Mercosur Consulting Group, Ltd.

International Energy and Environmental Law - International Legal Developments Year in Review: 2023

Co-editors of this article are Candace S. Chandra and Danielle Edwards; Authors of this article are Ricardo Silva, Sara Frazão, Madalena Osório, Judy Boyd and Thomas Andrew O’Keefe

This article discusses significant legal developments in the areas of international energy and environmental law from 2023. It outlines updates from Angola, Gabon, Guyana, Norway, Portugal, Republic of Congo, Suriname and Timor-Leste.

International Energy and Environmental Law - International Legal Developments Year in Review: 2023 This Article discusses significant legal developments in the areas of international energy and environmental law from 2023.

As published in the July 18, 2024 issue of the Latin America Advisor

"How Effective is Latin America's MERCOSUR Bloc"

www.thedialogue.org

Responsabilidad Ambiental Empresarial: Utopia o una alternativa en la que todos ganan? 15 de julio de 2024, Buenos Aires, Argentina

The Impact of ESG and Human Rights Due Diligence on the Western Hemisphere Energy Sector

Thursday, February 29, 2024
4 pm to 5:30 PM

Hilton University of Houston, Flamingo Room
4450 University Drive, Houston, Texas

Sponsoring ABA International Law Section Committee: International Energy and Environmental Law

Program Chair: Danielle Edwards, Roseau, Dominica

Moderator: Thomas Andrew O'Keefe, President, Mercosur Consulting Group, Ltd, New York, NY

Speakers:
Austin J. Pierce, Associate, Latham & Watkins LLC, Houston, Texas

Sharon G.K. Singh, Partner, Bennett Jones LLP, Vancouver

Wendy M. Taube, Attorney, Taube Law LLC, Chicago, Illinois

Gina S. Warren, Co-Director of the EENR Center, University of Houston Law Center, Houston, TX

Publicado en elDial.com 15 de agosto de 2023

Una Propuesta Caribeña para Obtener Mayores Fondos para la
Adaptación al Cambio Climático

Por Thomas Andrew O’Keefe

"En la agenda de la Cumbre para Un Nuevo Pacto Financiero Mundial organizado por el presidente francés Emmanuel Macron en París entre el 22 y 23 de junio de 2023, figuraban propuestas para reestructurar el sistema financiero multilateral y así proveer más recursos para responder adecuadamente a los desafíos presentados por el cambio climático. Muchas de estas reformas forman parte de un paquete de medidas inicialmente propuestas por Barbados, uno de los países más pequeños del mundo."

As Published on American University's Center for Latin American and Latino Studies Blog on June 14, 2023

Caribbean: Addressing Climate Change Through Global Finance Reform

By Thomas Andrew O'Keefe

Initiatives launched by Barbadian Prime Minister Mia Mottley to reschedule the debt of Caribbean countries hit especially hard by climate change and to reform international lender practices are gaining momentum.

In 2021 Mottley called for the suspension of debt and interest payments owed to multilateral financial institutions by Small Island Developing States (SIDS) while they respond to natural disasters exacerbated by climate change. (Half of the 39 UN-recognized SIDS countries are in the Caribbean.) Among the world’s most indebted countries per capita because of their tiny domestic capital markets and low tax bases, SIDS countries cannot pay their debt while also devoting scarce resources to rebuild critical infrastructure.

The government of Barbados also proposed important reforms to the multilateral lending system in preparation for the United Nations Framework Convention on Climate Change Conference of the Parties (COP 27) in Sharm el-Sheikh, Egypt, last November. Labeled the “Bridgetown Initiative,” the package included bold proposals:

– Redirecting up to $100 billion in unused IMF Special Drawing Rights (SDRs) for SIDS, allowing member governments to exchange their SDRs to borrow from one another’s central bank reserves at very low interest rates in response to an economic crisis.

– Operationalizing a $45 billion IMF-administered Resilience and Sustainability Trust.

