Cristina Lafont contends that removing the concept of human dignity of human rights practice can produce detrimental consequences, such as – and specially – the extension of legal human rights to corporations. Evaluating the recent trend of corporate human rights, Lafont sets forth a comprehensive analysis of “the negative effects that the distinctive functions of human rights norms—such as limiting state sovereignty, prompting transnational remedial action, and so on—can have upon the human rights of natural persons once corporations are recognized as legal persons bearing human rights.”
The Political Conception of human rights, as opposed to the Humanist Conception
While one would hinge on the intrinsic moral worth of the human being to justify human rights under a Humanist Conception, thinkers such as John Rawls and Charles Beitz, portrayers of the Political Conception, would reject this approach, thus denying the reliance upon human dignity to affirm human rights. Instead, “the political approach infers the nature of human rights from the purposes and modes of action manifested in the ongoing human rights practice itself”, contending that the backbone of such rights derives from “their special role as norms of global political life.” According to Beitz’s definition, “Human rights are the constitutive norms of a global practice whose aim is to protect individuals against threats to their most important interests arising from the acts and omissions of their governments.”
Upon the rock of the Political Conception the doctrine of corporate human dignity was built. “If human rights are not those rights that one has in virtue of being human, but rather those sui generis rights that one has in virtue of being subject to state authority, then it seems that human rights should include everyone within a state’s jurisdiction who enjoys legal personality rights”, even legal persons. Shunning human dignity as a criterion, the Political Conception draws recourse solely to “urgency” and “importance” when assessing the interests of the persons affected by a government act or omission. The subject’s interest in survival, under such an analysis, would surely be protected. That was established in the Yukos case.
When corporations are granted human rights
The high profile Yukos case is one of many cases (such as Société Colas Est v France, Agrotexim v Greece, and Immobiliare Saffi v Italy) where companies have been accorded human rights under the European human rights system.
The Russian Yukos Oil Company, previously state-owned, accumulated tremendous wealth under CEO Mikhail Khodorkovsky, who became the wealthiest man in Russia and a politically influential figure. In 2003, just prior to Russia’s December 2003 parliamentary election, and the March 2004 presidential election, Khodorkovsky was arrested, thus being eliminated from active political engagement (see: https://www.khodorkovsky.com/biography/arrest/). The Russian government, contending tax evasion, expropriated the assets of Yukos.
The company was forcibly broken up and its shares were sold to other companies. It was then declared bankrupt in 2006 and, a year later, liquidated. Yukos’ most lucrative assets ended up with the state-run oil company Rosneft. The case was perceived as a politically motivated governmental act which blatantly violated fundamental rules of due process.
Yukos was a Russian corporation (and thus a Russian national), therefore it did not have a State to take up its cause in proceedings against the Russian Federation before the International Court of Justice, for Yukos’ home State was in fact its very adversary. Moreover, the company could not bring a claim before an international arbitral tribunal under a bilateral investment treaty. Yukos was a Russian corporation (and not a national of any other State), hence its investment in the Russian Federation could not be governed by any bilateral investment treaty concluded by the Russian Federation with another State. Yukos was fundamentally isolated, incapable of having recourse to any international forum of judicial review, as its case concerned solely an internal matter.
Under these circumstances, the European Convention on Human Rights revealed its great significance, in its establishment of an international court which also adjudicates national cases when the protection of the values in dispute transcends the national jurisdictions and concerns the international society as a whole.
In 2004 the company lodged an application with the European Court of Human Rights under Article 34 of the Convention, which names “any person, non-governmental organization or group of individuals” as capable of bringing a claim. In contrast to other human rights documents, the ECHR does not limit the enumerated rights to natural persons. Furthermore, legal persons are explicitly included in the text concerning one of the enumerated rights, the right to property.
In 2011 the Court ruled that the Russian Federation had violated several human rights of the by then defunct company, specifically its right to a fair trial and its right to protection of property. Without the Convention—and its inclusion of corporations within its protective ambit—Yukos would not have been able to hold the Russian government accountable for its actions.
Conflicts between human rights of corporations and human rights of people
On a case-by-case basis, human rights of corporations have been expanded to include rights to privacy, property, due process of law, protection against discrimination, freedom of assembly and association, of movement, of religion, of speech, and the right to compensation for non-pecuniary damages. This is certainly another indicative of the trend identified by Eric Posner as “hypertrophy of human rights”.
However, recognizing human rights of legal persons may be to the detriment of human rights of natural persons, as they can often clash. As Lafont puts it, “there is no longer any reason to assume that a corporation’s ability to use legal human rights instruments that limit state sovereignty would reinforce rather than undermine states’ ability to protect the human rights of natural persons within their jurisdiction.” To base such contention, the author uses past Investor-State arbitrations as examples, and delves into what the consequences would be had corporations the capability to intervene in Bilateral Investment Treaties (BITs) as third-party beneficiaries protected under human rights law.
It is already fairly common for corporations to file lawsuits against States under BITs for employing certain public policies deemed to hinder the companies’ investments, even though said policies intended to forward the public good and human rights of the country’s people.
Among the cases cited by Lafont is the Investor-State arbitration initiated by Philip Morris International Inc., an American multinational cigarette and tobacco manufacturing company. PMI contended that Uruguay’s anti-smoking legislation devalues its cigarette trademarks and investments in the country and, on that basis, sued Uruguay for compensation under the BIT between Switzerland and Uruguay at the International Centre for Settlement of Investment Disputes (ICSID). Similarly, one could cite many other (even more notorious) cases in which state’s capability to employ measures to advance human rights of people within its jurisdiction was defiled by corporate interest.
Conflict between human rights and investor’s treaty-rights are often rendered evident. However, state parties can avoid such situations by amending the BITs and making explicit in its provisions the right of a state to adopt certain public policies. The critical shift would come, though, if the treaty-based economic rights of corporations were to be elevated to the status of human rights.
Should this occur, and corporations rights be equated with “universal entitlements on par with all human rights”, then “their scope and level of protection would no longer be seen as derived from and dependent upon state parties’ revocable consent and thus subject to their discretion”.
Lafont envisages a potential scenario in which human rights practice could face a conflict between two seemingly incompatible aims: “the protection of the human rights of all human beings or the protection of the urgent interests of all legal subjects, corporations included.” It is in such hypothetical scenario that she sees value in using Human Dignity as a criterion to protect the human rights of natural persons “even in the face of a pervasive extension of legal human rights to corporations.”
Firstly, the extension of human rights to corporations does not entail a necessity to ascribe human dignity to them. Furthermore, should a collision between rights in a specific situation happen, what ought to be determined is which of the rights “more directly touches upon human dignity and thereby justifies stricter protection.”
Thus, Cristina Lafont’s conclusion is that “in collision cases the factor establishing the relevant priorities is not whether all right bearers have the same rights, but instead whether the dignity core of any of the rights in conflict is threatened such that higher weight can be given to the right that more strongly protects human dignity.”
Pedro Rogério Borges