Panel III: Business and Human Rights
Chair: Ulrike Butschek (Director, Human Rights, Austrian Federal Ministry for European and International Affairs)
Digital Rights and their Implications for Business and Human Rights
Yuval Shany (Hersch Lauterpacht Chair in Public International Law, Hebrew University Jerusalem)
The EU’s Work on Due Diligence and Supply Chains
Markus Krajewski (Chair of Public Law and Public International Law, Friedrich-Alexander-University, Erlangen-Nuremberg)
Supply Chain Liability and its Application in the Global South
Michelle Ratton Sanchez Badin (Associate Professor, Getulio Vargas Foundation São Paulo Law School)
Chapters:
00:00:00 Introduction by Ulrike Butschek
00:03:06 Presentation by Yuval Shany
00:24:53 Presentation by Markus Krajewski
00:46:51 Presentation by Michelle Ratton Sanchez Badin
01:08:08 Q&A with the moderator
The tortuous relationship between economics and human rights was already on the mind of participants in the Vienna Conference 30 years ago. Amongst others, the Vienna Declaration and Programme of Action stressed the fulfillment of the right to development “so as to meet equitably the developmental and environmental needs of present and future generations” as well as the need to “help alleviate the external debt burden of developing countries”. It is accordingly hardly surprising that the relationship between international human rights law and international economic law has captured the interest of both researchers and practitioners to an ever larger extent. Whether it is trade law, international investment law or international finance and monetary law: every area of international economic law affects the enjoyment and full realization of human rights. This conference proposed a stock-taking of the full breadth of the relationship between international economic law and international human rights law and inquired to what extent the relationship should no longer just be conceptualized as one of regime conflict, but whether human rights can be turned into a vehicle to resolve and addressed particularly problematic issues raised in the area of international economic law.
Learn more about the DA and its programmes at https://www.da-vienna.ac.at.
#diplomacymatters #HumanRights #Law #Economics
Partners:
King’s College London (CIGAD): https://www.kcl.ac.uk/research/centre-for-international-governance-and-dispute-resolution
Austrian Federal Ministry for European and International Affairs: https://www.bmeia.gv.at/en/
having had our coffee break uh we uh strengthened to continue with business and human rights after trade uh human rights I think we’ve covered quite a lot of ground already uh in the various panels we heard uh so far and uh the specialty of this panel is not only only that uh we have very distinguished speakers but also that they’re all somewhere else uh I now see them on the screen uh thank you to the tech technical team for allowing them to join in here in Vienna I would like to send them my warmest greetings yal Shani uh marus kvki and uh Michelle ratton Sanchez Badin and if I may I would uh just turn to your first names for the sake of of easiness um right uh business and human rights is was covered to some extent uh first of uh by the High Commissioner second of course in the in the keynote panel we already disc discover covered technology and human rights to some extent um but uh we now if I understand understand correctly from those who who conceived the whole conference we we go a bit more in depth into the various various topics and if I may I would start with Yuval Shani uh Yuval is the H laak chair in international law and former dean of the law faculty of the Hebrew University of Jerusalem he was a member of the UN human rights committee from 2013 to 2020 and he served for one year also as a Time as a chair of the committee he currently serves as a senior research fellow of the Israel de democracy Institute and the co-director of the center for transnational legal studies at Kings College uh ell will uh share his insights on digital rights and their implications for business and human rights so is a very nice connection between the very first panel and and uh uh the uh questions on diligence and so on and if I may uh request actually all speakers since we are running late to be ex very very precise with regard to the timing and um might actually uh go at the cost of of the question answer period if we don’t manage to to uh be within schedule so with that somewhat impolite request but you have all sufficient uh experience with conferences of this kind that that I I think you will understand where I’m coming from as a chair uh youel the floor is yours thank you thank you very much and and thank you I mean I want to thank the organizers for for inviting me I wish I could be with you in person but um it was uh difficult I only landed this morning from U to London from another destination I will share a screen and and go directly in the interest of time into uh my presentation um so the point the first point which I would want to make concerning digital rights and implications for business and human rights is that uh the question of how do we protect uh digital rights um in a in a business and human rights framework is is very much um related to the general concerns that we have uh about the business and human rights framework and its adequacy to effectively regulate businesses the claim that I will be making is that a uh for digital uh for uh companies that provide Digital Services and effectively control digital rights this is a particularly critical uh connection that needs to be explored um and in a way in the realm of uh the claim that I would make that in the realm of digital rights actually companies may be much more important than States and therefore uh the need to find an effective framework to uh govern their activities uh is absolutely crucial and secondly I will uh discuss uh two uh notable attempts uh by uh digital companies that uh that uh um uphold digital rights and by un bodies that enforce digital rights to try to basically extend uh existing Frameworks to um uh private businesses that uh afford digital rights um so the first point is of course uh quite uh quite basic right rudimentary and it is that the the international human rights law uh which is the the the general normative Frameworks for All rights including uh digital rights is uh estate Centric framework uh it is uh comprised uh mostly of treaties uh that place obligations on States uh these obligations are due to other states as well as to uh individual right holders um compliance with these obligations is monitored by interstate bodies uh be they at the regional or at the UN level and we also know that human rights law uh international human rights law has very close and direct connections to domestic constitutional law uh which in many countries is also very State Centric namely that it mostly regulates the activities of governments I am aware that there are some countries including German speaking countries where uh a broader framework has been employed but this is not the uh the norm around uh the world so according to this framework when one is dealing with businesses that uh violate uh rights or that violate uh needs and interests that are um uh held or that affect right holders uh the Main Avenue by which one will deal with it would be through uh what we call uh positive State obligations I mean the state would have to uh basically um insert itself between a company and the individual regulate the activities of the company uh in order to protect uh the indiv idual so this is always true uh for business and human rights this is not this is not new uh the claim is that with regard to digital businesses uh we are talking about um a new uh Power configuration which uh puts these companies uh in a unique position in that they control the exercise of Key Human Rights so I will deal very briefly uh very soon with meta and with its uh human rights policies arguably the policies of meta are uh much more uh influential uh with respect to freedom of expression around the world than the policies of uh most governments around the world so the the fact that