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Stabilization Clauses and Human Rights: The Role of Transparency Initiatives

  • Sotonye FrankEmail author
Chapter
Part of the Interdisciplinary Studies in Human Rights book series (CHREN, volume 3)

Abstract

This chapter examines the impact of transparency initiatives undertaken by several African countries as part of the Extractive Industries Transparency Initiative (EITI) on the scope of stabilization clauses in these countries’ contracts. In particular, it looks at the effect of the transparency initiatives on the potential impact of stabilization clauses on the protection and promotion of human rights.

Using case studies of Tanzania, Liberia, Sierra Leone and Zambia, it argues that there is a link between a lack of transparency in the extractive industry contractual process and the scope of stabilization clauses, and this has implications for human rights. The broadest and most stringent forms of stabilization clauses exempting investors from the applicability of all change in law are usually agreed upon under opaque circumstances and promoted by regimes known or widely perceived to be corrupt. The broad scope of these clauses allows investors to rely on them to evade laws enacted to promote and protect human rights. As a result, the clauses impose constraints on the countries’ abilities to implement their human rights obligations under international law.

Conversely, the introduction of transparency initiatives in the extractive industries of the countries as a result of their involvement with the EITI contributed, at least in part, to a reduction in the scope of stabilization clauses or an abolition of stabilization clauses altogether. As a result, investors are less likely to be able to rely on stabilization clauses to avoid complying with laws enacted to promote and protect human rights. The findings therefore suggest that as more African countries join the EITI and begin to implement measures to improve transparency in their extractive industries, the potential impact of stabilization clauses on human rights diminishes.

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Copyright information

© Springer Nature Switzerland AG 2019

Authors and Affiliations

  1. 1.Rivers State UniversityPort HarcourtNigeria

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