party may be ordered to pay some legal costs (such as experts’ costs) where the constitution as civil party has been judged to be abusive or dilatory.¹²⁶ This rule does not apply where criminal proceedings are concerned with crimes or misdemeanours against persons, or where the civil party has obtained legal aid.

Victims still have to pay for their lawyer’s fees when they join criminal proceedings. Access to financial assistance is therefore crucial for victims who are unable to afford legal representation and access to the criminal justice system. The Victims’ Rights Directive recognizes a right to legal aid. Member States have the obligation to ensure that victims have access to legal aid where they have the status of parties to criminal proceedings.¹²⁷ Legal aid should cover at least legal advice and legal representation should be free of charge.¹²⁸ As a result, foreign victims should have access to legal aid in transnational criminal litigation against MNEs. However, the provision of legal aid remains subject to national conditions or procedural rules.¹²⁹

In France, rules on legal aid do not distinguish between civil or criminal matters, or the nature of the dispute. Furthermore, the status of the party to the proceedings (eg victim or accused) is not taken into account when deciding whether or not to grant legal aid.¹³⁰ As a general rule, legal aid is available to natural persons whose resources are insufficient to enforce their rights in court. Such aid may be total or partial.¹³¹ French nationals, nationals of other Member States, and persons of foreign nationality habitually and regularly residing in France are eligible for legal aid. However, legal aid must be granted without considering the residence status of foreigners when they are civil parties to criminal proceedings.¹³² Therefore, foreign victims can obtain legal aid when they take part as civil parties in criminal proceedings against MNEs. Furthermore, legal aid may be exceptionally granted to non-profit legal persons, such as NGOs, that are registered in France and lack sufficient resources. Another important aspect is that victims and their dependants are exempt from having to prove their resources when they bring a civil action in support of the public prosecution or for damages arising out of a number of serious crimes, namely intentional attacks against life or personal integrity.¹³³ Furthermore, in exceptional circumstances, the means condition may be waived where the circumstances of the legal aid applicant are of particular interest having regard to the object of the litigation or the foreseeable costs of the proceedings.

In the Netherlands, victims of crime are not automatically entitled to legal aid. They can use the assistance of a lawyer during the criminal trial,¹³⁴ and part of their lawyer’s fees may be reimbursed by the State depending on the victim’s income. Victims of a violent crime or a sexual crime and their surviving relatives may, under certain circumstances, qualify for free legal assistance from a lawyer regardless of their income. In such cases, a prosecution must have been instituted and the victim or surviving relative needs to qualify for benefits in accordance with Article 3 Violent Crime Compensation Fund Act (Wet schadefonds geweldsmisdrijven).

The Victims’ Rights Directive also provides that Member States must afford victims the possibility of reimbursement of expenses incurred as a result of their active participation in criminal proceedings.¹³⁵ This rule aims to guarantee that victims are not prevented from actively participating in criminal proceedings due to their own financial limitations. Reimbursement will nonetheless depend on their role in the proceedings, whether as parties, witnesses, or in another role, as well as national conditions or procedural rules. In practice, reimbursement should at least cover travel expenses and loss of earnings.¹³⁶ Both France and the Netherlands provide that the State will reimburse victims’ expenses.¹³⁷ In France, judges can also sentence the offender to pay costs incurred by the civil party and not covered by the State. In this case, judges will take into account the equity or economic situation of the convicted party.¹³⁸

Victims’ right to decision on compensation from the offender in the course of criminal proceedings

Pursuant to the Victims’ Rights Directive, Member States must ensure that, in the course of criminal proceedings, victims are entitled to obtain a decision on compensation by the offender, within a reasonable time, except where national law provides for such a decision to be made in other legal proceedings. They must also promote measures to encourage offenders to provide adequate compensation to victims.¹³⁹

In France, victims are entitled to bring a civil action (constitution de partie civile) at various stages of the criminal proceedings. A civil action aims at the reparation of the damage suffered because of a criminal offence. It is open to all those who have personally and directly suffered damage resulting from a criminal offence.¹⁴⁰ The civil action may be brought at the same time as the public action and before the same court.¹⁴¹

Under certain circumstances, French law allows NGOs to bring a civil action on behalf of victims of specific criminal offences. Articles 2-1 to 2-23 Code of Criminal Procedure list the types of associations that can exercise the rights granted to a civil party. In the context of this study, the most relevant associations focus on the following topics:

Associations must have been lawfully registered for at least five years at the time of the criminal offence in order to bring a civil action in criminal proceedings. Similarly, Article L142-2 French Environmental Code provides that lawfully registered environmental NGOs can exercise the rights granted to a civil party in respect of facts creating direct or indirect damage to the collective interests they defend and constituting a criminal offence according to environmental legislation. However, environmental NGOs are not subject to the five-year registration condition.

