Notes
In 2011, the UNHRC endorsed the UNGPs, which recognize that: (1) States have a duty to respect, protect, and fulfil human rights; (2) business enterprises have an independent responsibility to respect human rights; and (3) appropriate and effective remedies must be available when rights and obligations are breached. As part of their responsibility to respect human rights, business enterprises should exercise HRDD, meaning they should undertake processes to identify, prevent, mitigate, and account for how they address potential and actual impacts on human rights caused or contributed to by their own activities, or which are directly linked to their operations, products or services resulting from their business relationships.1
Following the endorsement of the UNGPs, corporate HRDD has become a norm of expected conduct.2 It has been integrated into relevant international instruments, such as the OECD Guidelines for Multinational Enterprises and the revised Tripartite Declaration of Principles concerning Multinational Enterprises and Social Policy of the International Labour Organization (ILO). A growing number of countries, especially in Europe, have also adopted or taken steps to adopt legislation imposing human rights and environmental due diligence on corporate groups. Besides these legal developments, a growing number of investors now ask companies to disclose how they handle their human rights risks.3 A small but increasing number of large corporations in different sectors have also expressed their commitment to respect human rights and, in some cases, have called for the adoption of mandatory HRDD standards.4 Some actors, including the UNWG, have called these developments ‘the beginning of a paradigm shift’.5 Nonetheless, the UNWG recently stated that while the global diffusion of HRDD as a norm of conduct in various frameworks is noteworthy, more remains to be done to translate the norm into actual practice.6
In the UNGPs, HRDD is undertaken first and foremost to prevent adverse human rights impacts.7 However, in practice it can have a significant impact on access to justice,8 especially when States design HRDD as a legal standard of conduct. Where this is the case, the way in which HRDD is designed and implemented can make it easier or more difficult for victims of business-related human rights abuses to seek liability or obtain redress from corporations.9 For example, failure to comply with HRDD raises the prospect of legal liability. Furthermore, a legal HRDD regime may require businesses to provide redress where damage results from the failure to conduct reasonable HRDD. At the same time, companies may rely on HRDD as a defence to show that they have done everything they could to prevent the harm. If such a defence is acceptable, there may be a greater burden on victims to demonstrate that the company should still be held liable.
2 Unpacking human rights due diligence
Due diligence existed in national and international law long before the UNGPs introduced the concept of HRDD. Due diligence has different meanings, ranging from a standard of conduct for assessing liability to a process for identifying and managing risks in commercial transactions, including legal liability risks. In the UNGPs, HRDD borrows characteristics from these distinct understandings of due diligence. It is seen first and foremost as a process undertaken by businesses to prevent the occurrence of human rights abuses. However, HRDD may have a significant impact on what happens once human rights abuses have taken place, especially when victims of such abuse are seeking to gain access to justice. This section explores the relationship between HRDD and access to justice, particularly in the context of the UNGPs.
The concept of due diligence
The concept of due diligence is not new and has various legal meanings at both national and international level.
Many domestic legal systems have standards that require private actors to conduct due diligence in various settings. In tort law, due diligence is usually understood as a standard of conduct required to discharge an obligation.10 This concept can be traced to Roman law under which ‘a person was liable for accidental harm caused to others if the harm resulted from the person’s failure to meet the standard of conduct expected of a diligens (or bonus) paterfamilias – a phrase that translates roughly as a prudent head of a household’.11 The diligens paterfamilias standard influenced the development of the tort of negligence in many legal systems. It was directly incorporated into Roman–Dutch tort law as the relevant standard of conduct. It also became the basis for the development of the ‘reasonable man’ test under the English common law concept of negligence and for similar standards in civil law legal systems.12 Due diligence also has specific meanings in the context of business activities. In corporate law, due diligence generally refers to the process of detailed investigation carried out by a business before becoming involved in a business transaction to identify and manage commercial risks. For instance, in the area of mergers and acquisitions, a company will undertake a detailed examination of another company, including its assets, contracts, customers, markets, or financial records, as one of the first steps in a pending merger or acquisition.13 In this context, the risk of legal liability is another commercial consideration to be identified and managed through due diligence in the context of a particular transaction.14
Due diligence takes on a different meaning in international law15 where it functions primarily as a norm of conduct that defines and circumscribes the responsibility of a State for the conduct of third parties.16 Under international law, States are normally responsible for the acts or omissions of persons exercising the authority of the State, since these actions are attributed to the State, even if the acts exceeded the authority given by the State. As a result, acts or omissions of non-State actors are themselves generally not attributable to the State. However, the State may incur responsibility for the conduct of third parties if it fails to exercise due diligence in preventing or reacting to such acts or omissions.17 This broad principle applies to various areas of international law, including in the fields of investment and environmental protection.18 Due diligence also plays a significant role in international human rights law in defining the extent of a State’s obligations to prevent and respond to human rights infringements by private actors within its territory or jurisdiction.19 Bonnitcha and McCorquodale summarise due diligence in international law as follows:
In summary, in international law, ‘due diligence is concerned with supplying a standard of care against which fault can be assessed’ that is relevant in some circumstances but not in others. As a standard of conduct, it defines the extent of states’ responsibility, for example, for infringements of human rights, damage to foreign property and transboundary pollution. It imposes an external, ‘objective’ standard of conduct to take reasonable precaution to prevent, or to respond to, certain types of harm specified by the rule in question.20
It is worth noting that States have imposed due diligence obligations upon businesses in various legal fields, including labour law, consumer law, and environmental law. However, States have neglected to adopt similar obligations in order to ensure that businesses respect human rights. There is little explicit reference to human rights in the variety of due diligence regimes that exist in the legal systems of most States.21 That said, the inclusion of HRDD within the UNGPs has led to a change in the way States treat corporate HRDD.
Human rights due diligence in the UNGPs
The UNGPs clearly provide that in order for business enterprises to meet their responsibility to respect human rights, they should have an HRDD process in place ‘to identify, prevent, mitigate, and account for how they address their impacts on human rights’.22 According to the UNWG, HRDD ‘provides the backbone of the day-to-day activities of a business enterprise in translating into practice its responsibility to respect human rights’.23 In its Interpretive Guide of the corporate responsibility to respect human rights,24 the Office of the United Nations High Commissioner for Human Rights (OHCHR) provides that:
It is through human rights due diligence that an enterprise identifies the information it needs in order to understand its specific human rights risks at any specific point in time and in any specific operating context, as well as the actions it needs to take to prevent and mitigate them.25
GP 17 defines the parameters of what the HRDD process should include. In particular, it should include assessing actual and potential human rights impacts, integrating and acting upon the findings, tracking responses, and communicating how impacts are addressed. Furthermore, GP 17 clarifies that HRDD:
(a) Should cover adverse human rights impacts that the business enterprise may cause or contribute to through its own activities, or which may be directly linked to its operations, products or services by its business relationships;
(b) Will vary in complexity with the size of the business enterprise, the risk of severe human rights impacts, and the nature and context of its operations;
(c) Should also be ongoing, recognizing that the human rights risks may change over time as the business enterprise’s operations and operating context evolve.
The HRDD process includes a number of interrelated processes, which should include four essential components.26 In a nutshell, business enterprises should:
•identify and assess any actual or potential adverse human rights impacts with which they may be involved to gauge human rights risks (GP 18);
•integrate the findings from their impact assessments and take appropriate action to prevent and mitigate adverse human rights impacts (GP 19);
•track the effectiveness of their response to verify whether adverse human rights impacts are being addressed (GP 20); and
•be prepared to communicate externally to account for how they address their human rights impacts (GP 21).
The HRDD process also needs to be complemented by appropriate policies that elaborate the business enterprise’s commitment to respect human rights and incorporate HRDD at all levels and functions, together with its active involvement in remedying adverse human rights impacts caused or contributed to by its activities.27
In the UNGPs, HRDD refers interchangeably to a process and a standard of care expected of companies to meet their responsibility to respect human rights.28 However, the way in which HRDD was formulated led some authors to suggest that the UNGPs failed to explain what due diligence means in practice. According to Bonnitcha and McCorquodale, the use of the term ‘due diligence’ appears to be ‘a clever and deliberate tactic’ to build consensus among businesspeople, human rights lawyers, and States.29 Yet ‘due diligence’ has a different meaning for these actors. Human rights lawyers usually understand ‘due diligence’ as ‘a standard of conduct required to discharge an obligation’, while businesspeople generally see it as ‘a process to manage business risks’.30 Bonnitcha and McCorquodale contend that the UNGPs invoke both understandings of due diligence without clarifying how they relate to each other. The confusion arising from this situation is problematic in practice because it creates uncertainty about the extent of businesses’ responsibility to respect human rights and how that responsibility relates to businesses’ correlative responsibility to provide a remedy where they have infringed human rights.31 This confusion raises questions about the possible effects that HRDD may have on access to justice.
Human rights due diligence and access to justice
HRDD may have a significant impact on access to justice, particularly when States design legal HRDD regimes. The way in which HRDD is designed and implemented can make it easier or harder to establish corporate liability or obtain redress for victims of business-related human rights abuses. For instance, HRDD may be defined as an expected commitment of businesses or as a mandatory obligation. While the infringement of the former does not have enforceable legal consequences, the violation of the latter may lead to corporate liability and provide a cause of action for victims of human rights abuses resulting from the failure to comply with due diligence. Furthermore, HRDD may create an obligation of conduct (ie the duty-bearer must behave in a certain manner) or of result (ie the outcome of that behaviour) for companies. In the context of legal proceedings, the nature and extent of the evidence required to trigger corporate liability will vary depending on the nature of the HRDD obligation. An obligation of conduct will either require victims to prove that the business has failed to exercise reasonable due diligence or require the business to prove that it has carried out reasonable due diligence. In the context of an obligation of result, proof of the damage is likely to be sufficient. In addition, under certain circumstances, HRDD may require businesses to provide remedies when human rights abuses occur. HRDD may also be relevant for determining the type and severity of sanctions and remedies once liability is established. Judges often have a significant amount of discretion and can increase or reduce sanctions and remedies depending on the level of the company’s culpability.32 In some situations, such as in criminal proceedings or civil cases where punitive damages may apply, the fact that a company has conducted serious and thorough HRDD may be seen as a mitigating factor. As such, a judge may decide to impose less severe penalties if the business has engaged in HRDD activities.33 If a company fails to exercise HRDD, a court could also mandate such activities as part of a sanction or remedy, or as part of a plea agreement.34
In the UNGPs, HRDD interacts with access to justice in a number of ways. First, the UNGPs do not address corporate liability in the context of HRDD. This is not surprising since the UNGPs distinguish between the corporate responsibility to respect human rights and corporate liability. The Commentary to GP 13 states that ‘[t]he responsibility of business enterprises to respect human rights is distinct from issues of legal liability and enforcement, which remain defined largely by national law provisions in relevant jurisdictions’. The corporate responsibility to respect is ‘a global standard of expected conduct for all business enterprises wherever they operate’, which ‘exists over and above compliance with national laws and regulations protecting human rights’,35 while corporate liability is a national standard defined and applicable in a specific domestic context. According to the OHCHR, the corporate responsibility to respect means that ‘[b]usiness enterprises should therefore not wait for legal regimes on human rights due diligence to emerge before establishing and developing their own human rights due diligence processes, nor should they consider that mere compliance with legal requirements on human rights due diligence will necessarily be consistent with their responsibility to respect human rights’.36
Nonetheless, the UNGPs consider whether HRDD can provide businesses with a defence against liability claims. The Commentary to GP 17 states that:
Conducting appropriate human rights due diligence should help business enterprises address the risk of legal claims against them by showing that they took every reasonable step to avoid involvement with an alleged human rights abuse. However, business enterprises conducting such due diligence should not assume that, by itself, this will automatically and fully absolve them from liability for causing or contributing to human rights abuses.
Accordingly, a business that demonstrates that it has conducted appropriate HRDD should be more likely to ‘address the risk of legal claims’ against it. This suggests that a business that conducts appropriate HRDD is less likely to be subjected to lawsuits or be held liable where a lawsuit is brought. At the same time, a business enterprise that conducts appropriate due diligence can still be held liable for causing or contributing to human rights abuses.
Stakeholders have suggested that allowing an HRDD defence to liability could incentivize companies to meaningfully engage in HRDD activities and have important preventative effects.37 At the same time, there are serious concerns with the appropriateness of an HRDD defence and whether such a defence is fair to victims.38 An HRDD defence might be particularly inappropriate and unfair ‘in cases where superficial “check box” approaches to human rights due diligence might be used as a reference point instead of genuine attempts to identify, mitigate, and address human rights risks as contemplated in the UNGPs’.39 If the courts are to accept an HRDD defence, it is therefore crucial to ensure that companies are obliged to set up and implement effective and robust HRDD measures. Otherwise, there is a twofold risk that companies will be, or will remain, involved in human rights abuses, while victims will struggle even more to prove corporate liability for the harm they have suffered and obtain access to remedies.
