Economic Actors and Criminal Liability / William A. Schabas
War Economies, Economic Actors
and International Criminal Law
William A. Schabas
The newly-elected Chief Prosecutor of the International Criminal Court (ICC), in one of
his first public declarations dealing with prosecutorial strategies and orientations, on 16
July 2003, focused on the role of economic actors in armed conflict. After indicating that
the crisis in the Ituri region of the Democratic Republic of Congo would be the likely
target of his initial investigations, he turned to what were described as
‘[m]oney-laundering and other crimes committed outside the Democratic Republic of
Congo which may be connected with the atrocities’. According to Chief Prosecutor Luis
Moreno Ocampo,
Various reports have pointed to links between the activities of some
African, European and Middle Eastern companies and the atrocities
taking place in the Democratic Republic of Congo. The alleged
involvement of organized crime groups from Eastern Europe has also
been mentioned. Their activities allegedly include gold mining, the
illegal exploitation of oil, and the arms trade. There is general concern
that the atrocities allegedly committed in the country may be fuelled
by the exploitation of natural resources there and the arms trade, which
are enabled through the international banking system. Although the
specific findings of these reports have not been confirmed, the
Prosecutor believes that investigation of the financial aspects of the
alleged atrocities will be crucial to prevent future crimes and for the
prosecution of crimes already committed. If the alleged business
practices continue to fuel atrocities, these would not be stopped even if
current perpetrators were arrested and prosecuted. The Office of the
Prosecutor is establishing whether investigations and prosecutions on
the financial side of the alleged atrocities are being carried out in the
relevant countries.1

1
Professor, Director of Irish Centre for human rights
‘Communications Received by the Office of the Prosecutor of the ICC’, Press Release No.:
pids.009.2003-EN, 16 July 2003, pp. 3-4.
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Economic Actors and Criminal Liability / William A. Schabas
The Prosecutor’s declaration had been anxiously awaited by those who follow the
unfolding work of the new institution, because the Rome Statute of the International
Criminal Court gives the Prosecutor an enormous amount of individual discretion in
deciding to launch cases. That economic factors would figure so prominently on his
agenda was quite astonishing and utterly unexpected, especially because the Court’s
jurisdictional framework seems to leave it very few, if any, tools with which to address
economic dimensions of armed conflict including money-laundering, illicit natural
resource exploitation and the illicit arms trade.
Indeed, to date, private sector actors, such as transnational corporations, have been highly
invisible in armed conflict, fueling war and atrocity, yet operating deep within the
shadows and often from remote and privileged environments. At best, they are
conceptualized as secondary participants in international crimes, in a world where
impunity, amnesty and immunity ensure that even the central architects of systematic
human rights violations are still about as likely to be held accountable as they are to be
struck by lightening. Chief Prosecutor Ocampo is surely aware of the obstacles in his
way, because of the shortcomings of current legal norms and mechanisms capable of
snaring the economic actors who contribute to conflict. Two paths lie open: strengthening
the inadequate norms and mechanisms that currently exist, and beginning to contemplate
the creation of a new legal regime better adapted to tackle these problems.
Economic agendas may contribute significantly to the outbreak and the perpetuation of
war. It seems that in our post-Cold War context, civil wars are often little more than
campaigns to acquire access to natural resources and markets, although somewhere in the
distant past it may be possible to identify a role for ideological factors and political
objectives.2 Prosecutor Ocampo’s laconic statement nevertheless highlighted some of the
complexities, because economic actors in armed conflict correspond to a variety of
profiles. His reference to the ‘international banking system’, the exploitation of natural
resources, the arms trade, and to companies from various parts of the world seems to
point to classic white collar criminals ensconced within wood-paneled boardrooms in
major capitals and financial centers. These forces are cloaked in legality and legitimacy,
largely beyond the reach of existing law. But note was also made of ‘organized crime
groups’, whose usually more clandestine activities situate them in a different legal
paradigm and one that is probably more within the grasp of existing international
regulation. For this latter category, the problem may be more a question of
implementation and enforcement. Finally – and here the law is perhaps most robust – are
2
Mats Berdal and David M. Malone (eds.): Greed and Grievance: Economic Agendas in Civil
Wars, Boulder and London: Lynne Rienner, and Ottawa: International Development Research
Centre, 2000.