French NGOs have played a crucial role in the emergence and development of transnational litigation against MNEs. For instance, Sherpa has been involved as adviser or litigator in most claims brought against MNEs. In parallel to its work on corporate accountability, Sherpa has also been involved in strategic litigation related to corruption, probity, and public embezzlement. However, Sherpa has recently faced a number of obstacles in bringing civil actions against MNEs in criminal cases. In 2019, Sherpa reported that French authorities had implicitly refused to renew its licence (agrément) to bring civil actions alleging crimes of corruption. For the NGO, this refusal was an important obstacle to its ability to participate in criminal proceedings. Ultimately, Sherpa was granted its licence following a public campaign on the topic.

Moreover, in the case against Lafarge, the Investigating Chamber of the Paris Court of Appeal rejected Sherpa and the ECCHR’s civil action on the ground that they did not have the necessary licence to participate in the criminal proceedings as civil parties.¹⁴² As a result, the Investigating Chamber also rejected the admissibility of all the legal briefs submitted by the NGOs.¹⁴³ Ultimately, in September 2021, the Court of Cassation ruled that only the ECCHR could bring a civil action, and only in relation to the offence of complicity in crimes against humanity for which Lafarge was charged.¹⁴⁴ The ECCHR promotes international humanitarian law, allowing it to act against both war crimes and crimes against humanity. As a result, the ECCHR can be a civil party in cases of complicity in crimes against humanity. Sherpa’s statutes, on the other hand, indicate that the NGO fights against economic crimes, implying that its action does not include crimes against humanity. Therefore, Sherpa cannot be a civil party in a case of complicity in crimes against humanity. The Court of Cassation’s decision serves as a reminder of the restrictive conditions under which NGOs can participate in criminal proceedings. The law does not recognize a general right of action for NGOs in criminal court. However, in derogation to the principle that only persons who have suffered direct and personal loss as a result of a criminal offence can bring a civil action before the criminal court, the law allows NGOs that defend certain collective interests mentioned in their statutes to bring a civil action for specific categories of offences related to these interests, and under strict conditions. This means that, in the context of transnational litigation against MNEs, only NGOs that explicitly defend the collective interests harmed by the corporate criminal offence can bring a civil action. Given that an NGO’s statutes can only cover a limited field of action, French law on NGOs in criminal proceedings limits the ability of corporate accountability NGOs, such as Sherpa, to effectively participate in criminal proceedings against corporations.

In the Netherlands, persons who have suffered direct damage as a result of a criminal offence are nonetheless authorized to join criminal proceedings to bring a claim for damages.¹⁴⁵ If the public prosecutor initiates or continues a prosecution, they must inform the injured party in writing as soon as possible. They must also inform the injured party of the time of the hearing in good time.¹⁴⁶ However, the victim’s claim for damages is ancillary to the assessment of the crime, and the court will assess whether the victim should institute civil proceedings instead. The admissibility of the victim’s claim depends on an evaluation as to whether or not the ruling represents an undue burden for the criminal proceedings.¹⁴⁷ However, this criterion, which was introduced in 2011, is rather vague.¹⁴⁸ If a court determines that the claim is inadmissible, the victim must submit the claim for damages before a civil court.

In Public Prosecutor v Van Anraat, a group of victims joined the proceedings to claim damages. However, the Court of Appeal of The Hague declared these claims inadmissible on the grounds that they were not ‘easy in nature.’ This was the admissibility criterion for joining a procedure to claim damages until the end of 2010. For the Court of Appeal, a criminal trial should not be burdened with complex civil cases, and the Supreme Court upheld this ruling in cassation.¹⁴⁹

4 Production of evidence

In criminal proceedings, the burden of proof for establishing the guilt of suspects is on the prosecution. Therefore, prosecutorial authorities are generally in charge of seeking both inculpatory and exculpatory evidence, often with the help of the police. In some States, such as France, investigating magistrates are also in charge of gathering evidence related to some criminal offences.

