What changed between the plenary report and the adopted text

The European Parliament,

– having regard to Articles 2, 3, 8, 21 and 23 of the Treaty on European Union (TEU),

– having regard to the Charter of Fundamental Rights of the European Union,

– having regard to the UN Guiding Principles (UNGPs) on Business and Human Rights, adopted by UN Human Rights Council Resolution 17/4 of 16 June 2011,

– having regard to UN Human Rights Council Resolution 26/9 of 26 June 2014,

– having regard to the updated draft legally binding instrument circulated by the Chair-Rapporteur of the Open-Ended Intergovernmental Working Group (OEIGWG) on 31 July 2023 and to the revised third draft thereof resulting from the eighth session,

– having regard to the UN Convention against Corruption,

– having regard to UN General Assembly Resolution 76/300 of 28 July 2022 on the human right to a clean, healthy and sustainable environment,

– having regard to the Organisation for Economic Co-operation and Development (OECD) Guidelines for Multinational Enterprises on Responsible Business Conduct,

– having regard to the resolution on Business and Human Rights in Africa of the African Commission on Human and Peoples’ Rights of 7 March 2023,

– having regard to the opinion of the European Union Agency for Fundamental Rights (FRA) of 10 April 2017 entitled ‘Improving access to remedy in the area of business and human rights at EU level’ and its report of 6 October 2020 entitled ‘Business and Human Rights – Access to Remedy’,

– having regard to the Council conclusions of 20 February 2023 on EU priorities in UN human rights fora in 2023,

– having regard to its resolution of 25 October 2016 on corporate liability for serious human rights abuses in third countries,

– having regard to its resolution of 4 October 2018 on the EU’s input to a UN Binding Instrument on transnational corporations and other business enterprises with transnational characteristics with respect to human rights,

– having regard to its resolution of 18 January 2023 on human rights and democracy in the world and the European Union’s policy on the matter – annual report 2022, and to its previous resolutions on earlier annual reports,

– having regard to Rule 54 of its Rules of Procedure,

– having regard to the opinion of the Committee on Development,

– having regard to the report of the Committee on Foreign Affairs (A9-0421/2023),

A. whereas the EU is founded on the values of respect for human dignity, freedom, democracy, equality, the rule of law and respect for human rights, as set out in Article 2 TEU; whereas its actions on the international scene must be guided by those principles and be consistent with the principle of policy coherence for development, as enshrined in Article 208 of the Lisbon Treaty;

B. whereas the implementation of the 2030 Agenda for Sustainable Development and the ‘leave no one behind’ principle implies that economic development goes hand in hand with social justice, good governance and respect for human rights;

C. whereas business enterprises are major players in economic globalisation, financial services and international trade, and are required to comply with all applicable laws and international treaties and to respect human rights; whereas business enterprises may cause, contribute or be directly linked to adverse impacts on human rights, such as modern slavery, human trafficking, forced labour, child labour and other forms of labour exploitation, land displacement, poverty wages and anti-union violations, as well as adverse impacts on the environment, including pollution, climate change, environmental degradation and biodiversity loss;

D. whereas corporations may contribute to sustainable development through job creation and economic development, and therefore may have an important role to play in the promotion of human rights, environmental standards, as well as in the prevention of adverse impacts on human rights and the environment;

E. whereas the rights of business enterprises and investors should be matched by binding and enforceable obligations in terms of compliance with human rights, labour and environmental law;

F. whereas victims of corporate abuse often face multiple and overlapping obstacles to accessing remedies, including judicial remedies and guarantees of non-repetition; whereas these obstacles are even more severe for vulnerable or marginalised persons or groups; whereas impunity for human rights abuses committed by some business enterprises remains largely unaddressed in the absence of a robust and comprehensive regulatory framework and alignment at global and regional level;

G. whereas abuses of workers’ rights by companies are on the rise worldwide according to the International Trade Union Confederation Global Rights Index, which reported that 113 countries exclude workers from their right to establish or join a trade union, up from 106 in 2021 to 113; whereas 87 % of countries violated the right to strike and four in five countries blocked collective bargaining;

H. whereas the UN Human Rights Council (UNHRC) adopted a resolution on 26 June 2014 establishing an open-ended intergovernmental working group (OEIGWG) to develop an international legally binding instrument (LBI) ‘to regulate, in international human rights law, the activities of transnational corporations and other business enterprises’;

