Towards Restating HR law and applicability to MLIs

by Chakravarthi Raghavan

Geneva, 9 August 2001 - - Jurists at the UN Sub-Commission on Promotion and Protection of Human Rights have welcomed the willingness shown by the WTO, the World Bank and the IMF in opening a dialogue on their policies and the promotion of human rights, but insisted that irrespective of their own charters, these institutions were bound to abide by customary public international law.

Several of the expert members insisted on the superior status of the international human rights law, embodying these rights, and the responsibility of both Member-States of these institutions, as well as the institutions themselves to abide by, and promote these indivisible political, civil, economic, social and cultural rights.

The Sub-Commission concluded Thursday nearly eight hours of debate on Globalization and its Impact on the Full Enjoyment of Human Rights, based on a progress report presented by two of its Special Rapporteurs and Experts, M.  J.Oloka-Onyango from Uganda, and Ms. Deepika Udagama, alternate member from Sri Lanka. Their report had focussed on the three multilateral institutions (MLIs) the WTO and its trading system, and the World Bank and the IMF.

In relation to the WTO, they had focussed in some detail (see SUNS 4952 and 4953) on the TRIPS and the issues of access to medicines and the conflicts between private rights and human rights, as well as the WTO’s dispute settlement system. In relation to the IMF and the World Bank, the two jurists had focussed on the economic policies they foster in member-countries, and in particular their ‘New Poverty Agenda’ (NPA) and their poverty reduction strategies as well as the Highly Indebted Poor Countries (HIPC) debt initiatives, and the fact of growing marginalisation of people in the rich and poor countries.

The two jurists in their report underscored the universally acknowledged indivisibility, interdependence and inter-relationships of civil, political, economic, social and cultural rights, flowing from the International Bill of Human Rights (comprising the Universal Declaration of Human Rights, the International Covenant on Civil and Political Rights, ICPR, and the International Covenant on Economic, Social and Cultural Rights, ICESR, and the Right to Development). These were recognized to be part of customary international public law and jus cogens(principles of international law which cannot be set aside by agreement or acquiescence), applicable to states and international indtitutions. As such they had a superior position of over the charters of the MLIs, and the responsibility and obligation of the MLIs, as international treaty institutions, to abide by them.

Apart from the representatives of the WTO, the World Bank and the IMF who participated in the meetings, and explained their policies visavis the human rights issues raised, several NGO representatives also spoke commending and encouraging the important report of the two expert jurists and joining issue with the formalistic positions, with nuances, of the MLIs that they were not formally bound by the various human rights instruments, but that their policies promoted it.

The IMF, in particular, seemed to take the position based on its specialized agency agreement with the UN, and the non-applicability of the international covenants to the IMF, but adding in subsequent interventions that this was a formalistic view but that it strove to promote human rights in members.

The sub-commission encouraged its two Expert members, as Special Rapporteurs, to continue their work and produce a final report on their mandate.

In its intervention, Wednesday a representative of the IMF said that in a strict sense, the Fund did not have a mandate to promote human rights and was not bound by various human rights declarations and conventions.

However, he conceded, this was too narrow a perspective, since the Fund’s activities involved economic matters that were critical for the empowerment of civil society and amounted to preconditions for the attainment of human rights in their broad sense.

Several Subcommission Experts, including Fisseha Yimer, Yozo Yakota, Asbjorn Eide, and Paulo Sergio Pinheiro, however expressed their surprise over the IMF’s blunt view that it was not bound by international human rights instruments and standards.

While the relationship between trade and financial regimes and human rights regimes was a vital issue, those regimes should not be compared on an equal footing, said Mr. Yokota. The human rights regimes were superior and could not be ignored even by agreements between States, or in the operations of international financial institutions.

An NGO representative from the International League for the Rights and Liberation of Peroples said it was not only corporate powers dominating the world economy that were wrong-doers by violating human rights, breaking national laws or destroying and degrading the environment, it was the legal framework of the world economy itself which allowed such harmful actions. The only way to respond was to enforce new forms of regulation into the world of private corporations. Independent monitoring be carried out by trade unions, NGOs and other groups, and by international institutions such as a revived UN committee.  The power and economic influence exercised by TNCs and such international bodies as the IMF and the World Bank meant that developing countries were losing control of their own sovereignty. The demands placed upon these countries by international forces, including through structural adjustment policies, amounted to denial of human rights, including economic rights, and to the loss of ability to take national action for the well-being of populations.

