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Critical Assessment on Transnational Corporation Assessment Answer

Question-  States are the Subjects  of International  Law, so Transnational Corporations Should not be subjected to human rights obligations. Critically assess this statement.  3000 words not including footnotes or bibliography. It needs OSCOLA referencing.  


Answer

Introduction

With the ramified changes, the applicability of international law has been increasing and helps in aligning the compliance of the work program. However, it has been analyzed that the States are bound by international law, so Transnational Corporations should not be subjected to human rights obligations. This shows that corporation or companies should be kept exempt from the issues and implication of the human rights which negatively impact the Generally it has been seen that the States are the subjects as well as the makers of international law due to the fact that the main responsibility of enforcing and protecting the human rights in their jurisdictions lies with the states. But a question is generally asked if the corporate entities also fall under international law and if the obligations relating to human rights can also be imposed on the transnational corporations. It has been suggested by different stakeholders that there is no legal or technical barrier present in the recognition of transnational corporations as the subjects of international law. Nonetheless, it has been observed that foundational principles of corporate law, some of the companies may decide to disregard the effective management of human rights and environmental laws in the enterprise. There is also a need for strengthening the requirement that the transnational corporations should abide by the obligations relating to human rights and can be held responsible for any violation of the human rights on account of the activities of these corporations. Some experts have also expressed the view that clarifying these obligations will not only be helpful in the safeguarding the human rights of victims under the circumstances, but it will also be beneficial for transnational corporations if human rights standards are introduced for the purpose of achieving better clarity and certainty in the international market. It is very important that the victims of the violations of human rights should have effective access to justice regarding the actions of TNCs and also to prevent the occurrence and the repetition of these violations. 

Critical assessment of human rights can also be imposed on the transnational corporation and International Corporation

Focusing On the Business Activities of Transnational Character: For the purpose of making the determination regarding the business activities that need to be covered under a binding instrument remains a contentious matter. There are some experts who believe that in view of the fact that the domestic corporations are not allowed to evade their responsibilities under domestic law, it can be said that the focus of international law should be on transnational corporations, including their decision-making bodies, subsidiaries and supply chain. On the other hand, some other experts claim that the domestic corporations can also be held liable for the abuse of human rights and as a result, all businesses should be covered by the future legally enforceable instrument. 

Obligations for Business Entities: In 2016, more than half of the top 100 economies of the world were transnational corporations (TNCs). In view of the foundational principles of corporate law, some of the companies may decide to disregard the effective management of human rights and environmental laws in the enterprise. At the same time, the participation of companies and other business entities in committing egregious violations of human rights that took place during the Second World War and also their involvement in economic, military and political life of the States, especially in case of the developing nations, has to be considered as among the motivations regarding the need for it indicating the responsibility of such corporations who were involved in these acts. A large number of scholars and commentators have discussed the issue related with the human rights obligations of TNCs under international law. Nonetheless, some efforts have been made at the international level for implementing or increasing the obligations of transnational corporations related with human rights.

UN Norms on Accountability of TNCs Regarding Human Rights: Any discussion regarding the human rights duties of transnational corporations will be incomplete without mentioning the UN Norms in this regard. The reason is that these Norms reveal a comprehensive document under the international law related with the human rights obligations of TNCs as well as the other business entities. These Norms contained 23 paragraphs that have been mentioned in 8 sections. These include the general obligations of TNCs in this regard as well as the right to equal opportunity and non-discrimination in treatment. They also contain the right to security enjoyed by individuals, the rights of the workers, obligations related with the protection of environment, respecting national sovereignty and human rights, as well as the general provisions related with implementation. Hence these Norms include a wide range of particular as well as general obligations concerning the protection of human rights. These Norms successfully provide different types of provisions related to human rights, ranging from the 'traditional' political and civil rights, as well as social, economic and cultural rights. They even go beyond the convention based agenda of human rights for the purpose of including a corporate social responsibility code. 

