The Role of the Host State to the Protection of Human Rights and the Environment From the Violation Done by Transnational Corporations

Transnational Corporations (hereinafter TNCs) have great influence in the economic development and social welfare in host states. Due to the strong economic power owned by TNCs, they are able to influence the government of the host states. However, to certain extent, in order to gain a great profit, they often violate human rights and the environment in the host states. Unfortunately, the TNCs are not the subject of International law, thus International environmental law and International human rights law cannot be applied to TNCs. It seems that TNCs are out of the ambit of Law. However, it is essential to enhance the role of the host state government to enforce the law in order to protect human rights and environment in the host state. This paper undertakes a critical examination of the issues relating to human rights violations and environmental damage done by TNCs in developing countries. The research method of this article is qualitative and the approach of the research is normative. The research finds that the role of the host sate to enforce the law to protect human rights and environment from the violation done by TNCs is paramount.


Background
Over the last thirty years 1 the power and role of Transnational Corporations (hereinafter TNCs) in international trade creates major impacts that cannot easily be ignored in the world. Basically, transnational enterprises are businesses that operate internationally. Hence, Transnational enterprises employ a variety of operational structures that mirror their international character. If the home or parent organization is located within a single state, the organization is usually fairly simple. On the other hand, enterprises with various parents located in multiple states often have quite complex structures. 2 Indeed, those TNCs 3 influence other countries through two types of foreign investment: foreign direct investment (hereinafter FDI) 4 and foreign indirect investment or also called portfolio investment.
The reasons why TNCs conducted business in developing countries are various. However, it can be generalized that the fundamental objective to conduct business in developing countries is to gain a huge profit. This objective can be achieved because of some reasons, such as lower production costs in developing countries, the availability of the raw materials, and big market access in developing countries.
Indeed, it is not only the lower labour costs that attract capital into other countries.
Additionally, the developing countries have conditions where regulations on safety and health at work, weak protection of human rights and environmental protection, where wages are below the subsistence level. 5 These conditions are an extra attraction or investment, because they reduce costs in those industries where largely semiskilled workers are used.
In many countries, TNCs effectively control the economy and thus define the social conditions for much of the population. 6 The most concern of the TNCs is the financial health of the corporation and its shareholders, and not to the social and environmental needs of the host states. The host government typically faces a conflict between its responsibility to protect human rights and safeguard the environment, and its needs to establish favourable economic conditions to attract foreign investment.
When the host states attempt to renegotiate how to protect the worker rights, community responsibility, environmental regulations, and industrial practices, the TNCs may jeopardise through an implied threat to leave and seek out a more favourable location.
TNCs may freely exploit economic, natural, and human resources of many states without respecting the basic human rights and environmental protection of their population. Nonetheless, many states are unwilling or unable to influence the behaviour of those companies effectively, or to protect their residents from abuses that may occur. 7 It is often argued that national systems should have a primary role in enforcing the accountability of non-state actors. However, victims normally face numerous obstacles in enforcing the accountability of TNCs in the national courts. 8 Hence, it is submitted that those obstacles could be addressed by recourse to certain international procedures. Unfortunately, the existing international human rights law is mainly state-centric as it creates obligations primarily upon States to promote human rights. 9 TNCs have been able to operate in a legal vacuum because international human rights law imposes no direct legal obligations on TNCs. Thus, it is imperative to encourage and to enhance the role of the host state governments to handle and to enforce the law to the TNCs that violate human rights and the rights to enjoy the healthy environment. However, in many cases the government of the developing countries are powerless and reluctant to enforce the host state law to TNCs. Take

Objective of the Research
The objective of the research, as followed: Firstly, to analyze the impacts of TNCs in economic development and social welfare in the host states. Secondly, to examine the human rights development in international law. Thirdly, to analyze and examine the violations that are done by TNCs in the host states. Finally, to analyze the role of the host state governments in protecting the human rights and the right to enjoy the healthy environment from the violations done by the TNCs.