these companies have these huge not only huge economic power but also huge interface uh with users and with the way in which users exercise their rights uh of course um transforms them into something which is more than the uh ordinary um cases that we have studied in business and human rights uh before such as the extraction industry or uh companies that uh uh inflict environmental uh harm here the connection to rights is much more Central uh these companies also have an exceptional capacity to enforce policy es so it would make much more sense again with the meta example for meta to uphold rights uh to ensure that speech is exercised or that hate speech is suppressed than to actually expect a state to um intercede uh and and enforce uh these policies and uh like uh with other very uh big companies when we’re talking about big Tech uh we do have here a unique regulatory uh challenges uh given that these companies are often too large and also too Global to regulate since they do uh operate all around the world and are not subject to uh um intensive uh regulatory power of Most states uh there is also um there are also questions regarding regulation and technology which I I do not have time to delve on but that has to do with the question of uh when is the right time for states to intervene uh and ready ulate uh when technology is actually developing because there are concerns of course that overregulation uh would styi the development of Technology uh the business and human rights framework uh would apply also to technology companies this is a a well uh known framework I I don’t think I have to uh spend much time on it in the interest of time we do have the three pillars the duty to protect the responsibility to respect and access to REM uh we do have uh I think we are also aware of the weakness of this framework this framework doesn’t is voluntary this framework is uh does not lend itself to strong enforcement uh this framework has issues regarding analytical Clarity mostly how do you distinguish in the real world between negative and positive obligations uh the the the framework focuses on negative obligation responsibilities of companies whereas in the real world actually it’s quite hard to separate the two uh and in a way it’s increasingly seen as outdated given the fact that states some states have taken the lead in introducing stronger requirements such as in areas such as due diligence uh transparency uh Etc um what is how what is however interesting uh for uh uh about the framework and is very much relevant uh to digital human rights is uh a the idea that the obligations of States sorry that the UH responsibilities of companies are uh independent of the obligations of states and that is of course a very important uh Dimension uh when we’re talking about digital companies that operate at the some at a somewhat transnational level uh they’re not wedded to any uh strongly wedded to any uh specific National legal system they interact with many legal systems and the business and human rights framework does suggest that they would have their independent responsibilities uh and secondly there is this assumption in the business and human rights framework that the basic uh Norms of international human rights law such as those found in the international Bill of Rights the two covenants from 1966 and some other Norms uh could be adaptable to uh to businesses and we will see that at least with regard to some digital businesses uh this uh translation into digital rights actually could work arguably uh this is not always the case so uh one example of an attempt by a major uh digital business which controls important digital rights to implement the uh business and human rights fr workk is the case of meta uh meta has voluntarily has introduced within its uh legal infrastructure which is quite thick it has terms of service it has different policies it has Community standards uh it has a corporate human rights policy so they did introduce within their policies and within their laws that the laws so to speak that regulate their activities they introduce significant uh human rights contents they’ve also um uh internalized human rights um standards into the way they internally uh do business in terms of governance accountability oversight and very interestingly they did establish aasi judicial body the oversight board which operates as uh as we will see effectively as a right uh enforcing is a digital rights enforcing body uh The Meta oversight board is um uh an independent uh body of adjudicators uh about 20 adjudicators serve in this body uh they review uh specific decisions involving uh content removal or refusal by the company to remove content from uh the main platforms that are owned by meta these are Facebook Instagram and threads um and what’s interesting about this exercise is that this looks very much like the uh activity of a human rights body I mean when you read uh meta oversight board decisions you will see that uh the heart of the decision is a human rights analysis that is based uh on a human rights methodology where uh the infringement is identified and then there is a very extensive discussion of whether the infring M can be justified under traditional human rights standards of uh legality legitimacy necessity proportionality um these decisions uh often site uh international human rights law Juris Prudence including by UN treaty bodies um and effectively they they uh conceptualize meta as if it was a state so so they do actually impose obligations on meta which are analogous to obligations that states incur in the field of freedom of expression in as applied in in the digital sphere actually uh an interesting dimension of of these decisions is that meta situates itself actually as a body that would correct um violations that have uh been uh effectual ated by States so there are some decisions where meta The Meta oversight board that would say that in countries where uh there is a repressive government that limits freedom of expression there is a particular value in allowing online expression uh on meta platforms so the conceptualization is not that the uh the digital rights exercised by companies are a derivative of international human rights law obligations of States but effectively uh it reverses the order I mean meta actually supervises the implementation of Rights also uh by States having said that this is a very interesting model but I will say it’s an interesting model that works for one cluster of companies no other digital uh rights company uh has something like uh like The Meta oversight board and it is also dealing with a realm of activity where indeed the analogy between uh a government and a company makes sense it would be difficult to extend this to other areas such as generative AI for instance or uh or or shared economy uh principles the other aspect which I want to briefly mention is that we we have seen uh an interest in uh extending the human right framework also to uh to the realm of digital rights as applied by businesses uh offering digital rights and here we have seen in particular extensive activity by one uh office holder which is the un uh UN Human Rights Council special rapporter for freedom of opinion and expression uh the main person who has been at the Forefront of this is David K uh a US University Professor but also his successor Irene Khan has also uh to some extent uh carried the torch forward and since 2015 uh David K has been pushing uh an agenda which would adapt human rights uh also develop historically for States also for companies and here you see some excerpts from the different very interesting report that he he has published uh anal analogizing analogizing states to companies for instance with regard to uh allowing encrypted U communication which is uh you could say a a new or emerging uh right or derivative of an existing uh right to freedom of expression um extending uh supervision mechanisms including company State visits also uh to companies um we demanding companies in the digital world to also um adopt positive measures so in a way going beyond the traditional business and human rights framework by actually rejecting this negative positive