Author: Shaun Milligan*
Published: April 2021
Description: In December 2019, the Hague Rules on Business and Human Rights Arbitration (the “Hague Rules”) was published. As a set of international arbitration rules, the Hague Rules provide a set of procedures for the arbitration of business-related human rights disputes which arise out of businesses’ commercial relationships or transactions (“BHR arbitration”). In considering why businesses may be willing to consent to BHR arbitration under the Hague Rules, the drafters of the Hague Rules pointed to the 2013 Accord on Fire and Building Safety in Bangladesh (the “Bangladesh Accord”), the first public agreement in which businesses have agreed to BHR arbitration. This article will distinguish the Bangladesh Accord from the Hague Rules by highlighting the instruments’ different approaches to privacy, confidentiality and transparency. In doing so, this article argues that while businesses were incentivised to consent to BHR arbitration under the Bangladesh Accord, it is unlikely that businesses will be similarly incentivised to consent to BHR arbitration under the Hague Rules. This is partly because the Hague Rules go significantly further than the Bangladesh Accord in promoting the transparency of BHR arbitration proceedings. As such, the Hague Rules will significantly increase the level of financial and reputational risk that businesses will be required to assume when consenting to BHR arbitration under them. To incentivise businesses to consent to BHR arbitration under the Hague Rules, this article recommends that the Hague Rules be amended to provide for a higher degree of privacy and confidentiality in BHR arbitration.
* LLB (Hons 1)/BBus(HRM)(Dist) (Griffith). As an Australian Government Department of Foreign Affairs and Trade New Colombo Plan Scholar, Shaun Milligan worked in the international arbitration practice groups of Herbert Smith Freehills’ and King & Wood Mallesons’ Hong Kong offices. This article is adapted from his LLB Honours thesis which received the Griffith Law School Dean’s Thesis Runner-Up Prize. The author thanks Associate Professor Dr. Therese Wilson (Dean of Law and Head of Griffith Law School), Antony Crockett (Senior Consultant, Herbert Smith Freehills) and Adjunct Professor Dr. Justin Malbon (Griffith Law School) for their helpful comments and suggestions. He also thanks Brenda Horrigan (Head of International Arbitration (Australia), Herbert Smith Freehills) for sparking his interest in Business and Human Rights Arbitration. The views and opinions expressed in this article are the author’s alone and should not be attributed to any other individual or organisation except where due reference is made in the article itself. Email: email@example.com.