5th meeting, 12th Session of Open-ended Intergovernmental Working Group on Transnational Corporations

Good morning, colleagues, Excellencies, distinguished delegates. I'd like to declare open the fifth meeting of the 12th session of the Open-ended Intergovernmental Working Group on Transnational Corporations and Other Business Enterprises with Respect to Human Rights. Now, before resuming our work this morning, I would like to refer to a situation that was presented to the Chair, Rapporteur and the Secretariat, and we have found out that photos or photographs were taken of persons present in the room without their consent, including cases when those persons were asked not to take the photos, but they still did. So I'd like to remind all participants that in line with the applicable norms related to UN conferences, under no circumstances can photographs nor videos can be taken of persons present in room 12 without asking permission. The limited flexibility that was given here in the working group that makes it possible for participants to record their own statements, and that is the only purpose, and under no circumstances can other participants be recorded or filmed without their consent. So if that If that will happen again, then we will be using the powers that we have to put an end to that situation. So I would like to invite participants to heed to this appeal and conform with the rules. So we'll come back to our work And we will now resume our interactive dialogue related to proposal 10, article 1.2. Adverse human rights impact. And I made my presentation of the proposal yesterday at the end of the afternoon. So now I'd like to open the floor to state I would like to take the floor with any proposals or comments in connection with this proposal of language and the alternative proposals related to article 1.2. So once again, I'd like to ask whether any state would like to take the floor.

Yes, I see Brazil.

You have the floor.

Chair, just to quickly support your proposal, including affected communities and eliminating internationally recognized on 1.2. Just to support.

Thank you.

Thank you. Japan, you have the floor.

Thank you, Mr. Chair, and good morning. First of all, we appreciate the deletion of "internationally recognized" as suggested in the Chair-auditors' proposal 10 from the perspective of eliminating ambiguous expressions from the definitions. That being said, simply stating "a human right" would potentially encompass every and all human rights, and therefore we would like to emphasize that definition of "adverse human rights impact" should be revised to make it narrower. Moreover, "human right" in this article is related to the definition of all human rights in Article 3.3 that will be discussed later, and we consider it necessary to make the scope of the term "human rights" consistent throughout this draft ABI. Also, we suggest striking out the phrase "or groups of persons of affected communities" for the same reason as we mentioned regarding Article 1.1. From this perspective, Article 1.2 should be revised as follows, quote: "Adverse human rights impact shall mean a harm arising in the context of business activities which corresponds to a reduction in or removal of a person's ability to enjoy a human right under international human rights treaties to which state party is a party." Let me add that we reverse reserve the right to revisit this proposal at a later date, depending on the revision of other articles. Thank you.

I'd like to thank Japan. The State of Palestine.

Thank you, Mr. Chair. We maintain our proposal expressed previously to delete this definition, adverse human rights impacts, and consolidate it into 1.3. Indeed, adverse human rights impact describes only the passive position of the person affected, and it borrows from the logic of common law and private law, which is concerned with harm or impact on a contract, not with a human rights violation. It departs from international human rights law, which does not treat harm to a right as an impact. Any impairment or restriction of a right is a violation. The current wording also produces a circularity. 1.3 defines an abuse as an adverse human rights impact, turning an outcome into a cause. So deleting 1.2 and defining the abuse or violation directly by the conduct and the harm it causes would resolve both problems. I thank you.

I would like to thank the State of Palestine. I give the floor to Cuba.

Thank you very much, Chair. We can support the proposals that were made by our chairperson. related to the deletion of the words "internationally recognized" and also add the collective dimension of the adverse human rights impact. Simply, we would like to reiterate our position that we'd like to be consistent throughout the text, and we would suggest that after "context of business activities" to add "of transnational character" or "of transnational corporations". We're also flexible in connection with the proposal made by the State of Palestine to merge this article with article 1.3. Thank you.

I would like to thank Cuba. Would any other State wish to take the floor? That does not seem to be the case. No, the United Kingdom, please, you have the floor.

Thank you. We continue to have concerns that the definition is not clear or precise enough, which has implications for the ability of states and businesses to implement the treaty requirements. We join Japan in welcoming the removal of the phrase "internationally recognised", which we consider to be a legally imprecise term. We suggest that the term "human rights" should be tethered to international human rights law. We also think that the phrase "corresponds to" lacks clarity. We would be grateful for clarification on what that means and what constitutes a reduction or removal of the ability to enjoy human rights when talking about harms from businesses. That raises key questions about the conduct that we would want to regulate. Is it essentially conduct that would be a violation if the state was the duty holder, or is it a lower threshold? For example, when considering qualified rights, are there qualifications and would proportionality come into play? Also, we query if we need the phrase "the ability" before "to enjoy". Could we simply say "to enjoy"? Furthermore, the addition of groups of persons and affected communities in that paragraph also suggests that human rights can be held collectively, which is not an accurate reflection of current international human rights law in the UK's view and in line with comments that we made yesterday.

I thank the United Kingdom. Any other state wishing to take the floor? That does not seem to be the case. We will now continue with the statements of representatives of civil society and other relevant stakeholders. I give the floor to Alliance Defending Freedom.

Mr. Chair Rapporteur, definitions determine the scope of States Parties' obligations and so must meet the requirements of legal certainty and determinacy. In our assessment, the definition of adverse human rights impact does not. First, it does not clarify how severe a reduction in a person's ability to enjoy human rights must be, or whether the conduct must be wrongful to qualify as an adverse impact. The consequence is that because an adverse impact is a constituent element of abuse under Article 1.3, even lawful conduct in connection with business activities could potentially qualify as an abuse. A state, by contrast, incurs responsibility only where its conduct meets the criteria that international human rights law sets for a violation. Second, because it speaks of a person's ability to enjoy a human right, the definition does not clearly require that the conduct actually impair that enjoyment. Third, the proposed extension to group of persons and affected communities risks detaching the definition from concrete individualized harm. If left unresolved, such imprecision can create a perverse incentive for business enterprises to adopt overly restrictive compliance measures that may curtail the very human rights and fundamental freedoms the instrument seeks to protect. We concur with the chair rapporteur's assessment that the term's function lies principally in the definition of human rights abuse. Taking into account the proposals for a comprehensive reformulation of Article 1.3, we therefore recommend deleting Article 1.2, as several delegations have previously proposed. Thank you.

Thank you very much. I give the floor to Georgetown University.

Thank you, Chair and distinguished delegates. This is a statement by Helena Stefanou-Steka of Georgetown University on behalf of Change the Law Limited. Change the Law agrees with the Chair's proposals and also agrees with the legal expert's previous non-paper that this definition should include the right to a healthy environment. Article 1.2 would say, "Adverse human rights impact shall mean a harm arising in the context of business activities, which corresponds to a reduction in or removal of a person's or group of persons or affected community's ability to enjoy human rights, including the right to a healthy environment." Thank you, Chair.

Thank you very much. I give the floor to the International Organization of Employers.

Thank you, Chair. I speak on behalf of IOE and USCIB. We have supported this definition in its current form, which is known and understood by states, business, and other stakeholders. The Chair's background notes that the current set of definitions appears to function adequately. We are therefore not supportive of the redrafting as it stands for three reasons. First, we are concerned by the deletion of "internationally recognized." This removes the anchor to UN Guiding Principles 12, under which the responsibility to respect refers to internationally recognized human rights. Without it, the definition would refer to any human right, opening the door to diverging interpretations across jurisdictions and to rights that lack an agreed definition in a legally binding treaty. Second, we note that the reference to harm arising in the context of business activities brings some precision by linking the definition to business activities. However, it does not establish a causal link. Any harm occurring around the business activity could still fall within scope. In line with the UNGPs, the definition should refer to impacts that a business causes or contributes to. Third, the extension to groups of persons and affected communities further widens the circle of potential claims and adds to the uncertainty as to who may bring a claim and on what basis.

Thank you.

Thank you very much. I give the floor to International Trade Union Federation, Confederation.

Thank you, Chair. I speak on behalf of the Global Labour Movement. Chair, we can broadly support the suggested drafting changes to Article 1.2. However, we will have further comments on the concept of human rights abuse as it is linked with business activities at the appropriate time. Chair, we particularly appreciate the consequential amendment to the Chair proposal on the definition of victim to include groups of persons or affected communities. Similarly, we will comment on the questions of internationally recognized human rights under Article 3.3. Thank you, Chair.

Thank you very much. I give the floor to Setim.

Thank you very much, Chairman. My name is Bernardo Cal. I am from the Maya Q'eqchi' people in Guatemala, Central America, and representative of the Maya Q'eqchi' people at the regional assembly, and I speak on behalf of CETIM, member of the Global Campaign of Indigenous Communities. Indigenous communities in my region have been fighting against the impunity of corporations and defending our territory for decades. Article 1.2. proposes a definition of the concept of adverse impact, adverse human rights impact. This terminology stems from the focus of corporate law and is far removed from the logic of international human rights law, where any impact, harm, restriction, or failure to comply with an obligation constitutes a violation, which is the only legally appropriate term. This language places companies at the heart of the instrument instead of the victims and affected communities who are in consequence presented as passive subjects. Moreover, we believe that including this definition is intrinsically restrictive and severely limits the scope of protection of this treaty. In Guatemala, and in particular in the Maya Q'eqchi' territory, transnational companies dealing with mining, monoculture, setting up hydroelectric power plants are moving the rivers, they're diverting the rivers for several kilometres They are worsening our territory. They're drying up the riverbeds. This is a brutal violation of our human rights, the right to life and the right to water, a violation of our culture and our way of life as indigenous peoples. All the more so when the communities are collectively claiming the right, the defense of their rights before the state, the response is to criminalize us, to launch criminal proceedings against us and to imprison us. on the basis of false, fabricated evidence. This was my case because I was imprisoned for over four years following a transnational company coming to deviate a sacred river that belonged to my people, the Maya K'iche' people. So I have suffered from this criminalization personally, and now I have an opportunity to be here, to be Before this microphone to be heard by different state representatives, I want to flag that there are hundreds of arrest warrants out for individuals in my people, the Maya Ixil people, for the mere fact of defending their territory and their rights. So I'm surprised that Guatemala, the representatives and representation of my country, have not spoken thus far. They have not intervened. This is a historic opportunity to contribute to defense of human rights and protection of territory in the face of the activities of these transnational companies. In line with the historic position of the global campaign, we would stress the importance of using the term violation, which is understood to be intrinsically linked to the failure to comply with legal obligations and violation of the rights enshrined in international law. Moreover, transnational corporations could well use this concept, arguing that their activities are causing impacts and not violations, thereby sidestepping their responsibility, given that adverse human rights impact is quite a vague concept that could well be sidestepped without the provision of any remedy or reparation. Thank you very much, sir.

Muchas gracias.

