Quasi-Judicial Dialogue for the Coherent Development of International Law

Multilateral Development Banks have established international accountability mechanisms over the last 25 years in order to offer private individuals or groups a process through which they can demand the redress of grievances caused by the banks’ projects. Accountability mechanisms are often composed of experts appointed by each bank’s Board of Directors. The mechanisms generally have a compliance review function, with or without a problem-solving function. With their different mandates, these quasi-judicial bodies have, just like judicial bodies, proliferated in a process that can be deemed “quasi-anarchic“. This post explores a recent project in Kenya presented simultaneously before two accountability mechanisms, and argues that accountability mechanisms’ “quasi-judicial dialogue” can constitute a source of inspiration for the coherent development of international law.

Two Accountability Mechanisms, Two Mandates

As judicial and quasi-judicial bodies participate in the development of international law, there is a risk of incoherence in their decisions with consequences such as unpredictability, inequalities or forum-shopping, which would endanger the international legal system (see Jonathan I. Charney, Is International Law Threatened by Multiple International Tribunals?). Incoherence may become even more acute for Multilateral Development Banks’ accountability mechanisms as they confront very similar factual scenarios, especially in the case of co-financing where parties affected by an investment may seize more than one accountability mechanism, just like in the Kenya Electricity Expansion Project presented before the World Bank and the European Investment Bank’s accountability mechanisms.

Indeed, there are four important differences between the mandates of the World Bank Inspection Panel (hereinafter the Panel) and the European Investment Bank’s Complaints Mechanism. In all four aspects, the World Bank’s policy is more restrictive than the European Investment Bank’s (hereinafter EIB). Firstly, a request to the Panel may only be submitted by two or more people, or their representative, who claim that they have been or are likely to be affected by a Bank-financed operation, while the EIB’s Complaints Mechanism is accessible to any person or group alleging maladministration. Secondly, the Panel’s jurisdiction ratione materiae covers no more than the World Bank’s policies, while the Complaints Mechanism jurisdiction is very vast, due to the broad definition of what can constitute maladministration. Indeed, the EIB is tasked with pursuing the policy objectives of the European Union. According to its Statement of Environmental and Social Principles and Standards, for projects within the EU, EU law is applicable. For projects outside the EU, the EIB then uses the legal principles and standards of the EU as a benchmark and is guided by its own internal policies, while each project must comply with national law and international agreements ratified by the Borrowing State (see Nicolas Hachez and Jan Wouters, in Foreign Direct Investment and Human Development, pages 313-316). Thirdly, a follow-up mandate is conferred to the Complaints Mechanism only, while the Panel’s mandate generally finishes when its report is submitted. Finally, in contrast to the EIB system where the EU Ombudsman may be seized as a second recourse, there is no such possibility in the World Bank’s system.

Kenya Electricity Expansion Project before the Panel and the Complaints Mechanism

In 2014, both accountability mechanisms received letters requesting the investigation of issues related to the Kenya Electricity Expansion Project, located in the Olkaria Geothermal Area and co-financed by the World Bank and the EIB, amongst five foreign co-financers. The requests were submitted by members of a Maasai community resettled due to the project. They complained mainly about: not receiving land-title; the exclusion of some vulnerable people; the adverse effects of the resettlement; and the inadequate consultation and participation processes.

The Accountability Mechanisms’ Integration Tools: Harmonization of Jurisdiction, Procedural Integration, Same Findings and Joint Problem-Solving

With several co-financers and as many sets of environmental and social safeguards, the first problematic issue in this case was the accountability mechanisms’ different jurisdictions ratione materiae. However, the co-financers had found a solution since the beginning of the project: the three EU financers adopted the World Bank’s policies for land acquisition and involuntary resettlement. Furthermore, the Panel and the EIB’s Complaints Mechanism promoted procedural integration and signed a Memorandum of Understanding (hereinafter MoU), which foresaw the sharing of information and joint field visits while guaranteeing confidentiality as well as the respect of the accountability mechanisms’ respective policies. The MoU was effectively implemented: the Complaints Mechanism allocated internal resources to the investigation team put in place by the Panel and they carried out joint missions. The Complaints Mechanism even states in its Report that the findings of the Panel independent experts on involuntary resettlement are fully applicable to the Complaints Mechanism’s investigation.