Although the UNGPs do not address corporate liability, they recognize accountability as one of the objectives of HRDD. In the context of their responsibility to respect human rights, business enterprises should carry out HRDD in order to identify, prevent, mitigate, and account for how they address their adverse human rights impacts.40 In particular, GP 21 states:
In order to account for how they address their human rights impacts, business enterprises should be prepared to communicate this externally, particularly when concerns are raised by or on behalf of affected stakeholders. Business enterprises whose operations or operating contexts pose risks of severe human rights impacts should report formally on how they address them.
Businesses should have policies and processes in place through which they ‘know and show that they respect human rights in practice’. ‘Showing involves communication, providing a measure of transparency and accountability to individuals or groups who may be impacted and to other relevant stakeholders, including investors.’41 Accountability in the context of HRDD is close to accounting or disclosure obligations of companies, where companies must report on their financial and non-financial performance and the risks associated with their activities. However, GP 21 seems to restrict accountability to ‘communicating how impacts are addressed’. It does not indicate whether, as part of its accountability, a company should be answerable for the consequences of its actions and face potential legal and non-legal sanctions and the provision of remedies. Nevertheless, business accountability for such consequences can be derived from GP 22 on remediation.
The UNGPs do not address the question of remediation in the context of HRDD. The reason is that HRDD and remediation are seen as separate processes that business enterprises must have in place in order to meet their responsibility to respect human rights. On the one hand, businesses should set up an HRDD process to identify, prevent, mitigate, and account for how they address their impacts on human rights. On the other hand, processes should also be established to allow for the remediation of any adverse human rights impacts businesses cause or contribute to.42 HRDD and remediation are independent processes because they address different stages of human rights abuse. The UNGPs differentiates between potential adverse human rights impacts (ie abuse that could occur in the future) and actual adverse human rights impacts (ie abuse that has already occurred). HRDD must be undertaken first and foremost to prevent potential impacts,43 while remediation processes should seek to redress actual impacts. Nonetheless, the OHCHR points out that although HRDD and remediation are two separate processes, they remain ‘interrelated’.44
Under Pillar II, on the corporate responsibility to respect, and subsequent to describing HRDD in the UNGPs, GP 22 deals with remediation processes. Accordingly:
Where business enterprises identify that they have caused or contributed to adverse impacts, they should provide for or cooperate in their remediation through legitimate processes.
The Commentary to GP 22 specifies that:
Even with the best policies and practices, a business enterprise may cause or contribute to an adverse human rights impact that it has not foreseen or been able to prevent. Where a business enterprise identifies such a situation, whether through its human rights due diligence process or other means, its responsibility to respect human rights requires active engagement in remediation, by itself or in cooperation with other actors.
The performance of HRDD may not always prevent the occurrence of business-related human rights abuse. In that event, remediation should then take place. When a business identifies, through its HRDD process, that it has caused or contributed to such abuse, it should be actively involved in its remediation through legitimate processes.45 Therefore, the business enterprise should play a direct role in providing timely and effective remedy.46 Companies may provide remediation through operational-level grievance mechanisms, meaning procedures typically administered by enterprises and accessible directly to individuals and communities. However, these mechanisms must meet certain core criteria.47 In particular, they should be legitimate, accessible, predictable, equitable, transparent, rights-compatible, a source of continuous learning, and based on engagement and dialogue.48 In some circumstances, it may be most appropriate for remediation to be provided by an entity other than the enterprise, such as a court or another State-based proceeding.49 In some situations, cooperation with judicial mechanisms may be required, in particular where crimes are alleged.50
GP 22 is limited to situations where the business enterprise itself recognizes that it has caused or contributed to an adverse human rights impact.51 If an enterprise contests an allegation that it has caused or contributed to an adverse impact, it cannot be expected to provide for remediation itself unless and until it is obliged to do so (for instance, by a court).52 In that event, the UNGPs lack guidance on how HRDD, as a standard of conduct, can be interpreted in order to establish corporate liability. Another limitation of GP 22 is that where adverse impacts have occurred that the business enterprise has not caused or contributed to, but which are directly linked to its operations, products, or services by a business relationship, the responsibility to respect human rights does not require that the enterprise itself provide for remediation, though it may take a role in doing so.53
Ultimately, ‘[HRDD] is fundamentally a concept that encapsulates a series of good practices without necessary or clear legal implications.’54 A company’s failure to carry out HRDD does not entail any legal responsibility. HRDD also plays a limited role in ensuring that businesses provide for the remediation of adverse human rights impacts. These characteristics of HRDD stem from the fact that the corporate responsibility to respect is formulated in a manner that produces barely enforceable legal consequences55 and gives companies a wide margin of manoeuvre to decide whether to remedy adverse human rights impacts.
3 Mandatory human rights due diligence in national legislation
In the UNGPs, HRDD is seen first and foremost as a standard and/or process aimed at companies. The UNGPs define HRDD as part of the corporate responsibility to respect, which is a standard of expected business conduct. Furthermore, they do not explicitly require States to impose a general HRDD obligation on companies. In the context of the State duty to protect human rights, the UNGPs only recommend that States should adopt HRDD standards in certain situations: when providing effective guidance to business enterprises on how to respect human rights throughout their operations;56 in the context of activities conducted by business enterprises owned or controlled by the State or that receive substantial support and services from State agencies;57 and in the context of business enterprises operating in conflict-affected areas.58 At the same time, the UNGPs suggest that in order to meet their duty to protect, States should enforce laws that are aimed at, or have the effect of, requiring business enterprises to respect human rights. Such legislation could impose HRDD obligations on companies. More recently, the UNWG acknowledged that although a number of business enterprises have taken steps to implement HRDD, considerable efforts by various actors, including States, are still required to make HRDD part of standard business practice.59
Following the adoption of the UNGPs, a number of countries have taken significant steps to impose mandatory HRDD on companies in recent years. In Europe, the French Act on the Duty of Vigilance and the Dutch Child Labour Due Diligence Act are currently the most notable instruments on HRDD. In July 2021, Germany enacted its own human rights due diligence law, which should enter into force in 2023.60 These instruments effectively require companies to identify human rights risks and prevent them from occurring in the context of their activities. Other EU and non-EU States, including Norway,61 Finland,62 and the UK,63 are currently considering, or are in the process of adopting, mandatory HRDD measures.64 While these initiatives vary in scope and content, they share the same goal of creating legally enforceable obligations for companies to identify risks to human rights and prevent such risks from materializing within their activities. However, such legislative processes are complex, can provoke controversy, and do not guarantee the successful adoption of HRDD norms. For example, in 2020, after years of debate on the adoption of a groundbreaking legislative proposal on HRDD,65 Switzerland ultimately opted for a less ambitious counter-proposal requiring sustainability reporting with limited due diligence.66
The adoption of national mandatory HRDD standards may potentially lead to corporate accountability and achieve, to some extent, access to justice. This section sets out the main features of the French Act on the Duty of Vigilance and the Dutch Child Labour Due Diligence Act and assesses their added-value from an access to justice perspective. However, before describing the French and Dutch HRDD legislation, it is important to consider what mandatory HRDD standards mean in the context of this book.
Mandatory human rights due diligence standards
Mandatory HRDD standards require companies to conduct and/or exercise due diligence to prevent and/or mitigate human rights abuses in their operations. The scope and obligations of HRDD standards may be articulated in a variety of ways. In terms of scope, HRDD norms may create obligations for all companies or specific groups of companies, or differentiated obligations that take into account the size and structure of companies. They may also require that companies conduct due diligence in the context of a variety of activities, such as their direct activities, the activities of companies they own and/or control, or the activities of companies with which they have a business relationship (eg suppliers, subcontractors). In addition, a legal HRDD regime may require businesses to exercise due diligence in order to respect human rights in general or to address specific human rights challenges, such as child labour or slavery. With respect to obligations, HRDD standards can impose different duties on companies. Typically, they should require that businesses identify potential risks of human rights abuses that may occur in the context of their activities, and take specific actions to prevent such abuse. In some cases, HRDD standards may force businesses to communicate how they address human rights risks in their activities. Finally, a legal HRDD regime may impose sanctions on companies that do not comply with their HRDD obligations. It may also force companies to provide remedies when human rights abuses occur in the context of their activities, depending on whether the companies have failed to exercise due diligence or have carried out insufficient or inadequate due diligence. In some cases, companies may be required to provide remedies even if they have conducted sufficient and adequate HRDD. Notwithstanding the various ways in which HRDD can be implemented, HRDD standards are ultimately aimed at avoiding the occurrence of human rights abuses by requiring companies to actively prevent them.
On the basis of this interpretation, HRDD norms should be distinguished from transparency standards that require companies to disclose how they identify and address human rights risks in their activities. Disclosure obligations are usually intended to ensure that a specific type of information is made public in order to enable stakeholders, such as investors, consumers, or NGOs, to evaluate and/or monitor the social and environmental performance of companies and make informed decisions. While disclosure obligations may encourage companies to respect human rights, they do not ultimately require companies to prevent human rights abuses in their activities. On the other hand, prevention of human rights abuses by companies is the main objective of HRDD.
However, businesses may be required to communicate how they address their human rights impacts as part of their HRDD.67 In the UK, the Modern Slavery Act 2015 (MSA) falls under the category of legislation imposing disclosure obligations upon companies.68 Under Section 54 MSA, large companies that carry out business in the UK must prepare a slavery and human trafficking statement each financial year, which should be published on their website or made available to anyone requesting it. This statement may take two forms. It may either describe the steps that the company has taken to ensure that slavery and human trafficking is not taking place in any of its supply chains and in any part of its own business, or it may simply declare that the company has taken no such steps. Therefore, the MSA only requires companies to disclose whether and, if applicable, how they address the risks of slavery and human trafficking. It does not oblige companies to actively address such risks. This can be inferred from the fact that a company does not risk legal sanctions if it declares that it has not taken any measures to prevent slavery or trafficking in human beings.69
The French Act on the Duty of Vigilance
In France, several national deputies introduced a bill in 2013 to create a ‘duty of vigilance’ (devoir de vigilance) of parent and controlling companies towards their subsidiaries, subcontractors, and suppliers.70 This bill sought to hold MNEs accountable ‘to prevent the occurrence of tragedies in France and abroad and to obtain reparations for victims of damage detrimental to human rights and the environment’.71 However, it stirred up a lot of opposition, most notably from businesses, and the French government was anxious about the initiative. After years of contentious debate, in 2017 France adopted the Act on the Duty of Vigilance,72 which creates new due diligence obligations in the context of MNE activities. This landmark instrument is the first statute to establish a general obligation for parent or controlling companies to implement HRDD. It also imposes a duty of due diligence in other areas, such as environmental protection and human health and safety. That said, its content was trimmed of controversial points, such as the existence of a duty of care per se, the possibility of holding parent companies liable under criminal law, and the reversal of the burden of proof on parent companies, which would have made the Act on the Duty of Vigilance a more robust instrument for corporate accountability.73
The Act on the Duty of Vigilance inserted two new articles into the Commercial Code: Article L225-102-4, which describes the HRDD obligations of companies, and Article L225-102-5, which provides for tort liability where companies fail to comply with those obligations.
The HRDD obligations of companies
Article L225-102-4(I) provides that parent and controlling companies of corporate groups (including MNEs) that are headquartered or registered in France and are above a certain size must draft and effectively implement a ‘vigilance plan’ (plan de vigilance).74 This plan must contain due diligence measures to identify risks and prevent serious violations of human rights and fundamental freedoms, human health and safety, and the environment in their business activities. A significant feature of this vigilance plan is that it must cover risks and violations arising not only from the activities of the company, but also from those of the companies it directly or indirectly controls and of subcontractors or suppliers with which it has an established business relationship, where these activities are related to this relationship. As a result, the mapping of risks must cover a broad range of business relationships and corporate structures, including parent companies and their subsidiaries, as well as supply chains involving subcontractors or suppliers.75
Article L225-102-4(I) also lists the measures that must be included in the vigilance plan. They consist of:
(1)A mapping of risks for their identification, analysis and prioritisation;
(2)Procedures for the regular assessment of the situation of subsidiaries, subcontractors, or suppliers with whom an established commercial relationship is maintained, with regard to the risk mapping referred to above;
(3)Appropriate actions to mitigate risks or prevent serious violations;
(4)A mechanism for alerting and collecting reports relating to the existence or occurrence of risks, established in consultation with representative trade union organizations in the company; and
(5)A system for monitoring the measures implemented and evaluating their effectiveness.