rights uh dichotomy so they are expected also uh to uh allocate resources towards uh facilitating uh d diligence and other uh obligations that the framework uh introduced uh and also uh specific Guidance with regard to uh access uh to remedies the upshot of all of this is that we have together with other activities uh by this special mandate holder and to some extent and to a lesser extent also other mandate holders we do see a process of gradually expanding a human rights framework to one specific digital right where maybe the analogy between a state and a business is particularly compelling uh whether this could be extended further on is something that uh we would have to see so uh this brings me to my last slide and again I’m I’m I’m moving quite quickly in the interest of time um we do have a framework uh the business and human rights framework that framework uh also applies to digital rights however it is a framework that remains essentially uh State Centric and we when we move from the state Centric features of the framework which of course have their own problems uh we are in a in an area where it is still very much voluntary uh So Meta has to buy in to the the process other companies such as for instance Twitter X decided to go in exactly the opposite direction and actually uh dismantle their content moderation apparatus so this is of course a very uh uh significant and critical weaknesses um these alternative Frameworks uh in terms of international law or any other body of law they tend to be relatively weak uh and offer limited enforceability meta is an interesting and impressive example but again I wouldn’t read too much into that even the meta uh uh process is is a Drop in the Ocean even with regard to meta very few decisions are actually being reviewed uh and millions of decisions are actually being taken without uh being reviewed and like I said this has not been expanded to other companies either in the in the digital freedom of expression realm but certainly not in other Realms where digital rights are relevant right to be forgotten right to algorithmic transparency right to a human decision maker Etc at a more fundamental level what we are missing I would argue is is is is a solid theoretic theoretical grounding of what makes digital rights applicable to digital companies we have a theory uh a democratic theory about which explains the applicability of human rights to States we do not have a strong uh Theory which explains the applicability of digital rights to picta companies um there have been some attempts to develop the idea of users rights of consumers rights but these are not traditional um avenues for developing human rights and in terms of the road forward uh one perhaps uh glimmer of hope uh is developments in Europe uh where we are seeing this increased uh and you could say constantly increasing interest in regulating businesses including digital businesses in ways that encourage them to undertake meaningful self-regulation uh that would incorporate some human rights standards and some human rights um uh remedial uh options although of course much more uh can be done and should be done in this regard so I thank you very much for your attention and I return to you Ora thank you very much yal uh thank you for this very clear and precise uh overview of uh the instruments we have and also the linkage between uh the private sector and this uh government responsibilities um we struggle with that a lot on the government side I have to admit and just if I may ask my question now but maybe waiting for your response after the other speakers have spoken but we really think that there is no such thing as digital space when it comes to rights so I would be interested on your take on what is digital rights because the law that as we have it right now applies to the digital space so uh but maybe we can uh uh come on on that afterwards and just on an anecdote um because you mentioned meta quite a bit um in another conference I had the privilege to talk to a representative from meta and she said um please make sure that you educate as many people as you can from the law side and the engineering side in in a in a joint way and since we are here in an academic institution I think this is important to mention and many of you have uh uh academic backgrounds with teaching responsibilities we need lawyers who understand the engineering part and we need Engineers who who have a legal profound legal knowledge and she said we would meta would hire immediately 500 people if they were available on the market so how is this for a some kind of advertisement on the job market but I think it’s relevant and so also hopeful for for young uh people coming to the job market so I think this is the way to go and um excuse me for for a personal comment here I I would like to turn to Marcus kvki now uh Marcus is profess of law um at er Langan nberg and he also taught at King’s College uh previously and also at potam and brayman between 2009 and 2010 he co-directed a program on International Trade law which we just heard about uh supporting Ethiopian law schools at Adis abiba University he served as a chairman of the Board of Trustees of the German Institute for human rights which is actually germanes Human Rights Institute ution and uh I understand he also frequently act as an expert in the German and European Parliament and advises International organizations parliamentary groups trade unions and Civil Society organizations on International economic law issues and human rights great example of uh the academic and uh public sector cooperation again uh Marcus will uh talk to us about the eu’s work on due diligence and supply chain as you mentioned we’ve heard quite a bit already about it I understand from the news channels uh that we have an important day today in terms of progress and step towards uh actually achieving this uh uh framework and and the D due diligence directive so I think it’s very timely that uh you share your insights uh on uh this particular uh topic Marcus the floor is yours thank you very mucha and thank you to the organizers for inviting me and um my apologies for not being there in person but on the one side this is the benefit of the new the new times when we can we can have these conferences in hybrid maners but of course it’s also the downsides because it makes it so easily to say well I’m I actually I cannot be there but maybe I join online so so next time definitely I’ll hope to to be there in person um but the technology of course allowed me to to present this so my task was to speak about is to speak about the eu’s work on due diligence and Supply chains and when I looked at the um this morning program and I saw a lot of representatives from from EU and oecd I’m I was pretty sure that um the work was already mentioned so I’ll see um that I also can maybe focus on some particular points I wanted to um briefly speak about the background and the context but I think I can be very brief on that and then really sort of walk our way through um the the due diligence directive um its development and um scope content enforcement implementation and then offer some initial assessment um and I’d be specifically interested of course in also hearing uh the assessment of others in the room so this is a picture which I sometimes use to sort of say well what are we actually talking about and when youal spoke I realized that the examples I give here of course all examples from the the non sort of uh uh uh um uh cyber world um we see of course um oil spilling in the Niger Delta we see the collapse of the Rana plaza building we see um for those of you who are a little bit older may remember the Bal catastrophe in 1984 when there was a huge gas link a gas leak and of course the collapse of the promino dam um in in Brazil so just just to give us a bit of a flavor of what we’re actually talking about and of course everybody is aware of that um when we look at these um corporate human right abuses and complicity in human rights violations we face what John Ry framed the governance Gap and you all nicely pointed out the the the human rights framework as we would normally apply it we would s of