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Economic Actors and Criminal Liability / William A. Schabas
the economic dimensions of war crimes themselves, the well-recognized international
offences of pillage and plunder, condemned by customary law for centuries and expressly
prohibited in one of the first great humanitarian law treaties, the Hague Convention of
1907.3
Catching the Accomplices
Only days after the adoption of the Rome Statute of the International Criminal Court at
the conclusion of the Rome Conference in July 1998, the prestigious British business
daily the Financial Times published an article warning ‘commercial lawyers’ that the
treaty’s accomplice liability provision ‘could create international criminal liability for
employees, officers and directors of corporations.’ Writer Maurice Nyberg referred to
condemnation of violations of human rights involving multinational corporations by
non-government organizations like Human Rights Watch, adding that ‘[i]t takes little
imagination to jump from complicity with human rights violations to complicity with
crimes covered under the ICC Treaty.’4
Certainly, to the extent that economic actors including international businesses are
involved in war crimes and crimes against humanity, there is much potential and the law
is, as the analysis below demonstrates, quite adequate. The participation will almost
invariably be indirect, as financiers, or as merchants of weapons and other war
paraphernalia, or traders in the spoils of war. International criminal law may apply to the
extent that illegal means or methods of war are being employed, or that civilian
non-combatants are being victimized. Note that the liability of economic actors would not
be for economic crimes, as these are essentially absent from the Rome Statute, save for
the war crime of “pillage and plunder.” Rather, economic actors would be held
responsible as accomplices in the “classic” international crimes: torture, disappearance,
apartheid and so on.
There are a variety of definitions of complicity in international criminal law, of which the
most widely accepted, and arguably the broadest, is that found in article 25 of the Rome
3
4
Prosecutor v. Kunarac et al. (Case No. IT-96-23-T and IT-96-23/1-T), Decision on Motion for
Acquittal, 3 July 2000. Prohibitions of pillage and plunder can be found in: Convention (IV)
Respecting the Laws and Customs of War by Land, [1910] U.K.T.S. 9, annex, arts. 28, 47;
Agreement for the Prosecution and Punishment of Major War Criminals of the European Axis,
and Establishing the Charter of the International Military Tribunal (I.M.T.), annex, (1951) 82
U.N.T.S. 279, art. VI(b); Convention (IV) Relative to the Protection of Civilian Persons in Time of
War, (1950) 75 U.N.T.S. 287, art. 33; Statute of the International Criminal Tribunal for the
former Yugoslavia, UN Doc. S/RES/827 (1993), annex, art 2(d); Rome Statute of the International
Criminal Court, UN Doc. A/CONF.183/9, arts. 8(2)(a)(iv).
Maurice NYBERG, ‘At Risk from Complicity with Crime,’ Financial Times, 27 July 1998.
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Economic Actors and Criminal Liability / William A. Schabas
Statute.5 An individual can be prosecuted for war crimes or crimes against humanity if
he or she
(c) For the purpose of facilitating the commission of such a crime, aids,
abets or otherwise assists in its commission or its attempted
commission, including providing the means for its commission;
(d) In any other way contributes to the commission or attempted
commission of such a crime by a group of persons acting with a
common purpose. Such contribution shall be intentional and shall
either:
(i) Be made with the aim of furthering the criminal activity or
criminal purpose of the group, where such activity or purpose
involves the commission of a crime within the jurisdiction of
the Court; or
(ii) Be made in the knowledge of the intention of the group to
commit the crime…
It should be relatively easy to understand how an economic actor might fall within the
reach of these provisions.6 Although the subject has received little or no attention from
the ad hoc international criminal tribunals for the former Yugoslavia (ICTY) or Rwanda
(ICTR), there are precedents in the post-Second World War prosecutions. In
concentration camp prosecutions, personnel at Belsen were found ‘in violation of the
laws and usages of war [and to be] together concerned as parties to the ill-treatment of
certain persons...’7 The Judge Advocate who successfully prosecuted the case conceded
that ‘mere presence on the staff was not of itself enough to justify a conviction,’ but
insisted that ‘if a number of people took a part, however small in an offence, they were
parties to the whole.’8 Nuremberg prosecutors also succeeded in obtaining a conviction
5
6
7
8
Complicity is also included in other instruments, such as: Convention on the Prevention and
Punishment of the Crime of Genocide, (1951) 78 U.N.T.S. 277, art. III(e); Convention Against
Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment, (1987) 1465 U.N.T.S.
85, art. 4(1); Statute of the International Criminal Tribunal for the former Yugoslavia, supra note
3, arts. 4(3)(e), 7(1); Statute of the International Criminal Tribunal for Rwanda, UN Doc.
S/RES/955, annex, arts. 2(3)(e), 6(1); Statute of the Special Court for Sierra Leone, art. 6(1).
See: William A. Schabas, ‘Enforcing International Humanitarian Law: Catching the
Accomplices,’ (2001) 83 International Review of the Red Cross 439; Tom Farer, ‘Shaping
Agendas in Civil Wars: Can International Criminal Law Help?,’ in Mats Berdal and David M.
Malone, supra note 2, pp. 205-232.
United Kingdom v. Kramer et al. (‘Belsen trial’), (1947) 2 LAW REPORTS OF THE TRIALS OF THE
WAR CRIMINALS 1 (British Military Court), p. 4.
Ibid., pp. 109, 120.
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Economic Actors and Criminal Liability / William A. Schabas
of three I.G. Farben executives who were involved in the construction of the slave-labor
factory at Auschwitz.9 Two of them, Friedrich Flick and Otto Steinbrinck, were found
guilty of complicity because of their financial support of SS leader Heinrich Himmler’s
activities and, more generally, those of the SS.10 The ruling did not, however, extend to
the corporation itself.
