The Duty of Care of the Parent Company: A Comparison between French Law, UK Precedents and the Swiss Proposals

Abstract

In 2017, France established a due diligence statutory obligation for French parent companies to monitor extraterritorial human rights and environmental abuses committed by their off-shore affiliates. Switzerland is also considering adopting a similar law for Swiss parent companies. These obligations are comparable to the duty of care that, according to recent case law, British parent companies owe towards their subsidiaries’ neighbours. This article compares and contrasts the newly introduced French due diligence statutory obligation, the UK precedents, and two alternative Swiss legislative proposals on the due diligence and duty of care of parent companies.

Putting the French Duty of Vigilance Law in Context: Towards Corporate Accountability for Human Rights Violations in the Global South?

“…Against this background, I analyze and discuss to what extent the first comprehensive and legally binding human rights due diligence regulation worldwide, the "Duty of Vigilance of Parent and Instructing Companies" law ("Duty of Vigilance law") adopted in France in 2017, could contribute to increasingly hold TNCs such as the French oil and gas giant Total accountable for their human rights and environmental performance in the Global South. This law has inspired activists and politicians across Europe to propose similar measures in other countries and at EU level, catalyzing 13 campaigns/ parliamentary motions for stringent legislation (Evans 2019; see also Palombo 2019).…”

Economic Law: Anatomy and Crisis

“…As a replay and amplification of domestic state change (Mashaw 1983;Shaffer 2012), the transnational arena displays a myriad of co-existing and intertwined "hard" and "soft" laws, rules, standards, and recommendations that in themselves offer but a glimpse at the complex sovereignty constellations that have been emerging over time. The significant increase in UN regulatory work over the past ten years (Ochoa 2008;Ruggie 2013;Deva and Bilchitz 2017) is complemented by a recent resurgence of domestic regulation of transnational corporations (Palombo 2019;Schiller 2019). The emerging transnational regulatory space is populated by private and quasi-public actors who have come to assume key roles in the preparation of binding rules, draft legislation, codes of conduct, recommendations, expert reports, and "white papers."…”

Transnational Corporate Liability for Environmental Damage and Climate Change: Reassessing Access to Justice afterVedantav.Lungowe

“…65 These situations can lead to severe problems of social and environmental justice 66 and even human rights violations. 67 In the absence of international law provisions to address extraterritorial abuses by MNCs, 68 and the near-universal absence of such legislation at the national level, 69 the decisions of home state courts on the liability of parent companies for harm caused by their foreign subsidiaries are vital. At the same time, such cases are highly fact-specific.…”