– Having multilateral development banks make $1 trillion in multilateral loans at concessional rates to fund climate change adaptation and resiliency in the developing world.

– Leveraging an additional $650 billion held by the IMF to set up a Climate Mitigation Trust that would attract much larger private-sector capital to invest directly in carbon-free energy projects, for example, and avoid governments incurring more debt.

These initiatives are starting to have an impact. The Inter-American Development Bank has announced plans to include a “hurricane clause” in its loan agreements with Central American and Caribbean member states, deferring principal payments for up to two years. Advocates hope the World Bank, Asian Development Bank, and others take steps as well. They also want commercial banks and other private lenders – which hold much of the SIDS’ foreign debt – to adopt payment suspension clauses.

International political support is growing for the proposed lending flexibility. Key elements have been endorsed by French President Emmanuel Macron, who has prioritized discussion on them at the June 22‑23 Summit on a New Global Financing Pact in Paris. IMF Managing Director Kristalina Georgieva and U.S. Special Presidential Envoy for Climate Change John Kerry have also expressed their approval. The World Bank Group launched an Evolution Roadmap in January to better address cross-border challenges such as climate change that affect its ability to promote economic growth, poverty reduction, and human development. An internal Bank committee completed an initial report on proposed reforms in time for the World Bank Group’s meeting in Washington in mid-April.

The SIDS nations have contributed least to the climate crisis but are most impacted by more frequent and ferocious hurricanes and typhoons, rising sea levels, unpredictable rainfall, and increasingly acidic oceans that wipe out critical food resources. In the Caribbean, the vital tourism industry is also suffering as piles of rotting sargassum seaweed, which is driven in part by climate change, arrive on its beaches.

An important reason the Barbadian proposals for reforming the global financial architecture may succeed is that they are not pleas for no-strings-attached compensation or reparations. Instead, they are focused on making the existing multilateral lending system more flexible to better meet the needs of governments to respond to the climate crisis and create incentives for increased private-sector investment – which will improve the countries’ ability to pay their existing debts. In contrast, an additional recommendation put forward by Barbados and other developing countries at COP 27 to tax fossil fuel companies based on their carbon emissions or impose an international carbon border tax to fund so-called “loss and damage” grants for climate vulnerable developing nations has yet to get more traction.

* Thomas Andrew O’Keefe is the President of Mercosur Consulting Group, Ltd. and currently serves as Chief of Party of the Caribbean Business Enabling Environment Reform (CBEE‑R) project based in Barbados.

https://aulablog.net/2023/06/14/caribbean-addressing-climate-change-through-global-finance-reform/

Environment, Conflicts, and Climate Change: Resilient Rule of Law

A Rule of Law Webathon presentation hosted by the Inter American Bar Association (IABA)

Monday, May 15, 2023 @ 10:00 EDT// 14:00 GMT // 16:00 CEST

Environmental degradation and competition over scarce natural resources can directly cause and exacerbate the root causes of social conflicts and wars, driving greater environmental damage and undermining prospects for peace. These forces can also threaten our societal infrastructures and violate basic human rights, such as the right to clean air and water, adequate nutritious food, a healthy environment, and a stable global climate. This panel will reflect on how the rule of law is an essential component of good environmental governance. Our panelists will discuss human rights and environmental due diligence, access to effective remedies, and conflict prevention and peacebuilding.

Program Chair/Moderator:
Lourdes Venes – Secretary General, IABA
Lizzette Robleto de Howarth – IAB Senior Member

Keynote Speaker:
Gabriela Ramos – Assistant Director-General, UNESCO

Speakers:
María Sofía Sagües
Daniel Sumalavia – Amazon Sustainable Landscapes Program gender specialist World Bank Group
Julian Newman – Campaigns Director, Environmental Investigation Agency
Thomas O’Keefe – President, Mercosur Consulting Group, Ltd.
David Sullivan – U.S. National Contact Point for the OECD Guidelines for Multinational Enterprises (on Responsible Business Conduct), and Senior Advisor on Corporate Social Responsibility, Bureau of Economic and Business Affairs, U.S. Department of State

REGISTER AT:

Welcome! You are invited to join a webinar: Environment, Conflicts, and Climate Change: Resilient Rule of Law . After registering, you will receive a confirmation email about joining the webinar. Environmental degradation and competition over scarce natural resources can directly cause and exacerbate the root causes of social conflicts and wars, driving greater environmental damage and undermining prospects for peace. These forces can also threaten our societal infrastructures and violate ba...