For several years now, judges at the ICTY in The Hague have been fine-tuning a brand of
complicity known as ‘joint criminal enterprise’, by which even relatively remote
accomplices to an atrocity can be found guilty of crimes committed by others to the
extent that the acts themselves were an objectively foreseeable outcome of the
conspiracy.11 Now applied to war crimes and crimes against humanity, the concept has
proven most effective in recent years in the prosecution of organized crime. Even the
terminology itself – ‘enterprise’ – suggests an economic context. The Prosecutor of the
Special Court for Sierra Leone is promising to explore this territory more thoroughly. For
example, the indictments, issued in March 2003 against, among others, the late rebel
leader Foday Sankoh and his ally, former Liberian president Charles Taylor, allege a
‘joint criminal enterprise’ whose objective was ‘to gain and exercise political power and
control over the territory of Sierra Leone, in particular the diamond mining areas. The
natural resources of Sierra Leone were to be provided to persons outside Sierra Leone in
return for assistance in carrying out the joint criminal enterprise.’12
Although criminal prosecution of economic participants in armed conflict for their role in
assisting grave violations of international criminal law has much potential, it is not
without its problems. First, if the objective is to choke off the conflict by depriving
combatants of funds, or in some other way to stymie the economic agendas that are at
work, the alleged wrongs that are committed rarely fall within the scope of international
criminal law. For example, although the Rome Statute prohibits use of certain weapons,
such as poison, asphyxiating gas and hollow-tip bullets, it does not at present challenge
9
10
11
12
United States of America v. Carl Krauch et al. (‘The I.G. Farben Case), (1948) 8 TRIALS OF THE
WAR CRIMINALS 1169, p. 1180.
United States of America v. Friedrich Flick et al. (‘The Flick Case), (1948) 6 TRIALS OF THE WAR
CRIMINALS 1217-1221.
Prosecutor v. Tadic (Case No. IT-94-1-A), Judgment, 15 July 1999, 15 July 1999. Also:
Prosecutor v. Krnojelac (Case No. IT-97-25-PT), Decision on Form of Second Amended
Indictment, 11 May 2000; Prosecutor v. Brdjanin & Talic (Case No. IT-99-36-PT), Decision on
Form of Further Amended Indictment and Prosecution Application to Amend, 26 June 2001;
Prosecutor v. Krnojelac (Case No. IT-97-25-T), Judgment, 15 March 2002
E.g., Prosecutor v. Sankoh (Case No. SCSL 2003-02-I), Indictment, 7 March 2003, para. 27;
Prosecutor v. Sesay (Case No. SCSL 2003-5-I), Indictment, 7 March 2003, para. 23; Prosecutor v.
Koroma (Case No. SCSL 2003-3-I), Indictment, 7 March 2003, para. 24; Prosecutor v. Brima
(Case No. SCSL 2003-6-I), Indictment, 7 March 2003, para. 23; Prosecutor v. Taylor(Case No.
SCSL 2003-03-I), Indictment, 7 March 2003, paras. 20, 23.
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Economic Actors and Criminal Liability / William A. Schabas
the use of those arms that are most common, especially in civil wars: automatic rifles and
other forms of small arms, machetes, anti-personnel mines and cluster bombs.
Anti-personnel mines were widely used in the conflict in the former Yugoslavia, yet there
have been no prosecutions alleging that this was contrary to the laws or customs of war,
and therefore prohibited by article 3 of the Statute. In other words, while it may be
possible to convict an arms manufacturer or trafficker who knowingly contributes to the
use of prohibited weapons – an analogy here would be the conviction of those who
supplied Zyklon-B gas to Nazi extermination camps13 – most of the lethal weapons are
not prohibited by international law. When they exist, the prohibitions, such as the Ottawa
Convention on anti-personnel mines, are neither comprehensive nor universal.
While the principles of complicity liability seem straightforward enough, most of the
existing experiments in international criminal law have limited them in one way or
another. The case law of the ad hoc tribunals for the former Yugoslavia and Rwanda has
required that participation in a crime be ‘substantial.’14 This may discourage prosecution
of economic actors, whose involvement in crimes, though undisputed, may seem to be
too remote. The Prosecutors of the ICTY and ICTR have shown little interest in pursuing
economic actors, although there is an outstanding indictment for the Rwandan
businessman Felicien Kabuga for his role in financing the Rwandan génocidiaires.15
Similarly, the jurisdiction of the Special Court for Sierra Leone is confined to ‘persons
who bear the greatest responsibility’ for serious violations of international humanitarian
law. 16 Determining who bears the greatest responsibility would appear to belong
essentially to the realm of the discretion of the Prosecutor. Theoretically, he might
determine that transnational diamond merchants, such as De Beers, fall within this
category,17 but this is not the direction that prosecutions have taken, and the initial
indictments have been directed to military and political leaders.
13
14
15
16
17
United Kingdom v. Tesch et al. (‘Zyklon B Case’), (1947) 1 LAW REPORTS OF THE TRIALS OF THE
WAR CRIMINALS 93 (British Military Court), pp. 93-101.
