How effective is the French supply chain law?

By Miriam Saage-Maaß
Miriam Saage-Maaß is Legal Director at ECCHR.

The French Loi de Vigilance (LdV) is the first law of its kind in the world: It has been in force since 2017 and obliges large French companies to exercise human rights due diligence in their global value chains. Obligated companies must draw up and publish plans for dealing with human rights and environmental risks worldwide throughout their value chain. In the event of violations of this obligation, affected parties can take legal action in French civil courts, demand rectification and, if there is a causality between the breach of duty and damage, also claim damages.

The first judgment under this law now shows that a good law alone does not necessarily help the people it is intended to benefit. What matters is the application and interpretation of a law.

Mega oil pipeline with devastating climate impact

In 2019, two French and four Ugandan organizations filed the first lawsuit under the LdV. It was directed against the French oil company TotalEnergies for neglecting its human rights and environmental due diligence obligations at its mega oil pipeline Eacop (East African Crude Oil Pipeline) in Uganda and the Tilenga project in Tanzania.

The world’s longest heated oil pipeline, which TotalEnergies is building together with state-owned companies from China, Uganda and Tanzania, will connect the oil fields in western Uganda and, in particular, oil wells in Uganda’s Murchison Falls nature reserve with the Indian Ocean. At stake for TotalEnergies and its partners is a billion barrels of crude oil with a current value of $80 billion. Climate researchers have calculated that the project’s climate footprint over its entire lifetime will be 25 times the current CO2 annual emissions of Uganda and Tanzania combined.

Plaintiffs demanded compensation

The plaintiffs accuse TotalEnergies of displacing more than 100,000 people from their land for the pipeline without adequate compensation and acting without regard for the endangered species living in the protected area. They argued that the court should require TotalEnergies to design its existing oil production and pipeline plans in accordance with its obligations under the LdV and to take adequate measures to address human rights risks.

TotalEnergies should also pay compensation to affected communities. In civil summary proceedings, the court should suspend the project until the associated risks are properly identified and the necessary measures to end human rights abuses and prevent an environmental disaster are implemented.

Dismissal of the complaint on formal grounds

On Feb. 28, 2023, the court in Paris dismissed the action in these summary proceedings. It based its decision on formal arguments. The plaintiff organizations had not complied with the procedure because they did not repeatedly file a formal complaint against newly drawn up due diligence plans of the company after filing the lawsuit and, at the same time, presented facts in the oral hearing at the end of 2022 that occurred after 2019.

Moreover, in summary proceedings, the court could only examine whether the company had drawn up due diligence plans at all in accordance with the LdV, which had happened in the specific case. Whether these plans meet the substantive requirements of the LdV would have to be clarified in ordinary proceedings.

Focus on due diligence plan

This ruling raises the question: Are French courts capable of dealing with the problems of global value chains? Or do the NGOs have excessive expectations, as TotalEnergies’ lawyer suggests when he claims that they are seeking a “Marxist” interpretation of the law?

In its decision, the court does not take into account the international framework in which the law was created. The LdV is a law that transposes international standards of human rights due diligence for companies into national law. According to the UN Guiding Principles, the aim is to take appropriate measures to prevent and minimize human rights risks.

It is not a matter of simply creating a due diligence plan. By focusing on the creation of a due diligence plan, the court formalizes a duty that is about an effort to take the most appropriate action in the specific context.

Urgent proceedings should have preventive effect

The purpose of due diligence laws such as the LdV is to have a preventive effect, i.e. to prevent human rights violations. In the interpretation of the Paris court, the summary proceedings, which are actually intended to have an equally preventive effect, cannot have any suspensive effect on the merits of the case. The entire procedure thus runs practically empty.

On the one hand, the plaintiffs can now appeal against this decision in summary proceedings to the second instance, which will take several years. Or they can try to get justice in the main proceedings. But this, too, will take time. By the time there is a final ruling, the pipeline project will probably be fully operational and the damage to the environment and to very many people will already have been done.

Miriam Saage-Maaß is a lawyer and Legal Director at the European Center for Constitutional and Human Rights (ECCHR), where she established the Business and Human Rights Program Area. She has worked on various court cases against companies related to the exploitation of workers in Bangladesh and Pakistan.


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