In a response to the report, a representative of the World Trade Organization, agreed that the dispute-settlement system could be improved. One intent of the system was to end unilateral actions in trade-related matters, or to reduce exercise of power in favour of the equality of States. The WTO Secretariat and WTO members were bound by international law; hence Member States must respect their human-rights obligations. hen participants were interpreting WTO provisions, they were required to take all other rules of international law into account.

However, WTO panels and its appellate body, only had the institutional capacity to determine if WTO rules had been violated in the cases they considered.

Another representative of the WTO, said that the WTO’s TRIPS Agreement sought to strike a balance between incentives for future inventions and the short-term use of today’s invention. TRIPS should contribute to innovation, and should be balanced with economic and social welfare. The TRIPS Agreement gave States leeway to implement provisions. It was a matter of opinion whether the actual right balance had been achieved, the representative argued. The issues raised in the report about extending TRIPS to traditional practices or medicines were under review by the TRIPS Council. Also WTO members had been engaged this year to ensure that TRIPS was part of the solution and not part of the problem in the public health crises in developing countries.

The IMF said that the report lucidly set out a number of pertinent issues, and the IMF fully agreed that further debate and understanding were needed of the globalization process. And although the Special Rapporteurs were sceptical about the IMF’s shift on poverty reduction strategies, it was indeed genuine. But little could be accomplished in defeating poverty in a context of basic macroeconomic imbalances—high inflation, for example, was a fundamental obstacle.

The Fund’s rules did not permit providing financial assistance, without conditionality, but the IMF was not engaged in mere debt collection. In any case, the issue of debt sustainability was one that the staff was closely monitoring.

Fisseha Yimer said for the Fund to say that human rights were not its concern was quite a surprise, even though the Fund representative had tempered his comments later on. On IPRs, while there was a need to ensure that the pharmaceutical companies did not have their incentive of innovation taken away, there was also a need for a balance. Yozo Yokota another Expert, said the relationship between trade and financial regimes and human rights regimes was a vital issue. But the two regimes should not, however, be compared on an equal footing. Human rights regimes were superior to trade and financial regimes.  Human rights were peremptory norms, and could not be ignored even by agreement between States, or in the operations of international financial institutions.  Global trade and economic law must respect human rights.

There was no room for negotiation on this matter. He had thought this went without saying, but after hearing the IMF representative, Yokota added, he wanted to make the point clearly. It was vital to consider how multilateral international financial institutions could be used to promote human rights, capitalizing on their expertise in matters of economic growth and development.

El-Hadji Guisse said that the WTO was a rich man’s club which aimed to make the rich richer and the poor poorer. Since its inception, it had done nothing to show it was interested in the poor and the developing countries. It only spoke of profit, and how to increase profit. It was true that many countries acceded to it, but they had joined an organization which had no interest in them, and they would realize no benefit.

Asbjorn Eide, another Subcommission Expert, said like Mr. Yokota he welcomed the globalization of human rights. But there was a difference between the universalization of human rights, and economic globalization. The universalization of human rights was about all States respecting human rights, while economic globalization was about developing global markets. It was interesting and encouraging that the WTO officials were open for a dialogue. As an intergovernmental organization, they were bound by international human rights law. But it seemed at this stage that no dialogue was possible with the IMF.  Hopefully, a dialogue would evolve in the future. On IPRs the comments of the WTO were most welcome. Even though there could be disagreement with some of the points, at least there was a growing recognition that intellectual property rights affected human rights. The existence and scope of intellectual property rights as a human rights was not necessarily congruent in domestic legislation.  Different countries had different scopes in their laws. Saying that something was an intellectual property right did not necessarily make it a human right—it had to fit into the scope of human rights.

Paulo Sergio Pinheiro, another Subcommission Expert, said the IMF had made an extraordinary statement; he wondered if the could elaborate a little further so that the Subcommission could know the foundations “for this splendid isolation of the IMF within the world of international organizations.” This debate, Pinheiro said, should be shared through the summary records of the Subcommission with the Commission on Human Rights and with the High Commissioner for Human Rights so that everyone could benefit from this bold and intriguing doctrine of the IMF on human rights. Perhaps a real and valuable dialogue would result.

Juilia Antoanello Motoc asked whether if these international bodies were prepared to accept the indivisibility of human rights, they were also prepared to adopt policies to this end? A lot of academics had said that States did not even realize what they were buying into when they agreed to the TRIPS Agreement.  It was a technical matter, and the Subcommission should focus on the role of TRIPS because it was going to play a large part of the world economy.

