MAPPING THE BUSINESS AND HUMAN RIGHTS LANDSCAPE IN LUXEMBOURG National Baseline Study October 2019 Author : Dr. Başak Bağlayan Table of Contents List of Acronyms INTRODUCTION ...................................................................................................... 7 METHODOLOGY AND LIMITATIONS ........................................................................ 9 METHODOLOGY ..................................................................................................... 9 LIMITATIONS ........................................................................................................ 11 KEY FINDINGS AND RECOMMENDATIONS ............................................................ 13 PILLARS I & III: STATE DUTY TO PROTECT AND REMEDY ........................................ 13 STATE DUTY: LAWS, POLICY AND REGULATION .................................................... 13 STATE BUSINESS NEXUS ....................................................................................... 22 ACCESS TO STATE-BASED REMEDY ....................................................................... 22 PILLARS II & III: BUSINESS RESPONSIBILITY TO RESPECT AND REMEDY ................. 26 HUMAN RIGHTS POLICY COMMITMENT ............................................................... 26 HUMAN RIGHTS DUE DILIGENCE .......................................................................... 27 REMEDIATION ...................................................................................................... 28 Acknowledgements Annex I: National Baseline Assessment Template Annex II: Business Survey on Corporate Responsibility to Respect Human Rights 3 List of Acronyms ABBL Assoxiation des Banques et Banquiers ACA Association des Compagnies d’Assurances et de Réassurances ALFI Association of the Luxembourg Fund Industry ASTM Action Solidarité Tiers Monde BHRRC Business and Human Rights Resource Centre BLEU Belgium-Luxembourg Economic Union CAA Commissariat aux Assurances CAD Commission d'accès aux documents CASS Conseil arbitral de la sécurité sociale CC Chambre de Commerce CCDH Commission consultative des Droits de l'Homme CET Centre for Equal Treatment CFR-EU Charter of Fundamental Rights of the European Union CLC Confédération Luxembourgeoise du Commerce CMCC Le Centre de Médiation Civile et Commerciale CNDP Commission Nationale pour la Protection des Données CoE Council of Europe CSSS Conseil supérieur de la sécurité sociale CSSF Commission de Surveillance du Secteur Financier CSOs Civil Society Organizations CSR Corporate Social Responsibility DIHR Danish Institute for Human Rights EBA Everything But Arms ECC Centre Européen des Consommateur ECHR European Convention on Human Rights ECtHR European Court on Human Rights EIA Environmental Impact Assessment EITI Extractive Industries Transparency Initiative 4 ESC European Social Charter EU European Union FEDIL Fédération des industriels luxembourgeois GDPR General Data Protection Regulation GRECO Council of Europe’s Group of States against Corruption GSP Generalised System of Preferences HORESCA Fédération Nationale des Hôteliers, Restaurateurs, et Cafetiers du Grand- Duché de Luxembourg ICAR International Corporate Accountability Roundtable ICCPR International Covenant on Civil and Political Rights ICESCR International Covenant on Economic, Social and Cultural Rights ICocA International Code of Conduct for Private Security Service Providers Association ICT Information and Communication Technology ILO International Labour Organisation IMS Inspiring More Sustainability INAP Institut National de l'Administration Publique INDR Institut national pour le développement durable et la responsabilité sociale des entreprises ITM Inspection du travail et des mines LuxFLAG Luxembourg Finance Labeling Agency LuxSE Luxembourg Stock Exchange MAEE Ministère des Affaires Étrangères et Européennes NAP Ministère de la Culture NBA National Baseline Assessment NCP National Contact Point NCPC New code of Civil Procedure NGO Non-Governmental Organisation NHRI National Human Rights Institution NPSD National Action Plan for Sustainable Development 5 ODL Office du Ducroire OECD Organization for Economic Co-operation and Development OEIGWG The Open-ended Intergovernmental Working Group OGBL Confédération Syndicale Indépendante du Luxembourg OGP Open Government Partnership OHCHR Office of the United Nations High Commissioner for Human Rights OLAI Luxembourg Reception and Integration Agency RBC Responsible business conduct SCAS Le service central d’assistance sociale SDGs Sustainable development goals SMEs Small and medium-sized enterprises SNCI Société Nationale de Crédit et d'Investissement in Luxembourg UDHR