I. Efforts to identify forced labour in the apparel supply chain
The situation of the Uyghur people in China has been under public scrutiny for quite a while now and civil society has been calling for action to prevent and end any involvement of multinational corporations in the human rights violations taking place. In spite of the attention, Uyghur forced labour on cotton farms is still said to feed into supply chains and consequently into the clothes we buy. In turn, we feed our money back into the forced labour system, strengthening it as we go about our day. This blogpost will discuss recent efforts to identify this forced labour in supply chains in order to change this vicious circle.
On 2 December 2020, several members of the Dutch parliament tabled two motions with the aim to address this link between the clothing industry and forced labour practices taking place in the Xinjiang region. The first motion requests the Dutch government to enhance the access to information held by customs authorities for researchers and NGOs. This will enable the latter to gain insight into specific elements of supply chains and to possibly identify whether a supply chain profits from forced labour. The second motion requests the Dutch government to reinforce the importance of the OECD-Guidelines with companies operating in the clothing industry and to urge them to facilitate the relocation of their supply chains away from the Xinjiang region or even from China. The members of parliament filing the motions did so after learning from round table sessions and conversations with the industry that companies are often not able to guarantee the absence of forced labour from their supply chains.
The first motion rejected when put up for vote, but supported by the opposition. The second motion was supported more broadly in parliament, resulting in the motion being adopted. Before these outcomes, a Dutch newspaper reported that the Dutch Minister of Foreign Trade and Development Cooperation Mrs. Kaag withheld her approval for both motions. With regards to the first motion, she explained how information from the customs authority falls under an obligation of professional secrecy, which is imposed on it at the European level by article 12 Regulation (EU) No 952/2013 (laying down the Unions Customs Code, UCC), preventing any of the suggested changes. With regards to the second motion, she iterated the non-binding status of the OECD-guidelines and how, according to those, businesses need to undertake risk assessments on their own account and then decide for themselves whether they should relocate. The government will not “instruct” companies on the matter of relocation.
This blogpost will discuss counterarguments for the view of Minister Kaag on the (necessary) inviolability of the obligation of professional secrecy of the customs authorities. In doing so, it will also touch upon her line of reasoning regarding the OECD guidelines.
Before that, it must be noted that for the present situation, access to supply chain information held by customs authorities will not be the ultimate solution to constitute fully transparent supply chains and rid them of Uyghur forced labour. As discussed at the consultations and round table sessions, companies will often have insight into the first few tiers of their supply chain, especially the confection phase of clothes production, whereas it is harder for companies to go back all the way to the cotton production. Spinning mills will often buy cotton from many different ginning mills located in different areas, or even different countries, such that the supply chain consists of many branches. Because of the many tiers in a supply chain, the Dutch customs authorities will often not possess all the information about the full supply chain at present. For that reason, some argue that legislation should change this as well.
Notwithstanding these considerations, access to supply chain information held by customs authorities could be part of a multi-dimensional solution. The information may still be able to 1) contribute to standard setting and enforcement of supply chain transparency (see the conclusion below), and 2) support existing initiatives that provide information to NGO’s who also operate in areas at the other end of the supply chain and might in turn be able to reveal the full supply chain based on information that is available to them. The Clothing and Textile Covenant already obliges its members to report on their production locations and in turn hosts the Open Apparel Registry in which this information is aggregated and made publically available. Based on this information, NGO’s conduct research into these and linked production location. In case they find irregularities in a production locations, the members (clothing companies) linked to those locations can be easily informed about them. As such, transparency created by different actors for different parts of the supply chain can contribute to their due diligence efforts. Based on these possibilities and the ongoing efforts, it is at least worthwhile to discuss the supposed inviolability of the obligation to professional secrecy.
In doing so, this blogpost argues that the situation, in which researchers and NGOs request access to supply chain information held by customs authorities, falls within the scope of the human right to information. Because of that, such a request should arguably be able to sometimes overturn the obligation of professional secrecy. Due to its scope, this blogpost will not discuss the particularities of the Dutch legal system and the precise and multi-layered set up of customs legislation. Instead, this blogpost aims to contribute to the debate on existing barriers to achieve supply chain transparency by evaluating the wording of article 12 UCC from a (European) human rights perspective, arguing that the scope and perceived inviolability of the obligation to professional secrecy should be up for debate, especially in light of the ongoing societal debate about supply chain transparency.