As Published in the May 9, 2023 Issue of the Latin America Advisor

"What Would an E.U.-MERCOSUR Trade Agreement Bring?"
https://www.thedialogue.org/wp-content/uploads/2023/05/LAA230509.pdf

Beyond Lawyering – Success in Law on Your Own Terms: Navigating Alternative Career Pathways for Individuals with Lawyer Degrees

Thursday, May 4, 2023, 2:30 PM-4 PM
Sheraton New York Times Square Hotel
811 Seventh Avenue at West 53rd Street
New York, New York

Sponsoring Committees: Young Lawyers Interest Network, AIJA – International Association of Young Lawyers, American Bar Association's Young Lawyers Division

Program Chair/Speaker:
Maritza T. Adonis, Lawyer and Lobbyist, Washington, DC

Speakers:
Itzik Amiel, International Speaker, Bestselling Author, Legal Professional Development Mentor, Attorney-at-Law, Amsterdam, Netherlands
Cecilia Barrero, Managing Partner, CE Barrero, Boston, MA
Federico Gurdian, Managing Partner, Garcia & Bodan, Managua Nicaragua
Thomas Andrew O’Keefe, Chief of Party, Caribbean Business Enabling Environment Reform Activity,
Bridgetown, Barbados
Sylvia Quaye, Attorney at Law, SSQuaye Law PLLC, Prospect, KY

https://web.cvent.com/event/e2dba0b5-a458-4e35-aa7c-43ebe7dc6fe7/summary

As Published in the December 22, 2022 Issue of the Latin America Advisor:

Is the MERCOSUR Trade Bloc Headed for a Breakup?
http://www.thedialogue.org/wp-content/uploads/2022/12/LAA221222.pdf

Publicado en: elDial.com - DC3117 - 15/11/2022
Lo que se Necesita para Convertir América del Sur en un Proveedor Global del Hidrógeno Verde
Por Thomas Andrew O’Keefe(*)

El hidrógeno es uno de los elementos que se encuentra con más frecuencia en el universo, aunque nunca lo podemos encontrar en su estado puro, sino compuesto con otros elementos. Cuando se produce a base del agua, se utiliza un proceso de electrólisis donde se aplica una corriente eléctrica para separar las moléculas de hidrógeno de las de oxígeno. El gas que resulta de este proceso se puede quemar con fines energéticos o es posible utilizado para potenciar células o pilas de combustible.

La producción del hidrógeno no es un nuevo fenómeno en Sudamérica. Muchos países del continente ya son importantes productores y es utilizado para la refinación del petróleo crudo, la producción de amoníaco y metanol sintético, y en la industria metalúrgica. Actualmente, la electricidad utilizada para el proceso de electrólisis en Sudamérica depende exclusivamente del uso de combustibles fósiles. Esto explica porque la producción del hidrógeno es uno de los mayores contribuyentes a la emisión de gases de efecto invernadero en algunos países sudamericanos. Lo que convierte el hidrógeno en “verde” es el uso exclusivo de la electrólisis a base de fuentes de energía renovable o que no emite dióxido de carbón, como sería la energía eólica, geotérmica, hídrica, nuclear, y solar.

