Human Rights Watch
As Leader of Transparency Effort, Company Should Speak Out
(New York) – BP should tackle a harsh government crackdown on independent groups and activists in Azerbaijan, Human Rights Watch said in a letter released today [see below]. The crackdown has seriously compromised an international natural resource transparency initiative in which the company plays a leading role. On September 20, 2014, BP and the government of Azerbaijan, a member of the same group, the Extractive Industries Transparency Initiative (EITI), held a high-profile ceremony to mark the official start of a major new project to supply gas from Azerbaijan to Europe.
BP helps lead EITI, a coalition of governments, companies, and nongovernmental groups to encourage better governance of resource-rich countries by fostering open public debate about how oil, gas, and mining revenues are used. BP is a founding member of the effort and currently serves as an alternate on its international governing board and the lead company on its national steering group in Azerbaijan. The initiative relies on the “multi-stakeholder” participation of governments, companies, and independent organizations at all levels, but the government of Azerbaijan is impeding the activities of independent groups, flouting its commitments as an EITI member.
“BP’s leadership role in a global coalition to promote transparency gives it a responsibility to uphold the initiative’s core principles of civic participation,” said Lisa Misol, senior business and human rights researcher at Human Rights Watch. “It should press Azerbaijan’s government to end its unprecedented crackdown on independent voices.”
The government of Azerbaijan has often highlighted its participation in EITI. It is a founding member of the initiative, currently sits on the EITI international board, and is rated as a “compliant” country.
Free and active civil society participation is a cornerstone of EITI. Rules for candidates and participating countries unequivocally require respect for fundamental freedoms.
But Azerbaijan is now using restrictive new laws regulating nongovernmental organizations and other tactics to try to silence independent groups, including leading groups participating in EITI. The government has cut off funding by freezing the bank accounts of organizations and their leaders arbitrarily and without recourse, and refusing them the authorization to register new grants. Authorities have also opened politically motivated investigations for alleged tax or other violations and employed other intimidation tactics.
In its September 12 letter to the company, Human Rights Watch called on BP to raise concerns about restrictions on activists both publicly and privately and to support calls for Azerbaijan to be suspended from participation in the transparency initiative until it stops targeting activists and independent groups.
BP has requested that its reply be treated as a private communication.
The EITI board is expected to discuss Azerbaijan and decide how to respond at the next board meeting, October 14-15, in Naypyidaw, Burma. A fact-finding mission by a delegation the EITI board sent to Azerbaijan to assess conditions for nongovernmental organizations was in Baku September 20-22 and is expected to report back to the board soon.
Speaking to the Financial Times, Jonas Moberg, the head of the initiative’s secretariat, said that if EITI determines that Azerbaijan is not adhering to the rules, the board could consider suspension when it meets.
“BP and other leaders of this prominent transparency initiative should not delay action to get Azerbaijan to change its course,” Misol said. “If they don’t send a clear message soon that the government’s intimidation and harassment of activists has to stop immediately, there may be no independent groups left to participate in the effort.”
Letter to Mr. Dudley Re. BP and Azerbaijan’s Crackdown
Robert Dudley
Chief Executive Officer
BP
1 St James’s Square
London SW1Y 4PD
United Kingdom
Re: BP and Azerbaijan’s crackdown
Dear Mr. Dudley,
We are writing to urge you to take action, publicly and privately, in response to a harsh government crackdown on civil society in Azerbaijan that has seriously compromised an international natural resource transparency initiative in which BP plays a leading role.
As you know, BP is a founding member of the Extractive Industries Transparency Initiative, which was launched in 2002 by Tony Blair, then the prime minister of the United Kingdom. The effort brings together governments, companies, and nongovernmental groups to encourage better governance of resource-rich countries by fostering open public debate about how oil, gas, and mining revenues are used. Currently, BP serves both on the international governing board of the EITI, as an alternate member, and on the national EITI steering group in Azerbaijan, where it coordinates corporate representation.
