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Myanmar Investment Commission

This article appeared in the Irrawaddy on 25 May 2017 here: https://www.irrawaddy.com/opinion/editorial/use-law-protect-human-rights-environment-irresponsible-investment.html

By DANIEL AGUIRRE 25 May 2017

Burma’s 2016 Investment Law and the implementing Investment Rules issued in April 2017 create space for the government and civil society to facilitate responsible investment and exclude investors that have track records of environmental destruction and human rights abuses.

This means that affected individuals and communities must now test Burma’s commitment to the rule of law. There are new opportunities for civil society to use law to hold them accountable. In this regard, both international law and Burma’s constitution guarantee access to justice for rights abuses.

The Investment Rules instruct the Myanmar Investment Commission (MIC) to consider whether investors have demonstrated a commitment to responsible investment. In considering the good character and reputation of the investor, the MIC may study whether the investor or any associate with an interest in the investment broke the law in Burma or any other jurisdiction. The rules explicitly mention environmental, labor, tax, anti-bribery and corruption or human rights law.

What this means is that if an investor is determined to have committed a crime, has violated environmental protection standards or was involved with human rights abuses, the MIC should not grant it a permit.  If such a company applies for an investment permit, civil society should bring its record to the attention of the MIC and advocate for the rejection of a permit.

Successive governments in Burma have focused on increased investment to develop the country and improve its people’s standard of living.

At the same time, human rights and environment proponents from civil society have opposed many investment projects, citing the impact on the environment and human rights of local communities. They complain that land rights are not adequately protected, that environmental impact assessments are not implemented and that they lack access to justice for corporate human rights abuses.

There are challenges to using the law to protect human rights in Burma. Disputes related to business activity are often considered sensitive political matters in which the courts are unable or unwilling to intervene. They are reluctant to review crucial decisions of administrative bodies or to hold rights abusers accountable.

But community activists, human rights defenders and lawyers have increased opportunities to pressure the courts to apply the law and should do so. Lawyers have an important role in protecting human rights by representing local communities.

Courts must become a venue to challenge administrative decisions that allow for irresponsible investment that does not comply with national law, and where appropriate, obtain remedies and reparations for victims of human rights violations.

The Investment Law and its rules, which govern both local and foreign investment except within special economic zones, provide legal guarantees for investors to access information and protections against expropriation including compensation and access to due process if changes in regulation affect their business. Investors can also access long-term rights to use land.

Civil society should help to ensure that only responsible investors benefit from these protections. According to the law, the MIC is the gatekeeper that issues permits and endorsements for many would-be national and international investments likely to cause a large impact on the environment and local community.

In order to ensure that the protective aspects of the law are effective, courts must have some power of review, at least to ensure that administrative bodies, such as the MIC, are acting reasonably and in accordance with the law, while respecting and protecting human rights. If the MIC grants permits for companies that do not meet the requirements outlined in the Investment Rules, their decisions must be subject to review by the judiciary.

Burma’s courts have the authority to review administrative decisions, particularly through the application of constitutional writs. Lawyers can use the writs of mandamusand certiorari to secure the performance of public duties and quash an illegal order already passed by public bodies such as the MIC. This would help ensure the MIC uses its mandate to prevent irresponsible investment.

Likewise, investors that fail to respect human rights or unlawfully cause damage to the environment must be held accountable; but there are few options to do so in Burma. Criminal prosecutions against companies, actions imposing administrative sanctions, and civil suits face a variety of procedural hurdles, particularly if involving joint ventures with state run enterprises.

For example, a negligence civil suit brought by villagers against the Heinda tin mine in Dawei District was unsuccessful because the 1909 Limitations Act demands complaints to be brought within one year of damage. Section 80 of the Civil Procedure Code requires prior notice and the names of plaintiffs to be given to the government two months before filing a suit against the government and allows small procedural defects to preclude a claim. Lawyers are sometimes unfamiliar with these procedures and communities are reluctant to put their names to such cases fearing reprisals.

Clearly there are significant challenges to ensuring that investment in Burma does not adversely affect human rights. To overcome these, civil society and lawyers must engage the administration—the MIC—to ensure only responsible investments is permitted and start to use the judiciary to review its actions. Likewise, cases must continue to be taken against investors that abuse human rights and harm the environment. Powerful investors must be constrained by the confines of the law, including human rights law.