En 2020, la administración saliente de Sebastián Piñera en Chile puso en marcha un plan para convertir el país en un importante exportador a nivel mundial del hidrógeno verde por el año 2030. Mientras tanto, la empresa australiana Fortescue anunció a fines del 2021 su intención de invertir 8.2 mil millones de dólares norteamericanos en la construcción de una masiva instalación en la provincia argentina de Rio Negro para elaborar hidrógeno verde destinado al mercado internacional. Argentina, desde 2008, ya goza de un proyecto piloto para producir el hidrógeno verde utilizando energía eólica para el proceso electrolítico. Argentina, igual que Brasil, también son los únicos países sudamericanos que, hasta la fecha, tienen normas establecidas de seguridad para la producción del hidrógeno.

Tal vez los dos países sudamericanos que actualmente están mejor posicionados para atraer inversiones en el sector de hidrógeno verde son Chile y Uruguay, ya que lograron establecer sus planes de energía a largo plazo después de un arduo proceso de consultas previas para llegar a un consenso nacional. Estos dos países también ofrecen políticas económicas estables además de un proceso regulatorio que es predecible para los inversionistas. Estos mismos factores explican porque que los dos países están liderando la transición hacia una matriz energética ecológicamente limpia en Sudamérica. Para dar dos ejemplos, el sistema de metro en Santiago hoy opera exclusivamente a base de energía renovable, mientras que Uruguay se encuentra en segundo lugar a nivel mundial detrás de Dinamarca en cuanto al uso de fuentes eólicas para generar la electricidad. Lo que también es interesante es que Chile, a diferencia de lo que marcó su impresionante transición hacia un mayor uso de energía renovable, ahora está pensando usar subsidios para fomentar su industria de hidrógeno verde.

Los países sudamericanos con las mayores reservas de gas natural, como lo son Argentina, Bolivia, Brasil, Colombia, y Perú, poseen la posibilidad de producir lo que se denomina el hidrógeno “azul” que, a pesar de utilizar un combustible fósil para la electrólisis, también incorpora tecnología para la captura y almacenamiento de carbono. Es importante resaltar, eso sí, que aún no se cuenta con la tecnología adecuada para garantizar que no haya ningún escape de gases de efecto invernadero en toda la cadena de producción, comenzando con la extracción gasífera, su transporte, su uso como fuente de energía y eventual captura y almacenamiento. Otra tecnología crítica que aún está por desarrollar es la manera de compensar la densidad baja del hidrógeno para que sea más competitivo en cuanto a costo. Sin ese hallazgo, se necesita tres veces más espacio para el almacenamiento de hidrógeno que el equivalente de gas natural para generar la misma potencia energética.

Para que América del Sur surja como una potencia mundial en cuanto a la producción de hidrógeno verde será necesario que se desarrollen nuevas y menos costosos tecnologías y que estas vengan idealmente del continente mismo. Entre las más importantes, está encontrar una manera de transportar el hidrógeno a larga distancia en forma mucho menos contaminantes que el transporte por barcos que actualmente utilizan combustibles provenientes de fuentes fósiles. El mismo hidrógeno podría ofrecer una solución si se lo puede convertir en combustibles sintéticos a base de amoníaco o metanol o en forma líquida para los medios de transporte. También será necesario establecer un marco regulatorio y de certificación armonizada a nivel internacional para verificar la neutralidad climática, lo que significa, emisiones netas de carbono cero, en todo el proceso de producción del hidrógeno verde.

Para no tener que depender en tecnologías foráneas, los gobiernos sudamericanos debieran fomentar la investigación y el desarrollo de nuevas tecnologías a nivel continental o regional para poder reducir los altos costos actuales para producir el hidrógeno verde. Los recursos para este tipo de investigación y desarrollo podrían ser provistos por la antigua Corporación Andina de Fomento (CAF) o, hoy en día, el Banco de Desarrollo de América Latina con sede en Montevideo igual como del Fondo para la Convergencia Estructural del MERCOSUR (FOCIM). Por su parte, los procesos de integración regionales como la Comunidad Andina y el MERCOSUR pueden facilitar la creación de cadenas productivas regionales para la elaboración de insumos que se necesitan para la producción del hidrógeno verde como las células o pilas de combustible y los electrolizadores.