The Act provides that a decree may complement the vigilance measures already provided for and may specify procedures for drawing up and implementing a vigilance plan. To date, however, no such decree has been adopted by the government. As a result, there are some uncertainties as to the content of the vigilance plan.76
Another important aspect is that the company must make the vigilance plan and the report on its effective implementation public and include them in its management report. Furthermore, the vigilance plan is intended to be developed in association with the company’s stakeholders and, where appropriate, within the framework of multi-stakeholder initiatives within sectors or at the territorial level. Although the Act on the Duty of Vigilance neither defines the concept of ‘stakeholders’ nor makes their participation imperative, the involvement of stakeholders seems to be a prerequisite for the proper execution of the duty of vigilance. This results from the fact that, in line with the UNGPs, the Act ‘uniquely combines mechanisms stemming from soft and hard law and aims to strengthen the accountability of parent companies in allowing them to self-regulate, under the control of both the judge and stakeholders’.77
The legislator provided several enforcement mechanisms to ensure that companies comply with their HRDD obligations. A company may be issued with a formal three month notice by a relevant stakeholder to comply with its obligations. Under Article L225-102-4(II), if the company does not comply, at the request of any person proving an interest, a court may issue an injunction ordering compliance subject to periodic penalty payments (astreintes).78 A court may also be seised to rule in summary proceedings for the same purpose.
To date, NGOs have played an important role in sending formal notices to companies in order to force them to comply with their HRDD obligations.79 They have also brought several complaints to the courts to enjoin companies to respect their obligations.80 For example, in one case several NGOs contended that the French oil company Total had not sufficiently developed and implemented its vigilance plan for its oil operations in one of Uganda’s natural parks, which, they argued, had major environmental and social impacts. They sent a formal notice to Total requesting that it review its vigilance plan.81 When the company refused to do so,82 the NGOs subsequently brought summary proceedings asking the civil court to order Total to fulfil its obligations under Article L225-102-4, and for injunctive relief.83
Until now, the HRDD mechanism set up under the Act on the Duty of Vigilance has proved difficult to enforce. It is currently challenging to establish the exact number of companies subject to the Act on the Duty of Vigilance. Over the last few years, the French government has persistently refused to establish a formal list of all companies that are subject to HRDD obligations, preferring to leave the role of law enforcement to civil society.84 NGOs took the bull by the horns and created a public website listing companies that are, in theory, subject to the Act on the basis of publicly available data.85 In June 2020, they identified 265 companies subject to the duty of vigilance. However, 72 of them (27 per cent) had not published a vigilance plan since the act came into force.86 The absence of a list of companies concerned enables them to escape the application of the Act. This factual impunity is reinforced by the fact that the French government has not taken any action to ensure the effective enforcement of the Act on the Duty of Vigilance. Furthermore, in the absence of an official enforcement mechanism, NGOs are obliged to take the lead in challenging companies to fulfil their obligations. However, NGOs do not have the financial and human resources to play such a role. A recent report commissioned by the government called for the creation of a governmental unit that would have an enforcement role.87
At the time of writing, one issue arises as to whether civil or commercial courts are the competent courts to require companies to comply effectively with their due diligence obligations. NGOs have raised concerns about the suitability of commercial courts, whose judges are company directors and elected by traders, to rule on cases involving human rights and environmental violations.88 Recent rulings have created uncertainty regarding which court is competent. In the case against Total for its activities in Uganda, the Nanterre Civil Court declined jurisdiction in January 2020 and referred the case to the commercial court.89 This decision was upheld on appeal in December 2020.90 The Versailles Court of Appeal considered that there was a direct link between the vigilance plan, its establishment and implementation, and the management of the company’s operations. This link was necessary and sufficient to retain the jurisdiction of the commercial court. However, in another case against Total for the inadequacy of its measures to combat climate change, in February 2021 a pre-trial judge of the Nanterre Civil Court (ie the same court as the one in the case against Total for its activities in Uganda) reached a different conclusion.91 He ruled that the plaintiffs benefited from a right of option, which they could exercise at their convenience, between the judicial court which they had validly seised and the commercial court. To reach that conclusion, the judge relied on the lack of provision in the Act on the Duty of Vigilance for the exclusive jurisdiction of the commercial court and the non-trader status of the plaintiffs. Importantly, he held that while the vigilance plan undoubtedly affects the operation of Total, its purpose and the risks it seeks to prevent are far greater than the strict framework of the management of the company. Therefore, the exclusive jurisdiction of the commercial court is not justified. The case was pending at the time of writing. However, it is expected that the case will be heard on appeal before the Versailles Court of Appeal, which has, in the past, ruled on the exclusive jurisdiction of the commercial court in this type of litigation.92 However, the uncertainty should soon be lifted by the Parliament. In the context of the adoption of an act on confidence in the judiciary, French deputies and senators are expected to decide whether the judicial courts have jurisdiction to hear duty of vigilance actions based on Articles L225-102-4 and L225-102-5. While the competence of the judicial courts appears to be preferred, some senators have expressed a preference for the jurisdiction of the commercial court. This question should be resolved by 2021–2022.93
The Act on the Duty of Vigilance also contains a liability regime for where companies breach their due diligence obligations. Article L225-102-5 Commercial Code states that:
Under the conditions provided for in Articles 1240 and 1241 of the Civil Code, failure to comply with the obligations laid down in Article L225-102-4 of this Code shall engage the liability of its author and oblige them to compensate for the loss that the performance of those obligations would have made it possible to avoid.94
Article L225-102-5 enables courts to hold parent companies of MNEs liable in tort law for any damage to humans or the environment arising from their failure to draft and/or implement a vigilance plan. It establishes a regime of direct liability of the parent or controlling company (as opposed to a regime of vicarious liability).95 It also creates a cause of action for individuals and organizations that have suffered loss resulting from the parent company’s failure to perform its due diligence obligations. This provides an opportunity for any person proving an interest, including victims of business abuse and potentially NGOs and communities, to bring a tort claim and seek redress. In this way, the Act on the Duty of Vigilance establishes a clear link between due diligence, liability, and remediation. Furthermore, the Act on the Duty of Vigilance has a distinct extraterritorial scope by creating the liability of the parent company in the context of its activities, the activities of companies it owns or controls, and of its subcontractors and suppliers.
To date, French judges have not yet ruled on the application of the new liability regime established pursuant to Article L225-102-5. However, potential plaintiffs are likely to face some barriers in establishing liability and obtaining compensation. As a result of the reference to Articles 1240 and 1241 Civil Code, the cause of action under Article L225-102-5 implicitly requires the existence of fault, loss, and a direct causal link between the two.96 Demonstrating the existence of fault on the part of the company and the direct causal link between that fault and the loss suffered is likely to raise some challenges for the plaintiffs.
The Act of the Duty of Vigilance creates a fault-based liability regime. Pursuant to Article L225-102-5, the company’s failure to comply with the obligations laid down in Article L225-102-4 triggers liability. This means that liability will be incurred where the company has failed to draw up and/or effectively implement a vigilance plan. To date, what characterizes the company’s failure to draw up and/or effectively carry out a vigilance plan remains unclear. Apart from the obvious situation where a company does not draft a plan, which would assume an infringement of the company’s obligations, which other acts and/or omissions could lead to liability? One question is whether the fault of the company can be demonstrated by a vigilance plan that has been insufficiently elaborated and/or implemented. The Act on the Duty of Vigilance sets out a number of measures that must be included in the plan and mentions the obligation to ‘effectively implement’ it, but provides little indication of what these measures actually consist of and what effective implementation means. These questions are important, as compliance with HRDD obligations is likely to act as a virtual defence to liability claims.
Furthermore, a company will be held liable for ‘the loss that the performance of those obligations would have made it possible to avoid’. According to Article L225-102-4(I), vigilance measures are intended to prevent serious infringements of human rights and fundamental freedoms, human health and safety, and the environment resulting from the activities of the company and the companies it controls, and from the activities of subcontractors or suppliers in specific circumstances. Companies should therefore be liable if their failure to draft and/or effectively implement their vigilance plan has led to serious violations of human rights and human health and safety, and environmental pollution. This point raises several issues. First, it is unclear which infringements will be serious enough to justify the liability of the company. Furthermore, there must be a causal link between the company’s failure to prepare and/or effectively implement a vigilance plan and the loss suffered as a result of the serious violations of human rights and fundamental freedoms, human health and safety, and the environment. Courts are left to decide how to establish such a causal link. The criteria that will be required to establish causality are currently unknown. However, the Constitutional Court has clearly stated that the liability of the company will be incurred where there is a direct causal link between the infringement and the losses.97
As mentioned earlier, the original Bill foresaw a reversal of the burden of proof from victims to companies. In the end, however, this reversal was rejected. As a result, plaintiffs will have the burden of establishing a direct causal link between the failure of the company to draft and/or implement its vigilance plan and the loss they have suffered. As this book has shown, in past cases brought against MNEs to hold them liable for human rights abuses occurring in the context of their global activities, victims have struggled to have access to evidence to demonstrate the liability of parent companies and, more generally, to information relevant for their case. In light of this experience, it is likely that claimants will struggle to establish a direct causal link between the loss they have suffered and the failure of the parent company to comply with its ‘vigilance’ obligations. In order to ensure that the Act on the Duty of Vigilance does not become a dead letter, some authors have argued for a relaxation of the causal link, or even a presumption of causality.98
Finally, no further indication is given as to the nature of the damage required to trigger liability. This lack of detail can be interpreted as leaving the door open to compensation for various types of loss (including bodily, material, or non-material loss). Some authors have also suggested that the failure of a company to comply with the obligation to identify risks referred to in Article L225-102-4 may be regarded as a failure to comply with a safety standard. This infringement could make it possible for the company to be held liable without resulting material or bodily damage.99
In conclusion, the Act on the Duty of Vigilance marks an important political step to ensure ‘a fair correlation between the economic power of multinationals and their legal responsibility’.100 In particular, it does so by facilitating the conditions for civil action against MNEs. However, the contribution of the Act on the Duty of Vigilance to improving access to justice remains limited for several reasons.
First, it applies to a limited number of companies (ie the largest MNEs) whose number is currently uncertain. As a result, victims cannot hold smaller corporate groups and other types of companies liable under the Act. Furthermore, it is difficult for NGOs to identify which companies fall within the Act’s scope.
Second, the Act on the Duty of Vigilance creates a specific cause of action in the context of the implementation of HRDD obligations. This means that, in other circumstances, victims of business-related human rights abuses or environmental pollution must rely on the current framework for liability, which, as noted in Chapter 6 of this book, is currently fragmented and insufficient. Therefore, legal reform remains necessary to improve access to justice in situations which do not fall within the scope of the Act.
Third, it will be difficult for victims to meet the Act’s requirements for triggering liability. These requirements do not address the substantive and procedural issues that victims have faced in the context of transnational litigation against MNEs. One example of this potential difficulty is the refusal to reverse the burden of proof for the benefit of victims. Finally, the Act on the Duty of Vigilance does not address the issue of remedies in the context of human rights abuses or environmental pollution. It only provides that the court may order the publication, dissemination, or posting of its decision, and the execution of its decision by means of a periodic penalty payment. The Bill originally provided that the company could be condemned to a fine of up to €10 million, which could be increased up to three times that amount depending on the seriousness and circumstances of the breach and the damage caused. However, this provision was quashed by the Constitutional Court.
The Dutch Child Labour Due Diligence Act
In October 2019, the Netherlands passed the Child Labour Due Diligence Act, which imposes a duty of care on companies to prevent the supply of goods and services produced using child labour on the Dutch market.101 Specifically, companies falling within the scope of the Child Labour Due Diligence Act are required to exercise due diligence in their supply chains by investigating whether there is a reasonable suspicion that the goods or services they provide were produced through child labour. This investigation should focus on sources that are reasonably identifiable and available to the company. If there is a reasonable suspicion, the company must adopt and implement an action plan. The Act suggests the observance of the ILO–International Organisation of Employers (IOE) Child Labour Guidance Tool for Business during the investigation, as well as the adoption and implementation of the action plan. In addition, companies must issue a declaration that they have conducted due diligence to prevent the use of child labour in the production of goods and services to Dutch consumers. However, the Act does not specify the form or the content of the declaration that companies must submit. This gap creates the risk that companies will submit declarations with insufficient information on how due diligence has been carried out. However, further rules may be laid down by regulatory acts in this regard.102 A supervisor is in charge of monitoring compliance with the Act by companies.