Unless civil society and lawyers can use the legal framework to address these concerns, Burma’s judicial system is unlikely to develop; lawyers will not gain valuable experience and the public will remain distrustful. The process is long and arduous but necessary to protect human rights and the environment from irresponsible investment.

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Re: Burma Responsible Investment Reporting Requirements

We write in response to the public reports submitted by U.S. companies in compliance with the Burma Responsible Investment Reporting Requirements (“Reporting Requirements”) issued by the US Department of State.

Composed of 60 eminent jurists and lawyers from all regions of the world, the International Commission of Jurists promotes and protects human rights through the Rule of Law, by using its unique legal expertise to develop and strengthen national and international justice systems. The ICJ appreciates the U.S. government’s efforts to promote responsible investment in Myanmar and to ensure that U.S. companies are responsibly managing their business activity in the country. We support your decision to continue to sanction businesses under the National Emergencies Act barring U.S. individuals and companies from investing or doing business with people linked to human rights abuses under the army’s military rule.

The ICJ urges caution over the United State’s recent decision to allow for an exception to the sanctions regime for people who have already been documented as having links to the military regime and implicated in human rights violations.1 This caution reflects the ICJ’s work with the Directorate of Investment and Company Administration, the Attorney General’s Office, and the Union Supreme Court of Myanmar, as well as civil society organizations, to strengthen and support local efforts at ensuring that investment protects and promotes the rule of law, human rights and the environment. In this regard, the ICJ has visited and researched on the human rights and environmental impacts of investments in the 3 Special Economic Zones (“SEZ”), as well as other non- SEZ sites, in the country.

We believe that future reporting must be strengthened to ensure that U.S. companies comply with the Reporting Requirements, conduct due diligence and disclose adequate information transparently about the impact of their business practices on human rights in Myanmar. This is especially crucial in light of significant reporting gaps in July 2013. Failure to strengthen the requirements will undermine the goal of the Reporting Requirement to be a tool for promoting investment that reinforces those political and economic reforms that are compliant with the rule of law and human rights and help to empower civil society.

The full document will be available on the ICJ webpage at: http://www.icj.org later today. The full document is attached here: Myanmar ICJ Letter to US State Dept 25Jan2016

For the full story see the Irrawady at: http://www.irrawaddy.com/burma/after-much-deliberation-investment-law-approved-by-parliament.html

After months of deliberation, Burma’s new investment law was approved by a joint sitting of Parliament on Thursday, replacing interim laws passed earlier in the term of President Thein Sein.

The law, which combines the 2012 Foreign Investment Law and the 2013 Myanmar Citizens Investment Law, alters the mandate of the Myanmar Investment Commission (MIC) and adds some nominal human rights protections to future foreign investment projects, among other changes.

Aung Naing Oo, director-general of the Directorate of Investment and Company Administration, told reporters in September that the investment law addressed human rights concerns raised by non-governmental organizations in the past.

 

The Nation has published a round up of the investment law reform process. It acknowledges that ‘Not every reform is without critics,’ and quotes the ICJ in the following section:

As the government consolidated its two investment laws, the International Commission of Jurists last month issued a statement, urging Myanmar to involve all stakeholders. As the resource-rich country would attract more investment in the area, key stakeholders should include affected communities and civil society, to promote a law that balances investors’ needs with human rights.

“This is a critical moment for the economic development of Myanmar. The laws it implements now will shape investment, economic development and, in turn, human rights for the foreseeable future,” said Daniel Aguirre, the international legal advisor to the ICJ.

“It is imperative that drafting is not rushed and that laws take into account international human rights laws and standards.”

ICJ has been working directly with DICA as well as with Myanmar civil society on investment laws and their potential impact on human rights in Myanmar.

While praising DICA’s willingness to consult civil society, including international non-governmental organisations, ICJ remains concerned that the draft law establishes significant rights for investors without protecting the rights of those affected by business activity. The draft would require investors to follow national laws without acknowledging that the existing national legal framework does not adequately protect human rights or provide remedies for those whose rights have been violated, it said.

