Doing Business with a Bad Actor: How to Draw the Line Between Legitimate Commercial Activities and Those that Trigger Corporate Complicity Liability

One of the most complex and highly debated problems in the context of corporate liability for complicity in human ri ghts violations is how to distinguish lawful commercial activities from those that give rise to corporate complicity liability. In many cases in which corporations are accused of aiding and abetting human rights violations, the act of assistance consists of what would usually be regarded as an ordinary and perfectly acceptable business activity, such as providing financing to a government or supplying it with goods or infrastructure. Merely doing business with a bad actor is not sufficient to impose liability on corporations for that actor?s human rights violations, but no clear criteria on what transforms legitimate business transactions into reprehensible acts of complicity exist. This Article approaches the question of determining the relevant liability standards by providing an in-depth analysis of jurisprudence stemming from three different contexts: Alien Tort Statute (ATS) cases on corporate complicity; ad hoc international criminal tribunals on the closely related question of dual-purpose act liability (where the assistance provided could be used for both lawful and unlawful activities); and U.S. criminal cases where the act of assistance consisted of a commercial activity. Jurisprudence stemming from these three different contexts has in common that many courts feel that the generally applicable standards for determining complicity liability need to be adapted and restricted where assistance consists of a commercially motivated or a dual-purpose act. This is largely achieved by requiring either that the assistance reach a certain significance threshold (limitations at the actus reus level of liability), or that the mental state with which it was carried out made the assistance particularly reprehensible (limitations at the mens rea level of liability). In the particular context of corporate complicity liability in human rights violations, academic debate of liability standards largely focuses on whether the relevant mens rea standard should be one of purpose or one of knowledge. While clearly important, this Article goes beyond this question and argues that the mens rea standard cannot be understood and determined in isolation. Without taking a holistic look at all elements of liability and their interaction, it is not possible to sufficiently understand the concerns that triggered adoption of a purpose standard of mens rea, the legitimacy of these concerns, and alternative ways of addressing them. The purpose of this Article is not to present detailed liability criteria that will work equally in all contexts. Rather, it serves the more modest aim of analyzing and drawing conclusions from the implications of different approaches to determining the necessary actus reus and mens rea elements of corporate complicity liability, while recognizing that the details need to be developed with reference to the specific contexts in which the question of corporate complicity liability arises.