Thank you very much. It was the last speaker on my list. I would like to thank all states and representatives of civil society and other relevant stakeholders for their contributions, and I take due note of all of your statements. Now we will turn to proposal 11, related to the definition of human rights abuse, article 1.3. The objective of this article is to maintain a distinction between human rights abuse and human rights violation, in line with the instruments related to the responsibility of States and human rights instruments, avoiding the use of both terms as a one single concept. This distinction was present during the discussions that took place in this working group, including during the 11th session, in connection with the different provisions contained in the text of the instrument. During the inter-sessional thematic conversations, many delegations have spoken in favor of using abuse for the operations of transnational corporations and violations for acts committed by states, and also define both terms separately. with the relevant definitions. I also would like to recall that reference to abuses aims at focusing the instrument on cases when an enterprise is a material author of the adverse impact, when violations are related to action or omission that is attributed to a state, something that would represent non-compliance with an international obligation. In this respect, The legally binding instrument could have provisions that only make a reference to abuses, others that refer to violations, and others that refer to abuse or violation. All of this depends on the specific nature of the provision and whether it refers to one or the other case. This differentiation contributes to clarifying the conceptual notions of the instrument that reaffirm, clarifies, or establishes different state obligations to regulate the conduct of private entities, keeping in mind that states already have the obligation to guarantee human rights in the face of non-state actors. in line with other instruments of customary international law and principles of international law. For this reason, we took into account articles 2, 5, 8, and 11 of the articles related to the responsibility of states for international wrongful acts and also the relevant commentary. On this basis, the chairperson rapporteur suggested the definition of a human rights abuse as an adverse human rights impact that results from acts or omissions from transnational corporations and other business enterprises, including state and non-state entities that take place in the context of business activities. This language is refers to the impact defined in article 1.2 and also is in line with the terminology 26/9 of the Human Rights Council and harmonizes the language with the expressions in the context of business activities and of code that is used throughout this text. Now with this introduction, I would like to open the floor. And first, I would like to give the floor to states that would like to make comments to the proposal number 11 related to amendments proposed to Article 1.3.

Thank you very much and good morning. Concerning article 1.3 on the definition of human rights abuse, we understand the intention to distinguish business-related abuses from violations attributable to states. In that context, we seek clarification about what is meant by state and non-state entities. In particular, Are state entities intended to refer to state-owned enterprises conducting business activities? And how would this be distinguished from state responsibility under international law in this context? It would be helpful to ensure consistency with articles 1.4 and 1.6. including following the proposed removal of the expressed reference to state-owned enterprises from article 1.4. We also would like to reiterate our view that limiting the LBI to transnational corporations or business activities of transnational character in this context and in the rest of the draft LBI does not reflect the universal nature of human rights or the approach of the United Nations Guiding Principles on Business and Human Rights, on which the Corporate Sustainability Due Diligence Directive builds. This concern also applies to the references and further considerations accompanying Articles 1.3 to 1.6. Thank you.

Thank you very much.

The European Union. Iceland.

Iceland, you have the floor.

Good morning. So on article 1.3, Iceland supports maintaining a clear distinction between human rights abuse referring to business conduct and human rights violation referring to conduct under the responsibility of states. However, when looking at the wording of article 1.3 alongside article 1.4, we do wonder whether introducing other business enterprises, no, we do wonder whether introducing references to transnational corporations and other business enterprises into this definition in this article is the best place for it. And we bring this up as the chair's own background note on proposal 12. for article 1.4 indicates that perhaps this LBI's transnational focus may best be addressed or captured in the provisions that that are about purpose and scope rather than here in the definitions chapter. So, yeah, all this to say that we are supporting, we supported We are basing this off of the Chair's background notes on proposal 12. We think that this could apply to proposal 11 as well. Thank you.

Thank you very much to Iceland. The GCC have the floor.

Thank you very much indeed, Chairman. On article 1.3, we believe it's important to distinguish between the abuses perpetrated by enterprises and state-perpetrated abuses. Thank.

You.

Thank you. I give the floor to Brazil.

Thank you, Chair. For the proposals, initially, I'd just like to echo the European Union in seeking clarification as to the purpose of state and non-state entities and how it relates to 1.4 there. But as a general matter, throughout the text, we reiterate our preference for the term "violations." either abuse and violations or simply violations. We do believe that applying this term to corporate acts is doctrinally sound, is consistent with the nature of international human rights obligation, and is supported by UN treaty bodies. And indeed, the reasoning is that legal order cannot grant corporation standing and protections as direct subjects of international rights while simultaneously not considering them from the status of potential violators of international obligations. Nevertheless, we remain committed to a constructive dialogue to foster consensus. And if you allow me a quick word on the previous paragraphs regarding still the collective nature of rights as being recognized by international law, we do believe that they are, that international human rights instruments have moved past an individualistic conception of legal harm, and this is reflected in several instruments, including in the UNDPs and UN basic principles to the right of remedy and reparation, as to why we insist on keeping affected communities throughout the text.

Thank you.

Thank you very much to Brazil. Cuba, you have the floor.

Thank you very much, Chairman. Cuba supports the definition proposed of human rights abuse and welcomes the fact that in this paragraph it's aligned with the scope of the instrument. We believe it's very important to reflect this scope in the articles of the definition, therefore we welcome this proposal. Moreover, we would propose adding in a full stop after the reference to other business enterprises. We believe that the additional mention of state and non-state entities somewhat removes clarity from the definition and could give rise to confusion with the term human rights violations that Cuba considers to be a separate concept. Thank

you.

Thank you, Cuba. The State of Palestine, you have the floor.

Thank you, Mr. Chair. On Article 1.3, the Chair's proposal argues that violation should be reserved for States. We respectfully disagree for three reasons. First, the Chair's text defines abuse as conduct that results in an impact. That is the active dimension of the definition, and it should be characterized as a violation. The term abuse creates a false hierarchy between states that violate human rights and corporations that merely abuse them. It implies that transnational corporations cannot commit violations and therefore have no obligation to respect human rights. Under the prevailing theories of human rights in international law, conduct is a violation because of the offense to human dignity, not because of who caused it, whether a state, a person, or a corporation. Second, the text covers state and non-state entities. Conduct of state-owned enterprises can be attributable to the state under the articles on state responsibility, so it is definitely a violation. Third, where corporations are involved in war crimes, crimes against humanity, or genocide, their conduct breaches peremptory norms of international law and cannot be adequately described as mere abuse. Referring to violations ensures that the instrument reflects the legal gravity of the conduct and the evolving understanding of corporate involvement in internationally wrongful acts. We therefore propose replacing abuse with violation or as a compromise and at the very least to add violation after abuse. This terminology should be standardized throughout the treaty for coherence and consistency. In addition, the chair's proposal omits indirect impacts and the right to a healthy and sustainable environment. We maintain our proposal from the May intersessional, which covers direct and indirect harm and the right to a clean, healthy and sustainable environment. We add to it conduct that causes or contributes to harm, harm that is threatened, as well as harm already suffered. and a failure to exercise human rights due diligence, so that the definition anchors both liability and prevention. Finally, we also see no need for 1.3 to refer to specific legal forms, such as transnational corporations and other business enterprises. Legal forms are already referred to by way of an indicative list in the definition of business relationships in 1.6. It is helpful to keep them there and keep the list indicative because any particular form or structure may become outdated with time. Paragraph 1.3 should instead refer to conduct, quote, in the context of business activities of a transnational character, unquote, in line with the scope wording we propose for 1.4 and 3.1. I thank you.

Thank you, Justice Palestine.

Thank you, Mr. Chair. We support the intent of the suggested language in the two rapporteurs' proposal from the perspective of limiting the LBI's scope to acts or omissions by business activities. Given this stance, we suggest deleting transnational cooperations and other. in the chair of reporters proposal in order to make it clear that human rights abuse means acts or omissions only by business enterprises. Acknowledging that the phrase international cooperations and other business activities derives from Human Rights Council Resolution 26/9, we consider that our tradition is also more appropriate from the perspective of consistency with the UNGPs. This is because the UNGPs require business enterprises to protect human rights regardless of the scale of the enterprises concerned or the sectors in which they operate, while local businesses registered in terms of relevant domestic law are excluded from the definition provided in the resolution 26/9 of transnational corporations and other business enterprises. Therefore, article 1.3 should read as follows, quote, Human rights abuse shall mean an adverse human rights impact that results from acts or omissions by business enterprises, including state and non-state entities, that take place in the context of business activities. Thank you.

Thank you very

much, Japan. Saudi Arabia, you have the floor.

Thank you very much, Chairman.

Thank you.

On 1.3, Saudi Arabia welcomes the link made between the definition of human rights abuse and acts or omissions from transnational corporations. The narrative that goes with the proposal insists on the distinction between violations perpetuated by enterprises and those perpetuated by the state. However, the definition does not contain direct elements of causality and substance and does not mention predictability. The expression proposed including state and non-state entities, that expression could be interpreted to include conduct by the state and its entities within that concept. That runs counter to the distinction between abuses perpetrated by enterprises and those perpetrated by states. That is why we would suggest that human rights abuse shall mean an adverse human rights impact that directly results from substantive acts or omissions from transnational corporations and other business enterprises. That covers the act of causality between the act, commission and omission and consequence. That makes it sufficiently clear and can be, we suggest it or deleting including state and non-state entities, the article should stipulate that the definition is without prejudice to the rules of international law pertaining to a responsibility

of the state. Thank you.

Thank you.

The United Kingdom, please.

Good morning, colleagues. Like others, we appreciate the distinction between violation, which typically refers to State action, and abuse, and that aligns with the conceptualisation of the protect, respect, remedy framework, which is a consensus document. However, abuse is normally used in non-binding instruments, and currently we do not consider that the term does have a legal content. Indeed, the Protect, Respect, Remedy framework, which refers to responsibilities for business rather than obligations. However, were the term to be given a legal content in a treaty, we would prefer a tighter definition We would recommend including a clear and more narrowly defined causal connection between business activity and adverse human rights impacts. In that regard, we recognise the removal of the words "in connection with", but we note that "its drafted acts or omissions" is extremely broad, and we will consider the insertion of the word "directly", as suggested by Saudi Arabia. In short, the UK preference is to have amendments that reflect direct causation by business activity that do not imply that states and business have the same international legal obligations. We also agree with the rationale of the comments regarding transnational corporations and other business enterprises from Japan and Iceland. Thank you.

Thank you very much to the United Kingdom. Do any other states wish to take the floor at this time? That doesn't seem to be the case. Let us now continue with statements from representatives of civil society and other relevant stakeholders. I give the floor to Alliance Defending Freedom.