The Report of the Complaints Mechanism was submitted several months after the Panel’s and their respective findings are very similar. On the issues governed by the World Bank safeguards, both find that: the identification of the project affected people was not in compliance with the policy; the mechanisms for consultation and participation was not satisfactory and that the resettlement occurred before the necessary elements were in place, such as land-titles or water access; and that the restoration of livelihoods was not ensured. It is interesting to note that several findings are phrased in practically the exact same terms.

One of the issues raised by the accountability mechanisms’ Reports is that the Maasai had not been categorized as Indigenous People. Here, the World Bank Policy on Indigenous People is not applicable to the EIB’s Complaints Mechanism because it was not adopted by the EU co-financers. However, both the EIB and World Bank policies enumerate essentially similar elements to identify Indigenous People and both accountability mechanisms conclude that the project failed to identify the Maasai community as Indigenous. The consequences of this non-identification are also determined by each Bank’s respective safeguards. The accountability mechanisms come again, almost verbatim, to the same conclusions, namely that this non-categorization implied insufficiently informed consultation and culturally compatible resettlement, as well as a lack of benefit-sharing arrangements and Maasai-specific expertise.

The problem-solving phase is also integrated. As the Panel’s mandate finishes, a follow-up mandate is conferred to the EIB’s Complaints Mechanism. Here, the World Bank Management joined in the mediation process

Mechanisms of Quasi-Judicial Dialogues

Because of the harmonized application of the World Bank policies in the loan agreement, the integrated process, the converging reasoning and interpretations as well as the similar and often verbatim conclusions, it seems that the Panel and the Complaints Mechanism have undertaken a deep formal and informal quasi-judicial dialogue. One can even assume that the Complaints Mechanism has informally stayed its decision until after the Panel published its Report and informally adopted a stare decisis doctrine, whereby it concurred and sometimes repeated the decision of the Panel, albeit without saying so.

This cooperation may provide inspiring tools to judicial bodies to respond to the threat of growing incoherence in international law. First, it supports the effort towards the harmonization of international law. Just as scholars have called for the creation of systematic legal norms to help “synchronize interpretations” by judicial bodies (see Philippa Webb, International Judicial Integration and Fragmentation, page 226), the World Bank safeguards were used by both accountability mechanisms, contributing to the coherence of the outcomes. Secondly, it shows that there is no need for one mechanism to withdraw when two bodies are seized with the same type of complaint because “anarchy” can be turned into complementarity. In addition to reducing costs, value was added to the process in this case because each mechanism contributed with its own advantages (safeguards, experience, experts, problem-solving capacity), which in fine benefits the claimants and the coherent development of international law. Even a hypothetical review by the EU Ombudsman can be seen as beneficial. Indeed, the complementary work of the mechanisms can answer some criticisms faced by each institution: the lack of problem-solving capacity and review mechanism for the Panel, and the loose phrasing of the EIB safeguards for its activities outside the EU. Therefore, when judicial bodies are hearing similar legal issues or the same factual scenario, they could enter into an MoU for procedural cooperation and complementarity, regarding the involvement of experts, investigation missions or sharing of documents and costs. As judicial bodies should reach their findings independently, the use of harmonized norms and strong cooperation during investigation help avoid, as much as possible, conflicting decisions. Also, one can assume that the institutionalization of concepts such as lis pendens or stare decisis in the MoU could be part of the solution (on lis pendens and res judicata, see Philippa Webb, International Judicial Integration and Fragmentation, pages 218-219; 222-224) and would help further ensure the coherence of the system for future cases. Finally, the MoU could provide for a complementary and coherent role by judicial bodies after issuing their decisions.

This cooperation process requires a delicate balance: the dialogue must be as formalized as possible in order to forge a predictable system where the same norms and interpretations are used and similar MoUs are entered into. However, especially because judicial bodies rarely find themselves confronted with the exact same cases, the dialogue must remain flexible and adaptable to each institution and each case, so as not to affect complainants. The case study illustrates that, even with different accountability mechanisms and sets of safeguards, fragmentation is preventable. With formalized yet flexible dialogue, the proliferation of judicial and quasi-judicial bodies can become an asset for complementary work and the coherent development of international law.