Regarding the status of these Norms, it was the aim of the Working Group as well as the Sub-Commission to come out with a comprehensive document, which deals with all the measures and norms for the purpose of making sure that the actions of TNCs are in tune with the objective of protecting and promoting human rights. During the drafting process, the intention was to provide a binding effect to these Norms. From the point of view of the wording used in the resolution adopting the norms and its commentary, the position of these Norms is still not flawless. There are several issues resulting in the non-abidingness of these norms. They start with the wording used in the preamble which mentions that 'every effort needs to be made for making them generally known and accepted'. Moreover, even if the authority of these norms is going to prove much helpful, but it is not a treaty. Consequently, it does not have a clear legal authority present within the development of international human rights legislation, making it mandatory for all parties. However, it has been analyzed that transnational companies can be held answerable for responsibilities under human rights law.

These Norms are considered as the extension of some basic principles related with human rights with a different actor in concentration. In this case, this actor is the TNCs. This position has resulted in some criticism. According to some experts, it is going to be a step too far if the TNCs are expected to become quasi-governmental organizations. However, this argument does not hold much water on account of the fact that even the Norms have recognized in its preamble that the State is going to be the main carrier of the responsibilities related with HRs. The cause behind extending this obligation is merely based on the effect and eight the influence of TNCs and other business entities on the human beings. These norms can prove to be effective in assisting the TNCs in the introduction of their own code of conduct and may also act as the grounds for creating the standards that are applicable internationally. However, it is desirable that these Norms should have some level of compelling compliance if they achieved the status of global customary regulations. However, until then, these Norms remain in the nonbinding but they can provide a comprehensive framework to be socially responsible TNCs related with their human rights obligations.

Enforcing The Human Rights Obligations of TNCs: The main intention of any rule is not only to achieve orderliness as well as to hold the law-breakers answerable. There are different forms of achieving this objective with the help of adequate enforcement mechanism. The enforcement mechanism related with enforcing the human rights obligations of TNCs includes self-regulation, national and global implementation apparatus. However this field still needs some development as the present position is not much heartening. 

Self-Regulation 

: This means that the TNCs shall come up with their own human rights obligation framework which enables them to abide by the Norms. It could present as the guidance notes reflecting the CSR of the TNCs. It can also be present through the means of regular human rights impact evaluation. However, it has been seen that there are only a few firms that perform the human rights impact assessment. As the self-regulation is a voluntary mechanism of enforcement, it is not very credible and effective. The reason is that the main objective in case of the TNC's is to make profit and therefore in case of a conflict present between monetary gains and their human rights obligations, the monetary gains are going to take priority. Hence, when it comes to accountability, there is a need for making sure that compliance is present in case of best and the worst corporations. Furthermore, it is considered that the non-state actors, the trans-national corporations are not recognized as international legal persons and hence obligations for upholding the human rights law is not imposed against them

Compliance at The National Level: it is generally recognized that the main responsibility lies with the States for respecting, protecting and making sure the human rights are the respected. Poorest will present need to be made sure that domestic legislation have been enacted for this purpose. Regarding the obligations of the TNCs related with human rights, very little have been achieved in this regard. The situation becomes even worse in case of the developing nations and depends on the form of government that is present in a nation, whether it is a democracy or a military dictatorship. An example in this regard can be given of the Ogoni crisis that took place under the military government in Nigeria in 1995. This crisis resulted in the death of Ken-Saro Wiwa. It was a human rights activist and had accused the Shell petroleum of complicity. This incident resulted in the case of Kiobel v Shell. However, it has been analyzed that States should also require the transnational corporations to submit their reports regarding the effect of their activities on the human rights of the people.

Even if there is no particular national law enacted in the United States, UK or even in the European Union that deals with the accountability of TNCs, but there have been several attempts, which barely materialized. Some efforts have been made for holding the accountability of TNCs in this regard. However these attempts were not made directly, but by relying on other domestic laws like the corporate criminal responsibility, environmental law and civil law, especially the Torts. This would showcase that put the necessary pressure on the transnational corporations for protecting, respecting and fulfilling their obligations related with human rights.