II. The right to access information held by customs authorities
The interpretation of the scope of the right to information in relation to article 10 European Convention on Human Rights (ECHR) has been developed over-time in the case law of the European Court of Human Rights (the Court). Although its precise meaning and contours are far from uncontested, there is a consensus that a human right to State-held information (which arguably includes information held by customs authorities) exists in relation to the right to freedom of expression. In 2016, the Court provided for an extensive discussion of the right in Magyar Helsinki Bizottság v. Hungary, which clearly sets out its evolved and authoritative interpretation. The Court explains how the wording of the right to information in article 10 ECHR first and foremost entails the right not to be obstructed by the State to receive and impart information. However, in two situations, positive obligations also exist for the State to actively make information available: 1) in case of a judicial order to disclose information; and, more importantly for the present discussion 2) “in circumstances where access to the information is instrumental for the individual’s exercise of his or her right to freedom of expression, in particular ‘the freedom to receive and impart information’ and where its denial constitutes an interference with that right”. In order to determine whether a request for information held by a public authority falls within the scope of the latter situation, the following criteria need to be assessed: 1) the purpose of the information request, 2) the nature of the information sought, 3) the role of the applicant, and 4) the availability of the information. These will be discussed in light of the present debate.
As for its purpose, the requested information should be instrumental to enable the individual to exercise his or her right to freedom of expression. Relevant for the Uyghurs situation and the related supply chain information, are the frequent references made by the Court in case law, such as Magyar Helsinki Bizottság v. Hungary and Társaság a Szabadságjogokért v. Hungary, to NGOs requesting information in order for them to exercise their function as social “watchdog”. The Court has also referred to researchers, for example in Kenedi v. Hungary, that need State-held information in order to exercise their academic freedom. In light of their efforts to examine the involvement of companies with Uyghur forced labour, as well as the need for supply chain transparency more broadly, supply chain information can be instrumental to NGOs’ and researchers’ functioning as social “watchdogs”. As for the third condition, the role of the NGOs and researchers should be considered must be discussed in this context as well. NGOs focusing on the relevant issues relating to the Uyghurs’ situation but also more broadly on the protection of human rights and civic space, in principle, intend and have the capacity to impart information into the public domain. In line with the Courts reasoning, NGOs and researchers have a role in creating the public forum in which societal debates can take place.
The nature of the requested information must also meet a public-interest test which the Court formulates as follows: “disclosure provides transparency on the manner of conduct of public affairs and on matters of interest for society as a whole and thereby allows participation in public governance by the public at large.” The Court explains that the test is met with regards to information that, amongst others, concerns “matters which are capable of giving rise to considerable controversy, which concern[s] an important social issue, or which involve[s] a problem that the public would have an interest in being informed about”. One could argue that the supply chain information held by the customs authorities is information that does not concern the public interest because it does not directly concern scrutiny over the functioning of the State itself. However, the Court ruled in Österreichische Vereinigung zur Erhaltung, Stärkung und Schaffung v. Austria that a denial of access to information held by the Tyrol Real Property Transactions Commission, a public body, on land transfers including those between private parties, was a violation of article 10 ECHR (although it must be noted that the names of the parties were anonymised in this particular information request). Furthermore, it cannot be denied that the supply chain information held by the customs authorities will give rise to considerable controversy. Also, in general a (global) societal debate is ongoing in relation to the regulation by the State of global supply chains. There is a need for civil society to be informed about the extent to which multinational companies are involved in human rights abuses or international crimes, even if those companies are unaware of their involvement, in order for a well-founded debate to take place. As such, it may be concluded that supply chain information, available with the customs authorities, should be able to meet the public interest test. As was discussed above, the extent of its availability will depend on the complexity of the supply chain and will not be further discussed here.
In short, we can conclude that the access to supply chain information held by customs authorities falls within the right to information laid down in article 10 ECHR. To understand the interactions with the obligation of professional secrecy of the customs authorities, an additional analysis is however necessary.
III. Taking a closer look: restrictions on accessing information from the customs authority
Restricting the right to information is possible, if such interference is within the limits set forth in the ECHR itself. In the Magyar Helsinki Bizottság v. Hungary case, the Court explains that if an interference with the right to information took place, this is only allowed if the interference is 1) “prescribed by law”, 2) legitimately pursues the interests of national security, territorial integrity or public safety, the prevention of disorder or crime, the protection of health or morals, the protection of the reputation or rights of others, preventing the disclosure of information received in confidence, or maintaining the authority and impartiality of the judiciary, and 3) be “necessary in a democratic society”.