As a consequence of this burden of proof, prosecutorial authorities often conduct a preliminary investigation to determine whether to prosecute or not. In the Netherlands, public prosecutors take several factors into account, including ‘the feasibility of a case, the possibilities to conduct an investigation, the availability of, and access to, evidence in foreign countries, the safety of witnesses, and the possibility of doing independent research in foreign countries’.¹⁵⁰ For international crimes, public prosecutors must inquire whether there is sufficient information to treat the case as a reasonable prima facie case and whether there is a reasonable prospect of successful prosecution.¹⁵¹

The primary responsibility of prosecutorial and judicial authorities in finding evidence, and the powers they can use for fact-finding, could, in theory, encourage victims to use the criminal justice system to hold MNEs accountable, especially when they cannot access evidence in the MNE’s possession or have limited financial resources to conduct an extensive investigation. In practice however, prosecutorial and judicial authorities often struggle to find a sufficient amount of evidence in transnational cases against MNEs. Various reasons explain this situation. Evidence in third countries may be difficult to access as a result of the foreign authorities’ refusal to cooperate with the home State’s authorities. Prosecutorial and judicial authorities may also lack the financial resources or the technical expertise to gather evidence abroad.

Until now, most prosecutors have declined to prosecute MNEs on the grounds that access to evidence was, or was likely to be, unfeasible. In France, prosecutors have dismissed complaints for lack of evidence in several criminal claims against companies or executives of MNEs, including DLH. In the Netherlands, in Riwal, the Dutch prosecutor decided not to prosecute the companies and individuals targeted by the report for various reasons, including the difficulty of accessing evidence in Israel. In this respect, the prosecutor stated that:

In this case, the relevant information was held by a subsidiary of the corporation in Israel, and the Israeli authorities had refused to act on requests for legal assistance sent by the Dutch Public Prosecutor.¹⁵³

In this context, the onus remains on victims to gather the evidence necessary for criminal litigation to take place. The role of victims in finding evidence is reinforced by the fact that they usually initiate criminal proceedings in transnational criminal claims against MNEs. Therefore, they must ensure that they have sufficient inculpatory evidence from the moment they report allegations of crimes to prosecutorial authorities or bring a civil action to join criminal proceedings. Often, victims have limited financial resources to gather evidence. As such, the intervention of NGOs in finding incriminatory information is crucial for ensuring that criminal proceedings can go ahead. However, it can create problems from an admissibility perspective.

NGOs have played an important role in gathering evidence that will be used in the context of criminal proceedings. However, scholars have suggested that prosecutorial authorities’ reliance on information provided by NGOs is not without risk, especially for the admissibility of evidence.¹⁵⁴ This reflection resulted from the handling of evidence in Kouwenhoven. In this case, the National Police Agency, which conducted the criminal investigation, and the public prosecutor relied on information supplied by the NGO Global Witness. The Court of Appeal rebuked the prosecution for failing to test the dependability and accuracy of the witness statements and for having uncritically adopted the information provided by Global Witness. Because of the lack of transparency with regard to witness selection, there was a risk of manipulation of the investigation. Kouwenhoven’s lawyer criticized the prosecutor for exclusively relying on witnesses provided by the same anonymous confidants used for the Global Witness Report.¹⁵⁵ As a result, the Court of Appeal acquitted Kouwenhoven. Huisman and van Sliedregt point out that

5 Punishment for corporate crime and remedies for victims

Until recently, criminal trials involving MNEs had never reached the trial phase. Therefore, no French or Dutch courts have ruled on the imposition of criminal punishments on companies or compensation for victims. However, an overview of potential criminal punishments imposed on companies and remedies for victims remains relevant for identifying the potential dissuasive effect of criminal sanctions incurred by companies and the remedies to which victims might be entitled. Other mechanisms, such as restorative justice, plea bargaining, and settlements, may constitute valuable alternatives to obtain remediation. They may however raise questions whether they interfere with the victims’ quest for accountability and justice.

Criminal punishment for companies

Both France and the Netherlands recognize the criminal liability of legal persons, which include companies, and provide sanctions specifically applicable to them.