In terms of scope, the Child Labour Due Diligence Act applies to both Dutch and foreign companies providing goods and/or services to Dutch end-users (ie the natural or legal person who uses or purchases the good or service). However, it excludes Dutch companies operating abroad that do not provide goods and/or services on the Dutch market. Although the Act targets the last tier of the supply chain, companies under the obligation to investigate must consider the risk of child labour in the entire supply chain involved in the production of the goods or services.103 Moreover, the Child Labour Due Diligence Act applies only to child labour and is therefore not a general piece of HRDD legislation. The Child Labour Due Diligence Act is due to enter into force in mid-2022.104
The Child Labour Due Diligence Act provides for the imposition of administrative and/or criminal sanctions on companies for non-compliance with their investigation, action plan, and declaration obligations. However, it does not contain provisions allowing access to remedies for actual victims of child labour. One reason is that ‘the stated aim of the Act is the protection of Dutch consumers, rather than the protection of the actual victims of child labour’.105 As a result of the relativity requirement in Dutch tort law,106 when victims of child labour bring a tort claim based on Dutch law, they will not be able to base their claim directly on the violation of the Child Labour Due Diligence Act. Therefore, victims will have to rely on existing general civil law and, where possible, criminal law to seek redress. In some circumstances, they may nonetheless be able to rely on the Act indirectly. This should be the case where violation of the Act can be constructed as an indication that an unwritten norm pertaining to proper societal conduct has been violated by the company.107
Nonetheless, the Act provides that any person, whether natural or legal, whose interests have been affected by a company’s action or failure to comply with the Child Labour Due Diligence Act may file a complaint with the Supervisor. However, this opportunity is limited by the fact that only a concrete indication of non-compliance by an identifiable party provides grounds for submitting a complaint. However, it is likely that it will be difficult to prove that a person has been affected by non-compliance with the Child Labour Due Diligence Act. Non-compliance should cover situations where a company has not issued a declaration and where it has adopted inadequate measures. Given that the act does not define the criteria setting out what is expected of the quality of risk assessment or of a company’s action plan to prevent and mitigate child labour in its supply chains, it is likely that complaints will focus on failure to provide a declaration.108 In addition, a complaint may only be dealt with by the Supervisor either after it has been dealt with by the company or six months after the complaint has been lodged with the company without it having been addressed.
The Child Labour Due Diligence Act is likely to be complemented by more comprehensive HRDD legislation in the coming years. In March 2021, several political parties submitted a Bill on Responsible and Sustainable International Business Conduct to the Dutch Parliament. This bill aims to impose a due diligence obligation on companies with more than 250 employees to address human rights violations and environmental damage in their value chains.109 The legislative process was ongoing at the time of writing.
4 Towards mandatory human rights due diligence in the EU
States are not the only actors that have adopted mandatory HRDD standards. The EU has also introduced a number of instruments that require companies to exercise due diligence towards humans and the environment in specific contexts. More recently, a number of studies on due diligence commissioned by the EU institutions have shown an increasing interest in the adoption of a mandatory EU HRDD instrument.110 In April 2020, the EC announced its intention to propose a legal instrument that would impose mandatory HRDD in the EU (EU Initiative). This section discusses current EU due diligence standards and how a potential EU instrument on mandatory HRDD could further improve access to justice.
Existing EU due diligence standards
The EU has adopted a number of instruments that impose ‘certain due diligence-related obligations for human rights and environmental impacts’.111
In 2010, the EU adopted Regulation 995/2010 laying down the obligations of operators who place timber and timber products on the market (EU Timber Regulation).112 This instrument aims to combat illegal logging by preventing the import and placing of illegally harvested timber on the EU market. In particular, the EU Timber Regulation imposes due diligence obligations on specific players in the timber industry. On the basis of a systemic approach, operators should take appropriate steps to ensure that illegally harvested timber and timber products derived from such timber are not placed on the internal market. To that end, operators should exercise due diligence through a system of measures and procedures to minimize the risk of illegally harvested timber and timber products derived from such timber being place on the internal market.113 Due diligence is seen as a risk management exercise in the context of the EU Timber Regulation. The due diligence system includes three elements inherent to risk management: access to information, risk assessment, and risk mitigation. The due diligence system should provide access to information about the sources and suppliers of the timber and timber products being placed on the internal market, including relevant information such as compliance with applicable legislation, country of harvesting, species, quantity, and, where applicable, sub-national regions and concessions for harvesting. Operators should carry out a risk assessment on the basis of this information. Where a risk is identified, operators should mitigate that risk in a manner that is proportionate to the identified risk in order to prevent illegally harvested timber and timber products derived from such timber from being placed on the internal market.114
An important aspect of the EU Timber Regulation is that Member States must punish operators, traders, and monitoring organizations for any infringements of the Regulation. Penalties may include fines proportionate to the damage to the environment, the value of the timber or timber products concerned, and any tax losses and economic detriment resulting from the infringement. These fines should be calculated ‘in such way as to make sure that they effectively deprive those responsible of the economic benefits derived from their serious infringements’.115 However, the EU Timber Regulation does not refer to the possibility for third parties, whether consumers in the EU or local communities where the timber was illegally harvested, to seek redress for damage they may have suffered, either as a result of the placing of illegal timber on the internal market (for EU consumers) or as a result of environmental degradation and/or related human rights abuses (for local communities).
More recently, the EU decided to impose due diligence obligations on EU-based importers of certain minerals and metals through Regulation 2017/821 (EU Conflict Minerals Regulation).116 This instrument ‘establishes a Union system for supply chain due diligence … in order to curtail opportunities for armed groups and security forces to trade in tin, tantalum and tungsten, their ores, and gold. [It] is designed to provide transparency and certainty as regards the supply practices of Union importers, and of smelters and refiners sourcing from conflict-affected and high-risk areas.’117 More specifically, EU importers of specific minerals and metals must comply with ‘supply chain due diligence obligations’,118 which involve ‘their management systems, risk management, independent third-party audits and disclosure of information with a view to identifying and addressing actual and potential risks linked to conflict-affected and high-risk areas to prevent or mitigate adverse impacts associated with their sourcing activities’.119
In contrast to the EU Timber Regulation, the EU Conflict Minerals Regulation does not require Member States to punish EU importers for non-compliance. This lack of sanctions creates a risk of failure to comply, with the result that the EU Conflict Minerals Regulation is a toothless instrument. While Member States are not prevented from punishing infringements of the Regulation, they may be reluctant to punish infringements if other States do not provide for similar sanctions. Furthermore, the EU Conflict Minerals Regulation does not provide for the possibility for third parties to seek redress where the failure of importers to comply with their due diligence obligations results in damage.
In addition to these instruments, the EU has sought to increase transparency by imposing a corporate obligation to disclose information on human rights and environmental risks. As discussed above, disclosure obligations are not due diligence obligations. However, companies may have to assess and communicate their human rights impacts as part of their due diligence obligations. Directive 2014/95/EU (NFRD) lays down rules on disclosure of non-financial and diversity information by large companies.120 It amends Directive 2013/34/EU (EU Accounting Directive),121 which harmonizes the reporting standards of companies’ financial statements. The NFRD requires large public interest companies – primarily listed companies, banks, insurance companies, and designated public interest entities – to include a non-financial statement in their management report. This statement must contain ‘information to the extent necessary for an understanding of the undertaking’s development, performance, position and impact of its activity, relating to, as a minimum, environmental, social and employee matters, respect for human rights, anti-corruption and bribery matters’.122 Ultimately, the NFRD aims to increase the consistency and comparability of non-financial information disclosed by certain large undertakings and groups across the EU in order to provide a more complete picture of their development and performance, as well as the impact of their activities on humans and the environment.
The implementation of the NFRD has so far failed to achieve this objective. In 2020, the Alliance for Corporate Transparency, a group of NGOs and experts, published a study analysing the sustainability reports of 1,000 companies under the NFRD.123 It found out that:
while there is a minority of companies providing comprehensive and reliable sustainability-related information, at large quality and comparability of companies’ sustainability reporting is not sufficient to understand their impacts, risks, or even their plans.124
The lack of comparability found by the study appears, to some extent, to result from the considerable flexibility given to Member States and companies by the NFRD.
Another important flaw in the NFRD is that it excludes the review of the information contained in the non-financial statement. According to the EU Accounting Directive, the annual financial statements of large and medium-sized companies and public interest entities should be audited by statutory auditors to ensure that they provide ‘a true and fair view’ of assets, liabilities, financial position, and profit or loss of the company.125 However, an equivalent requirement for annual non-financial statements is missing from the NFRD, which merely requires that statutory auditors and audit firms should check whether a non-financial statement or a separate report has been provided. Furthermore, Member States have the option, not the obligation, of requiring that the information included in a non-financial statement or a separate report be verified by an independent assurance services provider.126 This means that, in practice, companies may include irrelevant or inaccurate information in their non-financial statements without being punished for it.
In April 2021, the EC adopted a proposal for a Corporate Sustainability Reporting Directive (CSRD), which would amend the NFRD’s existing reporting requirements.127 The proposed CSRD addresses some of the above-mentioned loopholes. It broadens the scope of the reporting requirements to include all large companies and listed companies. It also mandates the auditing of sustainability information, and introduces more detailed reporting requirements and the obligation to report in accordance with mandatory EU sustainability reporting standards. Another novel feature is that it requires all information to be published as part of companies’ management reports and disclosed in a digital, machine-readable format. However, NGOs have claimed that the proposed CSRD falls short on several key points. For example, a number of companies are still excluded from the scope of the proposed CSRD (eg all companies from high-risk sectors). The exemption for large companies that are members of corporate groups is also problematic.128 At the time of writing, the legislative process for adopting the proposed CSRD was still in progress.
Ultimately, the shortcomings of the current EU Framework on corporate conduct vis-à-vis human rights and the environment have resulted in calls by a number of CSOs for the adoption of more robust standards on corporate accountability.129
Options for an EU instrument on mandatory human rights due diligence
In April 2020, Didier Reynders, the European Commissioner for Justice, announced that the EC would introduce legislation to impose mandatory HRDD on companies in 2021.130 Reynders said the proposed instrument would contain, in particular, provisions to ensure corporate liability and access to remedies for victims of abuses. This announcement sparked a great deal of interest and commentary from various actors in the BHR sector, including CSOs, companies, governments, and academics.131 Furthermore, in March 2021 the EP adopted a resolution in which it requested the EC to submit without undue delay a legislative proposal on mandatory supply chain due diligence.132 This resolution also includes non-binding recommendations for the future instrument (EP Proposal).
If successful, the adoption of an EU instrument on mandatory HRDD (EU Instrument) would be a significant normative development for corporate accountability. First of all, such an instrument would be the first regional legislation to translate the HRDD concept into hard law. Given the EU’s economic and political leverage, this instrument could have a significant impact on respect of human rights by companies around the world. It could encourage, if not compel, companies in third countries to establish and implement HRDD in their operations, as well as prompt non-EU countries to follow the EU’s lead and enact similar legislation. A legally binding EU instrument on HRDD would also mark a fundamental shift in the EU’s approach to corporate responsibility for human rights. To date, the EU has primarily encouraged businesses to respect human rights through voluntary, or CSR, initiatives rather than legally binding rules (eg 2011 CSR Strategy).133 However, in the Inception Impact Assessment of the future instrument,134 the EC acknowledged that the current legal framework, in particular corporate legislation, fails to foster accountability towards stakeholders and ‘lags behind the development of global value chains and corporate structures when it comes to the responsibility of a limited liability company for identifying and preventing harm in its group-wide operations and production channels’.135 Ultimately, regulatory failure has been a driving force behind corporate short-termism and a lack of consideration for environmental, social, and human rights interests.
There would be several benefits in the adoption of an EU Instrument on mandatory HRDD. First, it would ensure that HRDD standards are implemented throughout the EU internal market. As previously stated, some Member States have already passed HRDD legislation, while others are considering doing so. However, the majority of Member States still lack HRDD requirements. As a result, the adoption of an EU legal instrument would ensure that HRDD is in effect in all Member States. Second, as more EU Member States enact HRDD legislation, the risk of fragmentation increases, leading to legal uncertainty and the need for EU-wide harmonization.136 The adoption of an EU Instrument would ensure that common HRDD requirements are applied across Member States, creating a level playing field in which businesses in all Member States would be required to follow the same rules. Third, enacting mandatory HRDD standards at EU level would reduce regulatory and compliance burdens for businesses operating across Member States, while ensuring greater legal certainty for companies. Finally, effective due diligence standards could address some of the barriers that prevent victims from seeking justice (eg attribution of liability to parent companies in corporate groups)137 and improve access to remedy.138
The remaining sections of this chapter discuss how the future EU Instrument on mandatory HRDD should be designed to achieve meaningful corporate accountability and access to justice. This discussion focuses on four key elements: scope, HRDD obligations, enforcement, and access to justice. It also points out how these issues were addressed in relevant EU preparatory documents,139 such as the Inception Impact Assessment and the EP Proposal.140 In order to ensure coherence with the current international BHR framework, the future EU Instrument should align with the UNGPs. However, where regulatory gaps exist, the EU should take the opportunity to go beyond the UNGPs in order to address those gaps.