looked to the the state um where the the human rights abuse took place we would ask for sort of whether the state has actually um fulfilled its duty to protect and then move from there but of course we know that that’s not the reality in many of these cases I I think we also should be aware of that this is not just a question of certain States but it’s a question of all states so we will find I would argue that we find the governance Gap when it comes to corporate human rights abuses in all states of the world and this is also important when we discuss um sort of the global implications of this we do have of course some International non-binding guidelines that we already mentioned the guiding principles the OCD guidelines of course I think may have been mentioned this morning already the io declaration this is sort of the the background here of course um and I think it’s important to realize that because when we look at um the due diligence legislation that are now emerging um we should be aware that they are not sort of um being developed in a in in a vacuum or in isolation but rather developed in the context of these non-binding uh guidelines so um what I have here on the slide um is actually a development of national L legislation in the EU and since I’m talking about the eu’s development I focus here on EU member states now you may wonder why the UK starts now of course the UK is no longer a member of the EU as everyone is aware of but back when they adopted um the modern slavery Act of 2015 the UK was still a member of the EU um and so this is of course um in a way at the beginning um one could argue of the eu’s perspective the EU is thinking about these um these questions when of course transparency obligations regarding modern R were first established then um the French la de vilon was adopted two years later which established General human rights due diligence obligations and on environmental harms um a couple of years later the German supply chain due diligence law and as you all know we hate it if we use more than one word to express complicated things in German so this is why we have a very long word for this The Gazette which establishes detailed human rights diligence obligations regarding U um both human rights and environmental harms we have legislative developments I hear also in Austria and I’d be interested to hear what the current status there is Belgium fin Luxembourg and the Netherlands there’s also legislation in Norway and Switzerland and of course also legislation discussions at least in in in in other parts of the world world but I put this year on this slide to to suggest this is really something that from an EU law perspective needed some attention to put it mildly now we did have or we do have of course other existing EU law already many of you will be familiar with the conflicts mineral regulation there’s also um the now um newly formulated corporate sustainability reporting directive which focuses again on reporting and then we have the deforestation um and Forest degradation regulation which replaces the timber regulation um which is already um more than 10 years old so again there are developments very specific developments and what we have now is of course pending uh de pending law we have I just want to mention this uh a regulation proposal on the prohibition of products made with forced labor on the market um and then here we do have um a commission proposal that was sort of discussed in an agreement in in the trilog and and so the formal adoptation adoption of this by Parliament and council is upcoming so when we when we look at the corporate sustainab due sorry the due diligence directive or the EU CS d as it’s called in in the jargon we should be aware that this is something which is based on International standards which which are not binding of course um which is in the context of domestic law developments in the EU but also part of a larger EU picture looking at specific uh products looking at specific production chains um and um also as as reporting directives and if you put that into sort of a time frame you can see you can say I’m I’m sorry you can say that we are moving from transparency and Reporting uh requirements via General due diligence laws to detailed delance laws and I think I mean when we when we criticize this we analyze this it’s important to realize that that’s that’s a certain development going on there so as many of you know in the room of course um this is a development which started a while ago first there was an eu-wide Civil Society compaign then the parliament adopted a resolution with the legis proposal the commission announced that they would do something then a little bit later they actually came up with a directive a proposal for a directive and that then went into the normal EU law uh um the EU law legislative process with the position of the council and the position of the parliament and then interinstitutional negotiations and then something that caused maybe a little bit of a heart attack to some people at least um there was an agreement in the trilogues and normally that then basically means that this is this is what’s going to happen but then the agreement in the trilog was not accepted by the council now um we can discuss why this was the case um I I would have couple of points or questions but um from the process perspective um the council produced a compromise proposal um uh a few months a few weeks ago the parliament accepted it there’s been a vote in the plenary and if I understood Oink’s comments correctly um we will also probably have um a final vote then in in the council uh today and then there will be an entry into Force process of course it has to be um uh um uh legally scrubbed and then has to be U published in the journal um the official Journal so entry into Force I have I have not heard sort of any clear predictions but it’s probably going to be the second half of 2024 unless they do it really quick and then they do it the next couple of weeks anyway so the it’s I think we can be sure by now that um the directive enters into Force what is it who does it apply to it applies to EU companies uh uh of a certain size um both regards with regards to employees and annual turnover it also applies and I think this is crucial it also implies to non-eu companies with more than 450 uh million euros annual turnover in the internal market now in in sort of EU jargon that’s sometimes called the Brussels effect but I want to point out that this is actually a legislative technique which also applies to the UK modern slavery act so it’s not something that that was invented in Brussels of course commission officials don’t want to be told that this was invented in London but um the idea is that if companies are not registered in the respective jurisdiction but operate in the jurisdiction then of course there is and I would argue also from a human rights perspective there is jurisdiction over these companies and that you can then actually also apply a m law just as a comparison when the commission starts um it started with much lower threshold of level the parliament even went even lower than that um and the compromise so to speak came out with 1,000 employees it’s clear that this is not a compromise between commission and Parliament but this is the council position so at the end of the day I think in many of these points the council position then actually um prevailed so what are the obligations and here I think I I can also be quick because at the end of of the day what we are looking at is um a due diligence requirement as established in the principles the non-binding principles the guide un guiding principles and others oecd that I mentioned earlier you have to integrate um human rights into your company policies you have to identify and prioritize adverse impacts basically risks um you have to prevent mitigate and remediate um adverse impacts there’s a requirement for stakeholder dialogue um requirement regarding notification mechanism complaints procedure monitoring the effectiveness and then publicly communicate about it so I think um leaving some details aside but basically speaking we can say this is what the