Thank you. As currently drafted, the definition of human rights abuse is framed by reference to adverse human rights impact, and so carries over its imprecision. This definition covers any act or omissions in connection with business activities that results in an adverse impact. It does not specify the standard of fault, or the required nexus between the conduct, the business activity, and the impact. Moreover, because adverse human rights impact is so broadly defined, virtually any reduction in a person's ability to enjoy a right could qualify as abuse. Mr. Chair-Rapporteur, we see merit in defining this term by reference to human rights violations. While violation has generally been understood to be reserved for state conduct, abuse could be its counterpart for business enterprises in a manner that ensures that comparable conduct is judged by comparable standards. Based on previous textual proposals, we therefore offer the following reformulation. Human rights abuse shall mean any act or omission by a transnational corporation or other business enterprise in the context of business activities that directly causes harm to the enjoyment of a person's universally recognized human rights and fundamental freedoms to a degree that would constitute a violation of those human rights and fundamental freedoms if carried out by or on behalf of a state within the territory of that state. This would establish a direct causal link to the harm, confine liability to concrete harm suffered by individuals, and set the threshold by reference to the standards governing the responsibility of states for human rights violations. Thank you.

Thank you.

I give the floor to the International Police Organization.

Thank you, Chair. I speak on behalf of IOE and USCIB. We note an improvement in this proposal, which now starts from the adverse human rights impacts and links it to the conduct of business enterprises. However, "results from" does not distinguish between impacts a business causes, contributes to, or is merely linked to, a distinction that is central to the UN Guiding Principles. Combined with the reference to omissions and the broader in the context of business activities, this will leave companies exposed for any impact they did not prevent. As we have constantly, consistently stated, the definition should refer to adverse human rights impacts caused or contribute to by business activities. Moreover, the new reference to transnational corporation and other business enterprises prejudice the debate on scope under Article 3 and introduces a distinction based on legal form, while the scope of this instrument should apply to all business activities. We echo the comments made by many states delegation in this room in that regard. As regards the reference to state and non-state entities, here again, state-owned enterprises should naturally be covered by this instrument on an equal footing with privately owned companies, without the need for special rules or distinctions. Thank you.

Thank you.

I give the floor to Sidsi.

Thank you, Chair, President, Rapporteur. I'm speaking on behalf of COPPE, Sidsi, and its member organizations, Manos Unidas, Misereor, CCFD-Terre Solidaire, Broadly, Dalen, Trocaire, and Fasten Action. We welcome the wording proposed by the Chair in Article 1.3, which links human rights abuse with the adverse impact, which are direct and indirect for those rights as a result of actual omissions in the context of business activities. However, we do regret the fact that there is no explicit reference to the direct and indirect impact of businesses And we do think there's a very important element missing, namely the explicit recognition of the right to a safe, clean, healthy and sustainable environment. This within the definition of human rights abuse, particularly Given the context of mining exploitation, the significant environmental deterioration linked to very many business activities and their direct consequences on human rights, this recognition is vitally important to ensure that a legally binding instrument offers a consistent, coherent basis to ensure prevention, accountability and remedy. Therefore, we urge States to reincorporate this explicit reference into Article 1.3. Thank you, Chair.

Muchas gracias.

Thank you. I give the floor to Georgetown University.

Chair and distinguished delegates, I'm Helena Stefanou-Steka of Georgetown University. This is a statement made on behalf of Change the Law Limited. Change the Law agrees with the Chair's proposals and agrees with the legal experts' previous suggestion in the non-paper that business relationships should be included in the text of 1.3. We also suggest states include additional wording for the environmental impact. Article 1.3 would say, human rights abuse shall mean an adverse human rights and environmental impact that results from acts or omissions from transnational corporations and other business enterprises and through their business relationships, including state and non-state entities that take place in the context of business activities. Thank you, Chair.

Thank you. I give the floor to Global Forum

Thank you, Mr. Chair, for giving me the floor. We recommend simplifying article 1.3 to ensure that the definition of human rights abuse is clear and avoids unnecessary repetition. The text should cover acts and emissions connected with business activities that result in adverse human rights impacts. This clarification is important because the definition provides the foundation for understanding which harms the instrument seeks to address. We support the objective of the amendment provided that the final wording remains precise and preserves the distinction between business-related abuses and violations attributable to states under international law. I thank you.

Muchas gracias.

Thank you. I give the floor to International Federation of Human Rights.

Thank you, Mr. Chair. So I deliver the statement on behalf of FIDH. The proposed new definition has the effect of clearly demarcating and restricting the scope of the LBI to abuses or harms caused or contributed to by businesses. This clearly leaves out violations by the state, even in the context of business activities. The Chair's explanatory note indicates that state violations are still sufficiently covered by treaties and other sources of states' obligations under international human rights law. Nevertheless, it must be clear that state-owned enterprises or the activities of states acting in a private, commercial or economic capacity are clearly included. In addition, we would like to raise a concern regarding the understanding of the phrase "other business enterprises", if the meaning of this is other business enterprises that undertake activities of a transnational character. While we agree that the LBI should pay particular attention to TNC and OBE that undertake activities of a transnational character and to prioritize them for purposes of regulation and accountability, we do not believe that the concept of human rights abuse itself should be restricted to abuses or harms involving only such enterprises. All business enterprises of all sizes, natures, organizational structures and other characteristics are capable of causing or participating in human rights abuses. A domestic company with no activities of a transnational character may commit a human rights abuse, even though it may fall outside of the scope of the LBI. The fact that the LBI focuses on TNCs and OBEs should not be understood as implying that other business activities are incapable of committing or contributing to human rights abuses. There are two ways, possible ways of addressing this. First, the definition could clarify that it's intended to operate within the context and for the purposes of the LBI and is without prejudice to broader definitions or understandings of human rights abuse under other legal regimes or normative standards. Another way is for the definition itself to be reformulated so as to make clear that all business enterprises are capable of causing or being involved in human rights abuses. Such a definition could read as follows: "Human rights abuse shall mean an adverse human rights impact that results from acts or omissions of business enterprises, including state and non-state activities that take place in the context of business activities, without prejudice to the responsibility of states for human rights violations under international law." And this should not affect the scope of the LBI obligations, which could still remain predominantly focused on TNC and OBE undertaking activities of a transnational character. As a final separate point, we would also like to highlight that the proposed new definition does not work well with other parts of the text. So for example, jurisdiction under Article 9.1a is established where the human rights abuse took place. So the shift from acts and omissions to adverse impact under the proposed new definition of human rights abuse would redirect the focus of this article from the place where the acts or omission occurred to the place of the harm, which is already addressed by Article 9.1. At the same time, it would leave the place where the acts or omissions that led to or resulted in the harm in certain circumstances without jurisdiction. and Article 10.2b presents similar challenges. So, these are just two examples to illustrate that the repercussions of the changes in the definition on all the parts of the text and the need to undertake a holistic analysis to determine whether the new definition works well across the entire text and if there might be a need for changes in other articles to make it work. Thank you very much.

Thank you. I give the floor to Franciscans International.

Thank you, Mr. Chair. This is a joint statement with ESCRnet, Feminists for a Binding Treaty, Franciscans International, the Center for International Environmental Law, and International Service for Human Rights. We know that the Chair's proposal for article 1.3 does not reference the right to a clean, healthy, and sustainable environment, as was explicitly mentioned in the third draft, and even though several states propose its re-inclusion during past negotiations, as by Palestine in the current session, also as mentioned in the Chair's proposal and summary. This would be consistent with the recognition of the rights by the UN Human Rights Council and General Assembly, and with the International Court of Justice advisory opinion on state obligation with respect to climate change, which concluded that the human rights to a clean, healthy, and sustainable environment is essential for the enjoyment of other human rights, as well as the Inter-American Court of Human Rights advisory opinion. It is important to explicitly mention the right to a clean, healthy, and sustainable environment in Article 1. We note the incorporation of environment in the 2025 Chair proposal for Article 6 and think that its incorporation in the definition of human rights abuse would ensure greater coherence for the implementation and interpretation of the Treaty. Similarly, and as suggested by various delegations, we would also encourage the inclusion of the right to a healthy environment in the Preamble. Lastly, on the discussion on the language on abuses and violations, we also support Brazil and Palestine's statements. Thank you.

Thank you. I give the floor to the International Trade Union Confederation.

I speak on behalf of the global labour movement. Chair, we can broadly support the new suggested language and agree with the rationale of maintaining a distinction between the concept of human rights abuse and violations for the recent seat. As we mentioned in relation to Article 13, it would be important to take account of any consequential amendment that may need to be made in light of this change. Chair, we acknowledge that the LBI intends to create a specific state's duty regarding prevention and remedy of harm suffered in the context of transnational business activities and relationship. Thus, it has designated a specific term to refer to the harmful conduct of private sectors as human rights abuse that should be prevented or remedied. However, Chair, while noting that the conduct of state-owned enterprises is covered by the term human rights As we have said from the outset of this process, a reference to human rights violation will be necessary to highlight the fact that human rights abuses by corporate activities can be accompanied by participation of state agent. For example, Chair, imagine a group of workers who decide to organize a union because their wages are unpaid and conditions are unsafe. The company then engaged in anti-union practices and dismissed the workers in retaliation for exercising their right to freedom of association. This is an example of abuse. Then the workers gathered peacefully to protest the dismissal and demand that their rights be respected. The company, instead of addressing their concern, called the police. The police disperse the demonstration with force and violence, and several workers are injured. That, that chair, is a violation. It is true that such conduct by state is also regulated under different sources of international human rights law. Nevertheless, either here in the definition or as noted in the non-paper, a general provision on the duty of states to respect and ensure human rights in the context of business activity is needed. Whether a standalone provision or as part of the duty of prevention or implementation, such a clause would serve to ground in this instrument the existing state obligation under international human rights law, from which other specific obligation regarding prevention, access to remedy, and international cooperation with regard to transnational business activities will follow. Thank you, Chair.

Thank you. I give the floor to CETIM.

Thank you very much, Chair. My name is Pierre Maison, representing the European Commission and speaking on behalf of CETIM, we're part of the global campaign. Proposals on Article 1.3 causes problem because it only focuses on the notion of abuse and adverse impact on human rights, omitting violations, something that should be included here as well. In international human rights law, there's no particular difference between the two terms. The main UN treaties on human rights, for example, the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights, the Convention Against Torture, and CEDAW talk about violations and not about abuse, as mentioned by Brazil. The term abuse stems from the practice related to the Guiding Principles on Business and Human Rights, a legal framework that is voluntary, today recognized as being largely insufficient. The definition of abuse moves away from the logic of international human rights law and any impact on a recognized right, only restrictions on its exercise, represents a violation. This violation places enterprises at the heart of the instrument instead of victims and affected communities are therefore represented as passive subjects. International human rights law violations is not limited but it is a lack of being committed to an obligation that undermines a recognized right. Imposing a definition like in this document will create closed categories that may be exploited to avoid any form of responsibility and accountability and limit the evolutionary interpretation of international human rights law and run the risk of leaving without answers the new challenges, for example, indirect impact, environmental destructions, or problems related to the digital domain. So we ask you, Chair, to ensure that Article 1.3 focuses on violations and that this is something that would be used throughout the text, as most countries from the South have been proposing during these years of negotiations.

the definition of violation, regardless of who is responsible, the fundamental rights of peasants enshrined in the UN Declaration on the Rights of Peasants are violated by transnational corporations, by agro-business, by criminalizing us, by polluting our territory and through land grabbing. Thank you.

