BP violating human rights rules, says UK
A BP-led consortium is breaking international rules governing the human rights responsibilities of multinational companies in its operations on the controversial Baku-Tbilisi-Ceyhan oil pipeline, the UK Government ruled today.
Environment and human rights groups, which had filed an official complaint against BP eight years ago, say the ruling puts the oil multinational in breach of its loan agreements - including a multi-million pound loan backed by UK taxpayers.
Villagers living along BP's flagship oil pipeline have struggled to hold the companies accountable for alleged human rights abuses associated with its development. The pipeline brings up to one million barrels of oil a day from the Caspian Sea, across Azerbaijan and Georgia, to Turkey from where supertankers ship it to Europe.
The ruling follows the Complaint lodged under the OECD Guidelines for Multinational Enterprises by six groups in April 2003. The UK Government backed the pipeline in 2004 through its Export Credits Guarantee Department (ECGD).
The ruling states that BP failed to investigate and respond to complaints from local people of intimidation by state security forces in Turkey guarding the pipeline. Local human rights defender Ferhat Kaya, for instance, has reported that he was detained and tortured by the paramilitary police for insisting on fair compensation. Villagers allege that they are routinely interrogated when they raise concerns over the pipeline.
The pipeline passes through an area of north-east Turkey with a substantial Kurdish minority who have been subject to state repression for decades. Since the pipeline's inception over a decade ago, human rights campaigners in Turkey and the UK have highlighted the risk of local people, particularly Kurdish minorities, being intimidated by state security forces. Today's ruling has found that, despite widespread awareness of this "heightened risk intimidation", BP failed adequately to respond to or investigate allegations of abuse that were brought to its attention.
The Complaint argued that such intimidation deterred local people from participating in BP's consultations about the pipeline's route and compensation negotiations for loss of land and livelihoods.
BP has consistently promoted the BTC pipeline as "world class" in its approach to human rights. According to its legally-binding commitment to comply with the Voluntary Principles on Security and Human Rights (an international code of conduct for multinationals operating in the energy sector), BP is obliged to "consult regularly" with local communities about the impacts of pipeline security arrangements and should record and report credible allegations of abuse by security forces to the authorities.
The UK Government has now found that BP breached its undertaking and failed to adhere to the Voluntary Principles in the north-east region of Turkey by not responding adequately to allegations of intimidation and not investigating them.
The ruling sets a major precedent. In future, to comply with these corporate social responsibility guidelines, multinationals will have to take into account the human rights context in which they operate, including the risk of intimidation, when designing and implementing corporate grievance mechanisms. Such mechanisms need to be robust enough that people can report intimidation without fearing further reprisals.
Given BP's legally-binding commitment to ensure that the BTC project complies with the OECD Guidelines, today's ruling from the UK government potentially places the company in breach of its contracts with the major international financial institutions (IFIs) that backed the project with taxpayers' money in 2004. In addition to the UK's export credit agency, these include the International Finance Corporation of the World Bank, the European Bank for Reconstruction and Development (EBRD) and other European and US export credit agencies.
The failure of BP to adhere to the OECD Guidelines and the Voluntary Principles, as required under the BTC project agreements, also raises major concerns over the due diligence undertaken by the IFIs before supporting the pipeline.
Nicholas Hildyard of The Corner House says: "Public funders knew about the intimidation, but failed to check whether BP had adequate procedures in place to address and remedy it. They ploughed ahead with the project anyway for political reasons. Western governments appear to have been willing to sacrifice the human rights of those living along its route in order to grab the Caspian's oil for the West."
Rachel Bernu of Kurdish Human Rights Project says: "It has taken eight years for the claims of villagers facing repression in this isolated area of Turkey to be recognised. We hope this ruling marks a turning point for the governments and companies involved so that villagers receive just compensation and human rights are not only respected but also promoted through investment in future."
James Marriott of Platform says: "This ruling shows that BP's pipeline allowed and enabled repression of local communities. Yet EU governments and companies continue to push for new pipelines to suck oil and gas westwards from distant places of extraction. BTC stands as a warning that these planned 'energy corridors' risk becoming 'corridors of militarisation and human rights abuse'."
Craig Bennett of Friends of the Earth says: "Using taxpayers' money to support this pipeline at the expense of people's human rights and the planet is a stain on the UK's reputation. The pipeline would not have been built without public funding. Government ministers must now come clean about what action they will take against BP for breaching its loan agreement. The only way to stop this cycle of exploitation is to wean us all off our fossil fuel dependency by investing in the safe, clean and ethical technologies of the future."
Commenting on the ruling, Nick Dearden of Jubilee Debt Campaign says: "This long-awaited ruling underlines the need for urgent changes in the UK's export credits system. Empowering British companies to violate the national laws of other countries goes against the most basic form of social and environmental responsibility. Without effective safeguards, projects like BP's one are bound to happen again."
Peter Frankental of Amnesty International UK adds: "The UK government's condemnation of BP for breaching internationally recognised human rights standards on the BTC pipeline begs the question of why taxpayers' money, in the form of export credit guarantees, was used to fund such a project in the first place. If such support had been withheld until BP had addressed the human rights context of their pipeline project, then these violations might never have occurred. It is time the UK's Export Credits Guarantee Department was reformed to prevent this from ever happening again."
The ruling gives BP three months to review and report on what it can do to strengthen its procedures to address these failings.
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