Research Method
It is a qualitative research. Business and production globalization makes national economies and destinies of their communities to be increasingly interconnected. In traditional economic theory, FDI can, in principle, have a positive or negative impact on national welfare, but many argue that global production and competition increase efficiency of the global economy because transnational corporation encourage international labour division, so that countries become more specialized in producing goods that have a comparative advantage. 12 Competition reduces monopolistic profits and intensifies pressure for innovation. Therefore TNCs can improve national economic performance, since these firms tend to have higher productivity than domestic firms and contribute to the spread of new technologies and to raising skill levels of national labour force.
Additionally the ability of corporations to organise production at the global level is seen as giving them a huge structural strength compared to the national government and labour force at the national level. 13 However, TNCs' activity was often seen as distorting development priority and producing excess profits which were repatriated particularly in developing countries. 14

Human Rights Development in International Law
Taking into account the strong factual relationship between environmental degradation and the impairment of human rights, it is important to consider how these two fields interrelate within the law. The Czech jurist and first Secretary General of the International Institute for Human Rights in Strasbourg divided human rights into three generations as early as 1977. 15 The so-called first-generation (human) rights refer to traditional civil and political liberties prominent in Western liberal democracies, such as freedom of speech, religion, and the press, as well as freedom from torture, which presuppose a duty of non-interference on the part of government towards individuals. 16 For many years, the dominant position was that only these rights were genuine human rights. Second-generation rights have generally been considered as rights which require affirmative government action for their realisation.
Second-generation rights are often styled as group rights or collective rights, in that they pertain to the wellbeing of whole societies. 17 In contrast with first-generation rights, which have been perceived as individual entitlements, particularly the preroga- Third-generation or solidarity rights are the most recently recognised category of human rights. 19 This grouping has been distinguished from the other two categories of human rights in that its realisation is predicated not only upon both the affirmative and negative duties of the state, but also upon the behaviour of each individual. Rights in this category include self-determination as well as a host of normative expressions whose status as human rights is controversial at present. 20 These include the right to development, the right to peace, the right to a healthy environment, and the right to intergenerational equity.
In fact, the right to a healthy environment requires a healthy human habitat, including clean water, air, and soil that are free from toxins or hazards that threaten human health. Indeed, there are two main visions of how human rights doctrine could be developed to help victims of environmental degradation, which can be obtained simultaneously. 21 Given the current existence of an international human rights legal structure, the first and most immediate remedy would be to link environmental damage to an established or fundamental human right. The second, long-term theory would be to broaden substantive human rights to include an environmental human right, most likely the right to a safe environment. 22 Thus, if the right to healthy environment is recognised as an integral part of substantive human rights, the victim of environmental damage conducted by TNCs may get access to gain proportional compensation through the human rights mechanism.
The Stockholm and Rio Declarations attempt to link environmental concerns to existing international human rights, 23 such as the right to life, the right to health, and the right to an adequate standard of living. Furthermore, Agenda 21 provides an important basis for the promotion of environmental health through the application of international environmental law of both the global and international spheres. 24 19 Thomas T. Ankersen  On the other hand, in the case of protection of human rights, TNCs should be able to prevent or actively support the protection of human rights in the host states due to the great influence of TNCs in the host states. However, in reality, TNCs does not support the protection of human rights in the host states, but it is very often TNCs uses the government of the host states to support their interest by violating human rights in the host states directly or indirectly. 30 In addition, TNCs search for the most reasonably priced manufacturing and operation sites, they are inevitably drawn to countries that offer inexpensive labour and in which labour health, and other basic human rights go unenforced. Consequently, TNC business activity affects the full range of human rights and does so in a wide range of countries and industries.
Thus, the individuals affected are diverse and including employees, consumers, and the communities that surround such businesses. 28 David Graham and Ngaire Woods, "Making Corporate Self-Regulation Effective in Developing Countries". http://www.elsevier.com/locate/worlddev, accessed on 29 August, 2010. 29 It is no doubt that TNCs have the potential for introducing environmentally sound technologies in host developing countries, their actual environmental impact will, however, depend on many factors, including: i) the sectors in which they invest, the age of their facilities, their strategies -i.e., market, resource, efficiency or asset-seeking and the degree of export orientation of the investment (specially when the destination market is "environmentally-sensitive"); ii) their corporate environmental policies, their approach towards environmental management, and the magnitude and type of their linkages with domestic suppliers, clients and competitors; iii) the host country environmental regulations and their degree of enforcement and the role played by stakeholder groups such as nongovernmental organizations, consumers, workers and local communities; iv) home country regulations regarding the responsibility of MNCs shareholders for their overseas operations and the role played by third party lenders -for example, international financial institutions-in -reinforcing environmental standards as a condition of lending. See, Daniel Chudnousky and Andres Lopez, "TNCs and the Diffusion of Environmentally Friendly Technologies to Developing Countries", http:// www.fund-on/org.ai/Descagas/tncs.pdf , accessed on 25 July, 2010. 30