A restriction on the right to access supply chain information is indeed prescribed by law in article 12 UCC (the obligation of professional secrecy by the customs authorities). The relevant part of the text of article 12 UCC reads as follows: “All information acquired by the customs authorities in the course of performing their duty which is by its nature confidential or which is provided on a confidential basis shall be covered by the obligation of professional secrecy […] Such information may, however, be disclosed without permission where the customs authorities are obliged or authorised to do so pursuant to the provisions in force […]”. On the basis of a textual interpretation, only information that is confidential by nature or provided on a confidential basis falls under the obligation of professional secrecy. It can be assumed here that supply chain information often falls within the scope of this article. Also, because of the general lack of binding supply chain legislation it is unlikely that many provisions will be in force that explicitly allow for the disclosure of supply chain information. Even so, based on the Courts case law, a balancing test still needs to be performed in order to determine whether the interference with the right to access information serves a legitimate aim and is necessary in a democratic society. We will discuss these in turn before applying it to supply chain information.
The most important interest that is invoked to justify interferences with the right to access to information is the protection of the right to respect for private and family life of others laid down in article 8 ECHR. Based on its wording, article 12 UCC also protects this right. In Magyar Helsinki Bizottság v. Hungary, the Court explains the wide application of article 8 ECHR and the different considerations for determining whether information relates to private life. Elements such as gender, name and the like most notably qualify as personal data. Also, business activities and professional activities in general may fall within that scope and as such can relate to the right to private life. In addition, the fact that certain activities are conducted in relation to others and in a public context do not necessarily preclude them from falling within the scope of private life. According to the Court answering the question whether it is foreseeable that an activity is conducted publically, is pivotal for determining whether personal data fall within the scope of the right to private life in light of its balance to freedom of expression.
Last, the Court will also consider whether restrictions on the right to access information are necessary even if those restrictions are prescribed by law and relate to private life. This year the Court judged in the Centre for Democracy and the rule of law vs Ukraine that the full CVs of candidates for parliament, thus including personal data on their education and work history, should be made available. The applicable legislation, which obliged candidates to make their full CVs available with the Central Election Commission, did not specify the public access of those CVs and the national courts even interpreted it as being confidential data. The interference was deemed to be prescribed by law, while the Court explained that the interference had not been necessary in a democratic society. One of the main reasons for that was the consideration that the candidates had put themselves forward for public scrutiny by applying themselves as candidates for parliament.
Based on the above, it must be considered in relation to article 12 UCC what the correct interpretation of “confidential by nature” should be in light of article 10 ECHR. On the same note, it should be considered when information is deemed to be provided to the customs authorities “on a confidential basis”. Given current practice, often, companies will be unable to foresee that its private (business) data were provided to the customs authorities with the possibility of those data ending up in the public realm. On the other hand, supply chain information is not necessarily confidential, dependant on applicable legislation and the exact way in which the information is presented. Also, the ongoing societal debate and the development of soft law instruments such as the OECD-guidelines and sectoral standards to which companies themselves adhere, provide for arguments that companies should be aware of the possibility of public scrutiny within those limits. On top of that, examples of companies, such as H&M, publishing (some) detailed supply chain information already exist which shows that such information is not necessarily confidential.
To conclude, in light of article 12 UCC and article 10 ECHR, restrictions to the disclosure of information can be justified. However, it should be generally assessed whether the current interpretation of article 12 UCC is always compatible with article 10 ECHR. Even without additional legislation in place, when national authorities assess information-requests, at least the specific considerations for applying article 12 UCC should be taken into account and motivated. This means for example that it should be addressed explicitly whether all the information that is requested falls within the ambit of article 12 UCC. Furthermore, it should be considered to what extent it might have been foreseeable for corporations that the provided information could be subject to public scrutiny.
It was argued here that the situation in which researchers and NGOs request access to supply chain information held by customs authorities, falls within the scope of article 10 ECHR. Also, it is arguably not impossible that article 10 ECHR, under certain circumstances, should trump the obligation of professional secrecy, even without additional legislation. The NGO “watchdog” function and the importance of the information for the purpose of free societal debate serve as important considerations for balancing the respect for the rights of businesses to their “private life”. Providing access to customs information can be one of the measures to accelerate change in transparency and, as a consequence, in the respect for human rights in supply chains. Individual consumers will be able to make choices in line with their values, companies can be assisted in conducting meaningful human rights due diligence, while society as a whole will be able to keep track of its evolving human rights standards.
Another conclusion can be added as well, which takes on the second objection by Minister Kaag to the motions (not wanting to provide “instructions” in relation to the OECD-guidelines because of its non-binding status and the prevalence of the company’s own responsibility because of that). Non-binding standards only function, if transparency will ensure the possibility to hold multinationals, if not legally, at least publically accountable by evaluating their promises and risk assessments within the public realm. Civil society must be able to make sure that if multinationals do not know there is forced labour feeding into their supply chains, or that they cannot guarantee its absence, it will be possible to bring that to light in order to further societal debate. In short: access to supply chain information should not be stopped at customs without good reason.