The scope of the future EU instrument on mandatory HRDD raises several crucial questions. First, as part of their due diligence obligations, which human rights should companies be required to respect? Businesses can have an impact on the full range of human rights. As a result, an EU Instrument should theoretically apply to all human rights.141 Nonetheless, there are significant practical difficulties with this approach. First, requiring businesses to exercise due diligence on all human rights would entail significant financial and technical resources, which not all companies may have. Moreover, there is a broad list of existing human rights, and one right can be expressed in a variety of ways in human rights instruments. MNEs, which operate in more than one country, and sometimes in different regions, are likely to be confronted with differing human rights standards. They may find it difficult to consider their impacts on all human rights enshrined in international, regional, and national instruments if the EU Instrument’s human rights scope is not delineated. This approach can also be counterproductive, since businesses can overlook human rights impacts that are most likely to occur in their activities. On the other hand, limiting the scope of the EU Instrument to an insufficient number of human rights may lead to businesses being unaware of less evident, but equally important, human rights violations. As a result, it is critical that the EU Instrument applies to a broad but realistic set of human rights. Businesses should be required by the EU Instrument to consider the human rights that are likely to be impacted by their operations. In order to determine the most relevant human rights, businesses should identify potential and actual human rights impacts. In accordance with the UNGPs, this exercise should be ‘ongoing’ as ‘human rights risks may change over time’.142
The EU Instrument should include a list of the human rights instruments that businesses must respect. To ensure consistency with international standards and practices, the EU Instrument should, at a minimum, reflect the internationally recognized human rights reflected in the UNGPs. GP 12 refers to the International Bill of Human Rights and the principles concerning fundamental rights set out in the International Labour Organization’s Declaration on Fundamental Principles and Rights at Work. However, the EU Instrument should go further and require companies to also respect rights enshrined in European instruments, such as the EU Charter and the ECHR. When HRDD applies to activities taking place in foreign countries, the EU Instrument may oblige businesses to comply with applicable national and regional human rights instruments. In these circumstances, companies should exercise HRDD suited to the local context. The EU Instrument should also demand that businesses pay attention to the human rights of vulnerable groups like children, indigenous peoples, women, migrant workers, or people with disabilities.
Article 1 of the EP Proposal vaguely refers to ‘human rights, the environment and good governance’ without delimiting their scope. However, the Recital in the EP Proposal states that the EC should include an annex143 setting out ‘a list of types of business-related adverse impacts on human rights’ expressed in various human rights instruments, including ‘the international human rights conventions that are binding upon the Union or the Member States’, the International Bill of Human Rights, international humanitarian law, UN instruments on the rights of vulnerable persons or groups, and the ILO Declaration on Fundamental Principles and Rights at Work and various ILO conventions.144 The Recital also suggests including regional human rights instruments and national human rights instruments. The EP Proposal attempts to strike a balance between the need to protect human rights and the conduct of appropriate HRDD by stating that ‘the Commission should ensure that those types of impacts listed are reasonable and achievable’.145
The second issue with the scope of the future EU Instrument concerns the types of businesses, or ‘undertakings’, that should carry out HRDD. Should the EU Instrument apply to all companies, regardless of size (whether small and medium-sized enterprises (SMEs) or large corporate groups)? In general, the UNGPs apply to ‘all business enterprises, both transnational and others, regardless of their size, sector, location, ownership and structure’.146 More specifically, the responsibility of business enterprises to respect human rights applies ‘fully and equally’ to all enterprises ‘regardless of their size, sector, operational context, ownership and structure’.147 However, the UNGPs stress that ‘the scale and complexity of the means through which enterprises meet [their] responsibility may vary according to these factors and with the severity of the enterprise’s adverse human rights impacts’.148 On this basis, all business enterprises should establish an HRDD process that is proportional to their size, unless they have severe human rights impacts, in which case corresponding measures to the impacts must be adopted. To date, only large companies have been subject to the few domestic statutes requiring mandatory HRDD (eg France). Legislators are cautious of imposing due diligence requirements that would be too onerous for small businesses.149 However, while SMEs cannot carry the same HRDD obligations as large companies, such as MNEs, the fact that SMEs can be involved in human rights abuses should not be ignored.150 Furthermore, SMEs constitute an overwhelming majority of enterprises in the EU.151 Therefore, the future EU instrument should require all companies operating in the EU to carry out HRDD that is proportionate to their size and/or leverage in the supply chain, and commensurate with the nature of the adverse human rights impact. In particular, the instrument should address the specific challenges faced by SMEs when carrying out HRDD.152
In the Inception Impact Assessment, only limited liability companies appeared to be the target of the EU Initiative. This option risks leaving a large number of companies outside the scope of future HRDD obligations. The EP Proposal suggests a wider scope. It would apply to large undertakings governed by the law of the Member States or established in the EU,153 publicly listed SMEs, and SMEs operating in high-risk sectors presumably established in the EU154 or, in some circumstances, established outside the EU ‘when they operate in the internal market selling goods or providing services’.155 However, the EP Proposal excludes a significant number of SMEs from the scope of HRDD obligations. On the other hand, the EP Proposal would require undertakings to ‘carry out value chain due diligence which is proportionate and commensurate to the likelihood and severity of their potential or actual adverse impacts and their specific circumstances, particularly their sector of activity, the size and length of their value chain, the size of the undertaking, its capacity, resources and leverage’.156 Technical assistance would also be provided to the obliged undertakings. The EC would be required to publish non-binding guidelines for undertakings on ‘how best to fulfil the due diligence obligations’, which would provide ‘practical guidance on how proportionality and prioritization’ may be applied to HRDD obligations ‘depending on the size and sector of the undertaking’.157 Furthermore, the EP Proposal would include support for SMEs, such as financial assistance.158
In addition, there is a question whether the EU Initiative should apply to all sectors or to limited sectors. Businesses are already subject to various due diligence requirements. However, these expectations are ‘often fragmented according to certain issues, sectors, or commodities, which can create legal uncertainty for businesses having to comply with different standards’.159 The EU institutions should take into account this aspect when drafting HRDD obligations for businesses and consider whether the adoption of a general obligation is better suited to prevent business abuse and ensure accountability. One of the advantages of a general approach is that it would minimize the risk of conflict between different due diligence standards, while, at the same time, facilitating the efforts of companies to fulfil their obligations and ensuring a comprehensive and consistent approach to due diligence. The EP Proposal takes a general approach and would apply to undertakings from all economic sectors, including the financial sector.
Another question with regard to the scope of the future EU Instrument is whether companies should conduct HRDD only for their own activities or also for the activities of their subsidiaries, contractors and subcontractors, and suppliers.160 This question is particularly relevant in the context of MNEs’ activities and raises the possibility of HRDD obligations having extraterritorial reach. GP 13 provides that the responsibility to respect human rights requires that business enterprises avoid causing or contributing to adverse human rights impacts through their own activities and seek to prevent or mitigate adverse human rights impacts that are directly linked to their operations, products or services by their business relationships, even if they have not contributed to those impacts. The Commentary to GP 13 clarifies that ‘a business enterprise’s “activities” are understood to include both actions and omissions; and its “business relationships” are understood to include relationships with business partners, entities in its value chain, and any other non-State or State entity directly linked to its business operations, products or services’. The UNWG has clarified that the HRDD of a business enterprise ‘extends not only to its relationships with first-tier suppliers, but to business relationships along the whole of its value chain, including business connections in the extended supply chain, business relations using products and services, joint venture partners, corporate lenders, project financers, investors, and governments’.161 HRDD should not be limited to an enterprise’s own activities and first-tier suppliers.162 Similarly, CSOs have suggested that businesses should conduct HRDD in their own operations, in their global value chains, and within their business relationships.163
The EP Proposal adopts a broad approach. Pursuant to Article 1(1) of the EP Proposal, obliged undertakings would ‘fulfil their duty to respect human rights, the environment and good governance’ and ‘not cause or contribute to potential or actual adverse impacts on human rights, the environment and good governance through their own activities or those directly linked to their operations, products or services by a business relationship or in their value chains, and that they prevent and mitigate those adverse impacts’. Therefore, undertakings would exercise HRDD for their own activities as well as for activities directly related to their operations, products, or services through a business relationship or through their value chains. In practice, this means that undertakings should respect, avoid causing or contributing to, prevent, and mitigate human rights abuses in a large number of situations (ie direct activities and activities of a business relationship or in its value chains directly linked to its operations, products, or services).
As far as the obligations of companies are concerned, an EU mandatory HRDD instrument should not be limited to reporting requirements, as these already exist under the NFRD. The UNWG has also clarified that a ‘comply or explain’ approach is not a sufficient mandatory HRDD regime under the UNGPs.164 The EU should adopt a substantive due diligence model, which, at the very least, requires businesses to carry out a risk assessment to identify the potential risks of human rights abuses that may arise in the context of their activities and those of companies with which they have a business relationship, and to take specific actions to prevent such abuses. Furthermore, when human rights abuse occurs, companies should be required to mitigate and remedy the resulting adverse impacts.
In general, the EP Proposal adopts a substantive due diligence model. It provides that the exercise of due diligence would require undertakings ‘to identify, assess, prevent, cease, mitigate, monitor, communicate, account for, address and remediate the potential and/or actual adverse impacts on human rights, the environment and good governance that their own activities and those of their value chains and business relationships may pose’.165 More specifically, undertakings would have to conduct a ‘risk based monitoring methodology’ to identify and assess potential or actual impacts on human rights, the environment, and good governance.166 They would also be obliged to establish and implement ‘a due diligence strategy’ effectively. This document would specify potential actual adverse impacts, map the value chain of the undertaking, adopt and indicate ‘all proportionate and commensurate policies and measures with a view to ceasing, preventing or mitigating potential or actual adverse impacts’. In their due diligence strategy, undertakings would also be required to set up ‘a prioritisation strategy’ where they are unable to deal with all the potential or actual adverse impacts at the same time.167 Importantly, undertakings would be required to engage with relevant stakeholders when establishing and implementing their due diligence strategy168 and to publish and communicate that strategy.169 The EP Proposal would also require undertakings to provide a grievance mechanism ‘both as an early-warning mechanism for risk-awareness and as a mediation system’.170 Where an adverse impact occurs, the undertaking would be required to provide for or cooperate with the remediation process depending on whether it has caused or contributed to the adverse impact or whether it is directly linked to the adverse impact.171
The French experience with the implementation of the Act on the Duty of Vigilance has shown the importance of having in place monitoring and enforcement mechanisms.172 The future EU mandatory HRDD instrument should include monitoring mechanisms to ensure that all obliged undertakings have an HRDD process in place and that they effectively comply with its requirements. In this respect, injunctive procedures could be useful, especially to prevent harm. Monitoring will only be effective if it is accompanied by each Member State’s publication of a list of obliged undertakings that fall under the scope of the EU Instrument. Businesses that do not comply with their HRDD obligations should also be subject to sanctions. The EU Instrument should suggest a list of adapted penalties.
The EP Proposal provides for both monitoring and sanctions. According to Article 13, competent authorities in Member States would have ‘the power to carry out investigations’ in order to ensure that undertakings comply with their due diligence obligations. In particular, they should be authorized to carry out checks on undertakings, such as an examination of their due diligence strategy and of the functioning of the grievance mechanism, on-the-spot checks, and interviews with affected stakeholders.173 Moreover, Member States would be required to provide for effective, proportionate, and dissuasive sanctions, which take into account ‘the severity of the infringements committed and whether or not the infringement has taken place repeatedly’.174 They would also be allowed to ‘impose proportionate fines calculated on the basis of an undertaking’s turnover, temporarily or indefinitely exclude undertakings from public procurement, from state aid, from public support schemes including schemes relying on Export Credit Agencies and loans, resort to the seizure of commodities and other appropriate administrative sanctions’.175
The EU mandatory HRDD instrument represents a timely opportunity to enhance the ability of victims of business-related abuse to seek redress. In order to ensure access to justice, the future instrument should address the main substantive and procedural barriers that victims, in particular foreign ones, face when bringing complaints against MNEs in EU Member States.176 On the basis of the obstacles described in Part II of this book, and taking into account the original purpose of due diligence norms, it is suggested that an EU mandatory HRDD instrument should: (1) create corporate liability where damage results from a company’s failure to comply with its HRDD obligations; (2) address obstacles hindering access to justice in the context of transnational business-related abuses, most notably by addressing relevant private international law issues; (3) place the burden of proof on companies; and (4) ensure the availability of appropriate remedies for victims.
The EU mandatory HRDD instrument should impose liability on companies that fail to comply with their due diligence obligations. There are several options possible. Liability could arise where: (1) the company does not conduct due diligence; (2) the company does not conduct due diligence in a sufficient or adequate (or reasonable) manner; (3) damage arises as a result of lack of due diligence and/or the conduct of insufficient or inadequate due diligence; and (4) damage arises in spite of sufficient and adequate due diligence. Since due diligence standards often create an obligation of conduct (as opposed to an obligation of result) for the duty-holder, option 4, which would create a type of strict liability regime that does not involve a fault element, is likely to be controversial and unfeasible in the context of an EU mandatory HRDD instrument.
The French approach to liability under the Act on the Duty of Vigilance could serve as an inspiration. Accordingly, the future EU Instrument should require that companies be held liable for damage resulting from their activities that could have been avoided if sufficient and appropriate due diligence had been conducted by the company. It is essential, from the point of view of victims, for the instrument to provide a legal basis upon which they can base their legal claims for redress. However, in doing so, the EU mandatory HRDD instrument should provide guidance on how liability should be triggered, such as the type of misconduct that would constitute failure to comply with HRDD obligations. Furthermore, it should take into account aspects that may hinder the ability of victims, in particular foreign ones, to hold companies liable, such as conflict of laws or access to evidence.