Violation of Human Rights Protection by TNCs in the Host States
The violations of human rights by TNCs may occur in a variety of ways, such as directly violating human rights, assisting in violations, failing to prevent violations, remaining silent about violations, or even operating in a state that violates human rights. 31 Hence, the level of an TNCs' responsibility in these varying situations differs.
Indeed, TNCs violate a wide range of human rights -from civil and political to social, economic, and cultural -and could remain unaccountable for their conduct by exploiting the loopholes of existing regulatory regimes.
For instance, forced relocation, forced labour, rape, torture and murder: these were the charges that Burmese peasants brought against the U.S. oil company, Unocal, in 1996. 32 Burma's Yadana gas field, located in the Andaman Sea about 60 kilometers off Burma's southwest coast, was developed in 1992 under a conventional "production sharing" contract between Unocal (28.26%), Total FinaElf, the project operator (31.24%), the state-owned oil companies of Thailand (PTT-EP) (25.50%), and Burma (MOGE) (15%).
The human rights abuses discussed here occurred along the 65-kilometer onshore Burmese section of the $1 billion pipeline constructed in 1998 to carry the gas 649 kilometers across Burma into Thailand. 33 However, in order to protect the citizens of these countries, to promote long-term sustainable development, and to legitimize corporate-led globalization, it is submitted that human rights concepts must be applied to these business projects.
Certainly, international human rights laws safeguard rights to life, liberty, and physical integrity by prohibiting actions that are injurious to the inherent dignity and security of the human being. Such actions include war crimes, genocide, crimes against humanity, arbitrary killing, torture, and other cruel, inhuman, or degrading treatment or punishment. 34   In most cases, these duties would focus on the matter of corporate complicity because businesses are more likely to be complicit (with their state partner) in the commission of war crimes, genocide, and crimes against humanity, rather than directly to commit those crimes themselves. As the UN Norms stipulate then, TNCs should have the obligation to avoid complicity in supplying products or services or providing financial or other material support, when they are aware that such conduct would further the design to commit war crimes, genocide, and crimes against humanity. 37

Violations of Environmental Protection by TNCs in the Host States
TNCs activities in the host states often cause environmental degradations. For example, in Ecuador, TNCs that extract oil from the ground have poisoned ecosystems, thereby endangering the welfare of indigenous people who are dependent on those ecosystems. 38 Moreover, TNC activities most commonly identified as raising environmental concerns are the export of harmful products and the export of hazardous processes or technologies. 39 Indeed, TNCs export hazardous processes by establishing highly-polluting industries outside home countries, thus creating potential problems with pollution control, disposal of hazardous wastes, workers' health and safety, and the risk of major accidents, such as the Union Carbide Chemical Disaster.  typically, these guidelines are not directed at corporations themselves (rather, they are directed at states whose task it is to apply them to the corporations within their jurisdiction).

