Rights as Usual

This post is by Salvador Herencia-Carrasco and Jordi Feo Valero. Salvador Herencia-Carrasco is the Director of the Human Rights Clinic, HRREC and part-time professor at the Section de Droit Civil at the University of Ottawa. Jordi Feo Valero holds a PhD in Human Rights, Democracy, and International Justice from the University of Valencia. He is currently a Senior researcher and professor of the Bachelor’s Degrees in Law and International Relations at the Universidad Internacional de Valencia (VIU), Grupo EG-VIU ESTUDIOS GLOBALES. This post is theirs.

A slightly different version was written in Spanish and published in Agenda Estado de Derecho on 4 December 2024.

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In the Latin American region, individuals and communities regularly suffer from the adverse impact of business activities on their human rights. Yet,  Latin American states have not yet adopted legislation to implement the United Nations Guiding Principles on Business and Human Rights (UNGPs). In the absence of action by the executive or legislative branches, it is important that courts “fill the void” and develop standards on business and human rights (BHR), including those related to human rights and environmental due diligence. The Inter-American Court of Human Rights (IACtHR) has been at the forefront in this regard, particularly in cases involving extractive projects in indigenous territories and in cases focusing on poor labour conditions.

Here we argue that as important as the role of the IACtHR has been in advancing standards to protect human rights, there is a need for national courts to step in.  Cases by top national courts (Supreme or Constitutional Courts) with BHR implications are decided almost daily, but only a handful of these decisions include the UNGPs or other relevant instruments as part of their analysis. Yet, as we explain below, such courts are ideally placed to clarify the duties of states and companies so that economic activities do not infringe on fundamental rights and freedoms.

In this blog post, we focus on the case of the Dulcepamba River hydroelectric project, currently before the Constitutional Court of Ecuador. This case involves numerous human rights violations and severe environmental damage which we explain in the first section. The case also presents an opportunity to examine the application of the Guiding Principles and, where appropriate, develop standards on corporate due diligence and the protection of rural and indigenous communities (section 2).

1. The case of the Dulcepamba River: hydroelectric project and access to water    

The San José del Tambo Hydroelectric Plant and dozens of communities inhabiting the Dulcepamba River basin have been in conflict for over 15 years because of the company’s activities in the region.

The case focuses on the construction of the ‘San José del Tambo’ hydroelectric plant and its impact on the San Pablo de Amalí community, as well as other rural and indigenous communities in the area. The conflict between the plant and the communities has been ongoing for over 15 years. To make the hydroelectric dam operational, the company diverted the course of the Dulcepamba River by approximately 120 meters, reducing the distance between the riverbank and the community to less than 20 meters. This diversion not only affected their access to clean water but also put at risk the lives and property of community members, particularly during the rainy season.

Over the years, the community has suffered material damages and the loss of human lives caused by the deviation of the river. In March 2015, heavy rainfall caused the river to overflow, damaging parts of the community’s land and houses, leading to three people losing their lives, and the destruction of several houses. Similar events occurred in 2017 and 2019.

Despite court rulings requiring the company to take corrective measures to mitigate the environmental impact on local residents, the company has failed to implement any mitigation plans, including reparation programs. In April 2019, the Ombudsman’s Office and the NGO CEDHU took to the Constitutional Court a case against an appeals court ruling that had  dismissed the alleged violation of constitutional rights in the conflict between the company and the community. In May 2019, this case was selected for review by the Constitutional Court of Ecuador, where the decision is still pending.

2. Due diligence in the business and human rights regime applicable to the Dulcepamba case

In the resolution accepting to review this case, the Constitutional Court stated that some of the topics of interest are to examine the state criteria to grant permits for the exploitation of natural resources, as well as the impact of business activities on constitutional rights, including the right to a safe and clean environment. In this context, a human rights and environmental impact assessment becomes fundamental to determine if the construction of the hydroelectric plant breached constitutional rights of the rural community.

As readers of Rights as Usual know, companies conducting due diligence broadly consists of assessing the risk of harm and taking the necessary measures to minimize or avoid it. This assessment includes the impacts of acts or omissions as well as the extent to which such consequences could have been avoided if the necessary measures and safeguards had been put in place. The determination of what due diligence requires depends on the context, the industry, he specific project, and the level of risk.

