Policy Brief: ‘The Case for a Court of Arbitration for Business and Human Rights’

Last week, Asser Institute researchers Antoine Duval and Catherine Dunmore released a new policy brief entitled ‘The Case for a Court of Arbitration for Business and Human Rights’. In this short Q&A, Antoine Duval provides some background to the context and objectives of the brief.

What is the policy brief about and why did you decide to write on this topic?
The policy brief is meant to contribute to the growing discussion on the use and usefulness of arbitration in the business and human rights context. Since the Human Rights Council adopted the United Nations Guiding Principles on Business and Human Rights (UNGPs) in June 2011, we have entered a complex and lengthy multilevel implementation phase. The third pillar of the UNGPs emphasizes the importance of providing victims of human rights violations with access to remedy. Yet, as we explain in the brief, access to remedy through national courts is still extremely limited due primarily to the existence of a multitude of procedural roadblocks in an extraterritorial context. The recent U.S. Supreme Court decision in the Jesner case denying the application of the Alien Tort Statute to foreign corporations illustrates this point. Furthermore, other soft mechanisms, such as the OECD National Contact Points, are often too weak to offer an effective remedy to affected actors in the sense of Principle 31 UNGPs (Effectiveness Criteria for Non-judicial Grievance Mechanisms). It is in this context that arbitration has emerged as a credible candidate to fulfill the commitments enshrined in the third pillar of the UNGPs. We wanted to contribute to this discussion from our own perspective based on our experiences with international arbitration.

What is the core argument of the policy brief?
The main point of the policy brief is that we need to think beyond the horizon of the ongoing work of the Working Group on International Arbitration of Business and Human Rights which is focused on devising a set of rules, and to also look at the institutional features of arbitration in order to fit them to the particular business and human rights context. More concretely, we argue for a single Court of Arbitration for Business and Human Rights (CABHR), which would be (almost) exclusively competent for business and human rights disputes worldwide. In our view, empowering the CABHR would bring with it considerable advantages in terms of transparency, coherence of jurisprudence, independence and accountability of the arbitrators, and accessibility for victims. Much of the argument in favor of the CABHR is based on my previous work on the Court of Arbitration for Sport and its role in the structuring and operation of the lex sportiva. Finally, to hammer out the nitty-gritty institutional details of the CABHR, we recommend setting up a ‘constitutional’ multi-stakeholder convention involving non-governmental organizations (NGOs), transnational corporations (TNCs) and State representatives.

Do you think this is a realistic prospect?
I am very conscious that this is not going to be easy. To get TNCs, NGOs and States to agree on the institutional set-up and the funding formula of the CABHR will be challenging. Yet, I am convinced that for arbitration to make a real difference in the business and human rights field, it needs to be radically different from its traditional investment and commercial format. Not only are we talking about disputes related to human rights, but we are also dealing with imbalanced situations in which gigantic TNCs face relatively powerless individuals (or groups of individuals). This means that arbitration needs to reinvent not only its rules, but also its institutions. Strategically, it might be more realistic to locate the CABHR within an existing institution, such as the Permanent Court of Arbitration in The Hague, which has the advantage of already being a relatively ‘public’ arbitral body. In short, as much as I am convinced that arbitration can be a way out of the remedy deadlock, I also think that it will need to depart radically from its traditional structures and modus operandi to be so.

The Asser Institute publishes regularly policy briefs on issues of expertise of our researchers. You will find the latest briefs on our SSRN page.

Dr. Antoine Duval is a senior researcher at T.M.C. Asser Instituut, and coordinates the research strand on advancing public interests in international and European law.