Prosecutor v. Tadic (Case no. IT-94-1-T), Opinion and Judgment, 7 May 1997, paras. 691, 692.
Also: Prosecutor v. Delalic et al. (Case no. IT-96-21-T), Judgment, 16 November 1998, para. 326;
Prosecutor v. Furundzija (Case no. IT-95-17/1-T), Judgment, 10 December 1998, paras. 223, 234;
Prosecutor v. Aleksovski (Case no. IT-95-14/1-T), Judgment, 25 June 1999, para. 61.
Prosecutor v. Bizimana et al. (Case no. ICTR-98-44-I), Prosecutor’s Amended Indictment
Pursuant to the Decision of Trial Chamber II on the Defence Motion…, 21 November 2001, paras.
4.24-4.25.
Statute of the Special Court for Sierra Leone, art. 1.
L. Sanders, ‘Rich and Rare Are the Gems they War: Holding De Beers Accountable for Trading
Conflict Diamonds,’ (2001) 24 Fordham International Law Journal 1402.
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Economic Actors and Criminal Liability / William A. Schabas
Finally, while it may be of considerable interest to pursue private businesses for their
complicity in war crimes, and not just the individuals who work within them as managers
and directors, this is not always possible. For example, the jurisdiction of the
International Criminal Court is confined to ‘natural persons.’18 Corporate bodies and
legal persons were excluded from the Rome Statute for essentially practical reasons.
Many domestic justice systems do not provided for criminal prosecution of corporate
bodies or legal persons. For the complementary regime of the ICC to operate fairly, it
was believed necessary to find a common denominator of all major criminal justice
systems, and this made it unrealistic to include a provision on corporations.19
Shortcomings of Existing Law
International law endeavors to regulate armed conflict in a number of ways. First, and
foremost, it prohibits the use of force except in two extraordinary circumstances,
enforcement action pursuant to Chapter VII of the Charter of the United Nations and ‘the
inherent right of self-defense. Its success in this area is debatable, and prevention of
conflicts may well have more to do with the political and the diplomatic than it does with
any legal prohibition. Nobody has been prosecuted for ‘crimes against peace’ since the
1940s. Attempts to make aggression an international criminal offense punishable by the
International Criminal Court are proceeding, but at a leisurely pace, and there is no
assurance that they will succeed. Two issues make progress difficult in this area: there is
no agreement among States about how to define aggression; and there are possible
conflicts with the United Nations Security Council should the ICC attempt to determine
issues of aggression, because article 39 of the Charter of the United Nations says this is
the prerogative of the Council.
The law is considerably more developed and sophisticated in the area of jus in bello, the
legal regime governing the conduct of armed conflict, irrespective of whether the war
itself is unlawful. In addition to a weighty repertoire of treaties, with the 1949 Geneva
Conventions as the centerpiece, international law also brings a rich body of customary
18
19
Rome Statute of the International Criminal Court, supra note 3, art. 25(1).
For discussion of the debates leading to the exclusion of corporate bodies, see: Per Saland,
‘International Criminal Law Principles’, in Roy Lee, ed., The International Criminal Court: The
Making of the Rome Statute, Issues, Negotiations, Results, The Hague: Kluwer Law International,
1999, pp. 189-216, at p. 199; Kai Ambos, ‘General Principles of Law in the Rome Statute’, (1999)
10 Criminal Law Forum 1, at p. 7; Andrew Clapham, "The Question of Jurisdiction under
International Criminal law over Legal Persons: Lessons from the Rome Conference on an
International Criminal Court’, in: Menno T. Kamminga and Saman Zia-Zarifi (eds), Liability of
Multinational Corporations under International Law, The Hague: Kluwer Law International,
2000, pp.139-195.
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Economic Actors and Criminal Liability / William A. Schabas
norms to bear in this area. As recently as 1996, the world’s supreme judicial body, the
International Court of Justice, declared that the ‘cardinal principles’ of international
humanitarian law are the obligation to distinguish between combatants and
non-combatants, never to make civilians the object of attack, and to eschew the use of
weapons that cause unnecessary suffering to combatants.20
International humanitarian law provides a relatively sophisticated body of legal rules and
principles to govern international armed conflict, many of them customary in nature and
developed virtually from antiquity, but it has rather less to say with respect to intra-state
armed conflict. This is explained partly by historical reasons and partly by the reluctance
of States to allow international law to pry into an area of great sensitivity to them, their
conduct in putting down armed challenges to their own authority. To the extent that rules
exist to govern the conduct of internal armed conflict, their applicability is conditional on
certain threshold definitions. These exclude many low-level conflicts of great seriousness,
as well as riots, disturbances and terrorist acts. Although there are important exceptions,
such as the recent interventions in Kosovo, Afghanistan, and Iraq, most contemporary
armed conflicts are internal in nature.