guiding principles the second pillar that yua talked about the second pillar of The Guiding principles would require from companies now what’s interesting is um which which what is the scope of the due diligence obligations of course course um The Guiding principles basically don’t make any distinction um the German supply chain D law makes a distinction with regards to own operations direct and indirect suppliers um the EU directive um talks about own operations operations of subsidiaries and operations of business partners in a chain of activities both upstream and downstream so this is this is actually quite interesting that it opens the space to to a a much wider scope of du diligence than for example we have in in the German law when it comes to relevant human rights and environmental standards um the the the directive refers to an Annex and in the annex um the directive lists the two covenants the two main covenants it also lists the child Rights Convention and the ILO uh core labor conventions that’s an interesting selection I was a little bit surprised to see that at the end of the day um the convention on the rights of persons with disabilities was not mentioned because that’s actually the only international human rights treaty to which the EU itself is also a state party but that’s maybe a detail that can be discussed later it also mentions a number of environmental uh um conventions when it comes to Environmental Protection um convention biological diversity Dent species but also a number of quite specific uh environmental uh conventions talk about certain products or or certain C certain environmental uh risks and Hazards um in in the context of economic activities finally um how will this be enforced and the the the the directive here um is clear and um sort of has a dual approach um it has both administrative and civil liability as enforcement instruments when it comes to administrative enforcement it requires member states to uh entrust one or more supervisory authorities with powers to investigate um and adopt measures impose penalties and so forth it’s quite interesting that the directive also specifically contains the right of natural legal persons to submit concerns to the supervisory Authority so I I guess from an administrative law perspective I would say well that’s something you can always do but the convent the the directive actually specifically relies on that and tries to link I would argue um also stakeholder participation complaint mechanisms not just to sort of companies but also to the administrative enforcement mechanism it includes penalties um including pecuniary penalties with up to at least 5% of the annual turnover so it’s not nothing and most importantly I would argue on the enforcement side it also contains a requirement to introduce civil liability if um the company’s failing to take preventive or remedial measures caused a particular damage and that damage was not only caused by the business partners so there will be a lot of litigation in European courts about precisely this question now if you go to the runup plaza case or if you go to the the collapse of the bardino dam is this a damage that was only caused by the business partner or is this a a damage it was also uh partly at least caused by the failure of the the European company to take preventive or remal measures now um EU lawyers will of course uh know since this is a directive it’s not directly applicable it needs to be transposed into um EU member states law and um there’s a time period this is two years that’s the normal time period interestingly though um the um directive has what I would called a gradual scope of application so member states are required to transpose the directive into their law within two years but they are only required to sort of apply the law um in in the sort of three four and five years steps so very large companies already after three years um Third Country Companies three and four and then only after five years all companies within the scope of the EU uh directive so I mean if you do the calculation assuming that this enters into Force sometime the next couple of weeks or months um the two years elapse sort of second half of 26 and another five years so we will have the UN the the the EU wide um Level Playing Field um probably in 31 assuming all member states actually uh transposed this directive into the member state law um one other last point is um of course um this is EU law so um there’s a apart from the obligation to transpose of course there is a general obligation to interpret existing national law in light of the EU directive so this would be interesting both for the German and also the the French context where we already have laws um which may have to be interpreted in light of the EU directive a quick first assessment so um I think there are a number of benefits first of all we have at least attempts of an eu-wide harmonization of course um that um actually will depend on what member states do we have an enforcement mechanisms which is based on administrative sanctions and civil liability so you could say it’s more or less B combining the German and the French approach um there’s an alignment with International guidelines which I think is extremely important because many companies are already following these guidelines and it’s a singling effect um of legislation towards businesses in Global Supply Chain now will it actually change um the situation um in many Supply chains we don’t know I mean I’m I’m I’m we will probably hear some some insights in in a moment um but I think um what we can say is that at least um there’s a possibility that some business would change um their way of doing business now there are of course risks um one of the risks I already mentioned um National implementation legislation enforcement can be uh could diverge when this is the EU typical risk I mean uh what if uh the authority in Germany does something else than the authority in Austria um and of course there’s no Global Level Playing Field I mean this is an EU approach um even though it applies to non-eu companies it only applies to them when they operate on the EU market and of course and this is the big danger um what will companies do will they actually change or will they basically just as it’s sometimes called take the box and say yes yes we’ve done this we’ve done this we’ve done this but not change much and then of course it will not be really worth the effort from a human rights perspective and I think I’ll leave it at that I’m looking forward to questions and discussion thank you very [Music] much thank you very much Marcus also for the Precision one of the best overviews I’ve seen so far on the on the due diligence directive which is a very complicated a difficult animal and having been very quite a bit in the storm of the discussions um from both sides so to say from the business side and also from from those who would like to see more human rights implementation um I must say that it seems now these compromises that you’ve mentioned um seem to make everybody equally unhappy and um usually that’s not such a bad sign actually as in terms of outcome so um we’ll see as you said this will take quite a bit of time until we know whether it was uh worth anything or not I’ve also heard on a positive note that yes okay we had to compromise but this is still better than nothing so we have now a directive and this will be transposed International laws and it will have some sort of impact it can always be improved it can always be fine-tuned but but um it start and so maybe maybe we have a a good um dynamic in this regard I would be interested to hearing afterwards um how you see the implementation for smaller companies because that was one of the biggest criticisms from coming from the from the business side of course how should we deal with all these reporting structures and so on but um first and foremost uh I would like to turn to Michelle who is joining us from Latin America and uh I would say your contribution will be to some extent I I would see it almost as indispensable uh to what we just hear on what the EU is doing um to hear uh how you you see the question of