Stephany Caro Mejia and Ricardo Abend Van Dalen, DPLF Interns
In a landmark and controversial decision, the U.S. Supreme Court held in Citizens United v. FEC (2010) that the government may not restrict political speech on the basis of the speaker’s corporate identity (regardless of for-profit or non-profit status) because corporations, like natural persons, have a First Amendment right to free speech.
However, the Inter-American Court of Human Rights (“the Court”), in a recent advisory opinion issued at the request of the Republic of Panama, reached a very different conclusion regarding the rights of corporations. It affirmed that human rights belong principally to natural persons (i.e., individual human beings), and that these rights only apply to legal persons (incorporated entities) when necessary for the realization of the human rights of the natural persons who are its members. The Court took into account that the majority of international and regional human rights bodies do not grant human rights to legal persons, with the exception of the European Human Rights System and the UN Committee on the Elimination of Racial Discrimination (CERD).
According to Panama’s request for an advisory opinion, in the last few years, states have been increasingly concerned about whether legal persons are subjects of human rights under Article 1(2) of the American Convention on Human Rights (“American Convention”). Panama asked the Court to address the rights of legal persons in comparison with natural persons, as well as related topics such as collective group rights and the exhaustion of domestic remedies by legal persons. Although Panama asked eight particular questions, they all centered on the issue of whether legal persons, “inasmuch as they are composed of natural persons associated in these entities,” have human rights under, and are protected by, the American Convention.
The Court structured its response according to four main themes: 1) whether legal persons are rights-holders in the Inter-American Human Rights System; 2) the rights of indigenous and tribal communities and trade unions; 3) human rights protections of natural persons insofar as they are members of legal entities; and 4) exhaustion of local remedies by legal persons. The following discussion will primarily address points 1, 2, and 3.
In accordance with the American Convention and various civil codes in different countries of the Americas, the Court established that legal persons are “those entities, distinct from their members, with capacity to contract obligations and exercise rights, and whose capacity is restricted to the social object for which they were created” (para. 28. A). The Court interpreted Article 1(2) of the American Convention according to the rules on treaty interpretation enshrined in the Vienna Convention, particularly in Article 31(1): “A treaty shall be interpreted in good faith in accordance with the ordinary meaning to be given to the terms of the treaty in their context and in the light of its object and purpose.”
Based on these principles, the Court established that legal persons are not entitled to human rights under the American Convention and are thus not able to access the Inter-American petitions system as presumptive victims. The Court stated that in the context of the Convention as a whole there could be no reasonable alternative reading to the ordinary meaning of the text of Article 1(2) of the Convention, which establishes that the rights recognized in the treaty belong to persons, and further defines “person” as “every human being.” The Court also emphasized that the consistent references to “human person,” “man,” and “all persons” in the Convention’s Preamble and text demonstrated that it was created with the object and purpose of protecting the fundamental rights of human beings exclusively.
However, in conformity with the objective of protecting and promoting human rights, the Court did acknowledge that collective rights belong to indigenous and tribal communities. Reaffirming its case law on indigenous peoples, the Court noted that certain rights of indigenous and tribal communities need to be exercised collectively and have collective consequences that cannot be reduced merely to the level of individual victims in specific cases. Further, the Court emphasized the distinct social and cultural characteristics of indigenous and tribal communities that require special measures in accordance with international human rights law.
Notably, whereas the legal personhood of a corporation relies on an economic purpose and a corporate veil that separates the shareholders from the corporation and limits their liability, the legal personhood of an indigenous community is inextricably tied to the human rights of its members, such as communal property, self-determination, personal integrity, and freedom of assembly and association.
According to the Court’s ruling, the fact that corporate persons themselves are not the bearers of human rights does not necessarily mean that a natural person cannot seek recourse in the Inter-American System in order to have her fundamental rights upheld even if those rights are exercised exclusively through a legal person. Indeed, as shown by the example of indigenous communities, such recourse may be available in certain circumstances, depending on the specific rights involved. In other words, lack of human rights for legal persons does not establish a total prohibition on complaints by individuals who allege that their rights under the Convention are being violated, in cases where the exercise of those rights is conducted solely through a legal person, because each right under the Convention requires a particularized analysis that does justice to its distinct content and form of realization.
For example, the kinds of rights that may entitle an individual exercising those rights through a legal person to petition the Inter-American System if those rights are violated include rights involving the connection between human beings and society, such as the right to private property, free association, nationality, and so on (see the example of communal indigenous property above). By contrast, rights directly involving the vital, physical, or psychological functions of the human being, such as the right to life, personal freedom, or personal integrity, would not ordinarily be the sorts of rights that the Court would analyze as being exercised by an individual through legal persons (par. 111).
In the past, the Court has examined the alleged violation of the rights of individuals in their capacities as stockholders and as media company workers, where these individuals were exercising, through legal persons, their rights to property (in the case of the stockholders) and to freedom of expression (in the case of the media company workers). In the first case, Ivcher Bronstein Vs. Perú (2001), the Court differentiated between the rights of a company’s stockholders and those of the company itself, noting that the stockholders had certain direct rights through their membership in the company, including, for example, rights over their individual dividends (par. 114). In the second case, Granier et al. (Radio Caracas Television) vs. Venezuela (2015), the Court pointed out that media companies are means for the exercise of the right to freedom of expression of those individuals (including its own workers) who use those companies as a platform from which to spread their ideas or information (par. 115).
Given the advisory nature of the opinion, the Court did not anticipate how other rights may fare under this sort of analysis, merely noting that, just as it analyzed the right to property and the right to freedom of expression when those rights were implicated in concrete contentious cases, so will it analyze other rights when they themselves are implicated in concrete contentious cases. The Court did, however, point out that the key of the analysis is that the right in question must involve a direct and essential relation between the natural person requiring the Inter-American System’s protection and the legal person through which the violation occurred. Therefore, a simple link between the natural person and the legal person will not be enough to warrant the conclusion that the rights being defended are those of a natural person and not a legal person. In particular, the natural person’s participation in the activities of the legal person must be substantially related to the allegedly violated rights (par. 119). This gives prospective petitioners a useful preliminary measure with which to gauge their situations.
Overall, the Inter-American Court of Human Rights has used Panama’s advisory request in a strategic manner to reiterate its purpose of “safeguarding the essential rights of man in the American continent.” Given the growing presence and bargaining power of corporations in the Americas, the Court has taken an important step in explicitly outlining the key differences between natural and legal persons with regards to the Inter-American System, thereby safeguarding future victims’ human rights and access to the System itself.
 Article 1. Obligation to Respect Rights
- The States Parties to this Convention undertake to respect the rights and freedoms recognized herein and to ensure to all persons subject to their jurisdiction the free and full exercise of those rights and freedoms, without any discrimination for reasons of race, color, sex, language, religion, political or other opinion, national or social origin, economic status, birth, or any other social condition.
- For the purposes of this Convention, «person» means every human being.