Rights and Accountability in Development ('RAID') V das Air and Global Witness V Afrimex: Small Steps towards an Autonomous Transnational Legal System for the Regulation of Multinational Corporations

Article excerpt

The enforcement framework for the OECD's Guidelines for Multinational Enterprises has long been the subject of criticism, especially by representatives of private and public actors. But two recent cases have suggested that enforcement actions arising from civil society efforts to utilise the national contact points complaint system may be slowly influencing the emerging discourse of corporate behaviour in ways that will have substantial effect. Beyond providing evidence of a more muscular institutional transnational enforcement structure for soft law codes, the cases serve to outline a framework for the interaction of transnational and national systems of corporate regulation. The multilateral system for governing multinational corporate behaviour will affect not only that behaviour, but also the rules through which corporations may be governed as to their internal affairs and with respect to the character of their legal personality. The cases illustrate the way in which advances in governance issues are being crafted, step-by-step, from out of a system that, while formally non-binding, is increasingly developing the characteristics of a binding governance system. These cases suggest the parameters within which the Guidelines for Multinational Enterprises are beginning to serve as the focal point for the construction of an autonomous transnational governance system that is intended to serve as the touchstone for corporate behaviour in multinational economic relationships.


  I Introduction
 II The Regulatory Context
III The Cases
    A RAID v DAS Air (21 July 2008)
    B Global Witness v Afrimex (28 August 2008)
 IV The Analytical Context
    A The Construction of an Interlinked System of International and
      Municipal Hard and Soft Law
    B Corporate Law Challenges
      1 Respect for the Separate Legal Personality of Separately
        Constituted Entities
      2 Enterprise Liability
    C Toward Procedural Autonomy
  V Conclusion


The problem of the multinational corporation has been at the centre of transnational policy discussion for the greater part of the last half-century. (1) For the last decade, attempts to create hard law and harmonised regulatory structures for multinational corporations have been effectively blocked by a great alliance of business and developed state interests. (2) The most prominent among these failures has been the United Nations' Norms on the Responsibilities of Transnational Corporations and Other Business Enterprises with regard to Human Rights ('UN Norms'), (3) Moreover, attempts to stretch national law to bring the transnational activities of multinational corporations under the regulatory control of at least some states has been largely unsuccessful, (4) except perhaps within the academic literature. (5)

This breach in regulation has been filled with a variety of soft law efforts. (6) Prominent among them has been the UN successor regulatory strategy to the UN Norms--the UN Global Compact. (7) In addition, powerful regional state-private sector organisations have also sought to create soft law regulatory networks that might contribute to a set of behavioural norms among multinational enterprises. (8) Among these has been the Organisation for Economic Co-operation and Development ('OECD'), (9) who has been at the forefront of developing and creating frameworks for the implementation of soft law for corporate governance. (10)

Prominent among the OECD's soft law codes are its Guidelines for Multinational Enterprises ('MNE Guidelines'). (11) The MNE Guidelines are the only multilaterally-endorsed and comprehensive code that governments have committed to promoting. The MNE Guidelines express the shared values of the governments of those countries that are the source of most of the world's direct investment flows, and home to most multinational enterprises. (12) They are meant to be applied to the worldwide operations of businesses that might be subject to their provisions. …


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