supply chain liability from the Viewpoint of the global South Michelle FL is yours so let me yeah okay can you hear me yes very well sles okay thank you so much good morning and good afternoon for you in Yen and Europe I’d like to begin by thanking my colleague hogar for the invitation as well as for the supporters of the meeting and I appreciate the presence of the audience today it’s great pleasure to join you from Brazil for this virtual session so my presentation in this human rights and international economic law debate focuses on my ongoing research concerning Brazil’s positioning in this new je economic landscape characteriz it by intensive competition among major economies and the emergence of China I’ll discuss the current outcomes of the research which currently ra raises more questions than provide conclusions therefore I would greatly appreciate any comments and suggestions you may have my research begins with the identification of a mismatch between legal Doctrine and economic operations in the transnational landscape I will discuss two cases related to the operationalization of transnational economic relations one involve investments in the soybean agriculture sector and another in the Dion mining sector both cases illustrate the centrality of Natural Resources exploitation the Brazilian government’s ambition to integrate into Global value chains and the highly financialized forms of coordination with the international market however they also highlight a significant a lack of accountability mechanisms for the true beneficiaries of this economic exploitation and a deficiency and social responsibility measures for the local population affected by these activities well the Intensive um profile of a gravan and Mining exploitation in Brazil is associated with the process of colonization the Intensive mining exploitation process was a central reason for the so-called interiorization of colonization particularly highlighted in the 18th century for the gold cycle and the Intensive agriculture in turn became its exploitation along the coast zones in Brazil in the 16th century but expanded Inland in Brazil starting in the 1960s during the military regime such relative recent intensive production in agriculture was based on the use of machine and biotechnologies as well as in the intensification of productive inputs it is worth noting that these two types of activities were present in the country as a way of occupy the territory and designate its economic role in the world the nation building so here we have the Tex of two constitutions project was reflected in Brazilian constitutional regulation the first constitution of the independent Brazil uh was essentially aimed at regulating the structure of the state and carrying for the only common good which would be the territory and its defense no other provision disciplined the economic order except for the protection of private property in 1988 by the end of 20th century a significant Milestone occurred uh with the inclusion of a dedicated chapter on the environment of the Constitution making for the first time environmental concerns attained to constitutional status this provision established constitutional obligations concerning the environment significant broadening the scope of those respons responsibility for for those that are advocating for its protection as well as imposing a series of Duties on the part of the Public Power so Environmental Protection is now Wen throughout the constitution of fabric spanning from the fundamental rights of citizens to the responsibilities of the federal entities the regulation of the economic order and a dedicated chapter in the subject so uh just a minute okay the regulatory framework that we have now for the 20th century was shaped by desperation to Foster this industrial economy while eradicating Lifestyles and production methods that were in compatible with modern standards so following the 1988 Constitution that was celebrated as a charter for the citizens and redemocratization movement Brazil saw the rise of a neoliberal government starting with color deelo in 1990s that and subsequent administrations pursued reforms that aimed at liberalizing the economy privatizing public services and institutional ing austerity measures and among this reforms there was a reduction of public financing for domestic economic activities and cuts in government spending had a significant rep repercussion including in Agriculture and Mining sectors so while investors in those sectors in Brazil varying profile they share a common Reliance on the growing influence of the financial system that is characteriz it by diverse structures and highly transnational financial instruments my idea today is just to highlight a little bit how those instruments are playing a relevant role in those cases both cases that I bring here today they focus on experiences in the Sado region in Brazil that is a central area of the country with drier vegetation knowing as the Brazilian savanas that is kind of less appreciated by its environment and less International targeted such as the Amazon and the soybean production OCC course in the region that compris parts of the state that is highlighted here in yellow and dark blue uh and have a diversity of forms of occupation of the land so we have more than 3 thou 100,000 rural properties 1,000 agricultur settlements from agaran reforms 35 indigenous lands 36 kilolo territories that are communities that are still closed consist consisting of descendants of um 19th century runaway slaves so this is a very uh complex region that more recently explored this advancement of Agriculture exploitation um and with a changing landscape lates Camp due to the wealth of intensive Agriculture and they still very po poor people living in the region the exploitation of the lean that is more concentrated in the dark blue triangle also occurs in the serado region that crossing the JEA Valley in Brazil that is a historical side of minare exploitation known as the poorest index of Human Rights development in Brazil that is even nicknamed as the name by the name of misery Valley and um there is a fact that the constitution in a certain way disregards this region because it is not named in the Constitution as a protected biome then what we see uh in those two cases is the first one that I will better explain a little bit about not only its historical economic development but also how the economic supply chain is performing a role there and how financialization gained as a very prominent role in that value chain the recent years the soybean production is connected to what was named as a Green Revolution in the 20th century think thinking about uh food Security in the country and the extensive and intensive exploitation of the land what we had was that just that uh increasingly bro both private and public investments in infrastructure financing as well as favorable tax policies acted as magnets drawing New Economic players from various regions within Brazil and from abroad into the soybean industry in that region intensive production in that region has undeniably strengthened Brazil pos position as a global agriculture leader Brazil today responds together with the US for 70% of the world’s output on soybean that has been a very important commodity not only for the world as a whole but especially for China China and its food intensive consumption um at the same time it also raised concerns regarding economic diversification environmental repercussions and the sustainability of trade model heavily reliant on a single commodity reports of pressure on local population and land takeovers have been widespread prompting legal activists to assist the oppressed it and this has been the land grabbing topic is a historical topic since the colonization in the country but still uh more recently it has been also connected to a very intensive and aggressive acquisition of large L Parcels by Foreign investors then Brazil uh historically had some limitations in the of land but in 2010 decided to reinforce the laws and limiting the foreign acquisition that was an important movement for the reorganization of the supply chain that would