In parallel with international humanitarian law is the more modern regime of
international human rights law. It is said to apply without exception in both peacetime
and wartime, and without any interest in whether or not a conflict is international or
internal in scope. Nevertheless, certain principles of human rights law, such as the right to
a fair trial and freedom of express, can be suspended or derogated from in time of war.21
Moreover, courts continue to debate whether or not human rights law and humanitarian
law operate together, reinforcing each other, or whether one supersedes the other. The
International Court of Justice seems to consider that humanitarian law displaces human
rights law because it is a specialized body of principles intended to govern situations of
armed conflict (lex specialis).22 Finally, there is an ongoing debate among scholars and
practitioners to what extent international human rights law does apply to ‘non-state
actors’, like transnational corporations and other economic actors.
But aside from what may seem highly technical issues of the application of these two
bodies of law, the real problems reside with the substance of the norms, which do not
20
21
22
Legality of the Threat or Use of Nuclear Weapons (Advisory Opinion), [1996] I.C.J. Reports 226,
para. 78.
For example, International Covenant on Civil and Political Rights, (1976) 999 U.N.T.S. 171, art.
4. On this subject, see the recent ‘General Comment No. 29’ of the United Nations Human
Rights Committee, UN Doc. HRI/GEN/1/Rev.6, p. 186.
Legality of the Threat or Use of Nuclear Weapons (Advisory Opinion), [1996] I.C.J. Reports 226,
para. 26.
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Economic Actors and Criminal Liability / William A. Schabas
generally deal with economic matters. They are targeted at the core issues of threats to
bodily integrity, such as killings, mutilations, summary executions, sexual assaults and
pillage. Of course, economic actors who are directly involved in such violations and
abuses fall within its ambit as much as traditional combatants. Generally, though, the role
of economic actors is more indirect. For example, while it is widely agreed that trade in
diamonds helped to fuel conflict in places like Sierra Leone, 23 unless it can be
established that diamond traders were actual accomplices in the atrocities committed
against civilians, there is little that existing law can contribute. If it were actually an
unlawful act to buy and sell diamonds, even while knowing that somewhere along the
chain of possession they had been bartered for small arms or anti-personnel mines that
were then turned on the innocent, most jewelers in the developed world would have to
close their doors.
Finally, if the purpose of the exercise is to prevent conflict rather than to regulate it,
ensuring that wars do not happen instead of seeing that they are conducted with respect
for rules of chivalry, international law is woefully inadequate. The prohibition of the
use of force within the Charter of the United Nations, coupled with the punishability of
crimes against peace or aggression for those individuals who actually participate in a
breach of the peace, relates only to international armed conflict. By and large,
international law has nothing to say about the jus ad bellum of internal wars. There is
even acknowledgement of the legitimacy of resort to the use of force in some
circumstances. The preamble to the Universal Declaration of Human Rights accepts
‘recourse, as a last resort, to rebellion against tyranny and oppression,’ 24 while the
humanitarian law instruments nod benignly at ‘armed conflicts in which peoples are
fighting against colonial domination and alien occupation and against racist regimes in
the exercise of their right of self-determination.’25
Illegal use of force may provoke political intervention by bodies like the Security Council
of the United Nations, but it continues to elude such fora as the international criminal
tribunals. For example, the ICTY is powerless to prosecute those who actually started the
wars in Croatia, Bosnia and Herzegovina, and Kosovo; its subject-matter jurisdiction is
confined to violations committed after the wars had begun. Although the Security
Council imposed an arms embargo on the region, the Tribunal cannot prosecute those
23
24
25
John L. Hirsch, Sierra Leone, Diamonds and the Struggle for Democracy, New York:
International Peace Academy, 2001.
Universal Declaration of Human Rights, G.A. Res. 217 A (III), U.N. Doc. A/810, preamble.
Protocol Additional to the 1949 Geneva Conventions of 12 August 1949, and Relating to The
Protection of Victims of International Armed Conflicts (Protocol I), (1979) 1125 U.N.T.S. 3, art.
1.
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who defied the prohibition because this is not an offence within its jurisdiction. In what
was a last-minute and inadequate drafting compromise, the Rome Statute of the
International Criminal Court has jurisdiction over the crime of aggression, but only to the
extent that the offence is subsequently defined and that the tension with article 39 of the
Charter of the United Nations, which appears to reserve determination of cases of
aggression to the Security Council, is resolved.26 Unless States parties to the Statute can
agree on a legal formula, prosecutions for aggression cannot take place. At present, they
seem far indeed from any agreement.27
It is, perhaps, a commonplace, but one that deserves repeating. Wars, especially civil
wars, are often rooted in social tensions and dislocations that result from violations of
economic and social rights. The ‘rebel war’ in Sierra Leone (1991-2002) may have been
launched by individuals who were trained in Libya and funded by Liberia, but it drew its
initial support from a stratum of the country’s youth that was quite understandably
dissatisfied with endemic corruption, poverty and underdevelopment. This portrait of the
conflict, already noted by some observers, is becoming increasingly evident as the
hearings of Sierra Leone’s Truth and Reconciliation Commission unfold. Economic
actors, including corrupt officials and greedy transnational corporations in mining and
other areas of commercial activity, contributed to the overall misery and wretchedness of
the country in the three decades since independence, in 1961. Weak notions of social
responsibility among local elites as well as transnational commercial operators must be
strengthened if what may now be little more than a ceasefire is to be transformed into
lasting peace. Blaming the war on meddling by Muammar Qadhafi and Charles Taylor is
to some extent a distraction from the underlying economic causes of the war, something
to which both national and transnational businesses contributed.
