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Includes Guiding Principles on the World Bank Group, the International Monetary Fund and Human RightsThe World Bank Group and the International Monetary Fund are under substantial pressure to accept more accountability under international human rights law. This publication sets out the standards by which these international financial institutions are bound under international human rights law as it currently stands.Human rights law is 'living law' and has changed over time, as have international financial institutions, despite their sometimes static approach to their own mandates. However, the World Bank Group and the International Monetary Fund are both starting to recognize more and more the relevance of human rights to the fulfilment of their respective mandates, even if they still maintain, be it to different degrees, that international human rights law is only partly applicable to them. This publication argues that this position is no longer tenable and that human rights law does in fact apply to both international financial institutions.

Summary

INTRODUCTION

Human rights lawyers and human rights activists often hesitate or even hate to talk about human responsibilities and obligations (hereafter summarised as ‘duties’). This is the case for obvious reasons, which can best be understood in light of the very beginning of the history of human rights, relating to the protection of human beings against the abuse of power by States. Talking too much about duties of human beings (and their societal organisations) would be a nice ‘playing card’ in the hands of authoritarian governments, whether they are communist left, military right or religiously fundamentalist. In daily global reality one could and can find a lot of support for that fear. Think of the camps in the former Soviet Union and of today's developments in countries like North Korea and Iran. Also think of the grounds upon which in countries like China freedom of expression is dealt with: one is allowed to say everything, as long as it fits into the interests and views of the communist party.

Despite this, there might be good grounds to talk about human duties, alongside rights. This chapter addresses these duties of human beings and their non-governmental organisations towards other human beings and the world society as a whole. The focus will be upon a basically moral appeal connected to forms of accountability, and not upon new legally binding obligations. Further to that, the focus will be upon one selected issue: the need to realise the Millennium Development Goals (MDGs) and the human rights related thereto. Is the MDG reality ‘ordering’ us to rethink the notion of duties for not only States but for individuals and their organisations as well?

A FEW HISTORICAL REMARKS

Before entering into the question whether or not the MDGs raise the need to sharpen the notion of human duties in the context of human rights, it might be good to observe that already during the 1946–1948 negotiations on the Universal Declaration of Human Rights (UDHR) the issue of duties was discussed time and again. Already during the very first meeting of the drafting committee, it was proposed to formulate as a core principle of the Declaration ‘that man does not have rights only’, but also ‘owes duties to the society of which he forms part’.

Summary

In each and every situation that entails the risk, or actual occurrence, of human rights violations, effective accountability mechanisms must be available. These mechanisms have to provide victims or possible victims of such violations with effective judicial or non-judicial means of testing the legality, and practical consequences, of IFI policies, programmes and projects, including the role of IFI Member States, and to have consequences attached to these if so required from a human rights perspective.

This chapter discusses a number of (selected) issues within this domain relevant to further specify what accountability and redress mean for IFIs. The focus is on measuring standards for effective accountability and redress (subsection 5.1); human rights impact assessments (subsection 5.2); existing IFI accountability mechanisms (subsection 5.3); and mediation, arbitration and related dialogue-based ways of conflict resolution (subsection 5.4).

SUBSTANTIVE AND PROCEDURAL STANDARDS

One can find a range of international instruments reflecting upon accountability and redress in the case of violations of international law, no matter which actor (States, international organisations, companies). In the following, I take the words used in the DARS, DARIO, Maastricht ETO Principles, and UNGPs as inspiration, not because they are legally binding in each and every situation discussed in this chapter, but because they reflect common sense views on the need to provide reparation in the case of internationally wrongful acts, as well as how that could and should be done in practice. The words chosen are presented here in a descriptive, non-problematised way (italics added for emphasis).

The DARS provide that States are responsible for internationally wrongful acts and that they are ‘under an obligation: (a) to cease that act, if it is continuing; (b) to offer appropriate assurances and guarantees of non-repetition, if circumstances so require’ (Article 30). Further to that, responsible States are under an obligation ‘to make full reparation for the injury caused by the internationally wrongful act’, while’ [i]njury includes any damage, whether material or moral, caused by the internationally wrongful act of a State’ (Article 31). Further to this, it is stated that the responsible States ‘may not rely on the provisions of its internal law as justification for failure to comply with its obligations under this part’ (Article 32).

