Sunday, July 10, 2011

News From the State Department: U.S. OECD National Contact Point Update

(IntLawGrrls is pleased to welcome back alumna Natalie Bridgeman Fields, who contributes this guest post)

Last November, I wrote a guest post discussing the importance of the U.S. Organisation for Economic Cooperation and Development National Contact Point as a potential soft law vehicle that could be used to hold multinational corporations accountable for their responsibilities under the OECD Guidelines for Multinational Enterprises. (image credit)
The OECD Guidelines have just been revised to include an explicit provision on human rights for the first time -- and they still maintain strong provisions on environmental issues, information disclosure and other issues.
At the time of my last blog post, the U.S. National Contact Point was undergoing a review at our urging. Through it, Accountability Counsel, the nongovernmental organization for which I serve as Executive Director, and many other NGOs provided extensive comments and suggestions for reform of the mechanism. At the time, our unusually diverse coalition of civil society groups -- many of us who served on the National Contact Point Subcommittee of the Advisory Committee for International Economic Policy -- was hopeful that the U.S. National Contact Point would become an accessible and effective mechanism to raise complaints for communities harmed by the activities of multinational corporations around the world.
At the end of last month, I met with Jose Fernandez, Assistant Secretary of State for Economic, Energy & Business Affairs, who presented the results of the U.S. National Contact Point review process. (credit for photo of State Department headquarters)
The new policies and procedures just released fail to meet even the “core criteria” outlined in the updated 2011 OECD Guidelines for Multinational Enterprises (visibility, accessibility, transparency, and accountability), and are little change from last set of vague and inadequate procedures. The new procedures create additional hurdles that keep the U.S. National Contact Point inaccessible to communities and hidden to the public. The new policies also reflect the State Department’s lack of consideration of the civil society’s unified input and collective expertise.
The new procedures do have two important improvements:
► A timeline for the complaint process; and
► A provision stating that outside “parallel” proceedings do not automatically bar complaints from eligibility under the U.S. National Contact Point.
However, the remainder of the National Contact Point’s new provisions will make it hard to take advantage of even these advances.
As the revised procedures currently stand, it is impossible for persons who wish to use the mechanism to understand whether their complaint will be accepted, how it will be treated, and why. The vague and ambiguous procedures render the National Contact Point of little use to potential requesters, and give minimal guidance to the staff.
Additionally, the procedures structure the National Contact Point in a way that appears to bar the ability of the U.S. entity to make determinations as to whether the multinational corporation failed to comply with the OECD Guidelines. In contrast, the British National Contact Point can make such determinations. Final determinations are crucial to provide communities with validation of their complaints and to create a public record of the violation of the Guidelines. Without final determinations about compliance with the Guidelines, the National Contact Point is simply a mediator with unclear provisions for: who may file a complaint; under what circumstances it will be addressed; and even who will pay for the National Contact Point’s services. (The latest procedures have a mediation fee provision that may be so costly as to make the mechanism entirely inaccessible to communities harmed by U.S. multinational corporations around the world.)
While the newly released U.S. National Contact Point procedures do not provide for oversight, Assistant Secretary Fernandez has committed to the establishment of an Advisory Board to oversee the mechanism.
Civil society groups are proposing the creation of an Advisory Board composed of representatives from public interest organizations, labor unions, government, and business. The proposal is that the Advisory Board have the authority to review the U.S. National Contact Point’s functioning and ensure that it follows its own procedures.
Finally, the new procedures include troubling provisions on confidentiality and transparency, as well as a presumption against monitoring the outcomes of the National Contact Point process if an agreement is reached after the process, or if a determination is made about non-compliance, (These are steps used in other international accountability mechanisms in order to enhance effectiveness.)
The day after my meeting with Fernandez, I gave a talk to the annual meeting of representatives of international accountability mechanisms tied to international finance and development. As I presented my talk benchmarking the policies of eight mechanisms against one another, it struck me how far ahead of the U.S. National Contact Point they are in terms of transparency, accessibility, independence, and effectiveness. Our comments to the State Department during the review process had sought to use the collective experience of the other international accountability mechanisms to leapfrog ahead of the challenges that they had worked through in the early stages of their development.
The civil society coalition remains deeply concerned that the U.S. approach towards the Guidelines and the U.S. National Contact Point continues to create hurdles for local communities that seek to file complaints. Failure to adequately revise the National Contact Point also harms the ability of corporations to use the mechanism as a tool for addressing grievances. The coalition has called on the Obama Administration to lead in ensuring that multinational corporations practice business responsibly and that peoples around the world have an accessible way to address human rights and environmental issues affecting their communities. More on this issue is available here.

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