ABSTRACT
Over the past decades, transnational corporations have come under increasing public scrutiny for their involvement in human rights abuses, particularly in developing countries. One may think of violent acts against local communities, slave labor, and grand-scale environmental pollution. International investment law protects and safeguards the rights of foreign investors but falls short of holding them accountable to societies where they operate. A few arbitral tribunals have grappled with whether corporations could be held responsible for illegalities that constitute human rights violations inflicted upon the host state and its people. Arbitral case law suggests that the case’s outcome as to whether host states ought to be compensated for such violations varies based on how the illegal conduct is framed and the source of the liability-creating rules alleged to have been breached. This article discusses the arbitral treatment of corporate human rights violations by investment tribunals in three treaty-based cases: Copper Mesa v Ecuador, Urbaser v Argentina and Burlington v Ecuador. It draws on recent scholarly work on causation in investor-state arbitration to evaluate their approaches. It concludes by suggesting that if the post-establishment illegality involves actual harm, then bringing it forward as a counterclaim and founding investor’s liability on national tort laws, not international human rights law, heightens the likelihood of obtaining compensation.
Salama, Yasmin, Obtaining Damages for Corporate Human Rights Violations in Investment Arbitration (March 9, 2022). CIFILE Journal of International Law (forthcoming).
First posted 2022-05-25 11:00:32
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