In France, when a company is found guilty of a crime or misdemeanour, it will generally incur a fine.¹⁵⁷ The maximum rate applicable to companies is five times that provided for natural persons by the law punishing the offence. In the case of a crime for which no fine is provided for natural persons, the fine incurred by legal persons must be €1 million. In some situations, companies can also incur other penalties, including dissolution where the legal person has been established or diverted from its purpose to commit the offence; prohibition from directly or indirectly exercising one or more professional or social activities; placement under judicial supervision; closure of one or more of the establishments of the company that were used to commit the incriminated acts; exclusion from public contracts; prohibition to make a public offer of financial securities or to have financial securities admitted to trading on a regulated market; prohibition on issuing cheques; confiscation; posting of the decision pronounced or its dissemination either by the written press or by any means of communication to the public by electronic means; or prohibition on receiving any public aid.¹⁵⁸ Most of these sanctions will apply either temporarily or permanently.

When the company commits corruption-related offences, it can be sentenced to submit to a compliance programme, under the supervision of the French Anti-Corruption Agency, for a maximum period of five years.¹⁵⁹ Furthermore, when a company commits a misdemeanour, the penalty of sanction-reparation may be imposed instead of, or at the same time as, the fine normally incurred.¹⁶⁰ This punishment is relevant in the context of transnational litigation against MNEs. Where it is imposed, the company will directly compensate the victim’s loss. The victim and the company can agree that the reparation may be made in kind, which may then consist of restoring property damaged during the commission of the offence.¹⁶¹ However, the penalty of sanction-reparation cannot exceed €75,000 or the fine incurred by the legal person for the offence in question.

In the Netherlands, companies will often incur a fine when they are convicted of a criminal offence. Article 23 Criminal Code generally provides for six categories of fines ranging from €435 to €870,000. However, when legal persons, including companies, are convicted, the judge can impose a fine up to the amount of the next higher category if the category of fines determined for the offence does not allow suitable punishment. When the sixth category of fines is applicable and that category does not allow appropriate punishment, a fine may be imposed up to a maximum of 10 per cent of the company’s annual turnover in the financial year prior to the judgment or penalty decision.¹⁶² Other sanctions may be imposed on companies, such as withdrawal of certain rights, confiscation, and disclosure of the court judgment.¹⁶³ The Economic Offences Act (EOA) imposes a similar range of criminal sanctions for economic crimes.¹⁶⁴ It also provides additional penalties, such as the total or partial cessation of the business, forfeiture of objects, or confiscation of property belonging to the company.¹⁶⁵ Dutch courts can also impose interim measures, such as seizure of goods to safeguard the enforcement of payment of a fine or the confiscation of goods following a conviction by the court. Importantly, when a legal person commits a criminal offence, criminal punishments may be pronounced against not only the legal person but also the person(s) who ordered the offence, as well as those who gave actual direction for the prohibited conduct.¹⁶⁶

France and the Netherlands offer a broad range of criminal sanctions against companies. Of interest here is the possibility to impose a fine up to a maximum of 10 per cent of the company’s annual turnover in the financial year in the Netherlands. Furthermore, both countries allow for the punishment of the companies as well as the person(s) who ordered the offence. At the same time, the dissuasive effect of these sanctions is likely to be limited in the context of transnational litigation against MNEs. For instance, the highest level of fines remains low when compared with the benefits MNEs gain from committing crimes. Moreover, judges will not necessarily impose the highest penalty on the corporate perpetrator. These aspects raise the question whether existing punishments against companies are proportionate, and therefore appropriate, to dissuade MNEs from engaging in economically attractive criminal activities in the context of their group activities.

Remedies for victims

Criminal judges will generally focus on the remediation of the harm suffered by victims through awarding financial compensation.

In France, as previously mentioned, victims can bring a civil action to obtain reparation for damage suffered as a result of a criminal offence. This action is open to all those who have personally and directly suffered loss resulting from a criminal offence. A civil action is admissible on all counts of loss whether material, bodily, or moral, resulting from the facts which are the subject of the proceedings.¹⁶⁷ If the convicted offender does not voluntarily compensate the victim, the victim can seize the Victims of Crime Recovery Assistance Service (Service d’Aide au Recouvrement des Victimes d’Infractions, or SARVI). SARVI will pay the victim damages up to €1,000. Above that amount, it will pay an advance of 30 per cent, up to a ceiling of €3,000. SARVI then recovers the damages from the convicted person. The French State has also established a compensation fund for victims of crimes. The Compensation Fund for Victims of Acts of Terrorism and Other Offenses (Fonds de Garantie des Victimes des Actes de Terrorisme et d’Autres Infractions, or FGTI) originally compensated victims of terrorist acts. However, since 1990 it has also compensated victims of ordinary criminal offences, such as murder, rape and sexual assault, or offences resulting in permanent disability. To receive compensation from FGTI, a victim must meet specific conditions. If the offence was committed in France, compensation can be awarded to persons of French nationality, nationals of another EU Member State, or foreigners legally residing in France on the day of the events or of the application submitted to the FGTI. If the offence took place abroad, only French nationals can be compensated. This condition therefore limits the use of the FGTI in the context of transnational claims against MNEs.