Thank you very much. I give the floor to FIAN International.

Thank you, Chair. We read this statement on behalf of FIAN International and FIDH. We also supported the explicit inclusion of the right to a clean, healthy and sustainable environment in article 1.3 on the definition of human rights abuse, which has now been taken out. And as stated by other civil society colleagues, we seek for its re-inclusion. We also wish to highlight that the proposed distinction between human rights abuses and violations places undue emphasis on the identity of the actor rather than the human rights harm suffered by affected communities. This approach risks overlooking situations in which both state and corporate conduct is inseparable. For example, where a transnational agribusiness benefits from the forced displacement of communities, carried out by state security forces, the harm cannot adequately be understood solely through the acts or omissions of the company or the state in isolation. The state may be directly responsible for violations, while the company may have contributed to or benefited from those violations, potentially giving rise to its own liability. The definition should capture the full situation of harm without predetermining who may be legally responsible. The key is that limiting the treaty to transnational business activities should not mean limiting responsibility to the conduct of corporations alone. States as well as state-owned enterprises may facilitate, enable, participate in, or fail to prevent violations connected with those activities, and the treaty must address these situations as well. Therefore, should a definition of Article 1.3 be retained, it should preserve the broad scope of business-related adverse human rights impacts, recognize that state and non-state actors can both contribute to the same harm, avoid treating corporate abuses and state violations as mutually exclusive, and preserve existing international law on state responsibility. Thank you, Mr. Chair.

Thank you very much. That was the last speaker on my list. I would like to thank all of you for your contributions, those who participated in the exchange of views on the amendments proposed to article 1.3. Now, let us turn to proposal 12 related to the definition of business activities of article 1.4. The objective of This amendment is to improve the technical presentation of the text and align the definition with business relationship, avoiding any possible conceptual overlap. And this is why I invite you to look at this proposal in connection to proposal 14 on article 1.6. During the inter-session of thematic consultations, many delegations supported an indicative definition and not an exhaustive definition that is in a position to cover sectors that run the potential risk for human rights. Different delegations support that expressly the word extraction for the impact produced by extractive industries and also referred to financing and investment, while others warned on possible gaps that may be generated through the elimination of the term state-owned enterprises. The reference to the transnational character, many delegations reaffirmed the positions that they expressed early related to the scope of the application of the instrument. In this respect, some delegations observed that the indicative list may be enriched if it remains open, and the transnational dimension can be reflected in the declaration of purpose and declaration of scope and in different operative provisions, in addition to definitions. Other delegations also highlight the fact that there is an overlap between business activities and business relationship. And this is why it will be appropriate to decide on what should be included when we refer to business structures or form of business enterprises. Now, with these elements, the amendments relate to the following changes. The first relate to commercial or trade activities and specifies that activities can be carried out by physical or legal persons or through business relationships. Secondly, the indicative list is broadened while remaining open with the exploration, extraction, processing, as well as financing, investment, and insurance. Third, move to article 1.6, the list of business enterprises, state companies, financial institutions, investment funds, transnational corporations, and joint enterprises. while the definition of business relationship covers both state and non-state entities and explicitly includes financial institutions, investment funds and transnational business groups. Four includes for the first time direct reference to artificial intelligence and activities carried out through electronic or digital means. Now, as a reference to the work of the Group on Business and Human Rights and also reference to the Office of the High Commissioner, something we already did in the beginning of this meeting. Now, with this introduction, I'd like to open the floor to States that wish to make comments or statements related to proposal 12 in connection with the new proposals related to article 1.4.

La Union Europea.

The European Union, you have the.

Thank you, Chair, and thank you for the introduction and the additional clarifications provided. We would nevertheless seek additional clarification on the meaning of "other activity", which remains unclear to us. Is it intended to encompass non-economic or not-for-profit activities? Secondly, also by whom, corporations or any natural or legal person, given the already broad opening wording that is followed by a non-exhaustive list, we wonder whether additional examples are necessary. For example, artificial intelligence would already appear to be covered as its development or use constitutes a business activity, singling it out expressly may not add clarity. Thank you.

Muchas gracias.

Thank you very much. Brazil, you have the floor.

Thank you, Chair. On proposal 12, we support the streamlined definition of business activity, particularly the references to exploration and extraction, financial services, and digital technologies. We do favor an open-ended list that covers all business entities, including state-owned enterprises, which I trust may be included in the phrase "business relationships" as drafted in 1.6, which we'll see in a moment. On AI language, while we welcome its inclusion, we feel it might need a little bit of work and redrafting to be in line with recent international instruments on the topic. such as the UNESCO ethics on AI document or global digital compact. I believe that the phrase that tends to be going around the UN's digital emerging and related technologies. Anyway, I just believe that there's some work needs to be done and maybe it's also included already in electronic or digital means, but then I would also seek additional clarification on that. Thank you.

Muchas gracias.

Thank you very much. Iceland, you have the floor.

Regarding proposal 12, our comment is about the new reference to artificial intelligence, and echoes Brazil's thoughts, really. We respectfully note that artificial intelligence is a technology, and It is a technology rather than an activity per se, and therefore we suggest editing the text so that it refers to activities involving the development, deployment and use of artificial intelligence for precision purposes. That applies to the redrafted article 1.6 as well. Thank you.

Thank you. Japan, you have the floor.

Thank you, Mr. Chair. Taking into account that the concept of business activities relates to criminal punishment, the definition provided in the Chair-Rapporteur's proposal 12 should be revised to make it narrower and clearer in the same way as Article 1.3. To be precise, Article 8 in the current draft LBI requires each state party to adopt such measures as may be necessary to establish a system of legal liability, including criminal liability of legal and natural persons conducting business activities for human rights abuses that may arise from their business activities or relationships. On this premise, the phrase business activities defines the scope of the subjects and acts of human rights abuse subject to punishment. Therefore, business activities must be narrowly and clearly defined, consistent with the definition of human rights abuse in Article 1.3. Besides, Article 1.4 and the chair reporter's proposal 12 states that Business activities means any economic, commercial or other activity, but it is unclear what kind of activities is included in other activity. Some examples are provided in the text, but there is a reservation of but not limited to. Thus, it is unclear what kind of business are expected to be included. Therefore, business activities should be defined more narrowly and clearly. Thank you.

Thank you. Would any other state wish to take the floor? That is not the case. The State of Palestine, you have the floor.

Thank you, Chair. If you allow me, I will comment on 1.4 and 1.5 jointly, as my comments on them are related. On 1.4, we welcome the restructuring of this definition, which moves from listing types of business actors to listing business activities themselves. We welcome the addition of exploration, extraction, financing, investing, insuring, and artificial intelligence. We propose that trade also be included. Replacing financial institutions and investment funds with financing, investing, ensuring is acceptable to us as long as article 1.6 brings joint ventures, financial institutions, investment funds and transnational corporate groups into the definition of business relationship, giving the growing negative impact of transnational financial actors on human rights worldwide. Article 1.4 defines only the objective scope, the activity itself, and on its own it does not say that the activities concerned are those of a transnational character. Two separate definitions in 1.4 and 1.5, one of business activities and the other of business activities of a transnational character, distinguish between activities that are transnational and activities that may not be. and that risks broadening the scope beyond transnational corporations and other enterprises of a transnational character. For that reason, we propose to merge 1.4 with 1.5 into a single definition of business activities of a transnational character, meaning activities undertaken by transnational corporations and other enterprises of a transnational character, including through subsidiaries, affiliates and value chains. This would also prevent the fragmentation of liability. It would make corporate structuring irrelevant to who is covered and would keep value chains inside the definition itself. If you will kindly indulge me, I will read out the merged definition that we propose, which I am also happy to share with the chairmanship and any interested delegation. Business activities of transnational character shall mean any economic, commercial, or other activity, including but not limited to the exploration, development, extraction, manufacturing, production, processing, transportation, distribution, trade, commercialization, marketing, and retailing of goods and services, and financing, investing, and ensuring undertaken by transnational corporations and other enterprises of a transnational character, which can be private, public, or mixed, including through subsidiaries, affiliates, supply and value chains, and other business relationships. This shall also include artificial intelligence and activities undertaken by electronic, digital, and platform-based means. Such activities include those carried out by a parent company, companies owned by the same parent or stockholders, by entities that it directly or indirectly owns, controls, manages, or substantially influences as a part of its economic group, or by entities with which it maintains direct or indirect business relationships forming part of its value chain. For the purposes of this instrument, business activities of transnational character are defined as those, A, undertaken in whole or in part in more than one state or jurisdiction, or B, undertaken in one state but where a part of their ownership, decision-making, preparation, planning, direction, control, design, financing, sourcing, technology, data flows, processing, manufacturing, storage, distribution, commercialization, provision, insurance, certification, or disposal takes place through any direct or indirect business relationship another state or jurisdiction, or C, undertaken in one state as part of a value chain connected to activities, operations, or business relationships in another state or jurisdiction, including where the activity contributes to, enables, or benefits from transnational business operations, or finally, D, undertaken in one state but producing effects impacts or consequences in another state or jurisdiction. I thank you.

I thank the state of Palestine. Now, if there are no other requests for the floor. Sorry, I see Cuba. Go ahead.

Thank you very much, Chair. We would like to thank you for your proposal, proposal 12 on article 1.4. We believe that it is important that the list of business activities is not closed, so it doesn't become outdated with time. And also, we welcome the inclusion of artificial intelligence. So we can also support the proposal made by a colleague by Brazil on this issue. We also believe that have two definitions related to business activities and business activities of a translational character does not contribute to the consistency of the text. So we propose we merge articles 1.4 and 1.5. and have one single definition that will be clear and ensure consistency throughout the text. It is also important to keep in mind the scope of the legally binding instrument and to ensure that it is ambitious and also the other articles should be ambitious. So we should keep in mind the scope and focus on business activities of a transnational character. Thank you.

Thank you, Cuba. I give the floor to Saudi Arabia.