be firstly focusing in the farming axis of the supply chain thinking about in gaining the land and then had to spread the investments in other parts of the structure of the soybean supply chain Market what is important to note is that this chain is very specific because it’s very much concentrated uh there is a high concentration of economic power at the global level so just an example we has just have three major industries the transnational seed companies uh dominating 50% of the global soy Seed Market we have three uh AGR chemical companies that control 76% of the global ped and airbed market and this is very important when we think about how the chain this economic supply chain is working today uh the system in Brazil today is heavily based in a sort of private uh uh sort of contract that is named a berter contract through which there is the usion of a credit instrument that is a crop receipt where credit is received by the farmer under the obligation of repayment of secured by Future crop collateral so what happens is that Global organizers and Trader companies have contracts with the supply industries of seeds and agrochemicals and pcids and combine that with the financing to the farming so the local structure is very pressed by those financing instruments that are uh coordinated into the supply chain for the global market and this has had a very an impressive impact in the system in Brazil due to the fact that the government took off the subsidies and all forms of financing that was granted for the farmers before the reforms in the 90s um and more recently due to the the the the restrictions of acquisition in land we had a 10 years of Gap where investors decided not to invest in land but nowadays more recently what we have seen is that that they have transformed the way of getting the control of land through financial uh structures uh they are buying shares of land companies local land companies through the capital market and based on very specific agreements uh organized in this the system what we see that in the period of uh um 2021 202 two we have about 25% quart quarted of the the the production system in Brazil uh in the matu is connected to the system of financing of land and contrasted to less than uh 5% in the ’90s so again what we have then in the case of the mining system is also a very similar uh connection where we have um a new production system uh of lithium Brazil is not really a large produ produ productor of lithium uh but is moved has been moved by this uh specific branding of the idea of a Green Revolution based on green leum to to be explored on this poorest one of the poorest region regions in Brazil the Leal exploitation in ltin America especially in Chile Bolivia and Argentina has been very well explored in the literature but the case of Brazil holds a particularity due to the fact that Brazil is not a superpower on leum but the existence of this mineral combined with other critical minerals with the potential to attract invas ment in the Upstream part of the value chain and the capacity or at least the potential to combine the Upstream production with the development of Midstream industry connected to the lithium as a source being the case of electric cars and batteries as part of the energy transition project so the case analyz is about a company that is named siga that is a Company Incorporated in Canada uh benefiting of all the subsidies of green companies in that country but having as the controller a found structure of a Brazilian Citizen and Resident but other minor shareholders that include large investment funds such as Blackstone so Sigma invested in this uh project in the jonia valley and intends to have a more clean system of production of the leading where they will be cleaning all the the the the outputs of the pro the system of production but in fact there has been um concerns regarding the expansion into indigenous territories and there are other [Music] um facts uh along the increase of rates of violence prostitution that is associated with mining exploitation Mich may I interrupt apologize uh but uh could you wrap up in about two minutes or so yes I can thank you uh so the point is here is different from the agricultural sector so what I call the attention here and then maybe this can be combined with discussion of the due diligence analysis and their Market is the fact that this may be have very different local structures in the economic organization of the supply chain and also the fact that we also have to look at Financial explo Financial actors in those Supply chains not only about the companies that are there and in the case of Brazil the structure for the mining uh exploitation is different than the fact that we have more foreigners uh exploiting due to the fact the lack of Technology of local investors but we have a very deficient uh system of supervision uh or control by the state of uh the commitments that would be expected under the Constitutional regulation so uh this is Ju Just as a final remark where we get to this uh questions that are how can we effectively advance to towards this ecological transition that encompasses our present and also future existence how can we rethink the Notions of jurisdiction to involve the responsibility of the true beneficiaries because in the case of Brazil most of the responsibility is designed to think about local people that are residents and based in Brazil that is not the case of the funds and most of the financial actors and finally how can we take our Collective responsibility more serious to a more respons responsive ethical framework that has been we seen efforts in the global arena in the last decades but as we see they have not been sufficient and nowadays what we see are more National efforts in a way of constraining and regulating foreign investments and also thinking about the foreign investors the foreign investments of exporters of capital in other countries so thank you very much for your time and look forward for the disc thank you [Applause] Michelle thank you so much for this uh great overview of the national situation uh in Brazil which could probably at least at some level of abstraction Al Al um be found in other other uh countries equally um you mention specifically agricultural issues you mentioned Mining and um matters relating to Banks mayia now when we come to the um questions uh and discussion part uh very quickly unfortunately uh start with you and do the Reversed order so to say to be fair uh we have heard today a number of [Music] um approaches for remedies where uh it’s needed to in order to or we see potential violations for human rights and so on uh the High Commissioner has mentioned the need for the reform of the financial architecture on the international Global level um there is a working group in the UN of a treaty um on human rights and business uh which has been there for a while and uh hopping along so to say maybe that our the EU directive would would bring some new Dynamic but that’s another important Approach at the global level we have now the EU directive which has extra Taral um uh implications also uh we have seen National laws uh may I ask for your uh assessment what would your take be which which uh which approach would be the most effective when it comes to uh uh human rights implications uh uh and business uh regulation uh would it be uh into the financial architecture would it be the treaty on the global level would it be an Regional directive would it be the national law what’s your assessment uh I think that first thinking about the actors that have been the beneficiaries I would say that Financial regulation is really needed uh there is the way where they are coordinating the more complex um regulations what we’ seen that for the case of Brazil we have the companies the national companies there in the last um crisis that we had in Brazil in the mining exploitation what we’ve seen is that local actors have had uh paid um High IND denization but they are not the only beneficiaries they’re orders so I think that we should look at those actors at the financial system to think better about how can we think about their responsibility secondly