1. Corporate R2R Human Rights vis-à-vis Legal Duty of Care Cees van Dam – Filip Gregor – Paige Morrow EU Road Map to Business and Human Rights Conference Amsterdam, 11 May 2016 1

2. Preliminary conclusions research project ‘Human Rights in Business’  Human Rights in Business collaboration of leading European academic institutions funded by the European Union’s Civil Justice Programme aims at researching and resolving problems associated with access to justice for HR violations in business and HR context jurisdiction, applicable law, non-judicial remedy mechanisms and  advancing standards of care in tort/civil law  suggesting to introduce I. right to evidence re control of parent over subsidiaries II. rebuttable presumption of control over subsidiaries III. statutory duty to conduct human rights due diligence (HRDD) 2

3. Scenario I Evidence about control over subsidiaries  issue: victim’s access to info about control in realm of company  common law jurisdictions: disclosure obligations =>  scenario only applies to civil law jurisdictions  scenario: introduce specific disclosure obligation with respect to control a parent exercises over its subsidiaries =>  allow claimants to request the court to order a parent to disclose the relevant information for assessing its duty of care, including control it exercises over its subsidiaries general involvement in management of its subsidiaries  aim: extend basis for claimants to access information (though on limited aspect of liability question) 3

4. Scenario II Rebuttable presumption of control  issue: victim’s access to info about control in realm of company  applies to common law and civil law jurisdictions  scenario: accept prima facie evidence that company exercises control over its subsidiaries; then shift burden of proof to company to prove that it did not exercise control  NB: shift only concerns control, not duty or breach  definition of control needed  court could use control definitions from accounting law, such as company controls majority of shareholders’ voting rights company appointed or has the right to appoint majority of subsidiary’s management company has power to exercise or exercises dominant influence 4

5. Scenario III Statutory duty to conduct HRDD  issue: difficult to establish a duty of care for parent companies  scenario: making HRDD compulsory by creating statutory duties to identify, prevent, mitigate and cease HR violations for which company is directly or indirectly responsible  breach: acting as a reasonable person/company = effectively carrying out HRDD  causal connection between harm and breach  if requirements are met, company is obliged to pay compensation for damage suffered by claimants 5

6. Scenario III Statutory duty to conduct HRDD: tweaks  tweak 1: company’s HRDD duty might (initially) be limited to third parties over which company exercises legal control  later: extend scope to parties over which company has factual control (eg companies in supply chain)  question: how much factual control is needed? (less formalised relationships than parent/subsidiary)  tweak 2: company’s HRDD duty might (initially) be limited to specific human rights risks serious human rights violations breach of internationally recognised standards  common law: statute must explicitly confer a private right of action on individuals and recognise that duty is aimed at protecting a defined group of victims 6