It has been suggested that the conduct of sufficient and appropriate due diligence could serve as a defence against liability.177 This argument is consistent with the idea that due diligence essentially imposes an obligation of conduct. Furthermore, the use of due diligence as a defence would provide an incentive to comply with the EU legislation. However, as discussed earlier, it could create a major obstacle for victims, particularly if it is unclear what companies need to do in order to conduct sufficient and appropriate due diligence. This uncertainty could create a loophole that allows companies to overcome any liability claims against them. If the EU intends for due diligence to act as a defence against liability, in particular to encourage compliance and to guarantee legal security to companies that comply with their obligations, it should, at the same time, ensure that the burden of proof is on companies. This means that, in the context of a civil claim for damages, companies should prove that they have carried out sufficient and appropriate due diligence to ensure that no human rights violations occur in their value chain instead of victims having to demonstrate lack of due diligence on the part of the company. However, it is likely that, as in the French context, the inclusion of a provision for reversing the burden of proof will be met with resistance. Furthermore, litigators have suggested that such a defence should not be available ‘in case of control over the entity that caused the harm because victims should not bear the consequences of internal corporate structure decisions’.178
The availability of appropriate remedies is another crucial issue. Victims should have access to a wide range of remedies. While the award of damages, or financial compensation, should always be guaranteed, other remedies, such as injunctive relief, rehabilitation or account of profits, should also be available options. An EU mandatory HRDD instrument should also contain provisions that require Member States to guarantee adequate remedy mechanisms,179 whether these mechanisms are of a judicial or non-judicial nature. Member States could be given the opportunity to choose whether civil, criminal, or administrative mechanisms are the most appropriate for the domestic context. In any case, such mechanisms should be low-cost (or made affordable through the provision of legal aid), expeditious, and effective for victims.180 Furthermore, some authors have suggested that an EU mandatory HRDD instrument should require companies to engage actively in remedying any adverse impacts on human rights resulting from their activities or connected to them in their business relations.181 They could do so by setting up corporate grievance mechanisms as part of their HRDD procedures.182 This is one of the approaches adopted by the EP, where emphasis is put on corporate grievance mechanisms. Another solution would be to promote access to remedies through the use of alternative dispute resolution (ADR) mechanisms outside the corporate sphere, such as mediation, conciliation, or arbitration. However, the existence of non-judicial mechanisms, such as corporate grievance and ADR mechanisms, should not preclude the possibility for victims to bring their claims before the courts.
It is likely that provisions on civil liability will be included in the future instrument. Commissioner Reynders has stated on several occasions that there is a need to provide for civil liability in the context of the EU HRDD instrument. In particular, he has referred to EU rules on collective redress.183 The EP Proposal also suggests including provisions on civil liability. Article 19(2) would require Member States to ‘ensure that they have a liability regime in place under which undertakings can … be held liable and provide remediation for any harm arising out of potential or actual adverse impacts on human rights, the environment or good governance that they, or undertakings under their control, have caused or contributed to by acts or omissions’. The inclusion of civil liability in the future instrument would make a significant contribution to access to justice. It would recognize the link between HRDD and access to justice, provide an incentive for companies to exercise due diligence, and ensure that victims have access to judicial redress. However, the future instrument must also contain the necessary safeguards to ensure that potential victims can effectively hold an undertaking which has failed to comply with its due diligence obligations to account. At the time of writing, it was unclear how the suggestions made so far by Commissioner Reynders and the EP contain the necessary safeguards to ensure access to justice.
First of all, while it is important that collective redress mechanisms are taken into account, the future instrument should not rely solely on them to provide redress, particularly as current EU rules on collective redress are currently inadequate.184 Another aspect to consider is how HRDD should provide undertakings with a defence against liability claims. On this point, the EP Proposal is ambiguous. On the one hand, it provides that an undertaking which respects its due diligence obligations shall not be absolved of any liability which it may incur pursuant to national law.185 On the other hand, Member States would have an obligation to ensure that their liability regime is such that ‘undertakings that prove that they took all due care in line with this Directive to avoid the harm in question, or that the harm would have occurred even if all due care had been taken, are not held liable for that harm’.186 Here the relationship between the exercise of due diligence and liability would require clarification. In particular, it would be important to clarify the situations in which an undertaking is considered to have failed to comply with its obligations under the future instrument and how such situations may lead to its liability. In addition, where damage is caused by the direct activities of the undertaking, it is questionable whether an HRDD-based defence could interfere with the application of existing liability regimes which provide for strict liability rules.
On a positive note, the EP Proposal addresses several important issues which may limit the application of the civil liability regime. The first is the contentious issue of the burden of proof. In certain circumstances, the EP Proposal provides for a reversal of the burden of proof to the undertaking. For instance, the burden of proof ‘would be shifted from a victim to an undertaking to prove that an undertaking did not have control over a business entity involved in the human rights abuse’.187 However, victims would still have to demonstrate causation between the acts or omissions of the undertaking, or those under its control, and the harm arising out of potential or actual adverse impacts. Furthermore, the limitation period for bringing civil liability claims concerning harm arising out of adverse impacts on human rights and the environment should be reasonable.188 In particular:
[l]imitation periods should be deemed reasonable and appropriate if they do not restrict the right of victims to access justice, with due consideration for the practical challenges faced by potential claimants. Sufficient time should be given for victims of human rights, environmental and governance adverse impacts to bring judicial claims, taking into account their geographical location, their means and the overall difficulty to raise admissible claims before Union courts.189
Furthermore, the EP Proposal’s provisions would be regarded as overriding mandatory provisions in line with Article 16 Rome II Regulation.190 This would ensure that the law of the Member State implementing the EU Instrument, rather than the law of a third country, applies to transnational claims. Finally, the EP Proposal provides for various types of remedies, including ‘financial or non-financial compensation, reinstatement, public apologies, restitution, rehabilitation or a contribution to an investigation’.191 However, this reference to remedies is made in the context of extrajudicial remedies and it is unclear whether such remedies could be applied in the context of judicial proceedings.
This chapter has discussed whether the adoption of mandatory HRDD legislation offers some opportunities to address some of the barriers identified in this book and improve access to justice for victims of business-related human rights abuses in Europe.
Due diligence has gained momentum following the adoption of the UNGPs. As part of their responsibility to respect human rights, companies should undertake processes to identify, prevent, mitigate, and account for how they address potential and actual impacts on human rights caused by or contributed to through their own activities, or those that are directly linked to their operations, products, or services by their business relationships. Under the UNGPs, HRDD borrows characteristics from a different understanding of due diligence under national and international law, and refers interchangeably to the process and standard of care expected of companies to fulfil their responsibility to respect human rights. However, the way in which HRDD is formulated in the UNGPs does not explain what due diligence means in legal terms. This confusion is problematic in practice because it creates uncertainty regarding the extent of responsibility of businesses to respect human rights and how that responsibility relates to correlative responsibility to provide a remedy in situations where they have infringed human rights.
HRDD is seen first and foremost as a process undertaken by businesses to prevent human rights abuses from occurring. At the same time, HRDD may have a significant impact on what happens once human rights abuses have taken place, especially when victims of such abuses seek access to justice. However, the fact that the UNGPs do not clearly address the legal dimension of HRDD creates legal uncertainty and puts victims in a precarious situation. For example, while it is unclear how HRDD can be interpreted as a standard of conduct to establish corporate liability, in some circumstances it may provide businesses with a defence against liability claims.
Following the adoption of the UNGPs, a number of countries have taken important steps to impose mandatory HRDD on companies. In Europe, the French Act on the Duty of Vigilance and the Dutch Child Labour Due Diligence Act are currently the most significant instruments on HRDD. However, they differ greatly on liability and remedy. In France, courts may hold parent companies of MNEs liable in tort law for any damage to humans or the environment arising from their failure to draw up and/or implement a vigilance plan. However, potential plaintiffs are likely to face some barriers in establishing liability and obtaining compensation. Demonstrating the existence of a fault and a causal connection may, in particular, give rise to certain challenges. The Dutch Child Labour Due Diligence Act provides for the imposition of administrative and/or criminal sanctions on companies for non-compliance with their investigation, action plan, and declaration obligations. However, it does not contain provisions allowing access to remedies for actual victims of child labour. In both acts, the interests of victims in the context of mandatory HRDD obligations remain insufficiently protected.
The EU has adopted a number of instruments that impose certain due diligence-related obligations for human rights and environmental impacts. However, these instruments may not provide the possibility for third parties to seek redress for damage they have suffered as a result of a business’ failure to conduct due diligence. The EU has also adopted an important instrument imposing non-financial disclosure obligations on companies, which has proved to be ineffective in improving corporate reporting of sustainability-related information. The shortcomings of the current EU framework have led to calls for the adoption of standards which effectively require companies to respect human rights. The EC is expected to introduce legislation to impose mandatory HRDD on companies in 2021. The scope and obligations of this future EU instrument could be articulated in a variety of ways. However, this chapter has suggested that, in order to improve victims’ ability to seek redress for business-related abuses, an EU mandatory HRDD instrument should at least create liability for businesses that failed to comply with their due diligence obligations, place the burden of proof on companies, and ensure that appropriate remedies are available to victims. Nonetheless, the inclusion of such provisions is likely to be met with opposition from the business community.
The next chapter attempts to answer the question whether an international instrument on BHR could similarly contribute to improving access to justice.
1UNWG, ‘Corporate Human Rights Due Diligence – Emerging Practices, Challenges and Ways Forward’ (16 July 2018) UN Doc A/73/163, para 2.
2Ibid, para 20.
3Ibid, para 22.
4‘Companies & Investors in Support of mHRDD’ (BHRRC) <https://www.business-humanrights.org/en/big-issues/mandatory-due-diligence/companies-investors-in-support-of-mhrdd/> accessed 1 May 2021.
5UNWG, ‘Corporate Human Rights Due Diligence’, para 20.
6Ibid, para 24.
7Ibid, para 13.
8UN High Commissioner for Human Rights (UNHCHR), ‘Improving Accountability and Access to Remedy for Victims of Business-Related Human Rights Abuse: The Relevance of human Rights Due Diligence to Determinations of Corporate Liability’ (1 June 2018) UN Doc A/HRC/38/20/Add.2.
9The OHCHR’s Accountability and Remedy Project has already identified the need for greater clarity on the different ways in which HRDD and corporate liability can be interlinked. See UNHCHR, ‘Improving Accountability and Access to Remedy for Victims of Business-Related Human Rights Abuse: Explanatory Notes for Guidance’ (12 May 2016) UN Doc A/HRC/32/19/Add.1, paras 21–23, 55–56.
10Jonathan Bonnitcha and Robert McCorquodale, ‘The Concept of “Due Diligence” in the UN Guiding Principles on Business and Human Rights’ (2017) 28 EJIL 899, 902.
11Ibid.
12Ibid, 903.
13Ibid, 901. See also Olga Martin-Ortega, ‘Human Rights Due Diligence for Corporations: From Voluntary Standards to Hard Law at Last?’ (2014) 32 Netherlands Quarterly of Human Rights 44, 51.
14Bonnitcha and McCorquodale, ‘The Concept of “Due Diligence”’, 901.
15For a comprehensive analysis of due diligence in international law, see Joanna Kulesza, Due Diligence in International Law (Brill 2016).
16Bonnitcha and McCorquodale, ‘The Concept of “Due Diligence”’, 903.
17Jan Arno Hessbruegge, ‘The Historical Development of the Doctrines of Attribution and Due Diligence in International Law’ (2003) 36 NYU Journal of International Law and Policy 265, 268.
18Bonnitcha and McCorquodale, ‘The Concept of “Due Diligence”’, 904.
19Ibid.
20Ibid, 905.
21Olivier de Schutter and others, ‘Human Rights Due Diligence: The Role of States’ (ICAR, ECCJ and CNCA 2012).
22UNHRC, ‘Guiding Principles on Business and Human Rights: Implementing the United Nations “Protect, Respect and Remedy” Framework’ (21 March 2011) UN Doc A/HRC/17/31 (UNGPs), GP 15(b).
23UNWG, ‘Corporate Human Rights Due Diligence’, para 10.
24OHCHR, ‘The Corporate Responsibility to Respect Human Rights: An Interpretive Guide’ (UN 2012).
25Ibid, Q26.
26UNWG, ‘Corporate Human Rights Due Diligence’, para 10.
27Ibid, para 11.
28Lise Smit and others, ‘Study on Due Diligence Requirements through the Supply Chain – Final Report’ (European Commission 2020) 157, citing Bonnitcha and McCorquodale, ‘The Concept of “Due Diligence”’.
29Bonnitcha and McCorquodale, ‘The Concept of “Due Diligence”’, 900.
30Ibid.
31Ibid, 901.
32UNHCHR, ‘Improving Accountability’ (June 2018), para 32.
33Ibid, para 33.
34Ibid, para 34.
