Danish NCP findings in Maersk case

About the case 

• On 19 October 2021, two small law firms (French and Cameroonian) filed a complaint against A.P. Moeller- Maersk (Maersk) with the Danish OECD National Contact Point (NCP) on behalf of 337 former employees of Maersk’s subsidiary Douala International Terminal (DIT) in Cameroon.  On 6 May, the Danish NCP published a final statement, including its findings and recommendations
• In 2004, Maersk was awarded a 15-year contract for the renovation and management of the container terminal in the Port Authority of Douala, Cameroon. In 2005, DIT was created as a joint venture between Maersk, the French company Bollore, and private shareholders to operate the terminal. Maersk did not hold a majority stake in DIT; however it did hold the managing director position from 2014. In 2019 DIT was unexpectedly excluded from the tender process for the future operation of the port and by June 2022 Maersk had completely exited DIT.  
• The NCP complaint alleged that from 2004 to 2019 (the period of DIT’s management of the container terminal)
  • Maersk failed to exercise due diligence on its business relationship with DIT 
  • DIT imposed harsh working conditions, including excessive and forced overtime, and the associated health and safety risks amounted to forced labour   
  • DIT intentionally withheld the workers’ administrative documents and did not issue work certificates to workers when DIT’s contract for the terminal ended
  • DIT and Maersk were aware of the above worker’s rights complaints and failed to address them  
  • DIT withheld dividends of shares from workers and unilaterally changed an agreement with workers to provide them with shares. 
• Maersk declined to participate in mediation but provided some documentation in the investigation process. 

NCP findings 

• This is a complicated case because it spans two versions of the OECD Guidelines (2000 and 2011) and so the NCP had to assess the complaint against different versions of the Guidelines depending on when the impacts allegedly occurred. The NCP also separately assessed the period before and after DIT’s management of the container terminal.  
• The NCP dismissed or excluded many of the claims in the case because they were out of scope or there was insufficient evidence to substantiate them.
  • The NCP did not consider claims of embezzlement of shareholder rights since this does not fall within the scope of the NCP’s mandate. 
  • The NCP found that the claimants did not provide sufficient evidence of forced labour.  
  • The NCP was not able to determine if DIT held meaningful stakeholder engagement with workers –  DIT held regular meetings with worker representatives throughout the period, but the content of the meetings were not documented.  
  • The NCP found that there was not sufficient evidence to determine whether the standards of employment were worse in DIT than with comparable employers as required in the 2011 version of the OECD Guidelines. There was also insufficient evidence that DIT did not take adequate health and safety measures onsite.  
  • The NCP found that the failure to issue work certificates at the end of DIT’s management of the terminal had an adverse impact on workers, but that Maersk did not have control over this matter since the Port Authority requisitioned their assets including documentation when they took over the port.   
  • The NCP found that DIT was only given one month notice by the Port Authority of Douala that it would no longer be managing the terminal and so it was not possible for DIT to have informed workers sooner of the exit.  
• The NCP found that Maersk did not meet the Guidelines in the following instances
  • Maersk conducted human rights risk assessments in 2015 and 2017 and identified and prioritised several human rights risks. However, Maersk did not provide evidence of whether more in-depth risk assessments were conducted on-site or whether any actions were taken to prevent or mitigate the prioritised risks. 
  • Maersk required DIT to have a Code of Conduct, but did not show evidence that it monitored or audited DIT against the Code of Conduct.
  • Maersk did not carry out a risk assessment during the exit process from DIT. 
  • In 2020 and 2023 Maersk developed a Joint Venture Governance and Management Framework which governs the company’s engagement with joint ventures. The Framework includes minimum requirements related to corruption, competition and sanctions, but does not include human rights requirements.   

NCP recommendations

The NCP recommended that

• Maersk update its joint venture framework to include labour rights and human rights, mandatory training on risk-based due diligence for board members appointed to joint ventures, and a review of how Maersk uses its leverage with subsidiaries on human rights.
• Maersk review its due diligence procedures to ensure they are in line with the OECD six-step process and communicates on these. It is not clear when or how Maersk carries out human rights due diligence.

Implications

• Throughout the investigation Maersk claimed to have carried out certain due diligence activities – e.g. audits, trainings, stakeholder engagement – but was unable to substantiate these claims because it lacked the necessary documentation. Under the upcoming CSDDD this would be a legal liability. We advise our clients to ensure clear and documented records of its activities to prevent and mitigate impacts linked to its value chain and subsidiaries.
• A key theme in the findings report is that parent companies share responsibility with their subsidiaries for meeting due diligence obligations. This is not completely in-line with the EU Corporate Sustainability Due Diligence Directive (CSDDD). Under the CSDDD parent companies are allowed to carry out due diligence on behalf of their subsidiaries, but the subsidiaries themselves still hold liability for non-compliance and harm.