Contracting for Human Rights: Looking to Version 2.0 of the ABA Model Contract Clauses

Contracting for Human Rights: Looking to Version 2.0 of the ABA Model Contract Clauses

68 Am. U. L. Rev. 1519 (2019).

* Associate Professor of Law, Rutgers Law School.  I am deeply grateful to Jennifer Martin and David Snyder for their invitation to participate in the American University Law Review’s Symposium:  New Perspectives:  A Discussion on Modern Global Supply Chains and for their and other participants’ comments on this contribution.  I also extend sincere thanks to the participants of the Business and Human Rights Scholars Conference (2019), KCON (2019), and Innovate Rights (2019) for their comments and feedback, and to Tara Richelo for outstanding research assistance.

This Article offers a commentary on the American Bar Association’s initiative to craft model contract clauses that U.S. buyer companies can include in their contracts with suppliers. The purpose of the model contract clauses (“MCCs”) is to deepen the protection of human rights along the supply chain.  This Article briefly explains how the MCCs work and highlights two valuable contributions of the MCCs to the business and human rights space.  First, the MCCs effectively take buyers’ non-bindinghuman rights policies and put them into practice by incorporating them as contractually enforceable appendices to the supply agreements.  Second, the MCCs serve to relax the legally outdated distinction between product and process regulation by treating a product’s human rights conformity as being on contractual par with a product’s technical conformity (e.g., quantity, size, design).  Both of these contributions are hugely beneficial for purposes of advancing the protection of human rights within global supply chains.  This Article then discusses a central shortcoming of the MCCs, which is that the clauses shift all responsibility for human rights violations onto the supplier, ignoring the reality that the buyer’spurchasing practices can be a serious contributing factor to the occurrence of violations.  It concludes with some preliminary recommendations for improving the MCCs, in anticipation of a possible version 2.0 of the clauses.