Article by Bamdad Shams *
In an interdependent world marked more than ever by the redistribution of sovereign public powers between private economic actors, state and interstate authorities often appear in the eyes of people as legislators incapable of dealing with problems of global scope. In particular, global problems that are stressed by globalization, such as hunger, poverty, the deterioration of human health, human rights violations and abuses, financial crises, the fight against forced labor and the destruction of the environment and its biodiversity. Moreover, the capacity of these authorities to find lasting solutions to these global issues facing humanity in the 21st century, or at least attempting to reduce them, is difficult. Especially, through a concrete application of existing national, regional, and international legal instruments that are based on a rigid or ideological conception of law.
In other words, this conception rests on a theoretical premise according to which law can only result from a legal norm enacted by a public (state, interstate, or supra-state) authority effective on a territory, with implementation and compliance ensured through organized coercion of state organs. This fragmented, if not static, interpretation of the law conceives the construction and the production of the legal order of a liberal Western state during the twentieth century as its sole object of study to draw an artificial distinction. However, this concept of the law on the other hand is still anchored in current legal thinking, between ‘law’ which takes place within the state framework and ‘lawlessness’ which is developed outside any state framework. As if the positive law of each nation-state was identical in every respect to regulate legal relations and as if private actors could not create and enforce lofty standards of protection outside any state frameworks.
Classical international law illustrates that the creation of the modern state in Europe, serving as a breeding ground for the Westphalian system, has spread throughout the world. In the same vein, constitutionalists, legal historians and philosophers consistently affirm that the old continent is at the origin of legal positivism, and whose main features are the hierarchy of norms with a state constitution at the top and the monopoly of state institutions over the process of law creation. This state-centric positivist perception of law serves as a traditional basis for the legal orders of all countries and can be seen as the legal transplantation of the Western model of law to the interstate level during the last century.
However, the perpetuation and aggravation of environmental and human problems that remains unresolved in the current state of positive law, changes profoundly contemporary modes of production and implementation of the law. Non-state actors such as multinational corporations and NGOs are setting themselves up as real global legislators, to overcome the impotence of the traditional actors in the international law arena. They draw up rules that are both precise and effective in practice. They establish a post-Kelsenian hierarchy of norms, with at the top of this hierarchy, private protective instruments that they have created or approved. They create borderless quasi-legal orders outside the state. This contemporary lawmaking process is about to collapse the traditional dichotomies on which the relationship between state norms and private norms has long rested, such as, to mention just a few famous ones, law/non-law, hard law/flexible law, official law/non-official law, or formal law/informal law. All these dichotomous classifications of doctrinal nature do not fit within the complex and protean reality of law created by powerful private actors. Their lawmaking activities begin a discreet but firm evolution, since they cover rights and freedoms, witnessing the increasing anchoring of fundamental rights in non-state law (I). The question that will be answered in this article is whether this new normative framework reflects the emergence of a non-state system of protection of fundamental rights (II).
I. THE INCREASING ANCHORING OF FUNDAMENTAL RIGHTS IN NON-STATE LAW
Multinational corporations and NGOs enact more and more rules related to fundamental rights protection, in the form of a corpus of rights and freedoms listed in codes of conduct and standards that could be called lex humanis. Taken as a whole, we can see such private instruments protecting individual and collective rights and freedoms neither as virtuous declarations of goodwill with no binding legal effect nor as mere tools for the business strategy of corporations. On the one hand, they impose positive obligations in fundamental rights law (to protect and promote) on corporations and commercial partners, who are required to comply with them, mostly because of the economic advantages that it allows them to enjoy. They impose negative obligations (to respect) upon all of them wherever they carry out their activities. An example from practice may illustrate the incursion of fundamental rights language within the non-state normative production. The French oil company Total created and adopted its code of conduct dealing with topics such as human rights, environment, labor relations, health safety and inspection, among others. These various standards directly apply to the corporation itself, its employees, and also its suppliers, business partners, and even to members of local communities in host countries. In a nutshell, through its tailor-made fundamental rights instrument, the French oil group is committed to integrating social and environmental concerns in its oil exploration and production activities and to respecting, protecting and promoting human rights. This laudable aim is included explicitly in its Code of Conduct. In addition to this instrument of non-state law, the oil corporation enacted a Human Rights Guide that sets out a whole array of specific substantive rules protecting human rights that the corporation itself must respect as prescribed by the rights laid down in the Guide within its sphere of influence.
