Latest Developments, May 2

In the latest news and analysis…

Subsidiary immunity
The Associated Press reports that a Canadian judge has dismissed an attempt by Ecuadorian plaintiffs to have a $19 billion judgment enforced against US oil giant Chevron:

“Justice David Brown ruled Wednesday that the Canadian courts have no jurisdiction to enforce the controversial award handed down by an Ecuadorian court against Chevron.
The award to the villagers was made in Ecuador for black sludge contamination of a rainforest between 1972 and 1990 by Texaco, which Chevron Corp. bought in 2001.

Brown concluded the judgment was levied against Chevron Corp., and not Chevron Canada, therefore the subsidiary’s assets do not belong to the U.S. parent company

Alan Lenczner, the Toronto lawyer for the Ecuadorians, said they would appeal.
‘It cannot be right that a multinational company that operates entirely through subsidiaries is immune from the enforcement of a judgment in Canada, particularly where the subsidiary is 100% owned,’ Lenczner said in a statement.”

Unwanted aid
Al Jazeera reports that Bolivia has expelled the US Agency for International Development over “alleged political interference”:

“ ‘Never again, never again USAID, who manipulate and use our leaders, our colleagues with hand-outs,’ [Bolivian president Evo] Morales said in announcing the expulsion.

In an interview with Al Jazeera, Philip Brenner, an international relations professor at the American University in Washington DC, said USAID became a target after its suspected role in encouraging secession in Santa Cruz, ‘a very wealthy part’ of Bolivia.”

Timber laundering
Global Witness reports that “shadow permits” are keeping the illicit logging trade flowing from Africa to the EU which imported up to to €12.4 billion worth of illegal timber in 2011:

Meanwhile, the EU has been developing Voluntary Partnership Agreements (VPAs) with timber-exporting countries, which involve comprehensive forest governance reforms aimed at stamping out the illegal trade. Neither the EU Timber Regulation nor the VPAs take account of the widespread use of shadow permits, however. This means they could end up laundering the type of wood products they were designed to exclude.
‘Unless European and African policy-makers take urgent action, shadow permits could become the Trojan horse by which illegal timber is brought into the EU and passed off as legitimate. Timber importers must do proper checks right the way along their supply chains to make sure they know exactly where their timber came from and whether the permit used to get it was legal,’ said [Global Witness’s Alexandra] Pardal.

Illegal resource extraction
Reuters reports that nearly all of Liberia’s resource deals since 2009 have violated national laws:

“Liberian law sets rules for foreign investment projects including on competitive tendering, tax rates and equity stakes to be held by the government.
While some failures to comply with the law are relatively minor, the Moore Stephens draft shows the government granted vast swathes of land to firms including Golden Agri’s Golden Veroleum and Sime Darby without competitive bidding, and otherwise skipped contract steps meant to ensure a fair deal for Liberians.
Other companies with contracts found to be flawed include U.S. oil firm Chevron Petroleum and mining giant BHP, according to the report, which also accused Liberian authorities of having tried to stonewall the audit process since late last year by failing to hand over information promptly.”

No more executions
The Associated Press reports that Maryland has become the 18th US state and the first south of the Mason-Dixon line to abolish the death penalty:

“[National Association for the Advancement of Colored People] President and CEO Ben Jealous, who worked to get the repeal bill passed, noted the significance of a Democratic governor south of the Mason-Dixon line with presidential aspirations leading an effort to ban capital punishment. Jealous noted that in 1992, then-Arkansas Gov. Bill Clinton left the presidential campaign trail to oversee the execution of a man who had killed a police officer, a move widely viewed as an effort to shed the Democratic Party’s image as soft on crime.
‘Our governor has also just redefined what it means to have a political future in this country,’ Jealous said”

Fighting biopiracy
EurActiv reports that the EU is debating new measures that would require companies to compensate indigenous people for the commercial use of their knowledge:

“Under the law – based on the international convention on access to biodiversity, the Nagoya protocol – the pharmaceuticals industry would need the written consent of local or indigenous people before exploring their region’s genetic resources or making use of their traditional knowhow.
Relevant authorities would have the power to sanction companies that fail to comply, protecting local interests from the predatory attitude of big European companies.

But obstacles remain due to vested interests, particularly in the European pharmaceuticals industry. ‘90% of genetic resources are in the south and 90% of the patents are in the north,’ [Green MEP Sandrine] Bélier told EurActiv.”

Free trade racket
The Center for Economic and Policy Research’s Dean Baker argues that international trade agreements, such as the proposed Trans-Pacific Partnership, have more to do with “securing regulatory gains for major corporate interests” than free trade:

“All the arguments that trade economists make against tariffs and quotas apply to patent and copyright protection. The main difference is the order of magnitude. Tariffs and quotas might raise the price of various items by 20 or 30 percent. By contrast, patent and copyright protection is likely to raise the price of protected items 2,000 percent or even 20,000 percent above the free market price. Drugs that would sell for a few dollars per prescription in a free market would sell for hundreds or even thousands of dollars when the government gives a drug company a patent monopoly.
In the case of drug patents, the costs go beyond just dollars and cents. Higher drug prices will have a direct impact on the public’s health, especially in some of the poorer countries that might end up being parties to these agreements.”

Pharma power
This is Africa’s Adam Robert Green discusses concerns that pharmaceutical companies may be “shaping the public health agenda” in poor countries:

“One example is the HPV vaccination programme for cervical cancer in Rwanda, enabled by a donation from Merck. After three years, the freebies expire, but Merck promised to provide Rwanda with a discounted access price to the vaccine. Assuming donors and governments pick up the bill, the donations could be interpreted as market-priming – creating the conditions for adoption – rather than corporate citizenship.”