The renew our support to the streamlining of the definition as per the formulation of the President as to 1.4. We welcome the deletion of the indicative list. However, we believe that definition includes any economic, commercial, or business activities or other activities, ignoring the business standards that distinguish the business activities from other activities. It extends to the activities that are exercised through business relationships, which is incorporated in the definition of the full scope of trade and business relationships in Article 1.6. The proposed formulation added to the indicative list specific activities like exploration, processing, financing, investment and insuring, which makes it selective for specific sectors without adding any legal impact. We propose, therefore, that the definition should be confined to the economic or business activities undertaken for profit while deleting the phrase through other business relationships and to be confined to the indicative list in the negotiation draft while deleting any reference to production because it interferes with manufacturing. We also that the text shall include the activities when exercised by electronic or digital means, including the use of artificial technology. Thank you.

Muchas gracias.

Thank you. China, you have the.

Thank you, Mr. Chairman. With regard to 1.4, China agrees with the proposal made by the Chairman in deleting the listing of the categories of business enterprises because the LPI scope is limited to the transnational corporations. This is the biggest or lowest common denominator of the negotiation. Uh, too detailed listing of the category will make the provision very complicated and difficult to reach consensus. We believe this should also be reflected in other provisions, for instance, in 1.3, the list of.

State and non-state entities, we would like to, uh, uh, suggest that it be deleted.

Thank you.

Thank you very much.

China, Qatar, you're the floor.

Thank you, Chair. The State of Qatar, like a number of States, agrees with the deletion of the phrase and any other business relationship undertaken by a natural or legal person due to its ambiguous nature. And we also welcome the deletion of the indicative list of entity forms so as not to specify the particular sectors.

Thank you.

Thank you very much, Chiqueta.

Do any other states wish to take the floor at this point? Okay, if not, let's move to statements from representatives of civil society and other relevant stakeholders. I give the floor to International Organization of Employers.

Thank you, Chair. I speak jointly on behalf of IOE and USCIB. We are not supportive of this proposal. The redrafting worsens an already vague definition. What is meant by other activity, electronic or digital means, or artificial intelligence? It is unclear whether developing, selling, or simply using it will fall within scope when businesses of all sizes now rely on digital tools in their everyday operations. Many small enterprises, for instance, rely on mobile phones for their financial transactions through intermediaries beyond their control. How would state parties transpose such terms into their law and enforce them? Adding financing, investing, insuring could bring within scope those who simply hold passive investment in a company, which would be both impractical and unfair. The redrafting also falls business relationships into the definitions, further blurring both concepts and deletes the explicit reference to state-owned enterprises, which must remain covered. This definition is too broad and imprecise to provide legal certainty, we therefore call for its deletion. Thank you.

Thank you.

I give the floor to Sir Wendt.

Microphone, please.

I'm speaking on behalf of Association Sudwin and the Electropower Consortium, which work to combat forced labour in the electronic industry, as well as in Krispina, a resort institute in Indonesia. We would like to thank the Chair for including in the proposed redrafting of selected provisions of the legally binding instrument a clear and strengthened definition of business activity under proposal 12 for article 1.4. This definition encompasses the entire continuum of activities, including exploration, extraction and production. This is utmost important as our research conducted over the past seven years on Indonesian nickel mining and processing industry has revealed recurring patterns of vulnerability with the nickel processing industry. These vulnerabilities are shaped by systemic condition within employment relationship, including the normalization of excessive overtime, threats of losing overtime pay and essential allowance, disciplinary pressure exerted both directly through verbal reprimands and indirectly through the use of workplace application, economic pressure arising from wages that are barely sufficient to cover the high cost of living for workers and their family, and language barrier that constrain workers' ability to negotiate, question, or refuse dangerous order. Taken together, these conditions create a coercive working environment that blurs the line between compliance and coercion and may heighten the risk of forced labour within the nickel supply chains.

Therefore, we wish to.

Reiterate the importance of retaining the explicit inclusion of the different stages of business activities set out in the Chair's new proposal 12. Thank you, Chair.

Thank you very much. I give the floor to Georgetown University.

Distinguished delegates, I'm Elena Stefanos-Taka of Georgetown University. This is a statement made on behalf of Change the Law Limited. change the law agrees with the previous comment by the legal experts in a non-paper that the list should be indicative rather than a closed list. However, the wording is illustrative of the areas of greatest risk and vulnerability. Therefore, if the wording remains, then extraction should remain and domestic and gig workers should be added. In a previous intercessional thematic consultation, one of the legal experts suggested states should consider adding wording for AI and emerging technologies. Change the law agrees that AI should be added, including the governance of AI. Thank you, Chair.

Muchas gracias.

Thank you. I give the floor to Franciscans International.

Mr. Chair, I speak on behalf of the Feminists for the Binding Treaty, ACERNet, and Franciscans International. We support the additional language proposed by the Chair in regard to business activities. In particular, we support the addition of exploration, extraction, processing. The communities we work with have faced a variety of human right abuses and environmental degradation as a result of mining activities. As the world began discussing the possibility of a just transition, Indigenous peoples underscored that mining for critical minerals linked to the transition was green colonialism. We now see these critical minerals being targeted for use towards weapons and AI. Given this past, presence, and likely future context of predation based on the presence of minerals, we suggest that the chair consider adding the reference to common article one of the International Covenant on Civil and Political Rights and the International Covenant on Economic, Social and Cultural Rights in the preamble of the present LBI. On the restructuring of Article 1.4, which shifts from listing types of business structures to an indicative list, we can welcome the replacement of financial institutions and investment funds with financing, investing, insuring, and we propose that trade also be included, echoing Palestine's suggestion. However, our support for this change is conditional on Article 1.6, as suggested by the Chair, to including joint ventures, financial institutions, investment funds, and transnational corporate groups with the definition of business relationship. Given the growing negative impact of transnational financial actors on human rights worldwide, it is essential that they fall within the scope of this LBI. And lastly, we also support the inclusion of artificial intelligence and support an LBI that takes forward-looking approach. Therefore, we could support Iceland's suggestion to include language on the development, deployment and sale of AI. Thank you.

Thank you. I give the floor to the International Trade Union Federation.

Speak on behalf of the global labour movement. The definition of business activities, business activities of a transnational character and business relationship are interlinked and we therefore agree with the need to streamline the text and align the definitions for effectiveness and clarity. We also support the expanded reference to exploration, extraction, processing, financing, investing and insuring, as well as the inclusion of artificial intelligence. While we appreciate the rewording of the article to bring reference to business relationships up top, we think that it will continue to make sense to refer to the specific business structures and forms in the definition of business activities. Ultimately, it needs to be made clear that business activities are conducted by undertakings carrying on a trade or business, which at present is only articulated as a natural or legal person. As such, we believe that the reference to the specific business structure forms should remain, and that there is no duplication with the definition of business relationship. Chair, we also note the reference to business enterprises in other parts of the text when referring to a specific conduct required of corporate actors. I thank you.

Muchas gracias.

Thank you very much. You can now take your seat.

Thank you, Chair, as rapporteur. I'm speaking on behalf of the CICE and its member organisations, Manos Unidas, Misereor, CCFD-Terre Solidaire, Brot für die Welt, Trocaire, Frats de Nechten and CAFOD. We are pleased to note the broad definition of business activities provided by the Chair, rapporteur, in article 1.4. We are particularly pleased that it covers a broad range of sectors and stakeholders as well as actors, including public enterprises, financial institutions, investment funds, and activities related to digital technology and specifically AI. For greater clarity, we will suggest the addition of direct and indirect before the term business relationships, so as to cover the entire value chain. This is one of the strong points of the proposal because it reflects the diversity and complexity of modern business activities, both direct and indirect, which, as we know, in poorer countries where our local partners work, the partners that we've heard from in this room over the past few days, they are seriously affecting individuals and the environment, our shared home. We encourage States to maintain this broad approach and to ensure that they remain consistent with the definitions of business relationships and transnational business activities, which are included in other texts, so that the legally binding instrument does not leave any protection gaps. Thank you very much.

Muchas gracias.

Thank you. I give the floor to International Federation for Human Rights.

We welcome the addition of commercial activity to the definition. However, the text retains the phrase "other activity" without further qualifications. This makes the scope of business activities potentially extremely broad. We recommend delimiting the scope of other activity by qualifying it with the use of terms such as ancillary, related or supportive activities. This would help circumscribe the term, while at the same time being capable of capturing activities that may not be strictly economic or commercial in nature, but that business enterprises nevertheless undertake in support of these activities. This would include, to give a few examples, lobbying and political engagement activities, participation in policy making or multi-stakeholder initiatives, government advisory roles, philanthropic or CSR work, or even administrative or compliance activities that are necessary for commencing business activities, such as applying for a mining license or other type of permit. So the revised article could read as follows. Business activities means any economic, commercial or other ancillary, related or supportive activities undertaken by a natural or legal person, and so on and so forth. The use of terms such as ancillary, related or supportive activities and other terms could also be considered. Within the meaning of business activities would also help clarify the current definition of business relationships under Article 1.6. Under this article, the purpose to conduct business activities is built into the definition itself. This makes the scope of business relationship too narrow as it can leave out relationships that are formed to support, facilitate, or advance business activities, but not to conduct business activities as such. For example, the relationship between business enterprises and professional experts such as auditors, lawyers, or engineers might be commercial in nature, that it does not have as its purpose conducting business activities. The same is true of an arrangement between a business enterprise and state authorities to provide security services or between a business enterprise and a professional lobbyist to advance the business interest in a given context. Including activities that are supportive of economic or commercial activities within the meaning of business activities would ensure that relationships that are formed to support business activities but not to conduct business activities as such are also comprised within the meaning of business relationships for the purposes of the LBI. Thank you, Mr. Chair.

Thank you very much. I give the floor to Tierra de Derechos.

Thank you, Mr. Chair. My name is Zagithi Sbanzwe. I speak on behalf of Terra Dignitas and the Rural Women's Assembly, Eswatini, a member of the Global Campaign. On Article 1.4, we note with concern that the proposal didn't change much from the updated draft, and we believe this is a missed opportunity to bring greater legal clarity to the objective scope of the instrument. We have supported the amendment to article 1.4 put forward by more than 60 Global South states at the ninth session, because it anchors the scope where it belongs, on the conduct of transnational corporations and other business enterprises of transnational character. Yet the logic of the amendment must follow through to its conclusion. What this provision must define is not business activities in the abstract, but business activities of a transnational character. The current architecture with a general definition in article 1.4 and a separate one in article 1.5 is not merely redundant. It is structurally problematic. By drawing a line between business activities that are transnational and those that may not be, the text opens the door to a interpretation that extends the obligation of the instrument to purely domestic activity and even for SMEs. That will stretch the scope well beyond the mandate entrusted to this working group by resolution 26/9 and it will dilute the very focus on transnational corporations that so many delegations have defended. We therefore propose merging articles 1.4 and 1.5 into a single coherent provision that only defines business activities of a transnational character. As proposed by State of Palestine, we recommend building on the formulation presented by Palestine today, which is built upon the upon one presented by more than 60 states in 2023. The result is a definition that captures any economic or other activity undertaken by transnational corporations and other business enterprises of a transnational character, whether private, public or mixed, including through subsidiaries, affiliates, supply and value chains and other business relationships, as well as through electronic, digital and platform-based means. This is a definition that reflects how transnational business operates in practice, closes the gaps through which responsibility is too often evaded and keeps this instrument faithfully aligned with resolution 26/9. In Eswatini, we as peasants and women have been forced into contract farming in the sugar cane sector, which is controlled by UK-based corporations. Our land has been grabbed and we have been denied control over production and prices we receive for our crops. These violations of our rights to land and fair prices undermine our livelihoods and constitute a direct violation of our rights to food sovereignty as enshrined in the UN Declaration on the Rights of Peasants. We respectfully urge the Chair and States to adopt our proposal of merged text. Thank you, Chair.