Finalmente, es aconsejable que los países sudamericanos enfoquen sus esfuerzos primero en exportar el hidrógeno verde a mercados regionales, usando las redes de gasoductos y oleoductos existentes y rehabilitados para este propósito. Una vez que se ha logrado descarbonizar todo el sistema de transporte e industrias en el continente, Sudamérica estará en condiciones para exportar exitosamente el hidrógeno verde en forma masiva al resto del mundo.

(*) Presidente de Mercosur Consulting Group, Ltd. [https://www.mercosurconsulting.net] con sede en Nueva York y profesor del programa de Relaciones Internacionales de Stanford University en California

Welcome to Mercosur Consulting Group, Ltd.

As Published in the September 2022 Issue of the American Bar Association's Dispute Resolution Section's Just Resolutions Newsletter

Putting Civility at the Core of a New Federal Process for Consultation with Native American Communities
By Thomas Andrew O'Keefe

https://www.americanbar.org/groups/dispute_resolution/publications/JustResolutions/september-2022/civility-at-the-core-of-federal-process-for-consultation-with-native-american-communities/

As Published in the August 30, 2022 Issue of the Latin America Advisor "Will the EU and MEROSUR Revive Their Stalled Talks?"
https://lnkd.in/ebQXt7aQ

As published in the July/August 2022 issue of Washington Lawyer

Creating a Robust Tribal Consultation Process
By Thomas Andrew O'Keefe

This article examines the initiative launched in the last months of the Clinton White House and picked up again by the Obama administration to establish a federal consultation mechanism with tribal governments which now serves as the foundation for the Biden administration’s current efforts at enhancement. The article concludes with a set of policy recommendations as to what a new federal consultation process should ideally include in order to facilitate genuine and respectful dialogue with Native American communities that contributes to meaningful consensus building.

THE FULL TEXT OF THE ARTICLE IS AVAILABLE AT:
https://washingtonlawyer.dcbar.org/julyaugust2022/index.php #/p/42

As Posted on American University's Center for Latin American and Latino Studies Blog on June 3, 2022

South America: Future Global Green Hydrogen Hub?
by Thomas Andrew O’Keefe*

A handful of South American countries have long produced hydrogen using fossil fuels for their domestic hydrocarbon, steel, and petrochemical industries, but early efforts by Brazil, Chile and Uruguay to shift to renewable and carbon-free energy sources, along with the emergence of new lower-cost technologies, could position the continent as a leading global green hydrogen supplier.

Hydrogen is the most abundant element in the universe and can be produced from water utilizing the electrolysis process whereby a direct current is applied to separate hydrogen and oxygen molecules. The hydrogen gas that is produced can be either burned – for heat or to generate electricity – or stored in fuel cells that produce electricity to power transportation.

South America has been producing hydrogen for several decades. Many countries on the continent are already important hydrogen producers for the steel and petrochemical industries, including the manufacture of fertilizers, as well as for refining heavy-crude petroleum products. The electricity to facilitate electrolysis in South America currently relies exclusively on fossil fuels. This explains why hydrogen production is today a major source of greenhouse emissions in some South American countries.

Countries with substantial hydrocarbon reserves such as Argentina, Bolivia, Brazil, Colombia, and Peru also have the potential to utilize natural gas to produce so-called “blue” hydrogen, which incorporates carbon-capture and storage technology. The technologies to ensure the elimination of all greenhouse house emissions associated with the extraction, transport, and use of natural gas have yet to be developed.

Three South American countries have a jump on producing “green” hydrogen, made exclusively with renewable and carbon-free energy resources such as geothermal, hydro, solar, wind, and even nuclear power for electrolysis.