Furthermore, the draft law does not establish or protect Myanmar’s ‘right to regulate’ to protect human rights or other social or environmental needs. Investment law should indicate Myanmar’s obligation to enact necessary regulations for the protection of human rights, including economic and social rights such as the right to health, in the future in order to avoid legal disputes when adopting these regulations.

“The draft law’s proposed legal framework would provide all investors the right to be consulted and challenge any new national law or regulation that may impact their profits,” said Aguirre. “This framework would allow businesses to challenge government policies aimed at addressing legitimate needs within the country, and it could create a regulatory chilling effect in which Myanmar’s government would find itself in the troubling position of evaluating whether the passage of new social policies would lead to costly lawsuits from investors.”

“The draft Law as currently formulated runs the risk of hindering progressive regulation to protect human rights in Myanmar,” said Aguirre.

For the full article see: http://www.nationmultimedia.com/aec/Myanmar-kicks-off-investment-law-modernisation-30255535.html

International Commission of Jurists

 FOR IMMEDIATE RELEASE

 Date: 07/02/15 

Myanmar’s Investment Law Drafting Process at Critical Phase

As the Myanmar government enters a critical phase of establishing its new legal framework governing investments in the resource-rich country, it should continue working with all stakeholders, including affected communities and civil society, to promote a law that balances investors’ needs with human rights, said the International Commission of Jurists (ICJ).

“This is a critical moment for the economic development of Myanmar. The laws it implements now will shape investment, economic development and, in turn, human rights for the foreseeable future,” said Daniel Aguirre, ICJ International Legal Advisor.  “It is imperative that drafting is not rushed and that laws take into account international human rights laws and standards.”

ICJ has been working directly with Myanmar’s Directorate of Investment and Company Administration (DICA), as well as with Myanmar civil society, on investment law and their potential impact on the human rights of all people in Myanmar.

The International Finance Corporation, in support of DICA, has produced a Draft Investment Law designed to consolidate the Foreign Investment Law (2012) and the Myanmar Citizen Investment Law (2013) to create a level playing field for both local and foreign investors. DICA has now opened the process to civil society consultation.

ICJ conducted a workshop with DICA on bilateral investment treaties in July of 2014. In November, the ICJ submitted feedback on the Draft Investment Law providing expert analysis and flagging issues of concern.

An initial consultation on the Draft Investment Law took place on 29 January 2015. The ICJ along with other civil society organizations met with the IFC and DICA.

“The ICJ is encouraged by DICA’s willingness to consult civil society, including international non-governmental organizations, and hear concerns about investment laws and their potential to curtail important regulations designed to protect, promote and fulfill human rights,” said Aguirre. “The ICJ looks forward to formal engagement in a consultation process that will include both national and international civil society.”

The ICJ remains concerned that the Draft Investment Law establishes significant rights for investors without protecting the rights of those affected by business activity. The Draft Investment Law would require investors to follow national laws without acknowledging that the existing national legal framework does not adequately protect human rights or provide remedies for those whose rights have been violated.

Furthermore, the Draft Investment Law does not establish or protect Myanmar’s ‘right to regulate’ to protect human rights or other social or environmental needs. Investment law should indicate Myanmar’s obligation to enact necessary regulations for the protection of human rights, including economic and social rights such as the right to health, in the future in order to avoid legal disputes when adopting these regulations.

“The Draft Investment Law’s proposed legal framework would provide all investors the right to be consulted and challenge any new national law or regulation that may impact their profits,” said Aguirre. “This framework would allow businesses to challenge government policies aimed at addressing legitimate needs within the country, and it could create a regulatory chilling effect in which Myanmar’s government would find itself in the troubling position of evaluating whether the passage of new social policies would lead to costly lawsuits from investors.”

“The draft Law as currently formulated runs the risk of hindering progressive regulation to protect human rights in Myanmar,” said Aguirre. “The ICJ is encouraged that DICA has begun meeting with non-governmental groups and believes that an effective and meaningful consultation will help address key concerns about the Draft Investment Law. The ICJ looks forward to working with the Myanmar Government, with the IFC, and with all other concerned groups in order to promote a law that balances investors’ needs with human rights.”

http://www.icj.org/myanmars-investment-law-drafting-process-at-critical-phase/

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