Thank you. That was the last speaker on the list. My thanks to all of those who participated in this exchange, both representatives of states and civil society and other relevant stakeholders. I've taken due note of all of your comments and observations. Let's continue with proposal 13. On the article 1.5, on the definition of business activities of a transnational nature, the goal is to clarify those. This definition establishes three suppositions where a business activity becomes transnational in nature. when it is conducted in more than one jurisdiction or state, when it is conducted in a state but a significant part of the preparation, planning, direction, control, design, processing, manufacturing, storage, or distribution takes place in another state, and when it is undertaken in one state but has significant effect in another state or jurisdiction. In the intercessional thematic consultation, some delegations proposed deleting C because they thought that the criterion of significant effect lacked objective parameters. Other states thought it necessary to cover transboundary harm, such as environmental damage originating in one state and having impact in another. The Prep. proposal of an article 1.5 bis was also studied that would define the expression other business enterprises. There were different positions vis-a-vis the implications for subsidiaries and locally established entities conducting transnational activities. In light of that exchange, the chair rapporteur would suggest focusing the amendments in B on the two following aspects. Firstly, that the qualifier a significant part would be deleted because that may give rise to diverging interpretations. Secondly. The requirement that these stages take place through any business relationship in. another state could be replaced by a broader formulation whereby the activity involves the preparation, procurement, planning, direction, control, design, processing, manufacturing, storage or distribution, or other decisions or actions related to another state or jurisdiction. Parts A and C would remain as they are, just with the slight amendment to the heading, with the deletion of "above". With that introduction, then, let me open the floor, first of all, to States who wish to make comments on proposal 13 of the reformulated article 1.5. Let me remind you that some States have already spoken on this proposal when we addressed the previous article. So let me open the floor then. Let me give the floor first of all to the European Union.

Mr. Chair. As regards article 1.5 on the definition of business activities of transnational character, irrespective of the proposed adjustments that are proposed to its definition, we would like to restate our general concern about the proposal to limit the instrument to transnational business activities. As we said previously, this would not reflect the universal nature of human rights and the approach of the United Nations Guiding Principles on Business and Human Rights, to which the EU Corporate Sustainability Due Diligence Directive is based. Limiting the instruments to transnational corporations or business activities of transnational character would send the wrong signal in terms of human rights protection and may create an uneven playing field both for states and companies. Thank you.

Thank you.

The European Union. The GCC, please.

Thank you, Mr. Chair.

Regarding the definition of business activities of a transnational character in paragraph 1.5, we suggest re-entering the term "a significant part of".

In paragraph 1.5 B and to limit the mentioning to.

Decisions or actions related to another state in such a way to secure a sufficient objective.

Links to prove the trans boundary nature of these activities and not be limited to a small foreign component.

Thank you.

Thank you.

Iceland has the floor.

Iceland supports the retention of subparagraph C on significant effects in another state, as we attach great importance to capture transboundary environmental harm, including harm to the marine environment. We understand previous reservations delegations have had on this subparagraph, as the term significant effect lacks a threshold. We note that it may result in domestic activities with cross-border impacts to be understood or applied as transnational with respect to this provision. To address questions or concerns about legal certainty, we suggest clarifying the threshold of sub-paragraph and drawing from established standards, and more specifically, especially in this context, the Espoo convention. Our suggestion for the text is to change the reference to significant adverse effects or impact instead of effect, and we would be happy to further clarify or assist with the exact formulation, as well as provide further sources for established standards. Thank you.

Thank you to Iceland. I give the floor to Saudi Arabia.

Thank you very much, Chair. As far as 1.5 is concerned, Saudi Arabia gives particular importance to the definition of business activities of a transnational character. We're talking about an entry point for the implementation in its entirety of the instrument because the scope of the instrument is limited to these activities in line with our proposal for 3.1. So we must have an objective and clear link between activities and other states as mentioned in paragraph one. The Language in B has deleted the words "a significant part of its" and added "procurement" and language "other decisions or actions related to another state". This is a very open proposal and has no extradition, so any element is possible to talk about the transnational activities of a local nature. And also paragraph C does not mention significant effect in another state. This is a very broad description, does not establish a link between activities and other states and does not determine the nature of the impact and how it is linked to the type of activity. This is why we suggest to reintroduce in B a significant part and we suggest the deletion of the word procurement because imports from abroad is something that characterised most local commercial activity is this is not enough to be able to say that it is of a transnational character. And we also suggest the deletion of other decisions or actions related to. In this way, the paragraph will be quite objective. On, in line with our position that is well known to you, we suggest the deletion of this subparagraph. But we do also realize the importance of not excluding real transnational harm or damage. And this is why we can be flexible in terms of keeping this paragraph as long as it is limited to activities carried out in one single country and activities that have a direct, significant negative effect and that may be determined in a reasonable way related to individuals in another State. So this will help us have a clear and objective paragraph in order to have a paragraph that also covers indirect effects. Thank you.

I give the floor to China.

On 14.5, China has suggested in the last session to delete the significant impact on other countries in C, significant effect.

We believe that it's difficult to determine what it is referred.

In this drafting, in this text, so we suggest the deletion of it. Thank you.

I thank China. I give the floor to Japan.

Thank you, Mr. Chair. We understand that Article 1.5, which refers to business activities of a transnational character, is based upon the definition of business activity referred to in an article 1.4. Therefore, as long as we cannot agree on article 1.4 under this draft LBI at this point, we cannot agree on article 1.5 for the same reason either. Thank you.

I thank Japan. Brazil, you have the floor.

Thank you, Chair. On proposal 13, Brazil insists on maintaining sub-paragraph 1.5. We also, just similar to Iceland, think it's crucial for establishing extraterritorial jurisdiction in transboundary environmental disaster, a topic that's close to our heart. Now, we hear the opposition to the significant effect in the room. We think it does establish a certain filter for applicability by requiring demonstrable impacts, substantial impacts on recognized human rights. But we'd be willing to work on language that assuage other delegations' concerns. We appreciate Saudi Arabia's flexibility on the matter and looking forward also to hearing Iceland's proposals to assuage the concerns.

Thank you.

Thank you, Brazil. I give the floor to Cuba.

Thank you very much, Chairman. Very briefly, to reiterate that delegation of Cuba supports a definition that refers to business activities of a transnational character. And when we look at this with Article 1.4, this will be the definition that will enjoy primacy. Thank you.

I thank Cuba. Any other state wishing to take the floor? That does not seem to be the case, so we will now turn to the list of speakers representing NGOs. civil society and other relevant stakeholders. I give the floor to Global Forum for the Defense of the Less Privileged.

Thank you, Mr. Chair, for giving me the floor. We welcome and support efforts to clarify the definition of transnational business activities, particularly where planning, procurement, control, or other significant decisions take place across borders. It is important that the definition captures the connections between business operations in different states, rather than focusing only on where the final activity occurs. In addition, we recommend refining the proposed wording to ensure legal clarity while allowing the instrument to address business-related human rights abuses that involve more than one jurisdiction. I thank you.

Muchas gracias.

Thank you. I give the floor to the International Organization of Employers.

Thank you, Chair. I speak on behalf of IOE and USCIB. We are not supportive of this proposal. This definition is not needed and creates confusion as the instrument should apply to all business activities as stated previously. Moreover, the redrafting of Article 1.5 removes the significant part threshold so that any preparation, procurement, or other decisions or actions related to another state, however minor, will make an activity transnational. In addition, the significant effect criterion in subparagraph C remains problematic for us. It lacks objective parameters and could capture diffuse, indirect, or cumulative effects that cannot be traced back to any specific activity, making the boundaries of this definition impossible to determine. This only confirms that the definition creates confusion, and we call for its deletion. Thank you.

Thank you. I give the floor to Sidsi.

Thank you very much, Chair, Rapporteur. I speak on behalf of the Schinca People's Parliament, Sidsi, and its member organizations, Mamas Unidas, Misereors, CFD, Terre Solidaire, Broederling, Delen, Trocaire, Fasten Action, and CAFOD. Mr. Chairperson, Rapporteur, this article that seeks to define business activities of a transnational character is of particular importance of groups and individuals that are most impacted by these activities, especially indigenous peoples. We suffer from these impacts in a disproportionate manner. I am an indigenous Xinka woman from Guatemala. People had to learn through very difficult and frustrating experience on the very nebulous nature of transnational activities and how the absence of a broadly agreed definition works to make it easier for TNCs to use complex and opaque corporate structures and business relations to avoid their responsibilities and deny access to justice for victims. This is why we welcome the approach taken by the Chair to define business activities of a transnational character in Article 1.5 through the nature and cross-border effects of the activity. We believe that this is very important because the legally binding instruments should cover situations where business operations take place in different locations and their impact goes beyond borders. We encourage further consideration of the language in sub-paragraph B, especially in order to guarantee that it adequately captures the relevant direct and indirect cross-border trade relationships and their impacts without creating any gaps in protection. This should also be read together with Articles 1.4 and 1.6 and Article 3.1. That should provide a sufficiently comprehensive basis to define the scope of this instrument. Thank you.

Muchas gracias.

Thank you. I give the floor to International Trade Union Confederation.

Of the Global Labour Movement. Chair, we welcome the deletion of the undefined and vague qualifying term "significant". which could have led to unnecessary debates about what constitutes a business activity of a transnational character. Chair, the drafting change represents a significant improvement of the text. The deletion of "business relationship" in Article 1.4 is fine when considering that the revised definition of business activities states that such activities can be undertaken through business relationship. However, it will be important to track any further change down the line as the article 1.5b is integral in adequately covering corporate relationships in global supply chains. I thank you.

Chair.

Thank you. I give the floor to International Convention of Digital Workers.