Summary

Being bound by human rights obligations is one thing, determining the exact responsibility for the violation of such obligations by the IFIs as co-duty-bearers in the domain of international human rights law is something else entirely, and is the logical next step to be discussed. This chapter discusses three aspects of the attribution of responsibility for unlawful conduct: the attribution of unlawful conduct and responsibility to IFIs (subsection 4.1); what it means to be ‘in control’ (subsection 4.2); and primary, subsidiary and shared responsibility (subsection 4.3).

ATTRIBUTION AND RESPONSIBILITY

The circumstances under which international organisations may be held responsible for internationally wrongful acts have been laid down in the International Law Commission's Draft Articles on the Responsibility of International Organizations. The DARIO rules are used here as one of the possible lenses through which one can look at the (co-)responsibility of IFIs for the violation of human rights obligations. In light of Article 4 of DARIO, two conditions are required under international law for the responsibility of IFIs to be established: firstly, the breach of one of their international obligations, and, secondly, that the breach at issue is attributable to the IFI. As to the latter requirement, the conduct to be attributed will most of the time be the official conduct of the organs and agents of the IFIs acting within the overall framework of their functions, irrespective of the excess of authority or contravention of instructions (see also Article 2(c) and Article 8 DARIO).

The acts and omissions of IFIs may give rise to human rights violations where they aid or assist (Article 14), or direct and control (Article 15) a State (or another international organisation) in the commission of a wrongful act. The International Law Commission Commentary to the Draft Articles focuses especially on two conditions: the competence of the international organisation and the intention of the Member State. Article 61 of DARIO provides that the organisation must have competence in relation to the subject matter of the State's international obligation at hand before it can be held responsible, and the Commentary to the Article makes it clear that these situations are not limited to the transfer of a State's functions to an organisation.

Summary

In 2009, the Steering Committee for the programme ‘Beyond Territoriality: Globalisation and Transnational Human Rights Obligations’ (GLOTHRO), funded by the European Science Foundation and led by Belgian Professor Wouter Vandenhole, started a project on the human rights obligations of international financial institutions, most notably the International Monetary Fund (IMF) and the World Bank Group (WBG), which is composed of the International Bank for Reconstruction and Development (IBRD), the International Finance Corporation (IFC), the International Development Association (IDA), the Multilateral Investment Guarantee Agency (MIGA), and the International Centre for Settlement of Investment Disputes (ICSID). The project would build on a previous project, started in 2001 by the present author, which led to the publication of World Bank, IMF and Human Rights in 2003, containing the ‘Tilburg Guiding Principles on the World Bank Group, the IMF and Human Rights’.

The present publication provides an extensive explanatory text to, and a make-over of, the 2003 Guiding Principles, now called the ‘Tilburg-GLOTHRO Guiding Principles on the World Bank Group, the IMF and Human Rights’ (see Annex I). These principles are adapted to new insights and developments in the domain of international human rights law over the last decade, with special emphasis on the extraterritoriality of human rights, as well as on developments taking place in the domain of the international legal responsibilities of international organisations and their Member States. The text does not discuss the extent to which the WBG and IMF, and other multilateral development banks to which the findings would apply mutatis mutandis, actually live up to their international human rights legal obligations in daily practice. The focus is on discussing and clarifying the underlying legal concepts.

The explanatory text is comprised of arguments substantiating the Guiding Principles, taken either from doctrine or legal authorities. The aim of the publication is to clarify by what norms of international human rights law the WBG, IMF, and other IFIs are bound in 2014. Both the Guiding Principles and the text are meant to (re)present the relevant existing international human rights law (de lege lata), while adding a number of proposals with a view to the future law (de lege ferenda).

Summary

INTRODUCTION

As subjects of international law and as international legal personalities, the WBG and the IMF are capable of possessing rights and duties under their constituent instruments, general rules of international law, and the treaties to which they have acceded. This includes obligations in the domain of human rights, to be exercised separately from, or jointly with, their Member States. This statement will be further substantiated in this chapter by scrutinising the links between the mandates of IFIs and international human rights law (subsection 3.2); the incorporation of IFIs in the domain of international human rights law (subsection 3.3); the ‘political prohibition’, which prevents the WBG from interfering in political affairs (subsection 3.4); the human rights obligations of States acting in the context of IFIs (subsection 3.5); and the obligations following from the (legal) relationships between IFIs and private subcontractors (subsection 3.6).