35UNGPs, Commentary to GP 11.
36UNHCHR, ‘Improving Accountability’ (June 2018), para 9.
37Ibid, para 29.
38Ibid.
39Ibid.
40UNGPs, GPs 15 and 17.
41Ibid, Commentary to GP 21.
42Ibid, GP 15.
43UNWG, ‘Corporate Human Rights Due Diligence’, para 13.
44OHCHR, ‘The Corporate Responsibility to Respect Human Rights’, Q32.
45The UNWG has clarified that ‘legitimate processes’ may involve State-based judicial and non-judicial mechanisms, as well as non-State-based grievance mechanisms. UNWG, ‘Corporate Human Rights Due Diligence’, para 12.
46OHCHR, ‘The Corporate Responsibility to Respect Human Rights’, Q64.
47UNGPs, Commentary to GP 22.
48Ibid, GP 31.
49OHCHR, ‘The Corporate Responsibility to Respect Human Rights’, Q64.
50UNGPs, Commentary to GP 22.
51OHCHR, ‘The Corporate Responsibility to Respect Human Rights’, Q63.
52Ibid, Q68.
53UNGPs, Commentary to GP 22.
54Carlos López, ‘The “Ruggie Process”: From Legal Obligations to Corporate Social Responsibility?’ in Surya Deva and David Bilchitz (eds), Human Rights Obligations of Business: Beyond the Corporate Responsibility to Respect? (CUP 2013) 61.
55The corporate responsibility to respect is not in itself a legal standard. See UNHCHR, ‘Improving Accountability’ (June 2018), para 11.
56UNGPs, GP 3.
57Ibid, GP 4.
58Ibid, GP 7.
59UNWG, ‘Corporate Human Rights Due Diligence’, para 3.
60Gesetz über die unternehmerischen Sorgfaltspflichten zur Vermeidung von Menschenrechtsverletzungen in Lieferketten vom 16. Juli 2021.
61‘Norway: Govt.-Appointed Committee Proposes Human Rights Transparency and Due Diligence Regulation’ (BHRRC, 3 December 2019) <https://www.business-humanrights.org/en/latest-news/norway-govt-appointed-committee-proposes-human-rights-transparency-and-due-diligence-regulation/> accessed 1 May 2021.
62‘Finnish Government Commits to HRDD Legislation’ (BHRRC, 3 June 2019) <https://www.business-humanrights.org/en/latest-news/finnish-government-commits-to-hrdd-legislation/> accessed 1 May 2021.
63The UK is planning to adopt a narrow type of due diligence legislation to curb illegal deforestation. PA Media, ‘UK Sets Out Law to Curb Illegal Deforestation and Protect Rainforests’ The Guardian (London, 25 August 2020) <https://www.theguardian.com/environment/2020/aug/25/uk-sets-out-law-to-curb-illegal-deforestation-and-protect-rainforests> accessed 1 May 2021.
64‘Mapping mHRDD Legislative Progress in Europe: Map and Comparative Analysis of mHRDD Laws and Legislative Proposals’ (ECCJ, 28 May 2020) <https://corporatejustice.org/eccj-publications/16807-mapping-mhrdd-progress-in-europe-map-and-comparative-analysis-of-mhrdd-laws-and-legislative-proposals> accessed 1 July 2021.
65‘Initiative populaire fédérale “Entreprises responsables – pour protéger l’être humain et l’environnement”’ (Chancellerie Fédérale Suisse) <https://www.bk.admin.ch/ch/f/pore/vi/vis462t.html> accessed 1 May 2021. For a discussion on the Swiss Responsible Business Initiative, see Nicolas Bueno, ‘Diligence en matière de droits de l’homme et responsabilité de l’entreprise: le point en droit suisse’ (2019) 29 Swiss Review of International and European Law 345.
66Christelle Coslin and Margaux Renard, ‘Switzerland: Responsible Business Initiative Narrowly Rejected Despite Gaining 50.7% of Popular Vote’ (Lexology, 7 December 2020) <https://www.lexology.com/library/detail.aspx?g=0cc7c0cb-8f17-4c48-93be-f549a2321e4c> accessed 1 May 2021.
67UNGPs, GP 21.
68Anne Triponel, ‘Business and Human Rights Legislation: An Overview’ (Triponel Consulting, 14 October 2019) <https://triponelconsulting.com/business-and-human-rights-legislation/> accessed 1 May 2021.
69For a critical assessment of the MSA, see Virginia Mantouvalou, ‘The UK Modern Slavery Act 2015 Three Years On’ (2018) 81 Modern Law Review 1017.
70Proposition de loi n° 1524 & Proposition de loi n° 1519 du 6 novembre 2013 relatives au devoir de vigilance des sociétés mères et des entreprises donneuses d’ordre.
71Ibid (author’s translation).
72Loi n° 2017-399 relative au devoir de vigilance des sociétés mères et entreprises donneuses d’ordre.
73Sandra Cossart, Jérôme Chaplier, and Tiphaine Beau de Loménie, ‘The French Law on Duty of Care: A Historic Step Towards Making Globalization Work for All’ (2017) 2 Business and Human Rights Journal 317, 317.
74Two types of companies are subject to the obligation to establish and effectively implement a vigilance plan:
(1) Any company which employs, at the end of two consecutive financial years, at least five thousand employees within the company and in its direct or indirect subsidiaries whose registered office is in French territory; or
(2) Any company which employs, at the end of two consecutive financial years, at least ten thousand employees within the company and in its direct or indirect subsidiaries whose registered office is in French territory or abroad.
75In the context of former Article L442-6(I)(5) Commercial Code, the Court of Cassation has defined ‘established business relationship’ as a ‘regular, stable and meaningful’ relationship (Cass com 6 September 2011, n° 10-30679). In the context of the Act on the Duty of Vigilance, the link with the subcontractor or supplier must be sufficiently significant. Occasional contractors seem to be excluded from its scope. See Gérard Jazottes, ‘La sous-traitance saisie par la RSE’ in Sandrine Tisseyre (ed), Sécuriser la sous-traitance: quels nouveaux outils? (Presses de l’Université Toulouse 1 Capitole 2019).
76Academics and lawyers have raised concerns about the uncertainties regarding the entities included within the ambit of the vigilance plan and the content of the plan. See Stéphane Brabant, Charlotte Michon and Elsa Savourey, ‘The Vigilance Plan: Cornerstone of the Law on the Corporate Duty of Vigilance’ (2017) 93 Revue internationale de la compliance et de l’éthique des affaires 1.
77Tiphaine Beau de Loménie and Sandra Cossart, ‘Stakeholders and the Duty of Vigilance’ (2017) 94 Revue internationale de la compliance et de l’éthique des affaires 1.
78Periodic penalty payments are injunctive fines payable on a daily or per-event basis until the defendant satisfies a given obligation. See Ibid, 5.
79At the time of writing, at least five formal notices had been sent by NGOs to four companies: Total (for two different cases), Teleperformance, EDF, and Casino. See Concepcion Alvarez, ‘Total mis en demeure de s’aligner avec l’Accord de Paris, avant une attaque en justice’ (Novethic, 24 June 2019) <https://www.novethic.fr/actualite/environnement/climat/isr-rse/total-mise-en-demeure-de-s-aligner-avec-l-accord-de-paris-avant-une-attaque-en-justice-147392.html> accessed 1 May 2021; ‘UNI Global Union and Sherpa Send Formal Notice to Teleperformance—Calling on the World Leader in Call Centres to Strengthen Workers’ Rights’ (UNI Global Union, 18 July 2019) <https://www.uniglobalunion.org/news/uni-global-union-and-sherpa-send-formal-notice-teleperformance-calling-world-leader-call> accessed 1 May 2021; Concepcion Alvarez, ‘Devoir de vigilance: EDF mis en demeure pour violation des droits humains’ (Novethic, 3 October 2019) <https://www.novethic.fr/actualite/gouvernance-dentreprise/entreprises-controversees/isr-rse/devoir-de-vigilance-edf-mis-en-demeure-pour-violation-des-droits-humains-147763.html> accessed 1 May 2021; ‘Indigenous Organisations and NGO Coalition Warn Top French Supermarket Casino: Do Not Sell Beef from Deforestation in Brazil and Colombia – or Face French Law’ (Sherpa, 21 September 2020) <https://www.asso-sherpa.org/indigenous-organisations-and-ngo-coalition-warn-top-french-supermarket-casino-do-not-sell-beef-from-deforestation-in-brazil-and-colombia-or-face-french-law-stop-gambling-with-our-forests> accessed 1 May 2021.
80At the time of writing, there were at least four ongoing legal proceedings against three companies (Total, EDF, and Casino) under the Act on the Duty of Vigilance. See ‘Premier contentieux climatique contre une multinationale du pétrole en France: 14 collectivités et 5 associations assignent Total en justice pour manquement à son devoir de vigilance’ (Sherpa, 28 January 2020) <https://www.asso-sherpa.org/premier-contentieux-climatique-contre-total> accessed 1 May 2021; ‘Loi devoir de vigilance: première saisine d’un tribunal français pour le cas de Total en Ouganda’ (Les Amis de la Terre, 23 October 2019) <https://www.amisdelaterre.org/communique-presse/loi-devoir-de-vigilance-premiere-saisine-dun-tribunal-francais-pour-le-cas-de-total-en-ouganda/> accessed 1 May 2021; ‘EDF assigné en justice pour ses activités au Mexique’ (Sherpa, 13 October 2020) <https://www.asso-sherpa.org/edf-assigne-en-justice-pour-ses-activites-au-mexique#pll_switcher> accessed 1 May 2021; ‘Déforestation et atteintes aux droits humains en Amazonie: des représentants des peuples autochtones et associations assignent Casino en justice’ (Sherpa, 3 March 2021) <https://www.asso-sherpa.org/deforestation-et-atteintes-aux-droits-humains-en-amazonie-des-representants-des-peuples-autochtones-et-associations-assignent-casino-en-justice> accessed 1 May 2021.
81Amis de la Terre France et Survie, ‘Devoir de vigilance: total mise en demeure pour ses activités en Ouganda’ (25 June 2019).
82‘Total Responds to Questions from NGOs about its Projects in Uganda’ (Total, 9 September 2019) <https://www.total.com/info/statement-09302019> accessed 1 May 2021.
83‘Oil Company Total Faces Historic Legal Action in France for Human Rights and Environmental Violations in Uganda’ (Friends of the Earth International, 23 October 2019) <https://www.foei.org/news/total-legal-action-france-human-rights-environment-uganda> accessed 1 May 2021.
84CCFD-Terre Solidaire and Sherpa, ‘Le radar du devoir de vigilance: Identifier les entreprises soumises à la loi’ (2020) 5 <https://ccfd-terresolidaire.org/actualites/radar-du-devoir-de-7047> accessed 16 July 2021.
85Sherpa, CCFD-Terre Solidaire and BHRRC, ‘Le projet’ (Le radar du devoir de vigilance) <https://plan-vigilance.org/> accessed 1 May 2021.
86Sherpa, CCFD-Terre Solidaire and BHRRC, ‘Édition 2020 du radar du devoir de vigilance: Yves Rocher, Castorama, Picard, McDonald’s, France Télévisions, Bigard … 27% des entreprises hors la loi?’ (Le radar du devoir de vigilance) <https://plan-vigilance.org/edition-2020-du-radar-du-devoir-de-vigilance-yves-rocher-castorama-picard-mcdonalds-france-televisions-bigard-27-des-entreprises-hors-la-loi/> accessed 1 May 2021.
87Anne Duthilleul and Matthias de Jouvenel, ‘Evaluation de la mise en œuvre de la loi n° 2017-399 du 27 mars 2017 relative au devoir de vigilance des sociétés mères et des entreprises donneuses d’ordre’ (Conseil général de l’économie 2020).
88‘Total Abuses in Uganda: French High Court of Justice Declares Itself Incompetent in Favour of the Commercial Court’ (Friends of the Earth International, 30 January 2020) <https://www.foei.org/no-category/total-abuses-uganda-french-high-court-of-justice-declares-itself-incompetent-duty-vigilance-law> accessed 1 May 2021; Almut Schilling-Vacaflor, ‘Putting the French Duty of Vigilance Law in Context: Towards Corporate Accountability for Human Rights Violations in the Global South?’ [2020] Human Rights Review <https://link.springer.com/article/10.1007%2Fs12142-020-00607-9> accessed 1 May 2021.
89TJ Nanterre (ord réf) 30 January 2020, n° 19/02833. See also ‘Méga-projet pétrolier de Total en Ouganda: une décision de justice décevante’ (Amis de la Terre France, 3 February 2020) <https://www.amisdelaterre.org/mega-projet-petrolier-total-decision-de-justice-decevante/> accessed 1 May 2021.
90CA Versailles 10 December 2020, n° 20/01692 & 20/01693.
91TJ Nanterre (ord réf) 11 February 2021, n° 20/00915.
