Corporate Accountability and Human Rights Case Study PULP Mills in Fray Bentos - Uruguay Presented by Center for Human Rights and Environment (CEDHA) - Argentina Harvard - April 19, 2007 Jorge Daniel Taillant – jdtaillant@cedha.org.ar

Ence Botnia Rio Uruguay Argentina Uruguay

Principal Proponents Companies - Botnia/ENCE IFC MIGA Private Banks (ING / BBVA / Nordea / NIB) Finnvera (Finnish Export Credit Agency) Uruguayan Government (National and Local) Spain Netherlands Uruguayan Gov

Key Source of Problem Environmental Impact Assessment Summary – Orion – April 20, 2005 Two Mills ENCE/Botnia measured separately Incomplete EIAs and failed engagement generate speculation and mistrust “Consultations indicate that the project enjoys broad public support”

Broad Public Support! Just 10 Days Later!

Broad Public Support!

Gualeguaychu Assembly 40,000 persons Entre Ríos Gov Gualeguaychu Assembly 40,000 persons Taking to Bridge Argentine Gov Principal Oposition Gualeguaychu Assembly (40,000 personas) (Public/Business/NGOs) Select NGOs and Public in Uruguay Argentine Government (National, Provincial and Municipal) Uruguayan Prosecutor Press CEDHA Uruguayan NGOs

What to do?

Possible Channels of Action CAO Inter-American Commission of Human Rights European Commission for Violations to European Citizens Spanish/Finish Courts (Finnvera - ECA) Criminal Actions in Argentina against CEOs International Court of Justice Legal Action in Uruguay Equator Bank Compliance Claim (to BBVA and ING) OECD Guidelines for Multinational Enterprises UN Human Rights Norms for Transnational Corporations UN Global Compact Generally on Corporate Social Responsibility Commitments Corte Internacional de Justicia

Complaints – What We Did

Grounds of Action at CAO Violations to Environmental and Social Safeguards Violations to Disclosure Policy Violations to International Waterways Policy Poor Stakeholder Consultation Poor EIAs Violations of International Treaties

CAO Audit Findings Complaint by 40,000 Stakeholders “IFC’s due diligence to satisfy itself that the EAs were complete in all material respects was inadequate and not incompliance with the organization’s Disclosure Policy” (CAO, Feb 22, 2006) Insufficient evidence that proper consultation has occurred No cumulative impact study; IFC Fosters Separation of Projects! Need to generate transboundary trust in Local Communities Botnia’s beginning construction undermines legitimacy Special Efforts must be made to legitimize future studies Must study impacts of eucalyptus tree farming on water Must examine International Law Obligations; MIGA says not needed! Establishes legitimacy of (Gualeguaychú Assembly) IFC Fails to Give Clarity on how it will address Study Flaws “Further technical information and facts will not be sufficient” CAO Audit Findings

International Waterways International Waterways policy (OP 7.50)

International Court of Justice ICJ Ruling

Grounds of Action at IAHRC (for Responsibility of Uruguayan Gov Grounds of Action at IAHRC (for Responsibility of Uruguayan Gov. To Project) Right to Life Right to Physical Integrity Rights of the Child Judicial Process Progressive Realization of ESCR Right to Health Right to a Healthy Environment Access to Information Access to Justice We asked for Preventive Measures

Mixed Results Withdrawal of One Pulp Mill Withdrawal of One Major Financial Bank (480m) Posibility New Compliance Procedure at Equator Banks Debate Opening at OECD of Bank Liability to Guidelines Improvement of Remaining Mill 18 Month Delay Board Vote Date @ WB Investigation process initiated at IAHRC Greater Attention to Policy Procedures Awareness Building / Experience

Exploratory Strategies Articulation of Actions Others? UN CSR CAO World Bank Board Safeguards IACHR Indep. Control Mechs OECD -NCPs Companies IFIs Human Rights Press Social Movements NGOs National Governments Prvt Banks

Center for Human Rights and Environment Jorge Daniel Taillant jdtaillant@cedha.org.ar Center for Human Rights and Environment