Latest Developments, October 31

In the latest news and analysis…

New nuclear age
The Guardian reports on a new study suggesting countries that already possess nuclear arms are planning to spend large sums of money to upgrade their capabilities over the coming years.
“Despite government budget pressures and international rhetoric about disarmament, evidence points to a new and dangerous ‘era of nuclear weapons’, the report for the British American Security Information Council (Basic) warns. It says the US will spend $700bn (£434bn) on the nuclear weapons industry over the next decade, while Russia will spend at least $70bn on delivery systems alone. Other countries including China, India, Israel, France and Pakistan are expected to devote formidable sums on tactical and strategic missile systems.
For several countries, including Russia, Pakistan, Israel and France, nuclear weapons are being assigned roles that go well beyond deterrence, says the report. In Russia and Pakistan, it warns, nuclear weapons are assigned ‘war-fighting roles in military planning’.”

Dictator savings
Global Witness has welcomed a resolution adopted at last week’s UN anti-corruption conference that calls for national governments to enforce laws that forbid banks to accept money looted from the coffers of other states.
“Corruption on the scale that causes revolutions cannot happen without a bank to take the money. The very fact that some states are trying to get stolen money returned makes it clear that something has gone very wrong; these funds, which belong to the people of Egypt and Tunisia, should not be in foreign bank accounts in the first place,” said Global Witness’s George Boden.

Seal of approval
A new report by the Centre for Research on Multinational Corporations detailing labour rights violations on tea plantations owned by British-Dutch company Unilever raises “doubts regarding the reliability of Rainforest Alliance certification.”
“Civil society organisations have been urging tea companies for many years to address the precarious working conditions of millions of tea workers worldwide. In response, there is a clear trend of multinational tea packers indeed stepping up their efforts to address sustainability issues in this sector. To this end tea companies are increasingly making use of independent and more rigorous multi-stakeholder sustainability standard systems, such as Rainforest Alliance (RA), Utz Certified and Fairtrade, which are generally seen as best industry practice. As a consequence the share of world tea exports certified by global standard systems grew by 2000% in the period from 2004 to 2009 alone. It is estimated that roughly 15% of tea exported worldwide will have been certified in 2011. Now several years later this study is assessing whether there is evidence of improvement of the working conditions on tea estates that have achieved RA certification, the most important sustainability certification in the tea sector in terms of volume.”

Biopiracy
Al Jazeera reports on allegations that a subsidiary of US biotech giant Monsanto genetically modified Indian eggplant seeds without obtaining prior authorization.
“In response, the national biodiversity authority has announced its plans to prosecute Monsanto for carrying out this research without seeking its permission and the consent of hundreds of thousands of farmers who have cultivated these varieties for generations. Officials at the authority say that, by failing to consult with farmers and the national biodiversity authority, the multinational firm has run foul of India’s Biological Diversity Act 2002. The law states that, if companies want to genetically modify indigenous varieties of seeds and plants – for research or commercialisation purposes – they must obtain prior consent of the authority. That never happened, the national biodiversity authority says, so now Monsanto and Mahyco look set to face charges of biopiracy – a fancy word for theft. It will be the first criminal prosecution under the act if it goes ahead. Though brinjal is a vegetable that is now widely eaten and grown around the world, it is native to south Asia with more than 2,500 varieties.”

Colonization through investment
The Observer reports on the fallout of a biofuel bust in Tanzania, where a village leader speaks of “colonialism in the form of investment.”
“A quarter of the village’s land in Kisarawe district was acquired by a British biofuels company in 2008, with the promise of financial compensation, 700 jobs, water wells, improved schools, health clinics and roads. But the company has gone bust, leaving villagers not just jobless but landless as well. The same story is playing out across Africa, as foreign investors buy up land but leave some of the poorest people on Earth worse off when their plans fail.”

The right to food
A UN food expert is urging world leaders to put the right to food ahead of commercial interests at this week’s G-20 summit.
“The G-20 made an important statement of intent by placing food security at the top of its agenda. But agreeing on a food security action plan without addressing biofuels and speculation would be like running a bath without putting in the plug. All of the good ideas simply drain away,” according to UN Special Rapporteur on the right to food Olivier De Schutter.

Development 3.0
The World Bank’s Justin Yifu Lin argues for a third way in development thinking – in the wake of “structuralist, state-led” policies on the one hand, and “largely neo-liberal” ones on the other – and addresses critiques from three eminent economists.
“The credibility argument [that policies were not reversible] was used to support the shock therapy in the East European and Formal Soviet Union’s transition in the early 1990s. However, to ward off large unemployment and subsequent social/political instability, governments in transition economies were very often forced to provide other disguised and less efficient forms of subsidies and protection to firms in the old priority sectors even though those firms were privatized. As a result most transition economies encountered the awkward situation of ‘shock without therapy’.”

Business and human rights
In an interview with Business Ethics Magazine, John Ruggie talks about the voluntary guiding principles he formulated over his six years as UN special representative for business and human rights and the inevitable evolution towards legal accountability.
“Finally, judicial remedy will continue to evolve. Judicial reform in countries where the rule of law is weak and governments are corrupt is a slow process, but it is happening. And the web of legal liability for corporate involvement in egregious violations is expanding in the home countries of multinational corporations—a trajectory that will continue no matter how the U.S. Supreme Court rules on the applicability of the Alien Tort Statute to legal persons, such as corporations.”