Abstract
In this chapter, Drahn offers a detailed comparative account of how the UK, France, Germany, and Denmark transposed four EU directives in the policy area of Business and Human Rights. The first part focuses on the three EU public procurement directives. It works out the provisions that touch on human rights and explains to which degree the four national transpositions made use of the leeway the directives provide. Following the same structure, the second part analyses the EU Non-Financial Reporting Directive. By assigning each directive provision a human rights score, Drahn gives a qualitative assessment of member states’ willingness to go beyond the required minimum and adopt stricter human rights regulation. The chapter concludes with an account of the combined transposition, presenting an average human rights score per directive provision.
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Notes
- 1.
According to the EU Commission, public authorities spend € 1.9 trillion every year, which represents approximately 14% of the EU’s GDP (European Commission, 2016a).
- 2.
Differences can also be found regarding the threshold above which the directives apply. The exact thresholds for each directive are published on the website of the European Commission (see European Commission, 2016d). Tenders below the threshold remain under national legislation, but still must follow general principles of EU law.
- 3.
For the legal analysis of the provisions that include human rights considerations, I partly drew on the Occasional Paper by the Institute for Human Rights and Business (2015), which provides an in depth legal analysis of the EU public procurement directives.
- 4.
While this provision is “cross-cutting” (European Commission, 2016b, p. 1), recital 40 of the directive states that the social criteria should be taken into consideration when applying the exclusion criteria and when awarding the contract (see below).
- 5.
Annex X of the PSD lists twelve international conventions in the area of international social and environmental law.
- 6.
The Social clauses in the CD (Article 30(3)) and the UD (Article 36(2)) have similar wordings.
- 7.
The German term ‘vergabefremd’ was used in the interview to describe issues being external to the procurement.
- 8.
Article 71(1) in the PSD, Article 42(1) in the CD and Article 88(1) in the UD.
- 9.
Article 42(4) in the CD, and 88(6) in the UD.
- 10.
Article 79(1) in the UD, the CD does not contain a similar provision.
- 11.
Article 43(1) in the PSD, and Article 61(1) in the UD. The CD does not contain a similar provision.
- 12.
Article 64(1)-(4) in the PSD and Article 62(1) in the UD. The CD does not contain an equivalent provision.
- 13.
Technical specifications phase contains provisions on accessibility for disabled people in public buildings and in other places. The relevant provision, (Article 42(1) and Annex VII in PSD, Article 60 and Appendix VIII in UD, and Article 36, Recitals 66 and 67 in CD) require member states that all procurement that is intended to be used by persons (general public, staff etc.) has to take into account the accessibility for disabled persons, provided the requirements relate to the specific goods, works or services in question. While these clauses clearly have a social component, they are only relevant in the domestic sector and do not apply to human rights in the international context.
- 14.
Article 38 in the CD.
- 15.
Recital 70 and Article 38(4)f in the CD. The UD does not contain a similar provision, but as the report of the Institute for Human Rights and Business (2015, p. 16) suggests, the issue is covered by the overarching social clause.
- 16.
Article 38(5) in the CD.
- 17.
Derogations are possible for reasons relating to public interest such as public health or protection of the environment. In this analysis, the provision will still be regarded as mandatory.
- 18.
Recitals 105 and 106.
- 19.
Article 38(7)(a) in the CD. There is no similar provision in UD, but it allows reference to criteria under the PSD (Article 80).
- 20.
Article 84(3) in the UD. The CD does not contain a similar provision.
- 21.
Article 38 in the CD and Article 80 in the UD.
- 22.
Article 62 UD. No similar provision in the CD.
- 23.
Article 82(1) in the UD. The CD does not contain an equivalent provision.
- 24.
Article 82(2) in the UD.
- 25.
Article 76(6) in the UD.
- 26.
Recital 95 in the UD. There is no similar provision in the CD.
- 27.
Recital 97 in the UD. There is no comparable provision in the CD.
- 28.
As the International Institute for Human Rights and Business (2015, p. 21) notes, the case of Concordia Bus Finland (C-513/99) clarified that non-economic criteria, such as human rights criteria, can be used as long as the criteria remain linked to the subject matter of the contract, do not give contracting authorities unrestricted freedom of choice, are expressly mentioned in the tender, and comply with the EU’s fundamental freedoms.
- 29.
See e.g. Recital 90 and Article 67(2) in the PSD, and Recital 97 in the UD.
- 30.
Recital 103 in the UD and recital 65 in the CD.
- 31.
Article 87 in the UD and recital 64 in the CD.
- 32.
Article 90 in the UD and Article 44 in the CD.
- 33.
Article 90(b) in the UD and Article 44(b) in the CD.
- 34.
Provision PP 10 is only mandatory with discretion for the PSD and the CD. For the UD, this provision is voluntary.