I. whereas the OEIGWG, which has been chaired by Ecuador since its inception, has, to date, held nine sessions and a number of regional and other consultations with stakeholders, including from civil society and the private sector; whereas, in July 2023, the Chair circulated an updated draft of the instrument ahead of the OEIGWG’s ninth session scheduled for 23-27 October 2023;

J. whereas the EU has been working on ambitious legislation regarding corporate due diligence, among other kinds of legislation, which would serve as a basis for its negotiating mandate; whereas, in the absence of a negotiating mandate, the EU representative only participated in the OEIGWG’s sessions as an observer and only contributed general statements; whereas, further, the engagement of other large economies outside the EU in the discussions has been ambivalent over the years;

K. whereas, subsequently, the position of EU Member States has gradually evolved, with several of them actively participating in the latest sessions of the OEIGWG; whereas France and Portugal have joined the ‘Friends of the Chair’ group, assisting the Chair in developing consensus proposals from regional blocks; whereas, among its priorities in human rights fora in 2023, the Council stated its commitment to ‘actively participate’ in the UN discussions on the LBI and expressed its readiness to work with the Chair of the OEIGWG and the Friends of the Chair ‘to explore … a consensus-based instrument that can effectively enhance the protection of victims and create a global level playing field’;

L. whereas Parliament has repeatedly expressed its support for the UN discussions on the LBI, including by adopting a number of resolutions calling for the EU and the Member States to engage constructively in the negotiations;

M. whereas, in recent years, the EU has shown great ambition when it comes to business and human rights and has initiated a number of legislative initiatives aimed at regulating business activities on human rights and environmental and climate-related obligations, such as the Corporate Sustainability Due Diligence Directive, a proposal for a regulation on prohibiting products made with forced labour on the Union market, the Regulation on deforestation-free products, the Conflict Minerals Regulation and the Batteries Regulation;

N. whereas a number of EU Member States, such as France, Germany and the Netherlands, have recently adopted or proposed mandatory due diligence legislation, while a number of other Member States are considering following suit; whereas it is important to ensure coherence between due diligence legislation at Member State or EU level and the UN LBI;

O. whereas regulatory initiatives, including legislation, on business and human rights have been adopted, or are under discussion, in non-EU countries such as Australia, Brazil, Canada, Ghana, Japan, Mexico, New Zealand, Norway, South Africa, South Korea, Switzerland and the USA; whereas numerous other countries have developed a national action plan on business and human rights;

P. whereas the draft LBI contains a regional integration organisation clause to accommodate the respective roles of the EU and its Member States;

Q. whereas there is substantial and growing interest in, mobilisation around and expectations from the UN-level discussions on the LBI among affected communities, indigenous peoples, trade unions, members of civil society, scholars and experts globally;

General comments and the international framework on business and human rights

1. Stresses that the overall level of enjoyment of human rights worldwide is contingent, among other things, on the behaviour of corporations, given the current scale of globalisation and the internationalisation of business activities and value chains; emphasises, in this context, the importance for business enterprises to be able to rely on good public governance and a comprehensive and well-functioning legal system and framework in order to fulfil their human rights obligations;

2. Strongly supports the full implementation, within and outside the EU, of the international standards on responsible business conduct to complement and strengthen the implementation of the UNGPs; underlines the importance of the UNGPs and the OECD Guidelines and the broad support they enjoy; recalls that the UNGPs constitute the only global framework detailing corporate responsibility for preventing and addressing the risk of adverse impacts on human rights linked to business activity; stresses that any work done on the LBI should ensure full alignment with these standards;

3. Stresses that since corporate social responsibility is solely on a voluntary basis and is therefore not embodied in enforceable instruments, it risks creating market distortions and unfair competition for the enterprises that choose to comply with international standards or that are subject to national or regional obligations; recognises that although some progress has been achieved, human rights violations continue to occur; welcomes, therefore, efforts to create a level playing field and the pursuit of a globally supported commitment to responsible business conduct; welcomes, further, the current shift in terms of normative developments from soft-law initiatives towards binding standards;

4. Underlines the importance of closing the legal and regulatory loopholes which are being exploited by some business enterprises, including investors, at the cost of human rights and the environment;