The OECD's 1976 Guidelines for Multinational Enterprises (as revised in 2000)
recommend that enterprises respect the human rights of those affected by their activities consistent with the host government's international obligations and commitments. 46 Specifically, they recommend that enterprises contribute to policies of non-discrimination with respect to employment, to the effective abolition of child labour, and to the elimination of all forms of force or compulsory labour. However, the guidelines are not legally mandatory to OECD government or OECD-based 42 Ibid. 43 Neil.A.F Popovic, "In Pursuit of Environmental Human rights Commentary on the Draft Declaration of Principle on Human Rights and the Environment", Columbia Human Rights Law Review, Vol. 2, 1996, p. 497-498. 44 Edwin C. Mujih, "Co-Deregulation of Multinational Corporation Operating in Developing Countries: Partnering Against Corporate Social Responsibility?", African Journal of International and Comparative Law, Vol. 16, 2008, p. 252-253. 45 Ilias Bantecas, "Corporate Social Responsibility in International Law", Boston University of International Law Journal, Vol. 22, 2004, p. 311. 46 Rebecca Kathleen Atkins, "Multinational Enterprises and Workplace Reproductive Health: Extending Corporate Social responsibility", Vanderbilt Journal of Transnational Law, Vol. 40, 2007, p. 248. Company. 47 Hence the guideline is lack of enforcement either, because it is voluntary in nature.
The UN Global Compact is another soft law instrument directed at TNCs.
Though it is not strictly a code of conduct, its object is to encourage businesses to "embrace and enact" nine core principles 48 relating to respect for human rights, labour rights, and protection of the environment, both through their individual corporate practices and by supporting complementary public policy initiatives. 49 However, again, the lack of independent monitoring and enforcement 50 via sanctions highlights the limited ambition, and therefore, impact, of this initiative in providing protection against corporate abuse of human rights. 51 It is true that the UN expressly acknowledges that it has neither the mandate nor the capacity to monitor and verify corporate practices. 52 Yet, there is some concern as to the credibility of the Global Compact given that it is quite possible for TNCs to continue to violate human rights while enjoying the status of signatory to the Global Compact.
Finally, the UN Norms are phrased in mandatory terms and apply not only to transnational corporations, but also to other business enterprises, as well as their subcontractors and suppliers. 53 The UN Norms thus go many steps beyond previous guidelines, further evincing expanding notions of corporate liability. Like all of the instruments discussed above, the UN Norms are presented in the form of 47 Edwin C. Mujih,Op. Cit.,p. 254. 48 Sean D Murphy, "Taking Multinational Code of Conduct to the Next Level", Columbia Journal of Transnational Law, Vol. 43, 2005, p. 400. 49 A Guide to the Global Compact: A Practical Understanding of the Vision and Nine Principle, http:// www.unglobalcompact.org/content/Public_Documents/gcguide.pdf, accessed on, 10 October 2010. These principles were centered generally around well-accepted standards of human rights, labour rights, and environmental issues, derived from the UN Declaration of Human Rights, the International Labour Organization Declaration on Fundamental Principles and Rights at Work, and the Rio Declaration on Environment and Development: (i) To support and respect the protection of internationally proclaimed human rights; (ii) To avoid complicity in human rights abuses; (iii) To uphold freedom of association and the effective recognition of the right to collective bargaining; (iv) To eliminate all forms of forced and compulsory labor; (v) To abolish effectively child labor; (vi) To eliminate discrimination with respect to employment and occupation; (vii) To support a precautionary approach to environmental challenges; (viii) To promote greater environmental responsibilities; and (ix) To encourage the development and diffusion of environmentally friendly technologies. 50 Fla.J.Int'l L., Vol.19 2007, p. 9-10. 53 Cynthia A. William, "Civil Society Initiatives and Soft Law in the Oil and Gas industry", New York University Journal of International Law and Politic, 2004, p. 473. recommendations and guidelines that create no legally binding obligations. Although the UN Norms 54 may help establish customary law, provide guidance to courts trying to determine the extent of corporate norms, or serve as the basis for later treaties, they do not have the same effect that binding obligations have. A binding consensus of corporate obligations has proven to be difficult, but the Ruggie Report provided a framework in an effort to facilitate that goal. 55

National Regulation
Reviewing the soft law instruments of the OECD, the ILO, and the UN's Global Compact, and UN Norms 56 one might conclude that in practice they have achieved little of substance, due largely to their non-binding nature and the lack of meaningful implementation mechanisms and enforcement. 57 However, they have at least demonstrated an increased willingness on the part of certain multilateral institutions to formulate some human rights standards against which the conduct of TNCs can be measured. Indeed, there is a possibility that such soft-law initiatives may be elevated to hard-law through the formation of customary international law. However, it may be time-consuming process in a world of diverse interests to recognise soft law international instruments to be hard law. 58 It is almost inevitable that there will be adjournment before the law can properly respond to human rights abuses by TNCs, in which case there will be victims left without legal redress in the interim.
Thus, in order to accomplish the legal lacuna in international law, it is essential to enforce national law properly. The host states needs to enforce the domestic regulation of environmental practices and protection of human rights deal with the conducts of 54 Michael K Addo, "Human Rights Perspective of Corporate Groups", Connecticut Law Review, Vol. 37, 2005, p. 678. 55 Furthermore, six different sets of obligations can be deduced from the general obligations of the UN Norm that companies shall have the responsibility: 1) to use due diligence in ensuring that their activities do not contribute directly or indirectly to human rights abuses and 2) to ensure that they do not benefit directly or indirectly from those abuses; 3) to refrain from undermining efforts to promote and ensure respect for human rights; 4) to use their influence to promote respect for human rights; 5) to assess their human rights impacts; 6) to avoid complicity in human rights abuses. See, Sub-Commission on the Promotion and Protection of Human Rights, Fifty-fifth session, Commentary on the Norms on the responsibilities of transnational corporations and other business enterprises with regard to human rights. See also, U.N. Doc. E/ CN.4/Sub.2/2003/12/Rev.2, 2003. 56  TNCs properly. Since, the enforcement of national law by host states is perhaps still the most feasible and desirable method of controlling TNCs, although it poses many problems in developing countries.

