The responsibility of home states for violations of international obligations by their corporate citizens in fragile states

The number of multinational corporations (MNC) operating across the globe and their size have grown markedly since the 1990s. Mainly based in Global North countries, MNCs are created under the laws of their home states, from which they are separated by a corporate veil. Although home states benefit from the operations of their MNCs in other countries, they cannot be held accountable for the out-of-country actions of their corporate citizens unless, as the home state, they exercise a significant degree of control over the corporation. Meanwhile, the existence of fragile states persists. Such states frequently cannot regulate foreign companies on their soil, which often operate to lower standards abroad than in their home country. The result is that MNCs regularly violate international obligations in fragile states with impunity. In responding to this inequity, this dissertation uses Third World Approaches to International Law (TWAIL) to address the question of how international law has contributed to MNCs operating with impunity in fragile states. The dissertation attributes the persistence of an exaggerated corporate veil to the narrow application of the doctrine of state responsibility. The dissertation maintains this is manifested in the International Law Commission’s 2001 Draft Articles on Responsibility of States for Internationally Wrongful Acts (draft articles), which functions, to the benefit of the Global North, as a hindrance to the true development of the international customary law of state responsibility. As a solution, the dissertation argues in favor of increased investigation into the current state of customary law outside of the draft articles. It also proposes an application of state responsibility that holds states responsible for the acts of their corporate citizens in fragile states when states have aided or assisted a company without performing the requisite due diligence to ensure the corporation’s compliance with international law. Finally, in addition to a theoretical discussion, the dissertation addresses the above through a case study involving the violation of an arms embargo by a private military and security company in Somalia.Law, Peter A. Allard School ofGraduat