Corporate Responsibility and Civil Liability
Economic agendas are pursued through organizations in one form or another, generally
rebel groups of commercial corporations. The corporation dates to the early stages of
capitalist economies, and facilitates business activities in a number of ways, not the least
of which is the protection of the personal assets of the individuals who direct them and
profit from them. One means of regulating economic agendas in armed conflict may well
26
27
Rome Statute of the International Criminal Court, supra note 3, art. 5(2). See Theodor Meron,
‘Defining Aggression for the International Criminal Court,’ (2001) 15 Suffolk Transnational Law
Review 1.
Sylvia A. de Gurmundi Fernandez, ‘The Working Group on Aggression at the Preparatory
Commission for the International Criminal Court,’ (2002) 25 Fordham International Law Journal
589.
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be through standards of corporate responsibility. This is an area receiving an increasing
amount of attention, mainly with regard to human rights abuses suffered by persons in the
South at the hands of commercial corporations directed from the North. Labor standards
and environmental protection are at the core of contemporary concerns, but there is no
reason why the approaches undertaken in these areas cannot and should not be extended
to the context of armed conflict.
Most efforts in the area of corporate responsibility belong to the realm of ‘soft law’
initiatives or ‘corporate social responsibility’ (CSR). These are codes of conduct and best
practice, adhered to voluntarily by businesses, sometimes in exchange for public relations
and marketing advantages in one form or another. The prospect of consumer boycott may
often be a realistic encouragement to compliance. It seems likely that negative publicity
about the international diamond market and its contribution to conflict in Angola, Sierra
Leone, and elsewhere may well have influenced the behavior of the international
diamond industry. Labeling requirements whose objective is to unleash the forces of
consumers have had a nod of acceptance from the World Trade Organization dispute
resolution system.28
Yet, one needs to distinguish between different types of corporations with operations in
the area of armed conflict. Large, transnational companies in the extractive industries,
who through their operations may become complicit in violations of international law, are
typically legitimate entities and relatively amenable to CSR initiatives. Where the
corporations involved are arms dealers and shadowy commodity traders, however,
benevolent corporate culture is unlikely to be at its highest. Most of the relevant operators
are not particularly vulnerable to ‘naming and shaming.’ Their activities are more
analogous to those of organized crime than to that of innocent merchants and traders
whose products and services, inadvertently, are put to evil use.
One of the justifications for persuasion rather than coercion when transnational
corporations are involved revolves around the legal difficulties associated with
regulation. International norms of human rights and humanitarian law are addressed to
States, not individuals or corporations, it is argued. In response, a growing body of law
holding States responsible for ‘horizontal violations’ of human rights is invoked.
Although non-State actors may not be directly liable under international law, States are
responsible for ensuring that corporations under their jurisdiction behave in accordance
with certain minimum standards.
28
WTO Appellate Body, United States-Import Prohibition of Certain Shrimp and Shrim Products
(12 October 1998), (1999) 38 International Legal Materials 11.
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This argument helps to a point, but then confronts the additional obstacle of
extraterritoriality. States argue that to the extent that they are obliged to ensure their
corporate citizens behave responsibly, this duty is confined to their own territory.
Anything further might be taken as a violation of the sovereignty of other States. Wealthy
countries that attempt to regulate the conduct of their own nationals, corporate and other,
in poorer countries may even find themselves charged with neo-colonialism.
Here too, though, there is a potent answer. States are increasingly prepared to enact
legislation governing conduct of their nationals abroad when this involves serious
violations of human rights. Examples include the statutes adopted by many developed
countries aimed at sexual tourism by their own nationals in countries where the justice
system is overwhelmed, or simply corrupt, and therefore unwilling or unable to address
the exploitation of children. Similarly, many States have anti-trust and anti-bribery
legislation with extraterritorial effect. In other words, there are significant exceptions to
the general rule discouraging legislation with extraterritorial effect. Consequently, robust
national legislation in those countries that are home to transnational corporations, that is
aimed at commercial activity by corporations that contributes to armed conflict abroad,
could well have a meaningful impact.
There has already been at least one attempt to legislate in this area. In 1996, the State of
Massachusetts adopted what was known as its ‘Burma law,’ which attempted to regulate
state contracts with companies doing business with or in Burma.29 The statute was struck
down as unconstitutional by the United States Supreme Court, but only because the field
was deemed to be one of federal jurisdiction, and not because such initiatives were
impermissible per se.
The real problem, of course, is defining the line beyond which commercial activity is no
longer legitimate and acceptable. In many ways, this is the same problem faced in the
criminal sphere, with respect to complicity in war crimes and crimes against humanity. In
that context, the diamond merchant who trades with armed groups engaged in notorious
atrocities may be considered close enough to the offence for criminal complicity to be
engaged. However, the jeweler in a foreign city who only suspects the products he or she
is dealing with are ‘blood diamonds’ may be deemed to be rather too remote.