Enforcing Regulations by the Host States
Due to the fact, that the international instruments deal with protection of human rights and environmental right are not effective, it is essential to exhaust national regulations to be enforced to TNCs. Since, the fact that every state has jurisdiction over crimes committed in its own territory is a universally accepted maxime. 59 However, it should take into account that the exhaustion of national regulations in order to protect human rights and the environment face many hurdles. Firstly, in some instances, the states themselves may be abusers of human rights and protection of the environment, enjoining TNCs into complicit violation against local populations.
Secondly, the states may have little or no power against the TNCs due to the strength and position of TNCs, ,and perhaps even the terms of the bilateral investment agreement or trade rules under which the TNC has gained access to the host state's territory and market. 60 Alternatively, the host state which engaged in providing incentives to a TNC for its FDI is now caught in an awkward position of having to take action to effectively regulate or perplex activities related to the particular FDI initiative. Thirdly, the host state may be the beneficial owner of a partner operating in a joint venture with the TNC, thereby compromising the host state's real ability to hold the TNC accountable for any violations of human rights. 61 Finally, the host state may simply lack the resources to engage in any action against the TNC, either because of lax environmental or labour standards which contributed to the incident at hand, or the lack of legal or judicial infrastructure to adequately try a TNC. 62 It is submitted that is appropriate to strengthen the national environmental regulations and human rights regulations in the host states. Thus, human rights approach to address environmental degradation issues caused by foreign investment 59  Consequently, in order to take benefit of the international instruments in protecting human rights and the right to enjoy the healthy environment in the host states, the government of the host states may incorporate the provision international instruments into investment contract which legally binding to the TNCs. By incorporating the international instrument in the clause of the contract will change the status of the international instruments from soft law become hard law. In essence, if the host states want to enforce national regulations to protect human rights of their citizens, the host states shall embody all the international human right instruments and environmental instruments into national regulations. However, the national regulations needs to be enforced continuously and consistently. If regulations are rarely enforced, the regulation are usually simply ignored, for instance the Nigeria's regulations. 64 Additionally, it is very important to gain public awareness of the host state citizens to augment their knowledge deal with human rights and protection of environment. If the citizens aware of their basic human rights and the rights to enjoy the healthy environment, they will affect the law enforcement of the host states. Thus, public participation and willingness of the government are the factors that may be used to enhance human rights and environmental protection by the host states from abusing by TNCs.

Conclusion
TNCs have a great power to affect a state's social and economic policies. A TNC could use its power to positively influence a country's international human 63 Peggy Rodgers Kalas, "International environmental Dispute Resolution and the Need for Access by Non-State Entities", Colorado Journal of International Environmental Law & Policy, Vol. 12, 2001, p. 192. 64 Zakia Afrin, Op. Cit., p. 224. rights practices and the protection of the environment by refusing to invest in or deal with countries violating human rights and environment standards. However, in practice, TNCs often violate human rights and the environment in the host states directly or directly. It has been submitted that in most of the major cases of reported corporate human rights abuse, the host state has been involved. Indeed, TNCs violations on the human rights and environmental protection cause a great suffering to the victims and adverse impacts to the environment which are proven by many cases in the past. Due to the facts that TNCs is not subject of international law, TNCs in a certain extent are able to escape from direct responsibility to the human rights violation and environmental protection.
In order to protect human rights and environment in the host states, such as Code of Conduct, UN Global Compact and UN Norms are lack of legal enforcement mechanism and they are not legally binding. Thus, it is indispensible the role of the house states to enforce national law to the TNCs that violate human rights protection and environment. Consequently, the enforcement requires a great commitment and willingness of states as the primary actors of international human rights law and international environmental law to enforce the instruments through international and national mechanism. Besides that, it is evident that the elements of international custom, uniform practice exist to bind TNCs to recognised international human rights and environmental standards in their international operations. Thus, the international instruments can be used to strengthen the legal basis of the host states to enforce the national law.