On February 22, 2023, MENA Rights Group filed a lawsuit in a Paris court against TotalEnergies, one of France’s largest energy corporations, for failing to comply with French Duty of Vigilance Law. This 2017 law based on the UN Guiding Principles on Business and Human Rights (UNGPs) requires French corporations to identify and prevent human rights violations within their business practices and supply chains.
MENA Rights represents two men who claim that they were detained and tortured at a Bahalf gas plant that was used as a prison in Yemen. The UN Human Rights Council Yemen Expert Group found in 2019 that the plant was part of a network of detentions committing human rights abuses such as arbitrary detention and torture. The plant is operated by Yemen LNG, and TotalEnergies is their largest shareholder.
The MENA Rights Group alleges that TotalEnergies ignored “gross human rights abuses on the [Yemen LNG] site on multiple occasions”. TotalEnergies claims that it is concerned about the Yemen site and respects human rights. Albeit, it argues that because it “does not have a controlling interest” (more than 40%), in Yemen LNG, it is not responsible for the company’s human rights violations. TotalEnergies currently has a 39.6% interest in Yemen LNG.
The argument on controlling interest is unlikely to succeed, and there are key arguments that can be made that can strengthen the plaintiffs’ case due to this. Aside from direct corporate activities, the statute applies to potential “companies it controls within the meaning of Article L.233-16 II”, which includes bodies that it manages and/or supervises. Yemen LNG lists TotalEnergies as its “Project Technical Leader”. The Vigilance Law applies to “the operations of the subcontractors or suppliers with whom it maintains an established commercial relationship”, and TotalEnergies and Yemen LNG clearly have this relationship, as TotalEnergies owns 39.6% of Yemen LNG’s shares, and is thus its “main shareholder”.
The fact that Yemen LNG is a foreign company will not affect the claim. On October 23, 2019, the first French Duty of Care lawsuit was filed when various non-government organizations sued TotalEnergies after it rejected formal notice to comply with human rights and environmental standards under the Duty of Vigilance Law in its Tilenga oil project in Uganda. This case was the first under the Vigilance Law and established its application to overseas operations by French businesses. The case was dismissed due to procedural errors on February 28, 2023 but may be refiled in the near future.
With Tilenga dismissed, the Yemen LNG stands to become a groundbreaking case under the Vigilance Law and as a major precedent in French human rights law. Should the Court accept Total’s argument of non-control, French companies will be disobliged if they can get their shares to 39.9%, which presumably abrogates the spirit of the French Vigilance law.
The precedent could go beyond France and apply to the implementation of the EU’s Directive on Corporate Sustainability Due Diligence. On February 23, 2022, the European Commission published the draft directive which strongly resembles the French Duty of Vigilance law. If passed, the law will apply to all EU member states and EU as well as non-EU companies within them. Both solely encompass large corporations based on set quantitative measures such as number of employees and require corporate due diligence regarding human rights and environmental responsibilities (including that of subsidiaries, subcontractors, etc.). The Paris court should reject Total’s argument of non-control: this will set a key precedent strengthening business and human rights protection in Europe.
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