Stanislav Ogurtsov, Subcommission Expert, said at the beginning of the new century, the problem was not progress but human survival. New models of development were needed. The struggle to eliminate poverty was one of the biggest challenges for human rights. Education, health, development—were not just aims, they were human rights themselves. The international financial organizations were made up of States, and no State had ever said it was not interested in human rights. What was said on Wednesday morning by the IMF was a frightening and sad statement—something that had not been heard since orld War II. If what the IMF said (that it was not bound by the international covenants) was true, it was not known how the international financial institutions would continue to exist.

Francoise Jane Hampson another Expert said that the representative of the WTO had suggested that there was sufficient flexibility in the TRIPS Agreement to meet the needs of all parties. But this was not agreed. In some cases, a patent holder could ecognize that it was in his interest to accept a compulsory license. However, this was true only in the case of countries with a large population. Also, there was a problem in including the things over which patent rights were asserted, and the lack of encouragement in the present system for the development of medicines and treatment for illnesses found principally in the developing world.

This problem would either be unchanged or would be made worse by a system of incentives based on price differentials. Pharmaceutical companies would have an incentive to concentrate on those drugs that generated the greatest profits.  There was an intrinsic problem arising out of the legal nature and characteristics of the patent, a man-made legal construction. Other models needed to be examined. For example, he law of the sea contained a regime to regulate the exploitation of the resources of the deep sea bed, based on the concept of the common heritage of mankind. Clearly, pharmaceutical companies needed to be able to recoup their research nd development costs, but equally clearly, there was a need to ensure that hose who needed medical treatment had access to it, financially and geographically.

The IMF representative in another intervention said the Fund, in a strict sense, did ot have a mandate to promote human rights. Human rights were not mentioned in the articles of agreement. Moreover, the autonomy of the Fund in the UN system was established in its agreement with the United Nations. However, that was all to narrow. The question should be what was the Fund effectively doing to promote human rights. It was doing many things through many channels. The IMF trying to promote dialogue with the Subcommission, set up a framework for a productive dialogue. The IMF was open to dialogue. The Fund staff sought to cover as many human rights meetings as possible. Meetings had been put together with the Fund staff with Special Rapporteurs and Experts. It had also worked with the Commission on Human Rights in various matters.

There was an impression that there was a split between international economic law and international humanitarian law. But these two could mesh. It was not correct that the Fund was merely a debt collector. Each of the member countries participated in an economic dialogue with the Fund on an annual basis. The countries valued visits from the Fund’s staff to talk about the economic and financial setting. It was more than a debt collector. Everyone was unhappy with how structural adjustment was working. What was supposed to be done—stick with it, or try to improve it. The Fund tried to improve it, and it had been with various United Nations targets in mind, including the targets in the Millennium Declaration.

Fisseha Yimer, Subcommission Expert, said the IMF’s ‘position’ meant that the Fund did not have to follow human rights, but took steps that in any case promoted human rights. He did not think that was correct. Mr. Yimer said the Fund’s policy apparently did not acknowledge a legal obligation to follow human rights instruments, and he felt that the Fund did have such a legal obligation.  That was where the two of them differed.

A World Bank representative said these sorts of dialogues at the sub-commission were of fundamental importance for the World Bank, and people may have underestimated the influence such dialogues had on the Bank. As for the right to development, extensive efforts and dialogues had been held to mainstream the right to development into the Bank’s programmes and policies. He did not think this discussion should have a legal basis, should be an argument over what was right or wrong; it should be on what should be done and what was already being done. The World Bank realized profoundly that economic policies were connected with human rights; but it also was saying that economics mattered to human rights, and that economic progress helped human rights. The frustration he had heard in this room and other rooms was related to the fact that in many places the implementation of human rights was not taking place; as a result the World Bank was doing a great deal to help fund such things as schools and to help reduce poverty. The Bank, it was important to say, responded to the will of the Governments that made up its membership.

In brief response, Oloka-Onyango said that in the final analysis, the MLIs could not get away with their legal obligations. These bodies had development as their objectives, though they might differ on how this was being achieved. Ma. Deepika Udagama also welcomed the dialogue with the WTO, and said the views expressed was a progress over the last response they got in response to questions. The IMF’s response that the SAPs had been a failure was alarmingly candid. – SUNS4954

The above article first appeared in the South-North Development Monitor (SUNS) of which Chakravarthi Raghavan is the Chief Editor.

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