Victim compensation in the context of criminal proceedings has been a focal point in Dutch criminal justice policy since 2000.¹⁶⁸ In principle, victims can only claim monetary compensation.¹⁶⁹ When the criminal court finds an offender guilty, it orders the convicted offender to pay the victim compensation. This compensation is usually financial, and the court specifies the exact amount victims must receive. Compensation should cover all property damage and any psychological damage that the court considers to be fair. Since 2011, the Dutch State has guaranteed full compensation to victims of a violent or sexual crime, and if the convicted offender has not compensated the victims within eight months, the State will then recover the amount from the convicted offender. Victims of violent crime can also apply for financial compensation from the State through the Compensation Fund for Violent Crime (Schadefonds Geweldsmisdrijven) within three years of the crime. There is no restriction on third country nationals applying for compensation through the Fund. An interesting feature of compensation under the Dutch criminal system is that, since 2014, the State can seize assets, such as money and goods, from those suspected of a serious crime at an early stage of an investigation. These assets can subsequently be used to compensate the victims for damage suffered once the offender has been convicted (by a final conviction).

Alternative mechanisms

Restorative justice

Restorative justice has emerged as an alternative to the classical retributive model of court-based criminal justice.¹⁷⁰ A restorative justice process is any process in which the victim, the offender, and, where appropriate, any other individuals or community members affected by a crime participate together actively in the resolution of matters arising from the crime, generally with the help of a facilitator.¹⁷¹ Restorative justice offers a number of benefits for the victim and the offender, as well as the State. It is likely to lead to lower rates of subsequent offending, and to be cost-effective in comparison to incarceration.¹⁷² Restorative justice is well known in Canada and the US, where it has been in use for several decades.¹⁷³ Furthermore, restorative justice has shown to be relevant in post-conflict countries or countries which have experienced the commission of gross human rights violations on a large scale. In such countries, authorities may be faced with the difficult mission of achieving national reconciliation while answering legitimate demands for justice and reparation. Restorative justice may provide an adequate framework for restoring a balance between these competing demands.¹⁷⁴ Similarly, it has been argued that restorative justice is well positioned to address environmental crime.¹⁷⁵ Within the BHR field, there is emerging scholarship also arguing that restorative justice could be a suitable framework for providing effective remedies in the context of corporate-related human rights abuses.¹⁷⁶ In Europe, the picture of restorative justice mechanisms varies among States.¹⁷⁷ While some countries have had restorative justice processes in place for some years (eg Belgium),¹⁷⁸ others have only recently started to experiment with restorative justice, such as France.

At the EU level, the Victims’ Directive has been a game changer, as it requires all Member States to introduce restorative justice into their criminal justice system.¹⁷⁹ As a result, France amended its Code of Criminal Procedure in 2014 to include a provision on restorative justice. Article 10-1 now provides that, in the course of any criminal proceedings and at all stages of those proceedings, including the execution of the sentence, the victim and the perpetrator of an offence may be offered restorative justice measures provided that the facts have been established. A restorative justice measure is defined as ‘any measure enabling a victim as well as the perpetrator of an offence to participate actively in the resolution of difficulties arising from the offence, including compensation for damage of any kind resulting from its commission’. Such a measure may only be taken after the victim and the perpetrator of the offence have received full information about it and have expressly consented to participate in it. It must be implemented by an independent and trained third party, under the supervision of the judicial authority or, at the request of the latter, the prison administration. It is confidential, unless otherwise agreed by the parties and except in cases where an overriding interest linked to the need to prevent or punish offences justifies that information relating to the progress of the measure be brought to the attention of the public prosecutor. Similarly, the Netherlands now provides the possibility of restorative justice.¹⁸⁰ Pursuant to Article 51a(1)(d) Dutch Code of Criminal Procedure, restorative justice enables the victim and the suspect or the convicted person, if they voluntarily agree, to actively participate in a process aimed at solving the consequences of the offence, with the help of an impartial third party.