Mr. Chair, I'm representing the World Forum of Fisher People and on behalf of the ICSF as part of the global campaign I present this. As Palestine's position we also reiterate our call to merge both paragraphs 4 and 5 into a single provision and refer to TNCs and OBEs of transnational character in line with the proposal supported by over 60 Global South states. Having a separate abstract definition of business activities only dilutes the treaty's purpose and threatens to capture purely domestic enterprises and SMEs, exceeding the mandate of resolution 26/9. To maintain the core focus of this instrument, the only legally relevant concept to be defined is business activities of a transnational character. As Article 1.5 aims to determine what makes a business activity of a transnational character, it is important that these criteria avoid broadening the scope and equating business activities of transnational character to any cross-border business activities. Crucially, these criteria must reflect how transnational corporate power actually operates today, through fragmentation and global value chains. Too often, Transnational corporations outsource high-risk, polluting or exploitative operations to local suppliers and subcontractors, claiming that these abuses are purely domestic. As fisherpeople and communities, we see this in our territories, where transnational aquaculture, mining and shipping companies are using complex business structures to evade direct responsibility for violating the human rights of fishing communities and polluting the environment. They also escape the costs of environmental disasters, leaving affected communities unable to access remedies and reparations, as in the 2021 burning of the Excess Burr ship in Sri Lanka. To close this persistent loophole, and in line also with Palestine's proposal, we suggest that the Chair explicitly incorporate a criterion capturing activities undertaken within a single state as part of a value chain, specifically where the activity contributes to, enables, or benefits from transnational business operations. This approach does not capture ordinary domestic businesses, Rather, it adheres to the economic reality of TNCs, ensuring that corporations cannot evade accountability by fragmenting their operations and outsourcing their harms. I thank you, Chair.

Muchas gracias.

Thank you. That was the last speaker on my list. So I would like to thank all of those who participated in this exchange of views. Now we will look at proposal number 14 related to the definition of business relationship, article 1.6. As I said when I presented proposal 12, the idea is to align this definition with business activities, avoiding overlap or conceptual repetitions. This definition covers any relationship between physical and legal persons, including state and non-state entities, to carry out business activities through subsidiaries, agents, providers, associations, or joint ventures, or any other structure or relationship throughout the entire value chain. The central question that was discussed during intersessional thematic consultations was the inclusion of financial institutions and financial relationships. Some organizations and delegations supported this directly while other delegations said that the existing definition is sufficiently broad. Also, it was said that even though financial institutions are key providers of services for enterprises and can directly be involved in certain circumstances in the adverse impacts of the operations of the clients, they do not seem to be fully covered by the current definition. As a reference, what was kept in mind, paragraph 17 of chapter 2 of the guiding principles of the OECD on multilateral corporations related to responsible business conduct and article 3, paragraphs D and P of the EU directive 2024/1760 on due diligence of businesses in the area of sustainability. As a result, the language that is being proposed includes three elements. First, it includes in the indicative list financial institutions, investment funds, transnational corporate groups, elements that will be deleted from Article 1.4. Second, it deletes as provided under the domestic law of the state in order to ensure a uniform application of definition. Thirdly, it includes, just like Article 1.4, a reference to artificial intelligence and activities undertaken by electronic or digital means. Now, with this introduction, I open the floor first to states. to make statements or comments related to proposal 14 on language changes in article 1.6.

Thank you very much. we would appreciate clarification of the added value of a listing financial institutions and investment funds within a definition of business relationships. Their activities are already covered by the defined term business activities while considering them as vehicles of business relationships as indicated by the word through. seems to overstretch the concept. Conversely, a reference to corporate groups could help clarify coverage, but the qualifier "transnational" again would merit a reconsideration.

Thank you.

Thank you very much. The European Union. GCC, please. Thank you very much indeed, Chairperson. On 1.6, we believe that we need to limit everything linked to business relationships. We should mention the domestic law of the State And we shouldn't have hypotheses when it comes to responsibilities. When there is a business relationship or an investment relationship, the responsibility should be based on the direct causality. And we believe that businesses, state-owned businesses, should be treated like the private sector. when they undertake business activities, when they conduct business activities, the act of the business should be respected and I'm within international law.

Thank you. Thank you.

Do any other states wish to take the floor? Cuba have the floor. Thank you very much indeed, Chairperson. Our position on this article is in line with what we said on 1.4 and 1.5. We welcome the inclusion of language on digital technologies and artificial intelligence, and we also believe that this paragraph should include transnational enterprises as a regulated body and not as the centre of the article. So we propose that the language focus on business relationships of transnational corporations.

Thank you.

Thank you, Cuba. Japan, please.

Thank you, Mr. Otero. As we have pointed out regarding Article 1.4, since the concept of business relationship also relates to criminal punishment in connection with Article 8, it should be defined more narrowly and clearly. The current text is based on the concept of business activities, which is not clearly defined in the first place, and as such, it is unclear what kind of relationship is intended by the phrase "any relationship." We consider that The scope of the term business relationship should be clarified and the language revised accordingly. In addition, the vague scope of business relationship can make it difficult for business enterprises to reasonably predict what human rights abuses attributable to which business partners could become subject to liability. Therefore, the scope of the term business relationship should also be defined more narrowly and clearly from this perspective based on the existing international frameworks such as the UNGPs in which business relationships are premised on a certain degree of relevance.

Thank you.

Thank you very much. Japan, Brazil, you have the floor.

Yes, thank you, Chair. We do warmly welcome the explicit inclusion of financial institutions and investment funds in 1.6. We think it closes a loophole in the financing chain. We do see the value of including it both here and to mirror it in 1.4. In 1.6, especially because it triggers article 6 on due diligence and 8 on legal liability, so we do thank you for retaining the language there on 1.6. We can support it. Thank.

You.

Thank you, Pizzey. The State of Palestine, I have the floor.

Thank you, Mr. Chair. On 1.6, we welcome the retention of the reference to value chains. We welcome the addition of financial institutions, investment funds, and transnational corporate groups. And we reiterate that our support for the restructuring of 1.4 depends on them, together with joint ventures, remaining in this definition. We also welcome the deletion of the words as provided under the domestic law of the state, which would have let each state narrow the definition. We ask, we propose that the definition state clearly that business relationships are not necessarily contractual. It should cover any state or non-state entity linked to a business operation, product, or service, even where the relationship is not contractual. as well as entities in the value and supply chain, including subcontractors and contract manufacturers, and relationships that support or facilitate business activities. We also propose that it expressly include financial entities such as investors, shareholders, banks and pension funds that finance the activities of transnational corporations, because the financial capital that funds corporate activity must also fall within the instrument. I thank you.

Thank you very much to the State of Palestine. Do any other States wish to take the floor now? If that's not the case, we will move to statements from civil society and other relevant stakeholders. I give the floor to SUMED.

Thank you, Chairman. My name is Victoria Munoz and I'm a lawyer and human rights defender from Colombia. I speak on behalf of SUMED, the Association for the Promotion and Protection of Human Rights, a member of the Global Campaign. We wanted to stress the importance of Article 1.6, including the concept of a business relationship with the concept of supply chains and responsibility and solidarity. The supply chain is essential because it gives rise to international fragmentation that transnational corporations usually have by dividing their operations into different phases. The matrix or the parent company operates with subsidiaries in one or various countries who are apparently independent, but do have certain links to the matrix. And that happens because these large corporations move different steps of the supply chain to different countries, taking advantage of localization, such as cheap labor. and sometimes to avoid taxes. However, the parent company, the matrix, maintains the governance of the supply chain and uses it to maximize benefit and competitive advantage. This helps it improve labor costs, commercial access, resource extraction, or other type of advantages linked to production or trade. Responsibility in solidarity as part of the supply chain, the value chain in business activities is the proper mechanism to prevent these corporations from sidestepping their obligations vis-a-vis potential individual or collective victims. This with the pretext of externalizing risk and responsibilities to their subsidiaries, providers or subcontractors. So responsibility is not limited to the fact that the violation was committed in the value chain, but rather that the responsibility goes up to the top of the transnational company, which benefited from the operation. Given that transnational corporations promote the concept and development of the product, gaining for the majority of the profit. This is the part that should assume responsibility for violations committed by any of the sub entities in the global value chain. It's important to highlight that the parent companies and matrices dominate and guide the supply chain, the value chain, and they. control the IP and other intangible property, they design the marketing, establish the procedures and usually end up with the large part of the profits. These concepts of value chain and responsibility in solidarity mean that victims will be able to better seek comprehensive remedy from any of the actors involved, including the parent company, without them having to go to different parts of the subsidiaries or the providers. This should also be included in article 8 and the definition should include a good definition of the value chain. The best option would be that proposed by Palestine at the 8th meeting, which removed the reference to national legal systems and best describes business relationships that aren't necessarily contractual. This amendment should also include the financial capital financing them. This also means that the fragmentation of the value chain cannot become a tool for impunity. It helps also broaden the sphere of competence and the applicable law so that victims can choose where they would get most safeguards and guarantees, which is usually done for the headquarters. These principles are dissuasive. Transnational corporations need to take serious and effective measures to prevent and to correct practices which promote human rights violations. Given the ethical challenges here, it is vital to ensure universality of human rights across the globe. This requires a robust normative framework and a binding treaty that obliges companies to be held accountable.

Thank you.

Thank you. I give the floor to ITUC.

Microphone, please.

I speak on behalf of the Global Labour Movement. We welcome the additional reference to financial institutions, investment funds and transnational corporate groups and artificial intelligence at the end of the article, as well as the deletion of the reference to national law. Chair, these changes represent significant improvement to the text. Although not raised in the commentary to this specific provision, we know that the commentary to proposal 20 asks whether the concept of value change is adequately defined. Since the definition of business relationship is the only place in the text that includes a reference to value change, we see merit in explaining this term and the term global value change at the end of article 1.6. even though the concept may already be encapsulated in the existing definition. If the definition is needed, we could suggest something along this following line: Global value chains means the full range of upstream and downstream business activities of a transnational character of a business enterprise business relationship. Chair, it might sound very circular, but this formulation incorporates existing definitions. However, Chair, through you, we would like to ask the legal experts whether the current drafting and definition adequately defines or explains the concept of global value chain for the purpose of the adequate implementation of the LBI. I thank you.

Thank you.

I give the floor to the International Organisation of Employers.

Thank you, Chair. I speak on behalf of IOE and UIC-ABI. Chair, we cannot support this proposal. Defining business relationships as any relationship remains completely unworkable as it is limitless, vague and overly broad. More concretely, it wrongly presumes that a business has visibility and leverage over every other business to which it might be connected, no matter how far down a value chain. Just as the previous proposal, the redrafting adds new categories, such as financial institutions, investment funds and artificial intelligence, which further blur this definition with that of business activities. And here again, what is meant exactly by other activity or electronic or digital means? The retention of throughout their value chains and the deletion of as provided under the domestic law of the state remove an important anchor in national law and extend due diligence duties and liability to entities with which companies have no contractual relationship and into whose operations they have no insight or control, with important negative unintended consequences, especially for MSMEs. This is not consistent with the UNGPs, under which business relationships are those directly linked to a company's operation, products or services, and is simply unrealistic to implement. Chair, businesses need clear, precise and workable definitions to effectively carry out their human rights due diligence, in line with the UNGPs. Otherwise, this instrument risk undermining rather than strengthening meaningful due diligence in practice. We will therefore recommend in state. Business relationship means a relationship of a business enterprise with its business partners and other non-state or state entities directly linked to its business operations, products or services by contractual arrangement and to which it has visibility and leverage. Thank you.