- 35.
SI 2015 No. 102 Public Procurement.
- 36.
SI 2016 No. 274 Public Procurement.
- 37.
SI 2016 No. 273 Public Procurement.
- 38.
With the Gesetz zur Modernisierung des Vergaberechts (Vergaberechtsmodernisierungsgesetz—VergRModG), adopted on 17 February 2016.
- 39.
The Law Bekendtgørelse om annoncering af offentlige indkøb under tærskelværdierne med klar grænseoverskridende interesse og om anvendelsen af elektroniske kommunikationsmidler i udbud efter udbudslovens afsnit II og III was published on 17 December 2015 (Number: 1643).
- 40.
Bekendtgørelse Om fremgangsmåderne ved indgåelse af kontrakter inden for vandog energiforsyning, transport samt posttjenester, adopted on 15 December 2015.
- 41.
Bekendtgørelse Om tildeling af koncessionskontrakter, adopted 15 December 2015.
- 42.
Regulations 8 and 30–35 in the SI 2016 No. 273 and Reg. 36 in the SI 2016 No. 274.
- 43.
Articles 30 and 38 of Ordonnance 2015-899 state that the nature and scope of the demand for a public tender as well as the conditions for executing the procurement may take social concerns into account.
- 44.
Décret 2016-360 does not mention the social clause as a general principal either, it only contains the wording in Article 60, which deals with abnormally low tenders (see below). With respect to the CD, Ordonnance 2016–65 states in Articles 27 and 33 that, like Ordonnance 2015-899, the nature and scope of the demand for a concession contract as well as the conditions for executing the concessions contract may take social concerns into account.
- 45.
Article 42(1) in the CD and Article 88(1) in the UD.
- 46.
Reg. 71 in the Public Contracts Regulations, Reg. 42 in the Concession Contracts Regulations and Reg. 87 in the Utilities Contracts Regulations.
- 47.
Moreover, § 36(4) of the VgV also contains a provision requiring subcontractors to respect social concerns.
- 48.
Article 88(6) in the UD and Article 42(4) in the CD.
- 49.
Article 88(6) in the UD and Article 42(4) in the CD.
- 50.
Regulation 71(8) in the Public Contracts Regulations, Regulation 42(7) in the Concession Contracts Regulations and Regulation 87(8) in the Utilities Contracts Regulations.
- 51.
The same applies to the transposition of the UD. Executive order No. 1624 refers in § 10 to Udbudsloven § 177 para. 5.
- 52.
Articles 42(5) in the CD, and 88(7) in the UD.
- 53.
Reg. 42(2) in the Concessions Contracts Regulations and Reg. 87(2) in the Utilities Contracts Regulations.
- 54.
Article 79(1) in the UD. The CD does not contain a similar clause.
- 55.
Article 61(1) in the UD. The CD does not deal with labels.
- 56.
Article 62(1) in the UD.
- 57.
Article 57(3) states that derogations are possible for reasons of public health or where exclusion would be disproportionate. For this study, this exemption clause will not be considered as discretion.
- 58.
Regulation 57(1) in the Public Contracts Regulations and Regulation 38(8) in the Concessions Contracts Regulations.
- 59.
Recital 70 and Article 38(5)-(6).
- 60.
The same applies to the transposition of the CD. Order No. 1624 § 10 and order 1625 § 3 refer to § 135 para. 3 and § 137 (7) Udbudsloven. The transposition of the same clause in the UD is considered as discretion-passed-on, because the directive provision is voluntary.
- 61.
Article 80 in the UD (with reference to the exclusion criteria of the PSD), and Article 38(7)(a) in the CD.
- 62.
Regulation 57(8) in the Public Contracts Regulations, Regulation 80 in the Utilities Contracts Regulations, and Regulation 38(16)(a) in the Concessions Contracts Regulations.
- 63.
The same applies to the transposition of the UD and the CD. Order 1624 § 10 and in order 1625 § 3 refer to § 137 Udbudsloven.
- 64.
Article 69(3) in the PSD, and Article 84(3) in the UD. The CD does not contain a similar clause.
- 65.
Article 58(1) in the PSD, Articles 62 an 80 in the UD, and Article 38 (1)-(2) in the CD.
- 66.
Article 82 in the UD. The CD does not contain a similar provision.
- 67.
Regulation 67(3) in the Public Contracts Regulations and Regulation 82 in the Utilities Contracts Regulation.
- 68.
Interestingly, § 152 of the GWB provides the possibility to consider social aspects in the award of concession contracts, even though the CD does not require or suggest this. However, this will not be considered by this analysis.
- 69.
Recital 103 in the UD, and Recital 65 in the CD.
- 70.
Article 87 in the UD and Recital 64 in the CD.
