Business and Human Rights before the Inter-American Court of Human Rights: 2021 in Review and a Look Forward to 2022

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It is a pleasure to welcome (back) Salvador Herencia-Carrasco and Kelsea Gillespie to Rights as Usual. Salvador Herencia-Carrasco (@Sherencia77) is the Director of the Human Rights Clinic, HRREC and part-time professor at the Section de Droit Civil at the University of Ottawa. Kelsea Gillespie (gill006@uottawa.ca) is a J.D. candidate at the Faculty of Common Law, and research assistant at the Human Rights Clinic of the University of Ottawa.

This post is theirs.

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In 2021 the Inter-American Court of Human Rights (IACtHR) released two judgements with significant business and human rights (BHR) implications: Miskito Divers vs. Honduras and Martina Vera vs. Chile. Both decisions build on the 2015 Kaliña and Lokono vs. Suriname ruling, where the IACtHR used the UN Guiding Principles on Business and Human Rights (UNGPs) to highlight a state’s duty to assure that private businesses fulfill human rights and environmental regulations. Miskito Divers and Martina Vera are new decisions from the Court that engage with the UNGPs, and while the outcomes of both decisions are welcome, the application of the UNGPs and BHR principles leaves room for improvement.

The Miskito Divers and Martina Vera cases take small steps toward tying the UNGPs to the American Convention on Human Rights (ACHR) and to a lesser degree, to the San Salvador Protocol on Economic, Social and Cultural Rights. The IACtHR seems willing to engage with BHR principles in its reasoning but timid about introducing more concrete reparation orders to address the state’s role in regulating business conduct vis-à-vis human rights. In this post we review the 2021 decisions and make recommendations, as the Court is set to consider new BHR cases in 2022.

 Miskito Divers : Labour rights and responsibility of businesses

This case addresses the health and labour conditions of Miskito divers working for lobster fishing companies operating in their territory. The case resulted in a friendly settlement between the state and the petitioners, which was reviewed and accepted by the IACtHR. The main focus of the Court’s decision is the health, safety, and working conditions of the victims, but in its review of the settlement, the IACtHR uses the UNGPs to establish some general obligations of states regarding BHR.

First, the Court reiterates the state duty to prevent all human rights violations by private entities operating under its jurisdiction (para. 48). This duty includes the adoption of specific laws and policies, including due diligence (para. 49) and reparation procedures (para. 50). These are broad statements that build on the first and third pillars of the UNGPs but lack specific reference to the situation of the Miskito divers.

Second, the IACtHR uses the second pillar of the UNGPs to state that businesses should bear the primary responsibility for ensuring their activities respect human rights (para. 51). This includes measures such as internal policies that are constantly evaluated, mitigation strategies, and accountability mechanisms that also apply to supply chains (para. 52). Once again, this broad language impairs its impact on the specific case and the Court fails to consider other key BHR governance instruments and internationally-recognized labour standards.

Finally, the Court did not order any specific measure obligating Honduras to enact specific laws or policies applicable to all corporations to observe human rights and BHR principles. This outcome would have been possible under Art. 63 of the ACHR related to reparations. Such an order could have gone a long way towards not only ensuring non-repetition in this case, but also preventing future rights violations by corporate actors.

The only reference to such a measure is a commentary on a reparation regarding the adoption of certification plans for safe fishing (para. 162.6.k), where the Court provides that Honduras must adopt new fishing regulations that includes “human rights policies, due diligence processes and processes to remedy human rights violations” (para. 138). The Court specifies that businesses should be made responsible for the financial cost of implementing new safety and oversight mechanisms. However, given that the order to adopt new fishing regulations is not integral to the overall judgment, it is doubtful whether the state will enforce this requirement for businesses.

Martina Vera: Health and the duty of private health insurances to respect human rights

Martina Vera is a case that deals with the right to health of a child with a disability and the state’s duty to assure her right to health. Martina was born with a rare condition known as Leigh Syndrome, which chronically affects mental and psychomotor abilities. In her hometown of Arica, the public hospital did not have the expertise to provide adequate treatment, forcing her parents to contract with a private health insurance policy (ISAPRE) in 2007. In 2010, the ISAPRE unilaterally cancelled the policy because Martina’s condition was “progressive and irrecoverable” (para. 128). The cancellation, which put her life at severe risk, was technically legal and done according to Chilean regulations at the time, as confirmed by the Chilean Supreme Court.

Martina Vera is an important decision because it develops the right to health of children with disabilities and the role of the state to assure the right to health of its population. But as the IACtHR analyzes the right to health, social security, and whether Chile fulfilled its duty to ensure that private corporations offer a quality and efficient health service (para. 100), a specific BHR approach is noticeably absent.

As in Miskito Divers, the IACtHR refers to the UNGPs (para. 84-88), but the focus is on the state’s duty to regulate and oversee that private businesses offering public good services – like healthcare – do not affect the rights to life and personal integrity of individuals (para. 89). Noticeably, in Martina Vera the Court chose not to analyze issues like conflict of interest or the mercantilization of public goods, which have a significant impact on the privatization of public goods.

For example, regulating private health insurance is highly technical and many of the experts in the field move between regulatory agencies and the companies offering such services, resulting in a “revolving door” effect in the industry. The fact that at the time legislation allowed health insurance companies to cancel client policies when deemed too expensive should have raised questions from the Court during the evidence stage. The Court could have asked Chile for more information on the process regarding the drafting of this legislation, as well as a study regarding the economic impact of these regulations on the rights of vulnerable people. Most likely, the result would have showed that the privatization of public goods leads to economic factors prevailing over the human rights of the beneficiaries.

The lack of analysis of the root causes contributing to Martina’s case becomes more evident in the reparation orders, where the Court did not include any specific measure regarding BHR. Even though the Court recognized that the ISAPRE knew about the condition of Martina Vera and still cancelled her policy (para. 129), the Court did not order Chile to review its current regulation of private health companies or to adopt policies to assure a prompt access to effective legal remedies by users of the ISAPREs.

Conclusions: Diagnosing and treating the root causes of BHR cases

 In Miskito Divers and Martina Vera, the IACtHR advances the integration of the UNGPs with the ACHR, particularly with Art. 1 (obligation to respect rights), Art. 2 (adoption of internal measures) and Art. 25 (right to judicial protection). These cases show that where a private business impacts the rights of an individual, the IACtHR is willing to evaluate the merits of the case against state requirements to protect and uphold human rights and to provide access to remedy under the ACHR.

However, the Miskito Divers and Martina Vera cases demonstrate that while the Court is willing to engage with the UNGPs in its reasoning, it is yet to apply BHR principles consistently in reparation orders. If a state is to achieve not only non-repetition of the same human rights violation but also is to prevent future violations, more proactive reparations orders would assist a state in fulfilling its duties under the ACHR.

To properly address the lack of specific regulation on BHR in the Americas, the Court needs to take a direct approach in confronting the root causes of cases like Miskito Divers and Martina Vera. The Court will have a chance in 2022, in three cases with BHR implications: the U’wa Indigenous Peoples vs. Colombia (extractive projects on Indigenous land), the Tagaeri and Taromenane Indigenous Peoples in Voluntary Isolation vs. Ecuador (environment and extractive licenses on naturally protected areas) and La Oroya Trail Smelter vs. Peru (environment and health of population).

There is an obvious cost to introducing more regulation requiring businesses to respect and protect human rights in the marketplace, but as demonstrated by Miskito Divers and Martina Vera, the human cost of not doing so is higher.