Universal Declaration of Human Rights UEL Union des Entreprises Luxembourgeoises ULC Union Luxembourgeoise des Consommateurs ULESS Union luxembourgeoise de l'économie sociale et solidaire UNGPs UN Guiding Principles on Business and Human Rights UPR Universal Periodic Review UNWG UN Working Group on Business and Human Rights 6 Introduction The UN Human Rights Council unanimously adopted the UN Guiding Principles on Business and Human Rights in June 2011.1 Since their adoption, the UNGPs have become the authoritative global reference for preventing and addressing adverse human rights impacts of business activity and have generated an unprecedented convergence of stakeholders around the specific and detailed Principles and their implementation.2 The UNGPs contain 31 principles, divided over three core pillars: Pillar I (GPs 1-10) clarifies the State duty to protect against human rights abuses by businesses through effective policies, legislation, regulation and adjudication. The UNGPs also stipulate that States should ensure that policies are coherent across departments and functions, and that their participation in multilateral institutions is aligned with their human rights obligations. States are required to exercise extra vigilance in the regulation of business in conflict-affected areas or when there is a State-business nexus. Pillar II (GPs 11-24), the corporate responsibility to respect human rights, requires businesses to adopt and embed a high-level policy commitment to respect human rights, develop and implement human rights due diligence processes and establish processes to remedy human rights harm that they have caused or contributed to. The corporate responsibility to respect human rights covers both direct and indirect impacts that are linked to the companies’ operations, products, and services or through their business relationships ‘even if they have not contributed to those impacts’ (GP 13). Pillar III (GPs 25-31), access to an effective remedy, emphasizes the need for greater access to judicial and non-judicial remedies for those affected by business-related human rights abuse. Businesses are also required to provide for or participate in effective mechanisms to identify and address grievances as early as possible before 1 Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises, Guiding Principles on Business and Human Rights: Implementing the United Nations “Protect, Respect and Remedy” Framework, Annex, U.N. Doc. A/HRC/17/31 (Mar. 21, 2011) (by John Ruggie) [UNGPs]. 2 K Buhmann, ‘Business and human rights: Understanding the UN Guiding Principles from the perspective of transnational business governance interactions’ (2015) 6 Transnational Legal Theory 339, 415. 7 they escalate into human rights abuses. Three years after the adoption of the UNGPs, the UNHRC called on all Member States to develop national action plans (NAPs) to support the implementation of the UNGPs within their respective national contexts.3 This development followed similar requests to Member States made by the European Union in 20114 and 2012,5 and by the Council of Europe in 2014,6 among others.7 The UN Working Group on the issue of human rights and transitional corporations and other business enterprises (UNWG) also strongly encourages all states to develop, enact, and update NAPs on business and human rights. 8 To date, twenty-two States have developed and adopted NAPs to support the implementation of the UNGPs and twenty-three are in the process of developing one.9 The Government of the Grand Duchy of Luxembourg developed its National Action Plan for the Implementation of the United Nation’s Guiding Principles on Business and Human Rights (2018-2019) and adopted it on June 22nd 2018 (hereinafter ‘NAP’ or ‘NAP 2018-19’).10 In its current NAP, Luxembourg made several commitments under the heading of “A Joint Work Program”, which include commissioning a study that analyzes “[t]he existing situation and mapping of the potential negative impacts of business activities on human rights on one hand, and of existing efforts to prevent these risks or to mitigate their consequences on the other…”. The present Report has been prepared in furtherance of this commitment and assesses systematically the current level of implementation of the UNGPs in Luxembourg. The primary objectives of the Report are: (a) To identify and analyse gaps in legislation and policy that concern business and human rights; 3 Human Rights Council Res. 26/22, U.N. Doc. A/HRC/RES/26/22, at 2 (15 July 2014). 4 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions: A Renewed EU Strategy 2011-14 for Corporate Social Responsibility, COM (2011) 681 final (October 25, 2011). 5 European