In Professor Jackson's week 10 lecture on Global Business and Economic Autonomy, he mentions an case (The Nigeria Shell oil drilling case) in which a corporation maintained a larger army than some states. In the 1990s, Shell Oil allegedly enlisted the Nigerian military dictatorship to suppress opposition to Shell's oil operations. This case demonstrates the complex nature of corporate accountability in the international arena.
A 2002 lawsuit, Kiobel v. Shell, alleged that Shell "aided and abetted" the Nigerian military dictatorship in committing severe human rights abuses against members of the Ogoni people who were involved in a nonviolent movement to stop it from drilling for oil in their rich Niger River Delta homeland. But, in a challenge to a 200-year-old law, Shell is argued that as a corporation it cannot be held responsible for human rights violations abroad. The company didn't deny the charges; it claimed that as a corporation it should be able to get away with murder.
Shell asked the Court
for a "Vegas" rule: that what happens in Nigeria stays in Nigeria. In
the 1990s Shell funded and armed a violent military dictatorship. They used the
Nigerian army and sham courts to torture and eliminate people hindering oil-drilling efforts.
Shell --
and six oil companies who filed briefs in support of Shell -- claimed that as corporations,
they enjoy immunity from prosecution under international human rights law
because they are not a person, but a corporation.
In a 2–1 decision issued on September 17, 2010, the U.S. Court of Appeals for the Second Circuit held that corporations cannot be held liable for violations of customary international law, finding that: (1) under both U.S. Supreme Court and Second Circuit precedents over the previous 30 years that address Alien Torts Claim Act suits alleging violations of customary international law, the scope of liability is determined by customary international law itself; (2) under Supreme Court precedent, the Alien Tort Claim Act requires courts to apply norms of international law—and not domestic law—to the scope of defendants' liabilities. Such norms must be "specific, universal and obligatory"; and (3) under international law, "corporate liability is not a discernible—much less a universally recognized—norm of customary international law", that the court could apply to the Alien Torts Claim Act, and that the plaintiffs' ATA claims should indeed be dismissed for lack of subject matter jurisdiction.
This particular case displays one of the biggest dilemmas, mentioned by Professor Jackson, that faces the international community regarding how to deal with private actors. Unfortunately, the international community's lack of enforceable accountability extend to its economic sphere. As we see in this case, even with a corporation admitting to human right's violation on another state's land, the extraterritoriality that private actors enjoy can serve as an obstacle to international law and justice.
References
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Weiss, Peter. "The Question Before the US Supreme Court in Kiobel v Shell – If Corporations Have the Same Rights as People To Make Political Donations, Then Surely They Also Have Human Rights Obligations?". The Guardian. Retrieved March 5, 2015.
Leval, Pierre N. "The Long Arm of International Law." Foreign Affairs. 5 Feb. 2013. Web. 22 Apr. 2013.
Fatima, I think this is an outstanding explanation of the moral and legal problems that multinational corporations pose to global governance. Ideally we would hope to see domestic legal reforms which would make these corporations accountable for actions abroad. Lincoln Caplan expressed similar sentiments in a New York Times editorial entitled "Corporate Abuse Abroad, a Path to Justice Here," explaining that: "In a world where multinational corporations are primary actors, the need for a way to hold them accountable for extreme abuses is more urgent than ever."
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