This privately created human rights instrument therefore has the distinctive feature of treating oil corporations as guarantors both of the internationally agreed human rights and the correct application of UN secondary law precisely because it refers to relevant international human rights instruments (such as the Universal Declaration of 1948 or the UN Covenant on Economic, Social and Cultural Rights of 1966), the ILO conventions and the United Nations General Assembly resolutions to make rules which impose duties on those private actors to provide and protect human rights. Thus, it is possible to say that the French oil company is rewriting international law’s rules and principles, rather than solely incorporating international human rights instruments into the body of the Guide.
By implementing its Guide, suppliers and business partners of the oil group Total become active subjects of international law and duty-bearers of international human rights obligations. Furthermore, the resolutions of the United Nations General Assembly have direct binding effects on private economic actors. The Guide also entrenches a series of classical fundamental rights, which may not be enshrined fully in many legal systems, including the right to freedom of opinion and expression, the right to a fair remuneration, the right to a healthy environment, the right to water, the right to an adequate standard of living, including housing,  the right to freedom of movement, the right to life, the right to health, the right to take part in political decision-making, the right to join trade unions, the right to work, and even the right to property. In concrete terms, it means that both the oil group Total, its suppliers, and subcontractors have to implement protective norms of the Guide wherever they operate. In our view, the formulation of these non-state rules is imperative. To be convinced of this, one only has to cite a protective provision in the Human Rights Guide that explicitly states that Total is fully committed to respecting internationally recognized human rights standards.
In this regard, two comments are in order. First, as the French legal scholar Marie Larouer has pointed out in her doctoral dissertation on the codes of conduct, the verb ‘committing’ has become common ground in these types of instruments in such a way that the Total Code of Conduct does not deviate from this general trend. Next, the question that inevitably arises is what exactly is implied by this word. This author believes that the term ‘committing’ may not be a reliable indicator of the existence of a specific commitment from the private lawmaker. We think the opposite about the Human Rights Guide. One particularity of this non-state human rights law instrument is that it provides a specific ‘conflict of norms rule’ to deal with a conflict between a state law and a norm of the Total Code of Conduct by selecting and applying the most protective human rights norm, stated in the following terms: ‘in the case of inconsistencies between local laws and our code of conduct, we strive to apply the most stringent standard.’ All this is not without practical importance because, if the oil company’s code of conduct and a national law of a state which violates human rights have a claim to govern Total’s activities in that state, this code would oust the local law, in the name of human rights protection, even though this instrument emanates from a private actor. This protective rule in the non-state law instrument is, in a certain way, similar to the ‘public policy’ exception in private international law, both in its negative and positive dimensions. The normally applicable local law may be disregarded if this application is unfair or antithetical to fundamental rights. However, unlike this classic mechanism, in this particular situation, the more protective norms of a code of conduct would replace the local state law ousted. Therefore it could be seen as the manifestation of a transnational public order, even a ‘public order without a state’ (to use an expression coined by Professor Latty). As a result, implementing the law produced by the Total oil group generates unprecedented conflicts of norms problems in the field of fundamental rights in countries where the Group and its partners, are duty-bearers of fundamental rights which have been privately created to carry out their oil operations. The French oil group has therefore established itself in countries where the protection, respect, and fulfillment of fundamental rights and freedoms are mostly conspicuous by their absence, with the inescapable outgrowths of conflicts between its private instruments of fundamental rights protection and the national laws that encroach on rights and freedoms.
Consequently, in this new normative structure, the Governance & Ethics Committee plays a key role, because it has been created primarily for the protection of the rights and freedoms ensured by Total’s standard-setting instruments. This body comprises of a president, who is appointed by the chairman and CEO of Total, and members drawn from the main activities of Total. The Committee also has a dual role to play in the protection of fundamental rights. Firstly, it assumes a function that could be characterized as quasi-jurisdictional insofar as it may be referred to by any employee or individual outside the group in the event of infringement of the provisions contained in Total’s Code of Conduct and in Total’s Guide by the parent oil company, the companies it controls, their suppliers and subcontractors. Secondly, as a private complaint and dispute resolution body, the Governance & Ethics Committee deals with disputes and questions relating to the rights and freedoms outlined in the oil group’s normative instruments. It performs a human rights watchdog function, by ensuring that Total Group’s actors respect private protection instruments to which they are parties, and by inspecting any of the Group subsidiaries’ facilities. If a business partner infringes on the fundamental rights and freedoms protected by the Code or by the Guide, Total may suspend or end its business relationship with the non-state duty bearer. Thus, can it be assumed that the Ethics Committee serves as a ‘constitutional court’ in the normative order of Total or a sui generis body performing many different functions ?