In 2020 the outgoing administration of Sebastián Piñera of Chile launched an ambitious plan to convert the country into a major global exporter of green hydrogen by 2030. An Australian company at the end of 2021 announced plans to invest $8.2 billion to build a major export-oriented green hydrogen complex in the southern Argentine province of Rio Negro. A pilot project in Argentina has been producing small amounts of electrolytic hydrogen from wind power since 2008.

Chile and Uruguay are best positioned to attract green hydrogen investment projects, given their long-term national energy plans forged through extensive stakeholder consensus-building efforts as well as stable economic policies and predictable regulatory frameworks. These factors contributed to putting both countries at the forefront of the continent’s transition to a greener energy matrix. The Santiago metro system, for example, is now powered exclusively by renewable energy, while Uruguay is often ranked behind Denmark as a global leader in terms of wind-generated electricity.

Converting South America into a major global green hydrogen exporter will require new and less costly technologies to produce, transport, and consume it. Ideally, South American governments should encourage regional research and development of new technologies to reduce the current high costs to produce green hydrogen, perhaps with funding from the Development Bank of Latin America (CAF), which is now based in Montevideo, or the Fund for the Structural Convergence of the MERCOSUR (FOCIM). Regional economic integration schemes such as the Andean Community and MERCOSUR can also facilitate the creation of new supply chains for manufacturing competitively priced inputs such as fuel cells and electrolysers to produce hydrogen from water. Another missing piece is a low-cost way to overcome hydrogen’s comparatively low energy density. At present you need about three times more space to store hydrogen to make the equivalent level of energy sourced from natural gas. Retrofitting existing pipeline networks and devising innovative ways to more cheaply transport hydrogen over long distances, is also necessary.

South American countries would be wise to decarbonize domestic transport and industry through wide-spread use of green hydrogen before making the leap to global exports. Serving global markets sustainably will also require the deployment of low-carbon transport options to replace the current fleet of long-distance ships that rely on highly polluting diesel. Utilizing liquid hydrogen or ammonia and even methanol produced with green hydrogen to power ocean-going vessels may provide the solution.

June 3, 2022

* Thomas Andrew O’Keefe is President of Mercosur Consulting Group, Ltd. and a lecturer with the International Relations Program at Stanford University.

https://aulablog.net/2022/06/03/south-america-future-global-green-hydrogen-hub/

RESPONSE TO AXEL KAISER's OP-ED ARTICLE ON CHILE IN THE WALL STREET JOURNAL

To The Editor:

Axel Kaiser in his Op Ed "President-Elect Boric Aims to Undo Chile's Economic Progress" (WSJ, December 21, 2021) displays the same extremist rhetoric that caused conservative Jose Antonio Kast to go from a first round victory on November 21 to a stunning double digit defeat in the runoff a month later. An example is linking the Mapuche struggle for the return of stolen lands and for autonomy in southern Chile to terrorism.

Kaiser correctly describes the December 19 runoff as a referendum, and retaining the status quo was rejected by a significant majority of Chileans. No one can deny Chile's success in harnessing the free market to bring millions of its citizens into the middle class. What Chileans want to change, however, is the concentration of wealth in the hands of a few who pay little in income tax, while most struggle to get by on meager salaries, contend with substandard public education and health services and, upon retirement, receive pensions that leave them mired in poverty.

Ironically, the best guarantee that the Boric administration won't go off the rails on some radical adventure is the statistic cited by Kaiser himself: at least 64.3% of Chileans are middle class as defined by the World Bank.

Thomas Andrew O'Keefe, President
Mercosur Consulting Group, Ltd.
New York, New York

AS POSTED ON AMERICAN UNIVERSITY'S CENTER FOR LATIN AMERICAN AND LATINO STUDIES BLOG, OCTOBER 28, 2021

Putting “Teeth” in the Requirement for Consultation with Indigenous Peoples
By Thomas Andrew O’Keefe*

In no other region of the world have as many countries ratified International Labor Organization Convention 169 – requiring that governments consult Indigenous communities before approving projects that may detrimentally impact them – as Latin America, but human rights due diligence standards adopted by companies involved in investment projects are proving much more effective in guaranteeing adequate and effective consultations rather than government action. This is true even though ILO 169 requires that governments consult with local communities before giving the green light to investment or development projects that affect Indigenous lands, natural resources, and water supplies.