- 71.
Regulation 70 in the Public Contracts Regulations and Regulation 86 in the Utilities Contracts Regulation.
- 72.
Recital 64.
- 73.
See Article 57(1)f of the PSD, and 38(4)f in the CD. There are no similar provision in the UD.
- 74.
Article 90 in the UD and Article 44 in the CD.
- 75.
Recital 70 and Article 38(4) f.
- 76.
Section 16 in the Danish executive order No. 1624 on utilities, and § 7(2) in the executive order No. 1625 on concessions.
- 77.
To understand and analyse the NFR-Directive from a legal perspective, an internal briefing note of the European Coalition for Corporate Justice (ECCJ) from January 2016, which was provided by the organization’s director after the expert interview, was very helpful (see Appendix II).
- 78.
Article 2(1) of the Accounting Directive provides for a more detailed definition of ‘public-interest entities’.
- 79.
Key Performance indicators are a standard accounting tools to measure the performance of companies. Non-financial indicators can include social and human rights issues but can also refer to other areas such as intellectual capital or customer satisfaction.
- 80.
Because the directive consists only of one article, these provisions do not necessarily correspond with articles or sub-articles.
- 81.
According to Kinderman (2015), the initial proposal would have applied to approximately 18.000 companies, while the final version of the NFR-Directive only applies to 6.000 companies.
- 82.
Belgium, France, Denmark, and Slovenia.
- 83.
The recital refers to the (European) Eco-Management and Audit Scheme (EMAS), the UN Guiding Principles, the OECD Guidelines for Multinational Enterprises, and the ILO’s Tripartite Declaration.
- 84.
Article 1(1)6.
- 85.
SI 2016 No. 1245 Companies Partnership, The Companies, Partnership and Groups (Accounts and Non-Financial Reporting) Regulations 2016.
- 86.
See Section on British misfit in chapter 6 for further information.
- 87.
On 24 January 2017, the Commission had opened infringement procedure with a formal notice according to Article 258 TFEU (infringement number 20170096).
- 88.
Ordonnance n° 2017-1180 du 19 juillet 2017 relative à la publication d'informations non financières par certaines grandes entreprises et certains groupes d'entreprises and Décret n° 2017-1265 du 9 août 2017 pris pour l'application de l'ordonnance n° 2017-1180 du 19 juillet 2017 relative à la publication d'informations non financières par certaines grandes entreprises et certains groupes d'entreprises.
- 89.
The third law presented as transposing the directive merely announces the adoption of the ordonnance. Article 216 of law 2017-86 (LOI n° 2017-86 du 27 janvier 2017 relative à l'égalité et à la citoyenneté), adopted on 27 January announces the ordonnance.
- 90.
Articles 2 and 4 of the transposition law will only enter into force in 2019, as will be explained further below.
- 91.
Law on strengthening non-financial company reporting in management reports (CSR-directive transposition law) (Gesetz zur Stärkung der nichtfinanziellen Berichterstattung der Unternehmen in ihren Lage- und Konzernlageberichten (CSR-Richtlinie-Umsetzungsgesetz) vom 11. April 2017).
- 92.
Lov om ændring af årsregnskabsloven og forskellige andre love.
- 93.
More specifically the Contracts Regulations state that the reporting obligations are relevant for any traded company, banking company, authorised insurance company, or a company carrying on insurance market activity.
- 94.
The requirements of the directive would only apply to all companies that are subject to accounting class D and have 500 or more employees. The Danish transposition law also applies to companies that fall into accounting class D and have less than 500 employees, and to companies that are subject to accounting class C (Danish Business Authority, 2015, p. 6).
- 95.
It should be noted that the German CSR Law uses the wording of Recital 7 to give a more detailed account of the areas in which it applies. For example, where law stipulates that the non-financial statement should include employee matters, it also lists possible measures, such as gender equality, workplace safety or the core ILO conventions. While these clarifications do not further the understanding of impact, they could make reporting in these areas more substantial.
- 96.
Article 2 of Décret 2017-1265.
- 97.
Section 99a (3).
- 98.
Which means it can potentially weaken human rights reporting.
- 99.
Section 289e in the German CSR Law.
- 100.
Section 414CB(6).
- 101.
This decision will be discussed further in chapter 6.
- 102.
This means that the report can either be published as a supplement to management report or be published online. In both cases, the management report must make a reference to the non-financial report.
- 103.
Article 1(1)5–6 in the NFR-Directive.
- 104.
Article 1(1)6 in the NFR-Directive.
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Drahn, P. (2020). Empirical Analysis I: Transposition of the Directives. In: Adoption of EU Business and Human Rights Policy. Contributions to Political Science. Springer, Cham. https://doi.org/10.1007/978-3-030-46935-1_5
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