International Mechanism: Some efforts have been made at the international level for implementing or increasing the obligations of transnational corporations related with human rights. These have been mentioned in the section titled 'general provisions and implementation' of the UN Norms. However, the effectiveness of these norms depends on their proper implementation. Hence, provisions are present in these Norms related with adopting, disseminating and implementing the internal rules that comply with the Norms. It can be present in the form of internal guidelines and codes. At the same time, provision is also present for a reporting system that meets the reports to be sent to all the stake holders. How often the report needs to be sent and the effects of stakeholder contribution are some of the issues which are very discouraging. The methods discussed above may appear to be like self-regulation, but as a result of the monitoring by different stakeholders, they take the form of international mechanism. The stakeholders include the UN working committee, IGOs and the Sub-commission.

It can be stated in the end that it is well recognized that obligations are present for the transnational corporations related with human rights as mentioned in the Norms also in other relevant instruments. The critical evaluation that has been made about clearly mentions that despite the documentation of the obligations of TNCs, a challenge is still the case of the enforcement mechanisms. The challenge has proved to be very significant at the international, national and self-regulation level. It also needs to be mentioned in this regard that as mentioned by certain experts, the fact that the inability of the victims of the human rights violations for bringing legal action against a transnational corporation for violating its obligations related with human rights should not be the test for the presence of these obligations. Even in certain efforts were made in the form of enforcing the human rights obligations on the transnational corporations through backdoor by relying on other areas of law, but the fact is still present that only the human rights legislation has the capability of providing proper framework for the accountability and the obligations of human rights to be imposed on the TNCs in case of these violations. Recent research has revealed the impact of the activities of trans-national corporations on the human beings and also the need for internationally binding instrument through which the obligations related with human rights can be directly imposed on the TNCs. Even if a binding instrument is not present related with the obligations of transnational corporations concerning the human rights, there is certainly some pressure on the TNCs for complying with the Norms. The reason is that the individual corporations are going to be exposed to public opinion and scrutiny, particularly if the active monitoring is present by the NGOs, IGOs, the Working Committee and the Sub-Commission.

It has also been revealed by the relevant legal literature that more and more corporations are becoming concerned that the respect of human rights will provide them a long-term benefit. Therefore, these corporations are coming up with a policy for making sure that they respect their human rights obligations. The proof of this situation is present in the commitment expressed by a large number of corporations for observed in the human rights and other relevant standards. In fact such an evolution is not surprising. During the past few years, a number of leading corporations have designed strategies for helping them in becoming more socially responsible. Establishing a policy for protecting the human rights of the people is a part of this framework. It also marks the willingness of the corporations, particularly the transnational corporations of self-regulating. 

It also becomes clear after this discussion that in view of the significant challenges related with the enforcement of these obligations, no single mechanism has the capability of providing all the answers. Therefore it is for adopting a comprehensive approach in this regard. For doing so, it will also be necessary, that willingness should be present on part of the transnational corporations for improving self-regulation mechanism. This can be done by undertaking regular and adequate human rights impact evaluation. At the same time, there should be the introduction of domestic as well as international legislations at the national and international level for upholding the direct responsibility of the transnational corporations regarding the violation of human rights. Moreover, the States should also require the transnational corporations to submit their reports regarding the effect of their activities on the human rights of the people. On the other hand, if a particular State is not diligent in this regard, an effective remedy should be present in the form of personal complaints to the commission. This is going to put the necessary pressure on the transnational corporations for protecting, respecting and fulfilling their obligations related with human rights.

Conclusion

After assessing all the details, it could be inferred that even if, as the non-state actors, the trans-national corporations are not recognized as international legal persons and hence obligations for upholding the human rights law is not imposed against them but a close scrutiny of the international law provides that in fact, the corporations have a legal personality, which is sufficient for rendering them capable of having their own rights and obligations. As a result, it is possible that TNCs can be made responsible for their duties related with human rights.

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