in combining the regulation uh certainly a combination of different and a coordination I think that is one of the topics here uh of national and Global regulation is the better one because we have an asymmetry of uh economic distribution in the world but not only between countries but also inside the countries so uh I think that we should uh be aware of those asymmetries and how we can correct them not only nationally but also coordinating that globally um I don’t I I see that today for example thinking about food security and energy security the G20 is getting that in the agenda but more about on the supplying of those sources but not thinking about the sustainability of those global value chains in the terms of Social and environmental responsibilities okay thank you may I ask the other two speakers whether they would like to react to that otherwise I would uh turn to uh Marcus with another question but maybe uh no okay uh so Marcus uh I mentioned early on the main issue that has been voiced with regard uh to the potential problem or challenge that the directive uh will have is the overburdening of smaller uh companies um any remedies there how do you take it what what could be done what can we how can we best handle this well I mean first of all the question is what are smaller companies I mean I I would I would certainly argue that companies in the EU with more than 1,000 employees and an annual turnover of €450 million EUR are not small companies now I think the question relates to that most of these companies that fall under the directive or under the laws implementing the directive would hand down that responsibility in the supply chain to smaller to smaller um actors and I think here we need to be be very very uh careful and and and and not sort of oversimplify matter sometimes we have small companies who have an extremely good knowledge about a particular supply chain I mean I’ve spoken to small textile companies who said well we know exactly what’s going on there but in other context they may not so I think we we need to be we need to really look at it from a case by case standard a basis and then I would also argue that it is of course as always it is an obligation both of states to support small and medium-sized Enterprises with all sorts of um form of support with all sorts of um uh um also um advice I mean there’s there’s also a role I mean we’re talking uh not virtually we are at the diploma academi so if I see it correctly maybe many people in the room will become members of the the the core diplomatic in Austria and then of course um the question is where what what is the role also of the foreign Services of the member states so I mean if an Austrian company says well my supply chain ends in in in India I would see partly also a role of of governments to say well of course we can we can furnish you with some knowledge we have some insights I mean the details to be discussed and everything there may be uh uh Chambers of Commerce that can be that can be um sort of also taken into account and then of course it’s also a role of the larger companies not to just hand down sort of questionnaires I mean I’ve spoken to small and mediumsized companies and I said now we receive questionnaires from all our sort of business partners there’s one from Mercedes there’s one from Volkswagen there’s one from and of course that needs to be coordinated I think so we should we should take these things seriously um and maybe sending out questionnaires to your um to your um suppliers is not what the due diligence actually requires you to do thank you very much much uh Marcus I think we will probably be uh engaged with these questions for a number of years and indeed yes we aware at the state side that that this we have a role too but but it’s a shared responsibility and and this is particularly acute I think in this in this aspect um now returning to you uh last but not least sorry for waiting um the question digital rights um totally fascinating I think um how how would you go about this do you think there is such a thing as digital rights and you mentioned actually yourself that the the word translation of Rights was maybe is maybe the key here could I ask you to return to the beginning of the day uh where we started out with technology uh on your your take on that yes so I actually think it’s a very good combination that you’ve had of very uh specific cases and Regulatory initiatives and and then dealing perhaps with with some of the more abstract or conceptual issues so yes there are there are uh such things a digit as digital rights um you could say that probably uh we are alluding under this title to a number of things so there is one uh um one one meaning of digital rights is simp simply that you know some of the of the basic rights that we have are now simply implemented or practiced in a in a digital context using digital technology so in that regard uh online freedom of expression is is a form of freedom of expression that is mediated through digital means uh but that means that uh it’s it’s although um conceptually it’s it’s still freedom of expression it is applied in a very different way because of scale speed scope for instance considerations uh also you know in terms of access in terms of impact so uh so this would be one one dimension but there are there is also a dimension where you do have um uh digital technology developing certain needs or or certain um areas of uh the human rights discourse that were previous previously uh not existent before so the right to be forgotten for instance is a right that is a digital right because um we before digital technology made it so easy to retrieve information about us uh we had no practical reason for that uh for that right and the same would go uh probably for algorithmic transparency or the right not to be subject to to a automated decision making I mean these sort of uh or maybe even the right to internet access I mean these sort of uh uh new needs new interests that uh um that are relevant for uh digital technology users ERS and other individuals impacted by digital technology have their own logic and finally one could maybe say and this is perhaps uh the area I mean this is the general direction that I was moving in that this is not only whereas when we are thinking about um traditional human rights we are thinking mostly about rights that are um uh that uh have as a correlator state obligations when one is talking about digital human rights I think we’re increasingly also thinking about the technology companies as the as the immediate Duty holders and that requires us to think very differently about this F thank you very much so it’s also um not only the quality of the right itself but also who does it apply to and that’s an interesting aspect of course and and maybe you could also say and I haven’t time don’t have time to expand on this but maybe also new right holders I mean we can also think of virtual entities as as as an uh um as as right holders and we and avatars and all these sorts of uh metaverse related uh Dimensions they may have their own sets of rights that uh uh we haven’t really encompassed within the traditional human rights framework yeah and I would immediately add here rights and obligations and of course this I think would indeed bring us to an entire new conference topic Mr Professor es Maya maybe next year this time we we can expand on on this and and probably feel a day or two on on the various aspect of that uh if I understand the organizers of the conference correctly um in the interest of time since we are overdue already we we skipped the possibility for questions and answers from the floor however if there was anything you wanted to to uh hear or um respond from the from the panelists um there is the possibility maybe to forward emails and and transfer them and so on so so apologies for that um that it’s it’s uh we are in a somewhat tight framework I would like to convey my heartfelt thanks to the speakers uh who I think have covered a lot of interesting aspects of business and human rights and with that I would like to conclude the panel and uh give back to the organizers thank you very much [Music] you