New law is needed to link economy and human rights

Article as analysis
Even with growing numbers of human rights abuses as evidenced by the cases of China and Myanmar, Switzerland lacks any legal basis for the rapid introduction of targeted economic measures.

The past three years have brought mounting proof of the existence of Uyghur internment camps in Xinjiang and the practice of forced labour. No longer able to deny the evidence, Western countries are reacting: in April, the European Union (EU) imposed sanctions on Chinese officials and a State-owned company. Norway, like Switzerland, is a member of the European Free Trade Association (EFTA) and has joined in the imposition of sanctions.

Going even further, the United Kingdom brought in new rules on 12 January prohibiting the import of products suspected to be the outcome of forced labour in Xinjiang. Canada followed suit the same day and announced restrictions on imports from Xinjiang. With ever more extensive supply chains in which a product is no longer manufactured from start to finish at a single location but assembled from components made all around the world, it has become extremely difficult if not impossible to prove that a particular item is a product of forced labour. Hence the approach taken by the EU – acting on well-founded suspicions.

Perfect traceability impossible

The United States goes still further. Under the “Uyghur Human Rights Policy Act” and the “Uyghur Forced Labour Prevention Act”, the US Congress has placed an outright ban on imports of products made in Xinjiang. In the face of mounting evidence of massive human rights abuses, it is now incumbent on US and other companies to prove that goods imported into the United States are not products of forced labour, and not the other way around.

Switzerland is sticking to a very conservative approach, and doing the exact opposite: in rejecting the motion tabled by Councillor of States Carlo Sommaruga calling for a ban on imports of goods produced by forced labour in Xinjiang, the Federal Council adduced the difficulty of perfect traceability: “The Federal Administration is unable to verify conditions of production abroad and cannot therefore guarantee compliance of the ban on forced labour. It has neither the means nor the possibility to ensure the full traceability of every imported product or of each of its components.”

Switzerland pleads lack of legal basis

The foregoing examples show that where there is a will, there is a way. But Switzerland is unwilling. The country lacks the political will to align its economic interests with the observance of human rights, even in the face of abuses as blatant as those being committed against Uyghurs. Ever more jurists and parliaments around the world no longer hesitate to characterise them as genocide.

The only concrete action taken by the Federal Council has been to organise a roundtable with representatives of the textile industry operating in Xinjiang, “in order to inform them about the situation”, and with the machine industry. In the view of Alliance Sud, Public Eye and the Society for Threatened Peoples – which came together in the China Platform when the free trade agreement was being negotiated and which have relaunched this Platform since the discovery of the Uyghur camps – this is not enough. Nor is it for the United Nations. At the end of March the UN wrote to Switzerland and 12 other countries “recalling the obligations of home States […] to ensure that businesses under their territory and/or jurisdiction respect all human rights throughout their operations.” A privilege that our country would perhaps have been happy to forego.

The reason given by the State Secretariat for the Economy (SECO) for not doing more is the absence of a legal basis. The Federal Council confines itself to repeating that it expects enterprises to exercise due diligence, but refuses to go any further.

A framework that refers to and supplements existing laws

In the case of Myanmar, where the coup d’état staged by the military on 1 February has already claimed more than 800 lives but where there are less economic interests at stake, things are somewhat better. Switzerland has aligned itself with the EU and the United States and adopted sanctions against 11 senior military figures and the two army-controlled conglomerates. They are the Myanmar Economic Corporation (MEC), active mainly in mining, manufacturing and telecommunications, and the Myanmar Economic Holdings Limited (MEHL), with operations in the banking, construction, mining, agriculture, tobacco and agri-food sectors, among others.

What should be done in the light of this inaction or action that varies so greatly? The China Platform has commissioned a study to be conducted by Emeritus Professor Thomas Cottier, an international trade law expert who advocates that Switzerland should bring in a new foreign trade law that links economy and human rights. The currently applicable legislation is the Federal Act of 25 June 1982 on International Trade Measures, which by and large contains technical procedural provisions, confines itself to protecting the Swiss economy and provides no fundamental guidance on policy development.

“A new foreign trade law will constitute a framework which refers to existing laws that must be amended and developed as appropriate. This applies, among others, to the Embargo Act, which currently authorises measures only in the event of a decision by the United Nations or of sanctions implemented by the principal trading partners, namely the EU or the United States. Switzerland still has no legal basis on which to independently introduce economic sanctions in response to human rights violations. There should be a detailed examination of the extent to which other laws would permit this”, says Cottier.

But what would be the added value of the new law versus already existing legislation? “In Switzerland, there are legal bases that already allow for the taking of enforcement measures in the event of human rights abuses and criminal acts of corruption. They include for example the Embargo Act, the Goods Control Act, the War Materiel Act, the Federal Act on International Mutual Assistance in Criminal Matters, the Federal Act on the Freezing and the Restitution of Illicit Assets held by Foreign Politically Exposed Persons (law on potentate funds or dictators' assets) and the Criminal Code. But the new law should encompass the entirety of foreign trade law, including customs law and more particularly the federal law on the granting of tariff preferences to developing countries, which currently entails no conditionality. The Administration should undertake a study to ascertain what already exists and what is lacking or can be supplemented.”

This would ensure coherence and transparency in Switzerland’s foreign economic policy and pave the way for appropriate responses to outrageous human rights violations, irrespective of the economic interests at stake.