National Contact Point: The limits of dialogue

Glencore
Where people are dwarfed by machines. Photo: At Zambia's Mopani copper mine owned by the Glencore group, some 4,000 tonnes of copper ore are brought to the surface daily.
Article as analysis
Economic associations are opposed to the introduction of civil liability for business-related human rights violations and environmental degradation, as proposed under the Responsible Business Initiative; they point to National Contact Point.

It should be recalled that governments that have adhered to the OECD Guidelines for Multinational Enterprises, Switzerland among them, have undertaken to set up a National Contact Point (NCP), which is a non-judicial grievance mechanism whose structure and functioning vary from country to country. The primary function of the NCP is to promote the OECD Guidelines and receive complaints regarding the non-observance of the Guidelines by enterprises.

In Switzerland, the powers and functions of the National Contact Point are laid out in a Federal Council Ordinance, which tasks it, among other things, with “handling specific instances raised regarding presumed breaches of the OECD Guidelines by enterprises and to act as a mediator between the parties”.

An individual or a group may “raise specific instances” with the Swiss NCP, which is empowered, inter alia, to handle issues raised concerning the activities of Swiss enterprises established in non-OECD countries, quite likely in developing countries. Institutionally, the Swiss NCP is attached to the State Secretariat for the Economy (SECO) and has been assisted since 2013 by an Advisory Board composed of 14 members representing the Federal Administration, employers' federations and trade associations, trade unions, NGOs and academia. The NCP Procedural Guidance states that the NCP serves as a “platform for dialogue and mediation” between the parties involved, with a view to helping them resolve the dispute at hand. The NCP may itself conduct the dialogue or seek the assistance of an intermediary or an external mediator. Remarkably, however, “participation in this dialogue is not obligatory”.

Shortcomings and weaknesses of the NCP

The (sole) mission of the NCP is to encourage dialogue between the parties and not that of determining whether the OECD Guidelines have been breached. The NCP may not comment on the possible non-observance of the Guidelines by a multinational enterprise.

In its present form, the Swiss NCP confines itself to providing a platform for dialogue and mediation between the parties to a conflict. Besides, participation in this dialogue is not mandatory and the NCP has no means of persuading or compelling enterprises to take part in it. As such, it is a voluntary mediation procedure that therefore depends on the good will and good faith of enterprises that submit to it. Indeed, mediation is by nature consensual and does no more than offer the parties the chance – but does not require them – to take part in a process of assisted dialogue to settle a dispute.

Regarding the efficiency and efficacy of the Swiss NCP, the main weaknesses in its current structure and functioning are the following:

  • Its lack of institutional independence – being attached to SECO – unlike other NCPs that operate as entities independent of the government, one example being that of Norway, which comprises four independent experts;
  • stringent confidentiality requirements, or the lack of public access to the procedure;[1]
  • the paucity of resources provided to enable the poorest population groups (mainly) in developing countries who are harmed by the activities of multinational enterprises with headquarters in Switzerland to participate fully in the mediation procedure launched by the NCP (specifically to cover the costs of translation and travel for the communities concerned);
  • the absence of conclusions in the "final statements" from specific instances regarding the violation of the OECD Guidelines for Multinational Enterprises and the absence of clear recommendations on measures expected of enterprises to ensure full observance of those Guidelines;
  • the absence of a supervisory body (independent body with decision-making power), as the Advisory Board, with its vague mandate, does not fulfil these conditions;
  • the lack of material consequences for enterprises in the event of non-participation or bad faith during the proceedings, unlike the case of Canada's NCP which may withhold any commercial support abroad from the companies concerned, or which considers the attitude of enterprises when they wish to access credit/export support.

Complementarity between NCP and access to civil justice

By itself, a platform for dialogue and mediation would not be able to guarantee “Access to remedy” as called for in the third pillar of the UN Guiding Principles on Business and Human Rights. In fact, these principles affirm that “States should provide (…) non-judicial grievance mechanisms, alongside judicial mechanisms, as part of a comprehensive State-based system for the remedy of business-related human right abuses” (UNGP, 27). The same complementarity is being sought through Recommendation CM/Rec(2016)3 of the Committee of Ministers to Member States of the Council of Europe, whose chapter on civil liability for business-related human rights abuses provides that «Member States should apply such legislative or other measures as may be necessary to ensure that human rights abuses caused by business enterprises within their jurisdiction give rise to civil liability under their respective laws» (§32) and that Member States should consider allowing their domestic courts to exercise jurisdiction over civil claims concerning business-related human rights abuses against subsidiaries, wherever they are based, of business enterprises domiciled within their jurisdiction if such claims are closely connected with civil claims against the latter enterprises (§35).

In this regard, the Federal Council itself recalls, in its National Action Plan for the implementation of the aforementioned UN Guiding Principles adopted in December 2016, the importance of effective national judicial mechanisms in deciding on material consequences and compensation when dealing with business-related human rights violations.

The mechanism for “raising specific instances” provided by the Swiss NCP is no more than a voluntary mediation procedure, as it has no power to rule on the violation of the OECD Guidelines or impose material consequences. It cannot therefore substitute for effective access to legal remedy before a judicial body that is competent to rule on the existence of business-related human rights abuses and impose adequate indemnification as called for under the Responsible Business Initiative.

 

[1] The NCP procedures remain confidential during the mediation process. The parties involved must also respect this confidentiality and may not make public any information during proceedings (NCP Specific Instance Procedure, paragraph 3.5). Norway, in contrast, allows public access to all information concerning an ongoing procedure, pursuant to the Norwegian Freedom of Information Act.