THE LINKS BETWEEN IFI MANDATES AND INTERNATIONAL HUMAN RIGHTS LAW

As explained in Chapter 2, the WBG has chosen not to interpret its mandate in isolation from developments taking place in the human rights domain, while sometimes touching upon legal terminology. The IMF also ‘plays’ with human rights terminology, albeit in a different way. The question is which more specific human rights obligations can be linked to the mandates of these organisations and on what grounds. Let me first borrow the enlightening words of Mac Darrow - the author of a seminal book on the issue in 2003 - used by him in a piece written in 2009 for the renowned Encyclopedia of Human Rights:

The UN Charter is perhaps the most important source of human rights duties for members of the extended UN family; the UN Charter binds the bank and the IMF equally. The IBRD [International Bank for Reconstruction and Development], IDA [International Development Association], and IMF have all entered into formal relationship agreements with the UN. The promotion of human rights is at the heart of the UN system's purposes, as provided in articles 1(3) and 55 of the UN Charter, although specific obligations are not well-defined.

Summary

The Maastricht Principles on Extraterritorial Obligations of States in the area of Economic, Social and Cultural Rights were adopted by a group of experts in international law and human rights at a gathering on 28 September 2011 organised by Maastricht University and the International Commission of Jurists. The experts came from universities and organisations located in all regions of the world and included current and former members of international human rights treaty bodies, regional human rights bodies, and former and current Special Rapporteurs of the United Nations Human Rights Council. Their work was based on legal research conducted over a period of more than a decade. The final version of the Principles, dated 29 February 2012, can be found at www.maastrichtuniversity.nl/ web/Institutes/MaastrichtCentreForHumanRights/MaastrichtETOPrinciples.htm. Although not legally binding, the Principles are often (and increasingly) referred to in national and international legal and semi-legal practice. See www.etoconsortium.org/.

Principle 8

Definition of extraterritorial obligations

For the purposes of these Principles, extraterritorial obligations encompass:

Summary

Text adopted by the International Law Commission of the United Nations at its fifty-third session, in 2001, and submitted to the General Assembly as a part of the Commission's report covering the work of that session. The report also contains commentaries on the draft articles. The text can be found at http://legal.un.org/ilc/texts/instruments/english/draft%20articles/962001.pdf. The General Assembly ‘took note’ of the Draft Articles and ‘commen[ded] them to the attention of Governments without prejudice to the question of their future adoption or other appropriate action’ (GA Res. 56/83, 12 December 2001). A few exceptions left aside not relevant in the present context, the Draft Articles are generally considered to be customary international law.

Article l

Responsibility of a State for its internationally wrongful acts

Every internationally wrongful act of a State entails the international responsibility of that State.

Article 2

Elements of an internationally wrongful act of a State

There is an internationally wrongful act of a State when conduct consisting of an action or omission:

Summary

The UN Guiding Principles on Business and Human Rights were developed as a (key) step in the implementation of the UN ‘Protect, Respect and Remedy’ framework for business and human rights, as developed in 2008 by the UN Special Representative for this issue, John Ruggie. The Principles have been endorsed by the UN Human Rights Council (HRC/RES/17/4, 16 June 2011), and the Council also established the UN Working Group on business and human rights, requesting it, inter alia, to promote the dissemination and implementation of the Principles; to identify good practices and lessons learned; to ‘continue to explore options and make recommendations at the national, regional and international levels for enhancing access to effective remedies available to those whose human rights are affected by corporate activities, including those in conflict areas’ (ibidem). The Principles, including Commentaries, can be found at www.ohchr.org/documents/ publications/GuidingprinciplesBusinesshr_en.pdf.

The UN Guiding Principles follow the division in terms of (a) the State duty to protect human rights, (b) corporate responsibility to respect human rights, and (c) access to remedy, to be taken care of by both states and business enterprises. The Principles are divided into ‘foundational’ and ‘operational’ principles; however, this division is left aside here. Italics have been added in order to facilitate reading/ browsing of this annex.

THE STATE DUTY TO PROTECT HUMAN RIGHTS

Principle 1

States must protect against human rights abuse within their territory and/or jurisdiction by third parties, including business enterprises. This requires taking appropriate steps to prevent, investigate, punish and redress such abuse through effective policies, legislation, regulations and adjudication.

Principle 2

States should set out clearly the expectation that all business enterprises domiciled in their territory and/or jurisdiction respect human rights throughout their operations.