Thank you very much.

Mr. Chair, Rapporteur, I'm speaking on behalf of CIDCE and its member organizations, Manos Unidas, Misereor, CCFD-Terre Solidaire, Broedlijk Deel, Trocaire, Fastenaktion and CAFOD. We welcome several important elements of this proposal on business relationships in Article 1.6, and in particular, we welcome the explicit inclusion of affiliates, subsidiaries, suppliers, joint ventures, financial institutions, investment funds, and transnational corporate groups, as well as the reference to value chains. These elements reflect the complexity of contemporary corporate structures, and we encourage ensuring that the provision is sufficiently clear and comprehensive to capture the entire value chain and the range of relationships through which business activities are conducted. including the investments and other services by financial institutions. This is essential to avoid legal uncertainty and, importantly, to prevent corporate structures from being used to evade accountability. I thank you.

Thank you. That was the last speaker on the list. My thanks to everybody for their contributions, states and representatives of civil society and relevant actors alike. We take good night. Sorry, Saudi Arabia, did you want the floor? Go ahead.

Thank you, Mr. Chair. Allow me. to make this intervention on 106 before moving to the next proposal. Mr. Chair, we note that the definition of business relationship has become too broad, covering any relationship in the entirety of the value chain, including financial institutions and investment funds. It also refers to government and non-government entities. while removing the reference to the domestic legislation, which might entail legal impacts on far or incidental links. We believe that the criterion must be the actual control or the direct and considerable impact in the relevant activities rather than the legal form of such a relationship. This should cover the control exercised through ownership in affiliates or venture or joint ventures. This definition should not be understood as covering the obligations of the enterprise or its responsibilities and pegging it to the individuals who own or work for them, given the fact that these activities exercised by legal persons is covered under 1.4. We therefore propose that the term "business relationships" should mean any contractual or operational relationship or other relationships that are based on ownership between legal persons who exercise a specific business activities. Investment that does not grant any control or direct or considerable impact in the relevant activities and the exercise of the state of its rights being the owner of such e-business should not form per se a business relationship in addition to incorporating a text on not affiliating the enterprise obligations or its responsibilities to persons for being part of such business. Thank you.

Thank you very much to Saudi Arabia for that statement. That wraps up our exchange on Article 1.6. We'll now move to proposal 15 on the definition of regional integration organization and Article 1.7. which raises an issue of location rather than content. This provision defines these organizations as those made-up, those conformed by sovereign states in a particular region to which member states have transferred competencies in the matters governed by the instrument, and it stipulates that references to states parties shall apply to them within the limits of that competence. regional integration organizations are only mentioned in the institutional and final provisions of the instrument. So in the intersessional thematic consultations, there was support to move that definition. At the same time, looking at Article 19, some delegations had questions on this and they suggested that the point on their right to vote should be addressed in Article 15. As a template, they use Article 44 of the Convention on the Rights of Persons with Disabilities, which governs or regulates these organisations in a standalone provision. The chairperson rapporteur would therefore suggest deleting Article 1.7 of this article on definitions and relocate its content, move its content with minor adjustments to article 19 on signature ratification acceptance approval and accession or to an independent article after the provision on consent to be bound. Its substantive content would remain in the new placement and states could also consider whether or not it's relevant to refer to the right to vote of these organizations in the Conference of States Parties. With this brief introduction then, let me open the floor first of all to States who wish to make comments on proposal 15 on article 1.7.

Saudi Arabia, you have the floor.

Thank you, Mr. Chair. Allow me to comment on the proposals on 1.7, 1.8, 1.10 being closely related. The Kingdom, Mr. President, the Kingdom welcomes the proposals by the chair rapporteur to relocate 1.7 and remove paragraph 1.10 and mainstream 1.8 in line with confining them to the clearly necessary definition. When it comes to due diligence, The Kingdom reaffirms that this should be based on the risks and should take into consideration the national context and needs, and should be confined to taking appropriate and reasonable measures within the confines of control or influence that can be reasonably exercised. Therefore, the Kingdom proposes, in addition to 1.8, to the effect that these operations must be based on risks and reasonable control, given into consideration the actual exercise of enterprises on such business activities or its influence, taking into consideration the national context. when these elements must also be incorporated in Article 6. We also propose that we welcome the flexibility granted to States in the new paragraph 6.7. Thank you.

I thank Saudi Arabia. I give the floor to Cuba.

Thank you very much, Chair. Cuba supports the proposal of the Chair to move the discussion of the definition of the term regional integration organization to Article 19. We'd like to still raise our debts about letting regional integration organizations to be part of this legally binding instrument and therefore have a right to vote. We're not sure that these organizations can apply the provisions of this treaty and how we can define their obligations vis-a-vis member states. Thank you.

Thank you, Cuba. Any other requests for the floor by states? Very well. If that is not the case, we will now turn to statements to be made by representatives of civil society and other relevant stakeholders. First, I give the floor to the International Trade Union Confederation.

Thank you, Chair. I speak on behalf of the Global Labour Movement. I will be very brief. We can support the deletion of article 1.7 on the understanding that it will be relocated to article 19. Thank you.

Thank you. I give the floor to Setim.

Thank you very much, Chair. My name is Andres. I speak on behalf of CETEM, member of a global campaign. I'll be very brief. Just like our friends from the trade unions, we also support the deletion of this article from the section on definitions and relocation in Article 19 and also the exclusion 1.10, and we'll be referring to that in due course. Thank you.

Muchas gracias.

Thank you. I give the floor to the International Organization of Employers.

Thank you, Chair. I speak on behalf of IOE and USCIB, and I will also be brief. We welcome this proposal, and we can support relocating this provision to Article 19, as we had suggested, which helps streamline the definitions. Thank you.

Muchas gracias.

Thank you. That was the last speaker on my list, so I'd like to thank all of those who contributed to this exchange of views. Now we will consider proposal 16 related to the definition of human rights due diligence, article 1.8. The objective of these changes is to move the larger part of the contents to Article 6 on prevention with some amendments that strengthen its alignment with international standards on responsible business behavior, with normative developments, jurisprudence, and these developments in different countries and regions. The definition contained in the updated draft of the legally binding instrument describes the processes through which companies identify, prevent, mitigate, and account for adverse human rights impacts. And it also includes its operational components, namely the identification and evaluation of impact, adoption of measures, follow-up to ensure the effective nature of such measures, and communication to interested stakeholders. Also, this proposal for changes in the language remains consistent with the fourth proposal for amendments presented during the 11th session related to article 6.1, 6.2, that had another purpose to specify the nature and the scope of due diligence referred to in Article 6.2 sub-paragraph c. Nonetheless, the term is only used in Article 6, in particular, paragraph 6.2 and 6.4. So this is why the question of moving it to the relevant article. National normative developments related to supply chain refer to due diligence as a set of substantive provisions and not as a definition. During the intersessional thematic consultations, different delegations and organizations preferred to keep the notion in this article as a cross-cutting notion. while other considered moving its contents to article 6 with an adjusted or simplified version. Different delegations stressed the need to align this with the guiding principles, especially with principles 15 and principles 17 through 21, and to keep reference to mitigation because prevention and mitigation are complementary elements. Now, with this input, the chair rapporteur decided to opt for an intermediate solution and keep only the first sentence of the definition of article 1.8, adjusting it in such a way as to cover all types of due diligence, including that of states, defining it as processes to identify, prevent, mitigate and account for adverse human rights impacts. In this way, we keep a broad and cross-cutting reference in the article related to definitions, while the other relevant elements, especially Those related to the due diligence of enterprises will be integrated in Article 6 with some amendments at a later stage. Now, with this introduction, I will open the floor first to states that wish to make comments with their suggestions related to proposal 16. on Article 1.8.

The European Union, you have the floor.

Thank you. Moving the operative elements of the definition of human rights diligence to Article 6 could make sense, provided that those elements are effectively retained there. However, we would appreciate clarification as to whether mitigation is intended to also encompass bringing actual adverse impacts to an end and providing for or cooperating in the remediation as appropriate to the enterprise's involvement. While this draft LBI appears to use the term in this broader sense, this is not expressly explained. It might therefore be worthwhile considering an explicit reference in Article 6 to identifying and addressing actual and potential adverse impacts with a clarification that addressing encompasses prevention, mitigation, cessation, and where appropriate, a remediation. It would also be useful to clarify the relationship between the due diligence obligations under Article 6 and the liability provisions in Article 8, including liability for harm resulting from a breach of those obligations, while distinguishing civil liability from administrative enforcement of non-compliance. Thanks.

I thank the European Union, and I give the floor to Iceland.

I promise I'll be quick. We are supportive of moving the operative elements of human rights due diligence to Article 6, but we do note that in light of the operative elements being moved to article 6 we also anticipate that article 6 will be closely aligned with the ungps and the oecd guideline guidelines and more specifically a risk-based and ongoing process meaningful stakeholder engagement and addressing actual and potential impacts thank you.

I thank Iceland. The State of Palestine, you have the floor.

Thank you, Mr. Chair. We can accept moving the operative content of 1.8 to Article 6. Consolidating the two avoids redundancy and makes human rights due diligence directly enforceable under Article 6. But the move must not weaken the obligation, and the sentence that remains in 1.8 is too weak. It does not mention value chains. It does not present due diligence as an obligation, and it falls short of the guiding principles and of several national due diligence laws. We therefore accept the move only if Article 6 sets out due diligence as a binding preventive obligation on transnational corporations and other enterprises. of a transnational character, covering their value chains, and as a legally enforceable standard of conduct, which is particularly crucial in high-risk sectors. The sentence that remains in 1.8 should also drop the words "adverse human rights impacts" in line with our position on 1.2, and refer instead to identifying, preventing, and remedying abuses and violations, and preventing and mitigating risks. Due diligence must be a standard of conduct, not a safe harbor. Carrying out due diligence cannot shield an enterprise from liability where it nonetheless causes or contributes to an abuse or violation, and procedural compliance should not be seen as enough. We reiterate that it is no substitute for the other mechanisms of prevention, liability, and jurisdiction that the treaty must also provide. I thank you.

Muchas gracias.

I thank the state of Palestine. We have exhausted the time that we have this morning, so we will continue this afternoon. On my list, I have the United Kingdom, Uruguay, and of course, any other country can ask for the floor. So I'd like to thank all of you for your participation this morning. The meeting is adjourned and we will see each other once again at 3:00 p.m. Thank you.