Manufacturing Standard Setting Committee: 7th Principle: Legality, Part I
Introduction:
This is an ongoing documentation of a series of dialogs between members of our Manufacturing Group, charged with the task of developing exceptional standards for jewelry manufacturing. Follow this link, https://fairjewelry.org/madison-dialogue-manufacturing-committee for full review of past discussions, including the entire principles and standards document.
The question of legality generated some discussion. In Part I, below, most of the concern was about language. In part II, to follow, some critical issues regarding the challenges of fair trade were more broadly discussed. ~Marc Choyt, Publisher
Below is a documentation of the dialogue for the 7th Principle, Legality.
Marc Choyt wrote:
Below, please find the 7th principle, Legality. Please comment if you feel it is in any way lacking. To me it seems quite straight forward.
Principle:
Companies and individuals will adhere to existing applicable laws and support the establishment of legal frameworks in sectors where they do not currently exist. They will comply with international conventions and national laws with regard to anti-money laundering, bribery and corruption.
Standards:
Minimum Requirements:
7.1: Companies agree to work within legal frameworks and comply with international conventions and national laws.
7.2: The fair made manufacturing company must pay all taxes, fees and royalties as applicable by law.
Melinda Nugent wrote:
Looks fine to me.
Patrick Schein wrote:
Coming back in the discussion after some traveling, I would like to make the following proposition on this 7th principle.
*7.1: *Companies agree to work within legal frameworks and comply with international conventions and national laws..
I think you cannot oblige a company to respect an international convention because conventions are made for states and not companies. Some states do not sign international treaties and this cannot be a reason to exclude its companies. For example, the US did not sign, unless recently, the Convention on the Rights of Persons with Disabilities (CRPD) which is in force and signed by 140 countries. Does than mean that all US companies can not be “fairmade” certified.
I agree that there are some international treaties or conventions that are very important for the initiative and thus should be mentioned separately. This is the case of the ILO convention that is mentioned in our social standards. I do not have the expertise on the legality issues to mention if there is a specific treaty we should enforce.
*7.2: * The fair made manufacturing company must pay all taxes, fees, royalties as applicable by law
There is no state royalty as in mining in manufacturing.
‘Companies and individuals will adhere to existing applicable laws and support the establishment of legal frameworks in sectors where they do not currently exist. They will comply with international conventions and national laws with regard to anti-money laundering, bribery and corruption.’
Same than for 7.1. A company can only comply to national laws. It is a country who adheres to international treaties and thereafter must adapt its national law to that treaty. Also, in money laundering, of what I know, there is no international treaties but only national ones which differs from one country to another. If you compare the US, Swiss, Dubai, I am sure you will find differences in their standards and all of those countries are quite active in jewelry. I would even propose to eliminate the whole phrase (red option) as whether it is money laundering or something else, we do require that the actors stick to their national laws.
Marc Choyt wrote:
Thank you for your suggestions, which I fully support. Does anyone else have additional comments?
Flavia Aarden-Kilger wrote:
I know very little about national laws and international conventions. I feel therefore that I should not comment on this particular principle and leave this section to the experts.
Hopefully there are more people within the group that have comments as it is their field and/or expertise.
Marc Choyt wrote:
Unless there are further suggestions, Patrick’s suggested revisions stand as our new principle and standard for Legality. Below is how it would read.
If there are no further suggestions, we will move on the 8th principle next week.
Principle:
Companies and individuals will adhere to existing applicable laws and support the establishment of legal frameworks in sectors where they do not currently exist. They will comply with national laws with regard to anti-money laundering, bribery and corruption.
Standards:
7.1: Companies agree to work within legal frameworks and comply with national laws.
7.2: The fair made manufacturing company must pay all taxes and fees, as applicable by law
Greg Valerio wrote:
I am happy with this, although company law in most countries will cover this anyway.
Stephen Metcalf wrote:
Would there be a marketing advantage if this FT designation would provide assurances that the manufacturing is free from money laundering, etc, in addition to the usual FT environmental and equity assurances?
Perhaps, but in practice, it would be very hard to convincingly demonstrate no corruption. Likewise, how can it be convincingly shown that Companies and individuals have adhered to existing applicable laws?
Patrick Schein wrote:
Stephen, thanks for your message.
1- Money Laundering: Yes it is an advantage but at the same level than respecting other laws like the social and environmental ones. By not specifying a law we do encompass all of them. If we specify one of them, we should specify all of them.
Also, fair trade includes 3 pillars which are: social, environment and economic. Money Laundering is included in the Economic pillar.
2- Demonstration to the consumer. Standards are designed to be verified. Once the standards are set, the certification agency draw what we call “compliance criterias”. Compliance Criteria are established to translate standard requirements and certification policies into verifiable control points that are evaluated in the certification process to determine compliance with the Standard. see:
http://www.flo-cert.net/flo-cert/main.php?id=60
The way to reassure the consumer is that a certifier audits the manufacturer according to the standards and their criteria and grant, or not grant the certification.
Hopes this helps.
Marc Choyt wrote:
Though I think Steve’s point is good, and had similar thoughts myself, I learn towards Patrick’s view. We can’t list all the laws. If there is an opportunity for additional documentation and commentary, however, would could mention the items specified as examples, but I think they are too specific for the actual standard which needs to cover everything.
So, I propose that the principle will read, as Patrick suggested:
Companies and individuals will adhere to existing applicable laws and support the establishment of legal frameworks where they do not currently exist.
Does anyone have additional ideas for comments? If not, we can move on to the next principle, perhaps later this week.