One thing seems clear: private economic actors no longer merely proclaim rights and freedoms through the instruments they create, but they apply them concretely within their respective spheres of activity. Most often, they develop private mechanisms for monitoring their implementation, which, in practice, have the effect of making binding those non-state norms. It is a matter of refuting the dominant positivist paradigm according to which private instruments cannot alone create any binding effects. In our view, this contemporary normative production blurs the artificial theoretical distinction that still exists up to now between ‘hard’ state law and ‘soft’ non-state law, a fortiori in the field of freedoms and rights. Even though codes of conduct and private standards relating to fundamental rights are becoming stricter, there are still charters of rights in many states that are de facto emptied of their substance due to the absence of control and enforcement mechanisms.
II. TOWARDS THE EMERGENCE OF A NON-STATE SYSTEM OF PROTECTION OF FUNDAMENTAL RIGHTS ?
The fundamental question that arises about the normative production of non-institutional actors in the area of freedoms and rights is whether there exists today a non-state system of fundamental rights protection. The answer seems to be positive. This original normative activity is leading to the gradual emergence of what could be called a ‘non-state fundamental rights law’ which is clearly at the opposite end of the ‘original verticalization’ of fundamental rights for at least two reasons. The first of these is that freedoms and rights enshrined in the non-state instruments must be respected by economic actors (corporations, subsidiaries, subcontractors, suppliers, business partners), and enjoyed either by specific categories of people (workers, consumers, indigenous peoples, local communities) or by all human beings, regardless of their respective geographical location or their adherence to these protective rules of non-state origin. These rules profoundly transform the traditional conception of fundamental rights according to which the established actors (state, interstate or supra-state actors) are the only duty-bearers, by requiring firms themselves to ensure their fulfillment even beyond their direct sphere of influence. The safeguard of fundamental rights through the law created outside the state law leads to widening the circle of duty-bearers and right-holders in the world, by adding a potentially high number of private duty-bearers of rights and freedoms enshrined in a non-state instrument to the classic state duty-bearer. These rules profoundly transform the traditional conception of fundamental rights according to which the established actors (state, interstate or supra-state actors) are the only duty-bearers, by requiring firms themselves to ensure their fulfillment even beyond their direct sphere of influence. The safeguard of fundamental rights through the law created outside the formal state law leads to widening the circle of duty-bearers and right-holders in the world, by adding a potentially high number of private duty-bearers of rights and freedoms enshrined in a non-state instrument to the classic state duty-bearer. As a result of this, a right-holder may invoke a claim right against a duty-bearer, wherever they may be. In the global context of state retrenchment, a potential re-universalization of fundamental rights is therefore emerging, but solely through a private standardization, so that informal normative activity no longer seems to go hand in hand with the promotion of private interest. Thus, can it be assumed that the promotion of general interest or global public goods is now mainly a matter of law created outside the formal state law?
The second is that fundamental rights protection instruments of non-state origin, such as codes of conduct and standards, generate real subjective rights for individuals (natural and legal persons), which may be invoked by them in courts. For example, in the context of a litigation involving fundamental rights, and may be subject to external monitoring by private (non-governmental) bodies. The authors agree that state law is opposable, but still refuses to recognize that non-state norm (protecting a fundamental right) is also opposable, for the simple reason that it has not been created and shaped by the state legislator. In our opinion, this kind of private norm creates an opposability effect. But first, we need to define this legal concept because it lends itself to many doctrinal definitions, to the extent that a civil law legal scholar has rightly described it as an ‘uncertain concept’. It seems improper to base the opposability of the non-state norm (protecting a fundamental right) on the opposability of the state norm.
There are three potential meanings of opposability here. First, the private norm has bottom-up opposability, which means that the benefit of protection of a fundamental right ensured by this norm may be claimed against a corporation who enacted or ratified it, by an individual, natural person or legal entity whose right or freedom is affected by the corporate activities. Contrary to a widespread view that global corporations act with impunity, it is possible to argue the opposite, that they may be held liable both to their contracting parties and to third parties, based on the private norm (protecting a fundamental right).