29
An Act Regulating State Contracts with Companies Doing Business with, or in Burma (Myanmar),
1996 Mass. Acts 239, ch. 130 (codified as Mass. Gen. Laws §§7: 22G-7: 22M, 40 F½ (1997).
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When corporate responsibility is being addressed, within the context of civil liability
however, the rigorous standards that apply to criminal prosecution need not be observed.
Justice systems balk at punishing a foreign jeweler who is merely suspicious as to the
origin of diamonds, but have rather less difficulty imposing various civil consequences,
such as fine or confiscation, in such circumstances. The burden of proof is one of
preponderance of evidence, and not the daunting reasonable doubt standard of criminal
trials. In so many respects, then, a legal regime focused upon corporate accountability
and responsibility, with civil or administrative but not criminal consequences, has much
to recommend itself.
Model legislation might be devised indicating how such a system could operate.
Commercial corporations with their head office in a given country, or perhaps substantial
assets or activities, or some other significant nexus, would be required by law to abstain
from acts that might facilitate a conflict. These could be defined in a general sense, or
applicability might be triggered by some determination by a national or perhaps an
international body concerning a state of armed conflict. Upon proof that the norms of
conduct were breached, a variety of sanctions could be contemplated, including fines,
confiscation of assets, personal liability for directors and, ultimately, company closure.
‘Economic’ Truth Commissions
Political compromises associated with conflict resolution have often involved some form
of pardon or amnesty. The premier legal instrument governing non-international armed
conflict, Protocol Additional II to the Geneva Conventions of 1949, actually says that
‘[a]t the end of hostilities, the authorities in power shall endeavor to grant the broadest
possible amnesty to persons who have participated in the armed conflict…’30 But to
ensure that amnesty does not equal amnesia, and out of concerns that enforced silence
about perpetration of atrocities leaves post-conflict societies with festering sores that are
fundamentally destabilizing, many countries have convened truth and reconciliation
commissions. The most well-known, of course, is that of post-apartheid South Africa. But
more than twenty-five others have been cataloged over the last couple of decades.31
By and large, truth commissions focus on violent breaches of civil and political rights or
of international humanitarian law. They attempt to bring together victims and
perpetrators, and thereby promote reconciliation, but with frank and candid recognition of
30
31
Protocol Additional to the 1949 Geneva Conventions and Relating to The Protection of Victims of
Non-International Armed Conflicts, (1979) 1125 U.N.T.S. 609.
Priscilla B. Hayner, Unspeaking Truths, Facing the Challenge of Truth Commissions, Routledge:
New York & London, 2002.
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the truth as a prerequisite. Generally, they try to assess responsibilities for the conflict,
and to make recommendations aimed at preventing a recurrence.
There is no reason why truth commissions cannot also address the economic causes of
conflict, the role of economic agendas during the conflict, and the possible ways to deal
with them in post-conflict setting. The South African Truth and Reconciliation
Commission has done this, but very much as an afterthought. Its initial report, in 1998,
did not delve into the economic and social issues. Five years later, in its final report, the
Commission laid a share of the blame for apartheid upon the role of business, including
transnational corporations, and called for companies to finance programs of
compensation out of existing assets and future profits. Citing ‘decades of profits [that]
were based on systematic violations of human rights,’ the 2003 report proposed a levy of
3 billion rand on South African companies, including Anglo-American Mining
Corporation (which is itself a shareholder in the De Beers diamond business), and
criticized an 800 million rand trust fund established by business as ‘paltry’. The
Commission pointed to a wealth tax levied in West Germany in order to rebuild East
Germany following reunification as a model.
The Sierra Leone Truth and Reconciliation Commission, which began work in July 2002,
has a broad mandate enabling it to explore the role of economic actors, including those
involved in the diamond trade which did so much to fuel the ten-year civil war. Its
enabling statute charges it with creating ‘an impartial historical record of violations and
abuses of human rights and international humanitarian law related to the armed conflict
in Sierra Leone.’32 This allows it to examine violations and abuses of economic and
social rights, as well as civil and commercial rights. Moreover, it is also to determine
whether the ‘violations and abuses were the result of deliberate planning, policy or
authorization by any government, group or individual, and the role of both internal and
external factors in the conflict.’33 Therefore, the Commission has wide authority to
examine the role of economic agendas, notably the contribution of ‘respectable’
transnational corporations as well as that of quasi-criminal commercial operations. The
Truth and Reconciliation Commission Act states that the government is required to
implement the Commission’s recommendations. The Commission’s work is incomplete
at this point, and it is, therefore, too early to say whether it will rise to this challenge. But
its legislative framework provides an open door for such inquiry. The Commission
conducted detailed research into diamond mining, and held public hearings on the
subject. Its final report, due to be released in May 2004, is likely to make
32
33
Truth and Reconciliation Commission Act 2000, No. 4 (2000), s. 6.
Ibid., s. 7.