Principle 4

States should take additional steps to protect against human rights abuses by business enterprises that are owned or controlled by the State, or that receive substantial support and services from State agencies such as export credit agencies and official investment insurance or guarantee agencies, including, where appropriate, by requiring human rights due diligence.

Summary

Over the last two decades, many commentaries have been released on the way the WBG and IMF have taken human rights obligations on board, or refrained from doing so. This publication could have set the strict legal obligations and corresponding responsibilities for both IFIs higher, for instance, by presenting more extensive interpretations of already existing case law or by extrapolating trends in the human rights field more progressively than I have done. However, I believe that to do so would have overstretched the legal validity and applicability of developments in the field of international human rights law to IFIs such as the WBG and IMF. Overall, there is a lot of pressure on both organisations, as well as on other multilateral development banks not discussed here, to accept more accountability under international human rights standards. It has been made clear by what standards they are already bound, given the status of international human rights law in 2014, while, as to the extent to which both IFIs, be it to different degrees, still argue that they are not bound by such standards, it has been shown that the space for such a position is becoming more and more limited.

It helps to underscore that both IFI are independently moving in a direction in which the relevance of human rights to the fulfilment of their mandates is recognised, be it in the form of small steps following other small steps. In addition, it should not be forgotten that the pronouncements on human rights by both IFIs are only partly relevant from a strictly legal perspective. However, human rights law is best understood as living law and actors such as IFIs can be best considered non-static entities, even given their sometimes static approaches to their own mandates. Both IFIs have entered the human rights doorway, be it to different degrees. And should they want to move backwards or reconsider their respective ways forward, international human rights law as it presently stands can serve as an invitation, but also as a stop sign.

Building on human rights law as ‘living law’ and seeing both the WBG and IMF as ‘non-static entities’, it makes sense to put the findings of this publication in a somewhat historical perspective.

Summary

Are the World Bank Group (WBG) and the International Monetary Fund (IMF) bound to abide by international human rights law? For many legal and non-legal specialists it is clear that human rights must not be treated as something separate from activities conducted by the United Nations (UN) and the international organisations attached to, and closely working with, the UN. This is referred to as the ‘mainstreaming of human rights’. In this approach, the concept of human rights is used as a bridge in the fight against the (over-)fragmentation of international law and as a (the) guiding principle for the composite and complex organisation called the United Nations. This approach applies international human rights laws to the main organs of the UN and all the international organisations and specialised bodies linked to the UN, such as, in the context of the present publication, the WBG and the IMF. Others, however, argue that the charters and other constitutive documents of these international financial institutions (IFIs) have to be honoured and that one has to respect their specialisations. The consequence of this argument would be that such charters could/should be placed above or, at least, alongside other international obligations that the IFIs have by virtue of their links to the ‘UN family’. Both views keep coming up in discussions on the questions why and to what extent the WBG and IMF are legally bound by international human rights standards. The key aim of the present publication is to make it clear by what norms of international human rights law both the WBG and the IMF are bound, and to further identify and specify points for coining their responsibility for violating these norms. As to the latter, the focus is on principles and concepts that can help to attribute and apportion such responsibility to these IFIs, including the responsibility shared with their Member States.

As to the terminology used, the 2001 Draft Articles on the Responsibility of States for Internationally Wrongful Acts (DARS) use the term ‘attribution of conduct’ to a State (Article 2, header of Chapter II and Articles 10 and 11). The 2011 Draft Articles on the Responsibility of International Organizations (DARIO) do the same in relation to international organisations (Article 4, header of Chapter II and Article 9).

Summary

Text adopted by the International Law Commission of the United Nations at its sixty-third session, in 2011, and submitted to the General Assembly as a part of the Commission's report covering the work of that session. The text can be found at http://legal.un.org/ilc/texts/instruments/english/draft%20articles/9_l 1_201 1.pdf. A commentary can be found at http://legal.un.org/ilc/texts/instruments/english/ draft%20articles/9_ll_2011.pdf. The General Assembly ‘took note’ of the articles and ‘commen[ded] them to the attention of Governments and international organizations without prejudice to the question of their future adoption or other appropriate action’ (A/RES/66/100, 9 December 2011). Again, a few exceptions left aside not relevant in the present context, the Articles are generally considered to be customary international law.