A practical example will make this clearer. Let us imagine that a multinational corporation creates a code of conduct in which it promises to respect the fundamental rights of its employees (freedom of association, freedom of expression, the right to safe and healthy working conditions). The question that arises is whether the worker protection provisions of its code of conduct are enforceable (opposable) against its employees. In other words, can they claim the protection of their privately protected labor rights against their employers if those employers do not respect their code? What about employees who work in a country where local laws and regulations prove to be less protective than the code of conduct established by their employers? According to most law scholars, to which we subscribe, they can enjoy freedoms and rights guaranteed by the Code of Conduct, which are enforceable against their employers through contractual processes. This contractualization process of the protective labor norms of the code takes two forms: either a clause in the employees’ contract of employment refers to the code, or the employees sign the code of conduct at the same time as their contract of employment. As Fabrizio Marrella points out, in this respect, workers in less developed countries, who are not protected by the local labor law, have an interest to ensure that the contractual social rights are respected because, presumably, these rights are more protective than the standard provided by the law of the country where the work is habitually performed. Then, the private protective norm has top-down opposability, which means that the non-state actor can request the natural persons, or legal entities, to respect and promote the fundamental rights enshrined in its norm. For instance, this is the case with NGOs, for which the inclusion of their normative production protecting fundamental rights into the transnational field is purely based on contracts that exist between them and corporate firms all over the world. It follows that if these private economic actors do not comply with the NGO’s norms, not only would this be considered as a breach of the contract with these non-state actors, but the latter can invoke respect for their rules protecting freedoms and rights under ordinary contract law. A practical example may help to illustrate this point: a textile firm in Tunisia enters into a contract with the Fear Wear Foundation (FWF) under which it agrees to respect and implement the NGO’s rules (i.e., FWF Code of Labour Practices), protecting workers’ rights. However, it turns out that this firm which is contractually responsible for the protection of its workers’ fundamental rights violates the NGO’s standards because, on the one hand, its workers earn low salaries, and on the other hand, they work in deplorable conditions, which violates the spirit of these non-state norms. In this situation, the NGO may seek to have the firm held contractually liable for breach of private-type workers’ fundamental rights, such as the right to a decent wage or the right to work in a healthy environment. This is especially this case if employees of the firm are contractually holders of the fundamental rights protected by the law enacted by the FWF. Finally, the rights and freedoms under private norms can be invoked by individuals against other individuals. This is what we call a ‘horizontal’ opposability of private protective norms. The rise of these transnational norms leads to an irreversible global process of ‘horizontalization’ of fundamental rights, whereby the opposability of fundamental rights created by non-state laws extends increasingly to horizontal relationships between private individuals. In other words, the rights and freedoms enshrined in non-state instruments can be invoked by a private individual litigant (natural person) in litigation against the other private party (natural or legal person). An example drawn from practice helps to clarify this point. Let us imagine that a contract is concluded between a powerful transnational clothing corporation and a subcontractor located in Bangladesh to design and produce clothing. A contractual clause provides that the subcontractor shall comply with the company’s code of conduct, which entails that workers are entitled to a healthy and safe workplace. Let us also imagine that the subcontracting company workers are faced with hazardous working conditions. And they want to hold their employers liable for these labor rights abuses.
Here, a question arises regarding whether they can avail themselves of the fundamental rights enshrined in the code of conduct in a lawsuit against their employer, even though they are third parties to the contract between their company and the transnational clothing corporation. In the view of contemporary legal scholars to which we subscribe, the answer seems to be “yes.” Indeed, when interpreting the code, some of its provisions create rights to the benefit of all individuals as third parties, such as those in the field of labor rights. Therefore, private actors are duty-bearers of non-state fundamental rights on an equal footing with states. All these freedoms and rights enshrined in the privately created law have erga-omnes effects, thanks to the universal values they embody. Thus, fundamental rights, whether of national or private origin, are binding on all authorities and persons, simply because of their substantive contents.
As a main feature, non-state fundamental rights norms can be directly enforceable (‘opposable’) against all business actors, such as multinational corporations, partners, subcontractors, suppliers, and dealers across the globe. That means that the right-holders under these private standards and codes such as consumers, workers, local communities, or individuals, can benefit from the protection of these fundamental rights for any breach of their rights by such private duty-bearers. The fundamental rights privately guaranteed are enforceable by these economic actors, meaning that they are required, under the non-state norms they have created or approved, to intervene in the public sphere to ensure their effectiveness. This calls for rethinking the concept of opposability, as well as other related concepts such as applicability, exigibility, invocability, and justiciability, without recourse to criteria laid down by state law, which does not have, or at least not, a monopoly on the creation and implementation of fundamental rights in our contemporary world.
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* Mr. Bamdad Shams holds a Ph.D. in Private International Law from Sciences Po Paris. He founded the Revue libre de Droit (RLD), for which he serves as Communication Director. Mail: firstname.lastname@example.org.