Plea bargaining

A plea bargain, also called a guilty plea, is an arrangement between a prosecutor and a suspect and/or defendant in which the offender pleads guilty in exchange for an agreement by the prosecutor to recommend a more lenient sentence, to drop one or more charges, or to reduce the charge to a less serious offence. This agreement may allow both the prosecutor and the offender to avoid a trial. While plea bargaining has been praised for reducing enforcement costs and caseloads of courts, it has also been criticized for impairing the presumption of innocence and the rights of the defence.¹⁸¹ Originally an American procedure, plea bargaining has become an important feature of some common law countries (UK) and has been transplanted in several civil law countries, such as France. Informal versions based on non-trial settlement also exist in various countries, including the Netherlands.¹⁸²

In France, two types of plea bargains exist that may be relevant for transnational litigation against MNEs. First, the procedure of ‘appearance on prior admission of guilt’ (comparution sur reconnaissance préalable de culpabilité, or CRPC) was introduced in 2004.¹⁸³ The prosecutor may, of their own motion or at the request of the suspect, offer a CRPC where the suspect acknowledges the acts of which they are accused. This means the prosecutor will suggest that the suspect be subject to the standard criminal sanctions. If the suspect accepts the offer, a hearing takes place before a judge who will then decide to validate, refuse, or modify the sanctions. Victims must be informed of the CRPC, and they are invited to attend the hearing. They can join the proceedings as a civil party and ask for compensation for the loss they have suffered. The scope of CRPC is limited to specific misdemeanours; crimes are therefore excluded. Furthermore, offences pertaining to intentional and unintentional attacks on personal integrity and sexual assaults are also excluded. Importantly, the CRPC can apply to a legal person, which then has to be represented by a natural person in accordance with Article 7064-3 Code of Criminal Procedure.

The second type of plea bargain is called ‘judicial agreement in the public interest’ (convention judiciaire d’intérêt public, or CJIP).¹⁸⁴ It was introduced in 2016 to allow prosecutors to conclude an agreement with legal persons accused of offences against probity. A CJIP may impose one or more obligations upon the legal person. First, the legal person may be obliged to pay a fine set in proportion to the benefits derived from the criminal offences. This fine should be up to a limit of 30 per cent of the average annual turnover calculated on the last three annual turnover figures known on the date of the observation of such breaches. Second, the legal person must submit, for a maximum period of three years and under the supervision of the French Anti-Corruption Agency, to a compliance programme designed to ensure the existence and implementation of various measures to prevent criminal activities by the legal person.¹⁸⁵ Importantly, the procedure leading to a CJIP allows for victim participation. Where the victim is identified, and unless the legal person can prove that it has already remedied the damage, the CJIP must provide compensation for the damage caused by the offence within one year. The victim is informed of the public prosecutor’s decision to propose the conclusion of a CJIP to the legal person in question, and must transmit to the public prosecutor any information to establish the reality and extent of the loss. Following the hearing of both the legal person and the victim, a judge then decides whether to validate or reject the CJIP. The public prosecutor must launch criminal proceedings in a situation where the judge rejects the CJIP.

Both CRPC and CJIP allow victims to claim compensation for the loss they suffered as a result of the criminal offence. They can provide victims with a fast-track route for obtaining remediation in comparison with traditional criminal proceedings, which can last for years. While the limited scope of the CRPC to certain misdemeanours is likely to limit its pertinence to transnational litigation against MNEs, CJIPs apply to a number of white-collar crimes – mainly bribery and influence-peddling, obstruction of justice, tax fraud, laundering of tax money, or falsifying business records – which are relevant for crimes committed by MNEs. In past criminal claims, victims have accused companies of committing some of these white-collar crimes (eg Rougier). In addition, one interesting feature of CJIPs is that they must be made public on the website of the French Anti-Corruption Agency. This provision guarantees that corporate wrongdoing does not go unnoticed. However, the very nature of CRPC and CJIP may limit their added-value for victims mainly interested in holding MNEs liable for their wrongdoing. A validation of a CRPC or a CJIP does not result in a conviction and does not have the nature or the effects of a conviction judgment. Furthermore, they carry more lenient sentences for legal persons, which limits the deterrent effect of criminal enforcement. More generally, plea bargaining may impair the public interest in effective punishment of crime.¹⁸⁶