Neither Canada nor the United States has ratified ILO 169, and they were among only four countries that voted against the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP) when it came up for a vote in the UN General Assembly in 2007, which endorsed the “free, prior, and informed consent” principle. Colombia was the only Latin American country not to fully embrace the UNDRIP.

Despite widespread ratification of ILO 169 and endorsement of the UNDRIP, Latin America is plagued by social conflicts involving Indigenous peoples who feel they were never adequately consulted. The most infamous example was in 2009 at Bagua in Amazonian Peru, when the administration of President Alan García used lethal force to counter protests by Indigenous peoples opposed to legal changes that facilitated energy, mining, and agricultural concessions on their lands. The violence resulted in the deaths of 34 people (mostly policemen) and hundreds of injured. Many of these social conflicts have delayed the completion of major energy and mining projects throughout Latin America for years, sometimes forcing their abandonment or the revocation by governments of previously granted concessions. The direct financial losses incurred by businesses have been huge, not to mention the damage to corporate branding image.

One reason for persistent conflicts throughout Latin America is that ILO 169 offers no definitive answer as to what happens if an Indigenous community vetoes a proposed project. Presumably that wouldn’t occur if the consultation were effective. But ILO 169 is vague on the precise consultation process a government must follow, leading to wide national variations as to who must be consulted and how. Although the UNDRIP implies that Indigenous peoples have the right to reject a project, its provisions are not considered legally binding by most governments unless specifically incorporated into domestic law. Even in Bolivia, one of the few countries where “free, prior and informed consent” is the law of the land, this did not prevent the administration of President Evo Morales from going ahead with a highway through the TIPNIS reserve in eastern Bolivia over the objections of its Indigenous inhabitants.

The growing importance of Environmental, Social and Governance (ESG) criteria in corporate decision-making, including the adoption of internal human rights due diligence policies and practices, may finally lead to effective consultation mechanisms that accept the notion that Indigenous peoples have the final say in either approving or rejecting a project that threatens their way of life or will permanently displace them from ancestral lands. For one thing, good faith consultation with Indigenous peoples is now a recognized international human right. More importantly, businesses are not absolved by a government’s failure to fulfill the obligation to consult Indigenous peoples on projects affecting them.

Multilateral lending agencies such as the Inter-American Development Bank have developed performance standards that include a consent requirement that must be adhered to by any company seeking their financing for investment projects that may impact Indigenous people. In addition, equity investors with investment risk management concerns are emerging as important guarantors of corporate consultation and consent with Indigenous communities, particularly in the natural resource extraction industry.
If the ESG criteria weren’t a big enough stick for private sector compliance, there is also an emerging trend in Europe and at the UN to make human rights due diligence principles mandatory for businesses. For example, France passed a law in 2017 that requires companies with a substantial presence in the country to adopt reasonable vigilance measures to allow for risk identification and for the prevention of severe violations of human rights directly or indirectly from the operations of the companies and their subsidiaries. Businesses that do not meet their vigilance obligations are liable for damages incurred by victims. These emerging legal obligations encompass not only the foreign operations of corporations but increasingly extend to the entire production and supply chain.
October 28, 2021

* Thomas Andrew O’Keefe is the President of Mercosur Consulting Group, Ltd and author of the chapter “Human Rights Due Diligence Practices for Adequate and Effective Consultation with Indigenous Peoples” in a forthcoming book to be published by the American Bar Association.

Putting “Teeth” in the Requirement for Consultation with Indigenous Peoples By Thomas Andrew O’Keefe* Indigenous groups in Bolivia march in defense of the TIPNIS/ Pablo Andrés Rivero/ Flickr/ Creative Commons License In no other region of the world have as many countries r…