OECD Guidelines for Multinational Enterprises The NCP / Company dialogue & mediation Serena Lillywhite Bangkok, 4 November 2009

Presentation overview 1.What happens after the complaint is lodged? 2.What is the function of the NCP? 3.The Initial Assessment Phase 4.The case is accepted as a ‘specific instance’ 5.Understanding the rules: confidentiality 6.Dialogue between parties 7.Preparing for mediation 8.The mediation process – what happens? 9.The NCP Final statement 10.Follow up / appeal and communication 11.Limitations of the NCP process

What Happens After the Complaint is Filed? Writing the complaint is just the beginning. Collaborate with local NGOs The process is long – months or years There are 2 phases – Initial Assessment phase & Specific Instance Phase There are no rules or timelines an NCP must follow in handling a complaint The company is not required to participate in the process, even if case accepted by NCP

What is the role of the NCP / structure? Promote the Guidelines to MNE’s Investigate & respond to ‘specific instances’ – cases Facilitate mediation between parties Issue, and make public, final statement on cases NCP structure varies – no rules 17 NCP single gov. depts. 10 NCP multiple gov. depts. 1 bipartite 9 tripartite (gov, bus, TU’s) 2 quadripartite (gov, bus, TU’s, NGO’s) 1 mixed structure of independent experts & gov

The Initial Assessment Phase This is the first step / investigation by the NCP The objective is to review the complaint material submitted by the NGOs and decide if there is enough evidence of non-compliance with the Guidelines This stage is unlikely to include assessment of alleged breaches The NCP may meet with the NGOs (complainants) and the company at this stage to seek clarification Best practice by NCPs indicates that consultation with independent experts is very valuable at this stage The NCP may request more information or documentation from either party The NCP may limit the scope of a complaint in order to accept the case

The Specific Instance Phase Second phase If a complaint is accepted as a specific instance it means the NCP thinks there is enough evidence to warrant further investigation. NCP can seek information from others NCP can do a country visit for fact finding – not common Lengthy process

Specific Instance Rules & Obligations Companies are not bound to participate in the specific instance process – they can refuse or ignore it After a complaint has been accepted as specific instance all parties (company & NGO) must adhere to “confidentiality principle” You can put out a media release when you first file complaint You cannot make public (media, your website or other means) information on case progress or information obtained throughout the process) Information about the issue already in the public domain or previously part of your campaign can remain on websites

Dialogue Between the Parties Dialogue and communication between the company, NCP and NGO varies Sometimes direct, sometimes via NCP, sometimes non- existent Nominate a member of the NGO team to be the key contact person Document all phone conversations and keep all correspondence Respond quickly and follow up Be professional & respectful

Preparing for Mediation Be prepared Seek input into the agenda of issues to be discussed in mediation – make sure it is relevant to case Find out who will be at the mediation Find out the process, how it will be conducted Not all aspects of your complaint may be discussed in mediation Think carefully who is best to attend the mediation to achieve outcome

What Happens in Mediation? Mediation is a discussion between the company & NGO/ TU, with the NCP trying to facilitate an agreed outcome You may be asked to prepare an opening statement – have this written down & ask to have it included in final statement Know what you are prepared to compromise on You will be asked to follow the agenda and agreed topics of discussion. If there is a new & relevant development – make this known in advance Ask for ‘time out’ to discuss developments in private with your colleagues There is no time limit

The NCP Final Statement NCP must issue final statement at end of complaint process, and make it public This is a most ‘controversial’ aspect of OECD complaint process Many NCPs refuse to state if Guidelines breached, or withhold aspects of complaint Ask to have your opening statement included as an Appendix Ensure all ‘Agreed Outcomes’ are in the final statement Ensure issues that agreement was not reached on are included in final statement Seek consultation in drafting of final statement – full disclose of issues, parties, breaches and outcome is the aim OECD Watch position: If no mutually agreeable outcome, NCP statement must still record a breach of provisions, or clear company

Follow up and Communication There is no appeal or follow up mechanism You can contact OECD Investment Committee if NCP ineffective and inactive There is no guaranteed compensation or remedy When the case is concluded you can put out a press release, but you cannot disclose information or conversations from the case (unless already in public domain) You can continue dialogue directly with the company

Limitations of the NCP process They are not binding Chapter content limited e.g. human rights, supply chains No redress mechanism or follow up NCP effectiveness very patchy Delays & non-action by NCP NCP structure – conflict of interest Unequal treatment of parties Lack of resources of NCPs Reticence to undertake fact-finding Cases blocked Investment nexus Sphere of influence Parallel legal proceedings Final statements often vague and do not make clear determination of violation

Using the complaint mechanism There can be benefits to filing a complaint if you enter into the process properly prepared and with a clear view of what outcome you hope to achieve. See checklist of considerations before proceeding with a case using the OECD Guidelines for MNEs (provided)

More Information: Become an OECD Watch Member Quarterly Case Updates OECD Watch Briefing Papers & reports OECD Watch newsletters OECD Watch Guide to the Guidelines OECD Watch Fact Sheets The OECD Guidelines on Multinationals TUAC Users Guide – Using the OECD Guidelines for Multinational Enterprises – A critical Starters Kit for NGOs – Friends of the Earth Netherlands –