In the Netherlands, there is no plea bargaining as such. However, criminal cases may be settled out of court through a so-called ‘transaction’ (transactie). The prosecutor will negotiate an out-of-court settlement with a suspect in which the suspect agrees to meet certain conditions, such as to pay a fine and/or to compensate the victim, in order to avoid being prosecuted and tried by a court. A transaction is a consensual agreement between two parties to avoid prosecution; it does not involve an admission of guilt or the approval of a court. If the offer of an out-of-court settlement by means of a transaction is rejected or ignored by the suspect, the prosecutor must charge the defendant and bring them to trial.¹⁸⁷

Out-of-court settlements

To date, plaintiffs and MNEs have rarely concluded out-of-court settlements in France or the Netherlands, unlike parties in various transnational claims against MNEs in common law countries. The only existing instance of out-of-court settlement took place in the context of the French criminal litigation brought against Total for gross human rights abuse in Myanmar.¹⁸⁸ Total agreed to pay €10,000 to each plaintiff in exchange for the withdrawal of the complaint. In addition, the company pledged to create a fund of €5.2 million to implement humanitarian and development projects.¹⁸⁹ Although out-of-court settlements allow for rapid remediation for victims, they are nevertheless problematic from the point of view of access to justice. This aspect is explored in Chapter 3 of this book.

6 Conclusions

This chapter has explored how French and Dutch criminal law and procedure affect opportunities for victims of extraterritorial crimes involving businesses to seek justice in France and the Netherlands. It showed that victims of extraterritorial or international crimes committed by MNEs face important procedural obstacles when seeking justice through criminal courts.

In general, the traditional jurisdictional principles under criminal law appear to be inadequate to ensure the prosecution of MNEs when they commit crimes in an extraterritorial or transnational context. In France and the Netherlands, the territoriality principle remains relevant when one of the constituent elements of the crime was committed on their territory or when a domestic company was complicit in a crime committed in a host country. However, a number of requirements must be met, including double criminality and a foreign court’s final judgment, which have made the prosecution of companies difficult so far. French and Dutch laws also recognize the existence of alternative principles of jurisdiction based on the nationality of the perpetrator or of the victim, or the necessity to prosecute perpetrators of gross human rights abuses. Among them, the active nationality principle appears to be the most justifiable jurisdictional ground for regulating the conduct of French and Dutch companies in host countries. Nonetheless, procedural requirements and institutional obstacles limit the opportunities offered by the French and Dutch criminal systems to hold members of MNEs accountable for crimes in host States.

As a result of the application of the principle of opportunity, the public prosecutor enjoys broad discretion to initiate prosecution in France and the Netherlands. This may be problematic, as prosecutors are generally reluctant to sue MNEs for human rights abuse or environmental pollution taking place in host countries. However, French law allows victims and NGOs to play a predominant role in criminal proceedings. At EU level, the Victims’ Rights Directive has reinforced the role and ability of victims to participate in criminal proceedings.

As in civil cases, access to evidence remains a thorny problem in the context of transnational criminal litigation against MNEs. As a result of the burden of proof on prosecutorial authorities, the prosecutor usually has the main role in gathering and requesting evidence. However, in practice this does not relieve victims of the burden of gathering the evidence necessary to demonstrate a company’s involvement in a crime. The difficulty in accessing relevant incriminatory evidence will often result in the prosecutor deciding not to investigate further or to prosecute alleged crimes committed by MNEs abroad. Victims and NGOs must therefore play an important role in gathering evidence before and during criminal proceedings in order to ensure the prosecution of MNEs. However, evidence gathered by victims and NGOs may not meet admissibility standards required under criminal procedure.

France and the Netherlands offer a broad range of criminal sanctions against companies. However, the dissuasive effect of these sanctions is likely to be limited in the context of transnational litigation against MNEs, as the highest level of fines remains low when compared with the benefits that some crimes committed by MNEs can generate. Furthermore, remedies for victims tend to focus on the award of financial compensation to the detriment of other relevant remedies, such as environmental remediation. These two aspects show that a reflection of appropriate sanctions and remedies under criminal law might be needed in France and the Netherlands. Finally, other mechanisms, such as restorative justice, plea bargaining, and settlements, may constitute valuable alternatives for obtaining remediation. They may, however, raise questions regarding their interference with the victims’ quest for accountability and justice.

In conclusion, French and Dutch criminal law and procedure are currently insufficient to address the challenges posed by economic actors committing crimes in a transnational context.

The next chapter analyses the rules governing the liability of corporate groups in areas directly relevant to human rights and environmental protection.