Article 1

Scope of the present draft articles

Summary

Before addressing the obligations following from existing international human rights law as it relates to the WBG and the IMF, this chapter illustrates how both of these IFIs present themselves today in relation to the links between their respective mandates and international human rights. This is undertaken to make it clear that discussing the obligations following from existing human rights law and the attribution of conduct that violates these norms in Chapters 3 and 4 is not a matter of imposing something externally upon IFIs, but links to discussions underway in both IFIs.

OFFICIAL WBG POSITION

The WBG underlines in its own recent policy statements that internal developments have shown ‘growing recognition of the need for the Bank to address human rights in a more explicit fashion’ and that there ‘have been significant advances in the Bank's thinking on this issue’. The evidence provided relates to the Bank's pronouncements from as early as 1998 on human rights, which contained statements about how the Bank supports the realisation of human rights and how it believes that ‘creating the conditions for the attainment of human rights is a central and irreducible goal of development’. The Bank's official statements refer to several developments outside the Bank, such as the 2003 UN Common Understanding on a Human Rights Based Approach to Development; the Secretary General's 2005 report In Larger Freedom; and the findings of the 2006 World Development Report Equity and Development. In the words of the Bank, ‘[t]he World Development Report 2006 explores the ways in which structural and distributional inequalities can hinder development, and grounds equity in two basic principles: Equality of opportunity and the avoidance of absolute deprivation, both of which have human rights dimensions’.4 Further to this, the Bank refers to, inter alia, its cooperation with the Office of the High Commissioner of Human Rights on several initiatives including, for example, supporting countries to take human rights considerations into account in the preparation of their poverty reduction strategies, as well as with the Organisation for Economic Co-operation and Development (OECD) Development Assistance Committee (DAC).

In the opening chapter the volume editors reflect on the content of the book. They do so, by first touching upon the ideas the Editorial Board of the Netherlands Yearbook of International Law (NYIL) had in mind when opting for a volume on the issue of crisis, including such questions as: how international law reacts to crises and whether or not crises in daily realities also cause crises within separate international legal sub-disciplines. Next to that they summarize the eight chapters, followed by a reflection upon four topics and perspectives that come to the forefront when taking the contributions together and not reading them as reflections on separate trends in separate fields of international law. The four topics relate to: the role of crises in developing international law; do we do the things right or do we do the right things?; reconsidering and sharpening compliance; and the role of international lawyers.

The rise of globalization and the persistence of global poverty are straining the territorial paradigm of human rights. This book asks if states possess extraterritorial obligations under existing international human rights law to respect and ensure economic, social and cultural rights and how far those duties extend. Taking a departure point in theory and practice, the book is the first of its kind to analyze the principal cross-cutting legal issues at stake: the legal status of obligations, jurisdiction, causation, division of responsibility, and remedies and accountability. The book focuses specifically on the role of states but also addresses their duties to regulate powerful nonstate actors. The authors demonstrate that many key issues have been resolved or clarified in international law while others remain controversial or await the development of further practice, particularly the scope of jurisdiction and the quantitative dimension of extraterritorial obligations to fulfil.

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The World Bank Group, the IMF and Human Rights

Rights, Responsibilities and Duties for the Civil Society. Moral Challenges Put Forward by the Millennium Development Goals

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Chapter 5 - Accountability and Redress

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Chapter 4 - Attributing Unlawful Conduct to IFIs and their Member States

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Frontmatter

Preface

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Chapter 3 - Applicable Human Rights Obligations

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List of Abbreviations

Bibliography

Annex IV - Maastricht Principles on Extraterritorial Obligations of States in the area of Economic, Social and Cultural Rights (2011) (excerpts)

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Annex II - Draft Articles on the Responsibility of States for Internationally Wrongful Acts (2001) (excerpts)

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Annex V - UN Guiding Principles on Business and Human Rights (2011) (excerpts)

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Chapter 6 - Concluding Remarks

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Chapter 1 - Introduction

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Annex III - Draft Articles on the Responsibility of International Organizations (2011) (excerpts)

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Chapter 2 - IFIs Positioning Themselves in the Human Rights Field

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Contents

Annex I - Tilburg-GLOTHRO Guiding Principles on the World Bank Group, the International Monetary Fund and Human Rights

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Crises: Concern and Fuel for International Law and International Lawyers

Global Justice, State Duties

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The World Bank Group, the IMF and Human Rights

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Global Justice, State Duties