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recommendations concerning the regulation of diamond mining, changes to the tax
structure, and similar measures.
There have been suggestions that truth commissions might also provide an appropriate
framework to address property disputes of various types resulting from armed conflict.
They do not seem to be particularly appropriate for this arena, however. Truth
commissions are best at speaking to phenomena of human rights abuse committed on a
large scale, by States or rebel groups, and often in contexts where it is difficult to identify
the specific perpetrator. It might trivialize their significance were they to be reduced to
arbitration of individual claims, rather like ordinary civil courts. Initial assessments of the
information gathered by the Sierra Leone Truth and Reconciliation Commission indicate
that victims are not so interested in achieving individual justice, in terms of restitution or
compensation, as they are in seeing a new political regime that ensures to them basic
economic and social rights, such as housing, work, education, and health care.
Generally, one of the great advantages of truth commissions is their flexibility. They do
not establish guilt and they do not impose punishment or other sanction. They are,
nevertheless, fact-finding bodies that can attribute responsibilities. By and large, their
rules of evidence are extremely liberal. The sorts of jurisdictional issues that plague
judicial solutions rarely arise with truth commissions. Of course, they are usually
powerless to implement their findings and recommendations; this is left to political
bodies. But overall, it would seem desirable that in future truth commissions, the possible
role of business in the conflict be flagged openly in the enabling instruments, and that
truth commissions be persuaded that no analysis will be complete if this dimension is not
studied and considered.
Conclusion
International law has proven itself to be modestly successful at regulating the conditions
under which the use of force is acceptable as well as the means and methods of warfare.
It has not been particularly good at controlling the phenomenon of weapons that cause
unnecessary suffering or that are indiscriminate, subject to a few rather archaic
exceptions, such as dum-dum bullets and poisonous gas. As a result, the most
significant economic actors in armed conflict – arms producers and traders– largely
escape legal sanction. Sometimes there are efforts to choke a conflict by means of arms
embargo, of course, but these efforts have been notoriously unsuccessful, as the cases of
the former Yugoslavia and Rwanda bear out.
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As for other economic activities, such as trade in mineral and other resources, there can
be no doubt that such ventures fuel armed conflict. This is probably as old as armed
conflict itself. Traditionally, armies live off the land. Where there is nothing left to
plunder, they wither and die, as Napoleon discovered at the gates of Moscow. The Nazi
armies were finally reversed when they could not quite extend their front lines enough to
include the rich oil fields of the north Caucasus, necessary to fuel the war literally as well
as figuratively. How different are these historical examples from the case of Sierra
Leone’s Revolutionary United Front occupying the country’s fabulous alluvial diamond
fields?
Pressure from civil society is already leading to the development of legal instruments,
most of them ‘soft’ rather than ‘hard,’ aimed at improving corporate social responsibility.
To date, the focus has been mainly labor and environmental standards. There is no reason
why this should not extend to the specific concerns of armed conflict. In Canada, pressure
from non-governmental organizations and industrial unions induced the petroleum
company Talisman to abandon its interests in Sudan, where its activities had allegedly
been associated with war crimes or crimes against humanity in the context of one of the
world’s most long-lived civil wars.
Commercial corporations that are involved in armed conflicts, to one extent or another,
may find themselves – or their directors and managers – exposed to criminal prosecution
as accomplices in international crimes. This is an area that deserves to be explored much
further. In 1997, when women’s organizations felt the International Criminal Tribunal for
Rwanda was neglecting gender crimes, an intense lobbying campaign essentially changed
the prosecutorial agenda, and resulted in the first significant international judgments on
the role of rape in armed conflict.34 A serious concerted effort to encourage prosecution
of the economic accomplices to conflict-related crimes might also be undertaken, to
similar effect.
International prosecutors have a great deal of discretion in the targets that they choose. At
Nuremberg, there were efforts to establish the role that the German business community
played in the rise of Nazism. These met with varying degrees of success. Walther Funk
was found guilty of war crimes and crimes against humanity principally for his role in the
German financial establishment, where he was President of the Reichsbank. He was
found guilty and sentenced to life imprisonment. But in the recent crop of international
prosecutions – Yugoslavia, Rwanda – there has been little interest in developing cases
that highlight the economic dimensions of the conflicts. This is probably not because of
34
Prosecutor v. Akayesu (Case no. ICTR-96-4-T), Judgment, 2 September 1998.
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the inherent difficulty in preparing cases as it is with prosecutorial strategy. The efforts of
the Prosecutor of the Special Court for Sierra Leone, who has referred to economic issues
in several of his indictments, may signal a change in this respect. The Chief Prosecutor of
the International Criminal Court has also manifested an interest in economic matters.
Perhaps the best way forward, in terms of bringing international law to bear on economic
agendas in armed conflict, would be to assist the Chief Prosecutor of the new
International Criminal Court in focusing on this area. One or two convictions of those
involved in the business of war, rather than in the war itself, will surely make headlines in
the Financial Times or the Wall Street Journal. The deterrent effect may be worth more
than a score of Security Council resolutions.
17