Under the Inter-American Human Rights System (IAHRS) and the interpretation of the American Convention on Human Rights on BHR cases by the IACtHR, states have a duty to adopt laws and policies, including due diligence procedures, to prevent businesses from breaching the rights of individuals and communities. Based on the documents available from the case docket, no BHR, human rights impact assessment or due diligence consideration was considered prior to making the decision to deviate the course of the river and approving the hydroelectric plant, despite the impact on the local communities.

If this is indeed the case that such impact was overlooked, the Constitutional Court should consider examining what the IAHRS has done in this field, particularly the Court. The IACtHR has progressively increased the use of the UNGPs to determine state responsibility under the ACHR, while also including guidelines for businesses. When dealing with these cases, the IACtHR has included the concept of due diligence to evaluate both state and corporate behavior, but, as per the ACHR, the Court can only determine the responsibility of a state. There are several cases in which the Court has included a section on due diligence, including the Miskito Divers and Martina Vera cases already analyzed on this site, but it is in the Olivera Fuentes v. Peru and La Oroya v. Peru cases, both from 2023, that the IACtHR delves deeper into this issue.

Olivera Fuentes is a case of discrimination of a same-sex couple in a restaurant of a supermarket chain in Lima, Peru. Although it has nothing to due with extractive projects, in this case the IACtHR focuses on the issue of due diligence, particularly the second pillar of the UNGPs, which centers on the responsibilities of business enterprises. The IACtHR reiterates its case law by stating that companies are the first entities that must ensure respect for human rights. Nevertheless, under Article 1.1 of the ACHR, states must adopt the necessary norms and policies to ensure that business activity respects rights. In the words of the Court:

100. (…) States should take measures to ensure that businesses adopt: (i) appropriate policies for the protection of human rights; (ii) good corporate governance practices that focus on stakeholders, with actions aimed at guiding business activities toward compliance with standards and respect for human rights; (iii) due diligence processes for the identification, prevention and correction of human rights violations, and to ensure dignified and decent work; and (iv) procedures that allow businesses to remedy human rights violations resulting from their activities, especially when these affect people living in poverty or vulnerable groups.

(Translation made by the authors)

This decision clarifies the state’s duty to protect human rights in the context of BHR and sets clear expectations that businesses must respect rights.

Based on the reasons why the Ecuadorean Constitutional Court decided to review the Dulcepamba River case, the UNGPs and the case law of the IACtHR, we expect the Court to provide some clear standards on environmental due diligence, the protection of the environment and the rights of rural communities. This is a good opportunity for the Court to do so, given the vulnerability of the community and the fact that unlike the IACtHR, the Constitutional Court’s competence is not limited to state responsibility. Many of the measures undertaken by the company to develop the project significantly affected their lives, their ecosystem, and access to resources necessary for their wellbeing. This is a recurring problem of extractive projects in Latin America, as there is always someone who will pay the social cost of these initiatives.

It should be clear that we do not object to the execution of projects that can contribute to economic development, including those that would increase the electrical connectivity of the country. However, we cannot ignore the fact that this unilateral decision to deviate the course of a river and limit the access to water needed by the communities would likely not have been approved in urban areas. However, as in many other cases, a different threshold is used when it comes to the rights of rural, poor and/or vulnerable communities.

3. Final considerations

The IACtHR’s case law on due diligence reinforces the state’s duty to implement a regulatory framework that allows companies to operate without infringing on the human rights of individuals and communities.

In the Dulcepamba River case, it will be crucial for the Constitutional Court to determine which measures were not implemented by the company and the state to prevent the harm caused to these communities.  With its decision, the Constitutional Court has the opportunity to contribute to the development of a specific legal framework on corporate due diligence that establishes the responsibilities and obligations of companies in the natural resource exploitation sector and helps to prevent similar actions from occurring in the future.

Disclaimer: The authors, representing the Observatory on Violence, Criminalization, and Democracy at the University of Ottawa and the International University of Valencia (EG-VIU ESTUDIOS GLOBALES), submitted an amicus curiae brief that was attached to the file of this case, which is currently being deliberated by the Constitutional Court of Ecuador.