As a member of the initiative’s leadership, BP has undertaken to promote the EITI standard and its underlying principles.[i] It has a particular responsibility to ensure that EITI’s “multi-stakeholder nature” as a coalition of governments, companies and nongovernmental groups “is maintained and fully reflected…at all levels.”[ii] A cornerstone of EITI is the principle of free and active civil society participation. Rules for candidates and participating countries unequivocally require respect for fundamental freedoms.[iii]
Azerbaijan, despite having been the first country to be considered fully compliant with EITI in 2009, today is blatantly flouting the initiative’s rules. The government is enforcing highly restrictive new laws regulating nongovernmental organizations and employing other tactics to systematically silence independent groups involved in EITI. The government of Azerbaijan has frozen the bank accounts of these groups arbitrarily and without recourse, and refused them the authorization to receive new grants from foreign donor organizations. This denial of all access to funding has left them unable to pay staff, rent, or utilities. Authorities also have opened politically motivated investigations for alleged tax or other violations to increase pressure on independent civic leaders who play a role in EITI. They potentially face arrest on false charges, as has already happened to dozens of government critics.
As BP has correctly stated, “the EITI is an inclusive process, involving governments, civil society and companies.”[iv] In Azerbaijan, however, the ongoing crackdown threatens the very survival of independent nongovernmental organizations, especially those that press for government accountability or engage in controversial work. Those targeted include the independent groups involved in EITI; indeed they are under such sustained attack that, in effect, the initiative is not able to function in the country. The national civil society coalition supporting EITI warned, in July, that “continuous pressures and restrictions” had forced the coalition and a majority of its members to suspend activities. The situation has only worsened since then. Human Rights Watch has documented that groups serving alongside BP on the national EITI steering group, known as the multi-stakeholder group or MSG, are among those who have been targeted and have been forced to halt activities.[v]
This situation demands firm and urgent action. The EITI process in Azerbaijan is in disarray and the credibility of the international initiative is in serious question. Given that BP plays an important role in EITI, at both the national and international level, we consider that it has a responsibility to act to publicly denounce the civil society crackdown in Azerbaijan as a “manifest breech” of EITI’s rules, to raise its concerns directly with the government of Azerbaijan at the highest levels, and to advocate within the international board of EITI for appropriate action to censure the government. In particular, we believe that the appropriate response, as defined in EITI’s rules, is for the government of Azerbaijan to be suspended from participation in EITI and from its seat on the initiative’s governing board.[vi]
We note that, in addition to its responsibilities as a leader in EITI, BP also has a reputational interest in securing better transparency over natural resource revenues in Azerbaijan. The company has significant investments in Azerbaijan’s oil and gas sector and a longstanding relationship with the state oil company, SOCAR. BP generates significant revenues for the government of Azerbaijan, which will be subject to less scrutiny if the EITI effort collapses. BP is currently expanding its investments with the “Southern Corridor Project,” a major new project to export natural gas from the Shah Deniz gas field in Azerbaijan to Europe. BP plays a lead role as the operator of the Shah Deniz consortium, in which SOCAR and other partners also hold a stake, and is partnering on the planned expansion and construction of pipelines to carry the gas to Europe.
We are aware that the Shah Deniz consortium has announced the formation of a high-level advisory panel, including EITI founder Tony Blair, to “advise on political, environmental, reputational and societal challenges that may be faced” by the project. We note that some of the key organizations in Azerbaijan that could provide the panel with useful information and perspectives on such challenges have been targeted in the government crackdown and have been forced to halt their activities. We believe that the current crackdown presents risks that merit the panel’s attention.
For all of these reasons, it seems clear to us that the serious deterioration of civil society conditions in Azerbaijan and its impact on EITI should be a matter of concern to BP. We urge that BP act without delay to take a firm stand to defend core transparency principles in Azerbaijan.
We are very interested to hear your perspective on this matter and would welcome a response by September 19, 2014. Please note that we may publicly call on BP to take action at that time, referencing this letter. We would be happy to be able to incorporate your response.
Thank you so much for your attention to this issue and we look forward to remaining in contact. If you have any questions, you may contact our colleague Lisa Misol.
Sincerely,
Arvind Ganesan
Business and Human Rights Director
Human Rights Watch
Hugh Williamson
Europe and Central Asia Director
Human Rights Watch