5. Notes with concern that in many countries’ judicial systems, numerous procedural, substantive and practical barriers persist regarding victims’ access to justice, including difficulties in identifying the competent court, barriers related to jurisdictional standards, short statutory limitation periods, excessive evidentiary burdens, limited or unclear liability owing to complex corporate structures, access to legal representation and information, prohibitive costs of representation abroad, as well as other inequalities between claimants and defendants; notes with concern, further, cases of victims facing intimidation or violence from the businesses involved in response to their seeking justice; emphasises that vulnerable or marginalised persons or groups, who may require additional attention in the context of stakeholder engagement activities, are facing heightened barriers to benefiting equitably from compensation payments or other forms of restitution;

6. Stresses the importance of including parent-company-based extraterritorial regulation and access to justice for victims of transnational corporate human rights violations in the home state of transnational corporations (TNCs); highlights, in particular, the need to define clear obligations for TNCs in relation to eradicating child labour and forced labour from their supply chains and operations;

7. Reiterates its strong support for the work being carried out in the UN through the OEIGWG to develop the instrument; expresses its appreciation for the work of the successive Chairs from Ecuador in steering this complex endeavour and welcomes the supportive role of the ‘Friends of the Chair’ group;

8. Calls on the Chair of the OEIGWG and the UN member states to ensure that the negotiations are conducted in a transparent manner, with meaningful engagement with all stakeholders, including civil society, trade unions and workers’ representatives and the private sector, with due attention paid to vulnerable stakeholders; insists, moreover, on the importance of ensuring active engagement from all regions, with a view to developing an effective instrument that reflects the global diversity of the legal, social and economic realities affecting human rights and that draws on best practices implemented at domestic and regional level; encourages regional human rights and economic organisations, as well as authorities, to help facilitate this universal engagement;

EU and Member States’ engagement with the UN process

9. Recalls that the EU has a Treaty-based commitment to promote human rights worldwide and multilateral solutions within the UN to common problems, which has yet to be reflected in its participation in the OEIGWG with a negotiating mandate;

10. Acknowledges the OEIGWG as the only global and multilateral forum where mandatory rules on business and human rights are being discussed and, therefore, considers it crucial for the EU to actively engage in this process, alongside a critical mass of UN members, in order to reach a consensus-based outcome that can rely on broad support globally;

11. Underscores that the latest normative developments at EU level on business and human rights are important initial steps towards addressing access to justice and victims’ rights, which lie at the centre of the LBI as a core human rights treaty; stresses, in this regard, the complementary nature, objectives and scope of, as well as the need for coherence between, both normative tracks, which will operate at different levels;

12. Believes that the EU should actively engage in the ongoing negotiations, in particular to further develop the draft LBI, while focusing on victims of business-related abuses across the value chain, dismantling barriers to justice and effective remedy, ensuring a level playing field and legal certainty for businesses, taking into account the particular character of small and medium-sized enterprises (SMEs), and enhancing cooperation by drawing on international perspectives and best practices; considers that this engagement would ultimately contribute to securing better implementation and enforcement of human rights internationally, while equally contributing to an international level playing field and delivering a global instrument that is both widely supported and ratified among states across all regions, including but not limited to the European Union, and that remains relevant in the face of evolving threats to human rights;

13. Welcomes the Council’s commitment that the EU will strengthen its engagement and actively participate in the OEIGWG; considers, however, that the only meaningful and tangible way to enact this stated commitment is by adopting an EU mandate for negotiations; urges the Council, therefore, to adopt an ambitious mandate for negotiations as soon as possible so that the EU is able to actively participate in the negotiations with a view to shaping the future LBI; stresses that the EU position must aim for strong provisions in terms of enforcement and monitoring mechanisms, as well as in relation to access to justice for those affected by violations;

14. Calls on the Member States, in the meantime, to engage in the process individually while coordinating their positions throughout the negotiations, so as to defend a strong, common and clear EU position, presenting in a constructive manner the legislative initiatives aimed at regulating business activities in relation to human rights and climate-related obligations, while showing appreciation for the progress made to date; expects the European External Action Service (EEAS) and the Commission, in particular the EU Delegation to the UN in Geneva, to play a proactive and constructive role in this process;

15. Calls on the Commission, the EEAS and the Member States to engage proactively with all partner states and include the topic in their dialogues with non-EU countries and regional organisations, in particular in the framework of the EU’s structured human rights dialogues; encourages the EU to reach out, in particular, to key partners which are currently developing their own frameworks on business and human rights at national level, such as Brazil and Japan, and at regional level, such as the African Commission on Human and Peoples’ Rights and the Inter-American Commission on Human Rights;

Elements for an EU position on the LBI