92Philippe Métais and Elodie Valette, ‘Devoir de vigilance: vers une option de compétence?’ (Dalloz Actualités, 17 February 2021) <https://www.dalloz-actualite.fr/flash/devoir-de-vigilance-vers-une-option-de-competence#.YDkRzGj0mUk> accessed 1 May 2021.
93Miren Lartigue, ‘Contentieux relatif au devoir de vigilance : vers la désignation de tribunaux judiciaires dédiés’ (Dalloz Actualités, 4 May 2021) <https://www.dalloz-actualite.fr/flash/contentieux-relatif-au-devoir-de-vigilance-vers-designation-de-tribunaux-judiciaires-dedies#.YXf3AJ7P2Uk> accessed 26 October 2021; ‘Action en justice contre Total : le Sénat met en danger la loi pionnière sur le devoir de vigilance’ (Notre Affaire à Tous, 6 October 2021) <https://notreaffaireatous.org/action-en-justice-contre-total-le-senat-met-en-danger-la-loi-pionniere-sur-le-devoir-de-vigilance/?utm_source=sendinblue&utm_campaign=Les_actualits_doctobre__Affaire_du_Sicle_mise_en_danger_du_devoir_de_vigilance_bote__outils_pdagogique&utm_medium=email> accessed 26 October 2021.
94Author’s translation.
95Cons const 23 March 2017, Décision n° 2017-750, para 27.
96Ibid, para 21.
97Cons const, Décision n° 2017-750.
98Anne Danis-Fatôme and Geneviève Viney, ‘La responsabilité civile dans la loi relative au devoir de vigilance des sociétés mères et des entreprises donneuses d’ordre’ [2017] Recueil Dalloz 1610.
99Ibid.
100Dominique Potier, ‘Rapport n° 2628 sur la proposition de loi (n° 2578) relative au devoir de vigilance des sociétés mères et des entreprises donneuses d’ordre’ (Assemblée Nationale, 11 March 2015) <http://www.assemblee-nationale.fr/14/rapports/r2628.asp#P252_90424> accessed 1 May 2021.
101Wet van 24 oktober 2019 houdende de invoering van een zorgplicht ter voorkoming van de levering van goederen en diensten die met behulp van kinderarbeid tot stand zijn gekomen (Wet zorgplicht kinderarbeid).
102Ibid, Article 4(3).
103Liesbeth Enneking, ‘The Netherlands Country Report’ in Lise Smit and others, Study on Due Diligence Requirements through the Supply Chain. Part III: Country Reports (European Commission 2020) 170, 175.
104Suzanne Spears, Olga Owczarek, and Rose Fernando, ‘Mandatory Human Rights Due Diligence Laws: The Netherlands Led the Way in Addressing Child Labour and Contemplates Broader Action’ (Allen & Overy, 2 September 2020) <https://www.allenovery.com/en-gb/global/news-and-insights/publications/mandatory-human-rights-due-diligence-laws-the-netherlands-led-the-way-in-addressing-child-labour-and-contemplates-broader-action> accessed 1 May 2021.
105Enneking, ‘The Netherlands Country Report’, 177.
106Relativity requires that the norm breached served to protect against damage such as that suffered by the person sustaining the loss.
107Enneking, ‘The Netherlands Country Report’, 178.
108Anya Marcelis, ‘Dutch Take the Lead on Child Labour with New Due Diligence Law’ (Ergon, 17 May 2019) <https://ergonassociates.net/dutch-take-the-lead-on-child-labour-with-new-due-diligence-law/> accessed 1 May 2021.
109‘Dutch Bill on Responsible and Sustainable International Business Conduct a Major Step towards Protecting Human Rights and the Environment Worldwide’ (MVO Platform, 11 March 2021) <https://www.mvoplatform.nl/en/dutch-bill-on-responsible-and-sustainable-international-business-conduct-a-major-step-towards-protecting-human-rights-and-the-environment-worldwide/> accessed 1 May 2021.
110Smit and others, ‘Study on Due Diligence Requirements – Final Report’; Markus Krajewski and Beata Faracik, ‘Briefing 1 – Substantive Elements of Potential Legislation on Human Rights Due Diligence’ (European Parliament 2020); Claire Methven O’Brien and Olga Martin-Ortega, ‘Briefing 2 – EU Human Rights Due Diligence Legislation: Monitoring, Enforcement and Access to Justice for Victims’ (European Parliament 2020).
111Lise Smit and others, ‘Study on Due Diligence Requirements through the Supply Chain. Part I: Synthesis Report’ (European Commission 2020) 26.
112Regulation (EU) No 995/2010 of the European Parliament and of the Council of 20 October 2010 laying down the obligations of operators who place timber and timber products on the market [2010] OJ L295/23 (EU Timber Regulation).
113Ibid, Recital 16.
114Ibid, Recital 17.
115Ibid, Article 19.
116Regulation (EU) 2017/821 of the European Parliament and of the Council of 17 May 2017 laying down supply chain due diligence obligations for Union importers of tin, tantalum and tungsten, their ores, and gold originating from conflict-affected and high-risk areas [2017] OJ L130/1 (EU Conflict Minerals Regulation).
117Ibid, Article 1(1).
118Ibid, Article 3.
119Ibid, Article 2(d).
120Directive 2014/95/EU of the European Parliament and of the Council of 22 October 2014 amending Directive 2013/34/EU as regards disclosure of non-financial and diversity information by certain large undertakings and groups [2014] OJ L330/1 (NFRD).
121Directive 2013/34/EU of the European Parliament and of the Council of 26 June 2013 on the annual financial statements, consolidated financial statements and related reports of certain types of undertakings, amending Directive 2006/43/EC of the European Parliament and of the Council and repealing Council Directives 78/660/EEC and 83/349/EEC [2013] OJ L 182/19 (EU Accounting Directive).
122NFRD, Article 1.
123Alliance for Corporate Transparency, ‘2019 Research Report: An analysis of the sustainability reports of 1,000 companies pursuant to the EU Non-Financial Reporting Directive’ (2020).
124Ibid, 10.
125EU Accounting Directive, Article 4(3).
126Ibid, Article 19a(6).
127European Commission, ‘Proposal for a Directive of the European Parliament and of the Council Amending Directive 2013/34/EU, Directive 2004/109/EC, Directive 2006/43/EC and Regulation (EU) No 537/2014, as regards corporate sustainability reporting’ COM(2021) 189 final.
128‘On the Corporate Sustainability Reporting Directive (NFRD reform) Proposal: Most Promising Changes and Caveats’ (Alliance for Corporate Transparency, 21 April 2021) <https://www.allianceforcorporatetransparency.org/news/on-the-draft-sustainability-reporting-directive-nfrd-reform-proposal-most-promising-changes-and-caveats.html> accessed 1 May 2021.
129‘Key Features of Mandatory Human Rights Due Diligence Legislation’ (ECCJ, June 2018) <https://corporatejustice.org/publications/key-features-of-mandatory-human-rights-due-diligence-legislation/> accessed 16 July 2021.
130‘European Commission Promises Mandatory Due Diligence Legislation in 2021’ (RBC, 30 April 2020) <https://responsiblebusinessconduct.eu/wp/2020/04/30/european-commission-promises-mandatory-due-diligence-legislation-in-2021/> accessed 1 May 2021.
131‘Commissioner Reynders Announces EU Corporate Due Diligence Legislation’ (ECCJ, 30 April 2020) <https://corporatejustice.org/news/16806-commissioner-reynders-announces-eu-corporate-due-diligence-legislation> accessed 1 May 2021; Adidas and others, ‘Support for EU Framework on Mandatory Human Rights and Environmental Due Diligence’ (BHRRC, 2 September 2020) <https://www.business-humanrights.org/en/latest-news/support-for-eu-framework-on-mandatory-human-rights-and-environmental-due-diligence/> accessed 1 May 2021; ‘Towards EU Mandatory Due Diligence Legislation: Perspectives from Business, Public Sector, Academic and Civil Society’ (BHRRC, 11 November 2020) <https://www.business-humanrights.org/en/from-us/briefings/towards-eu-mandatory-due-diligence-legislation/> accessed 1 May 2021.
132European Parliament resolution of 10 March 2021 with recommendations to the Commission on corporate due diligence and corporate accountability (2020/2129(INL)).
133European Commission, ‘A Renewed EU Strategy 2011–2014 for Corporate Social Responsibility’ (Communication) COM/2011/0681 final.
134European Commission, ‘Sustainable Corporate Governance’ (Inception Impact Assessment) Ref. Ares(2020)4034032.
135Ibid.
136Axel Marx and others, ‘Access to Legal Remedies for Victims of Corporate Human Rights Abuses in Third Countries’ (European Parliament 2019).
137Ibid, 107–110.
138EU FRA, ‘Improving Access to Remedy in the Area of Business and Human Rights at the EU Level’ FRA Opinion – 1/2017 [B&HR], Opinion 21.
139It should be noted that these texts are intended to assist in the preparation of the future instrument and are not, in themselves, binding.
140The EC’s proposal was due to be published by the end of 2021, after the completion of this book, and thus could not be considered in the analysis.
141Krajewski and Faracik, ‘Briefing 1’, 5.
142UNGPs, GP 17(c).
143The EP Proposal also refers to additional similar annexes listing the types of business-related adverse impacts on the environment and good governance that fall within its scope. Ibid, Recitals 22 and 25.
144EP Proposal, Recital 21.
145Ibid.
146UNGPs.
147Ibid, GP 14.
148Ibid.
149Krajewski and Faracik, ‘Briefing 1’, 8.
150To date, the role of SMEs as perpetrators of human rights abuses has been largely neglected in the BHR debate. See Ceyda Ilgen, ‘The Implementation of the UNGPs on Business and Human Rights for SMEs: Challenges and Opportunities’ (LLM Dissertation, University of Essex 2019).
151Krajewski and Faracik, ‘Briefing 1’, 9.
152Ibid, 9.
153EP Proposal, Article 2(1).
154Ibid, Article 2(2).
155Ibid, Article 2(3).
156Ibid, Article 4(7).
157Ibid, Article 14.
158Ibid, Article 15.
159Lise Smit and others, ‘Business Views on Mandatory Human Rights Due Diligence Regulation: A Comparative Analysis of Two Recent Studies’ [2020] Business and Human Rights Journal 1, 4.
160Krajewski and Faracik, ‘Briefing 1’, 10.
161Letter from the UNWG to European Commissioner for Justice Didier Reynders, Ref SPB/SHD//NF/GF/ff (22 October 2020).
162Ibid.
163‘Joint Open Letter: An EU Mandatory Due Diligence Legislation to Promote Businesses’ Respect for Human Rights and the Environment’ (ActionAid and others 1 September 2020).
164Letter from the UNWG to European Commissioner for Justice Didier Reynders.
165EP Proposal, Article 1(2).
166Ibid, Article 4(2).
167Ibid, Article 4(4).
168Ibid, Article 5.
169Ibid, Article 6.
170Ibid, Article 9.
171Ibid, Article 10(1).
172See Elsa Savourey and Stéphane Brabant, ‘The French Law on the Duty of Vigilance: Theoretical and Practical Challenges Since Its Adoption’ (2021) 6 Business and Human Rights Journal 141.
173EP Proposal, Article 13(1).
174Ibid, Article 18(1).
175Ibid, Article 18(2).
176This approach has been suggested by NGOs and academics active in the BHR field. See, for instance, Robert McCorquodale and Martijn Scheltema, ‘Core Elements of an EU Regulation on Mandatory Human Rights and Environmental Due Diligence’ (August 2020); Methven O’Brien and Martin-Ortega, ‘Briefing 2’.
177McCorquodale and Scheltema, ‘Core Elements of an EU Regulation on Mandatory Human Rights’.
178Lucie Chatelain, ‘Corporate Due Diligence and Civil Liability: Comment from Multi-Stakeholders’ (NOVA BHRE, 3 March 2021) <https://novabhre.novalaw.unl.pt/corporate-due-diligence-civil-liability-comment-from-multi-stakeholders/> accessed 1 May 2021.
179Krajewski and Faracik, ‘Briefing 1’, 15.
180Ibid.
181Ibid, 14–15.
182Methven O’Brien and Martin-Ortega, ‘Briefing 2’.
183‘Commissioner Reynders Announces EU Corporate Due Diligence Legislation’; Mirjam Erb and Julia Grothaus, ‘EU Commissioner for Justice Reveals Details of Forthcoming EU Legislative Proposal on Human Rights Supply Chain Due Diligence’ (Lexology, 3 March 2021) <https://www.lexology.com/library/detail.aspx?g=76345b5f-b3a7-4035-b5dd-8f0c0d89f56e> accessed 1 May 2021.
184See Chapter 4 of this book for a discussion on collective redress mechanisms in the EU.
185EP Proposal, Article 19(1).
186Ibid, Article 19(3).
187Ibid, Recital 53.
188Ibid, Article 19(4).
189Ibid, Recital 54.
190Ibid, Article 20.
191Ibid, Article 10(3).