Agency Failure, Legal Liability and Jurisdiction, and International Organizations

On occasion, I have lamented what I perceive as the lack of due attention in the scholarly literature to the actual circumstances of international organizations, starting with the UN. One of those fundamental issues concerns accountability, in the special sense that there is no obvious judicial forum for reviewing actions even of individuals alleged to have engaged in serious misconduct, such as fraud, embezzlement, etc.

On the one hand, the treaties put the organizations and their civil servants beyond the reach of national courts.  On their face, they seem to leave at most, in some cases, the often highly unlikely possibility of a prosecution or civil action in the person’s national jurisdiction.  Given the politics, let alone the legal questions, home jurisdiction prosecution of one’s own nationals is out of reach in many if not nearly all cases.   On the other hand, such accountability as supposedly exists rests in various internal review processes. These internal review processes vacillate, however, between being tools by which senior managers are able to punish whistleblowers and so protect themselves or their underlings or their national confreres or what have you; or else being captured by the other side of the process through what amounts (in my jaundiced view, admittedly) to the world’s strongest public employee union.

It’s not really surprising that legal academics find it hard to get too interested in the hard material facts of UN budgets and fiscal accounting – although as Marx often advised, follow the money. But it is more surprising to me that so little attention has been paid to the legal issues involved in the accountability-jurisidction questions.  These include particular whether and, if so, which courts might have jurisdiction in the remarkably varied cases that, in an accountable domestic society, might have attracted the attention of regulators or prosecutors or someone; actions by agencies and organizations also remarkably varied; and finally actions by individual actors who also vary quite a lot in their legal situations, perhaps diplomats, perhaps not, and so on.

At the height of the Oil-for-Food scandal at the UN, when the General Secretariat was at its politically weakest (as the reach of the scandal went all the way up to Kofi Annan, whom the Volcker investigation reports left seriously wounded, with clear implications of some level of culpability, while leaving a barely sufficient shred of cover to not force a fight over pushing Annan to resign), there were calls for someone to prosecute someone for something. It was not just the Oil-for-Food scandal, however, as those familiar even superficially with the opportunities for fraud, self-dealing, and rent-seeking, in a system at once as byzantine and unaccountable as the UN’s, would recognize. As more rocks began to be overturned in other UN programs and organs, evidence  of serious graft, embezzlement, kickbacks, and other financial fraud of a kind that would plainly be criminally prosecutable, if only there were someplace to prosecute it, began to emerge in other UN programs. The procurement program for the politically crucial peacekeeping operations – in my view, one of the (very few) UN activities worthy of serious support by the US – was particularly at risk, for example, as its budget has ramped up in recent years, outstripping the regular organization budget.  And to be clear, I do not raise here disguised political or policy questions – just “simple” fraud by well-placed officials that I don’t imagine anyone in the upper tiers of the organizations at issue would defend in substance.

In the midst of this turmoil at the UN in 2005, the then-Manhattan DA, the legendary Robert Morgenthau, announced an investigation into the senior UN official in the Oil-for-Food scandal, Benon Sevan (who departed to his native Cyprus, and, if I recall correctly and I might not, following “internal reviews” at the UN, had his legal fees paid and saw no reduction in his pension benefits). The legal basis for this was never exactly clear to me, however. Because the UN is located in Manhattan? Because some of the conduct involved might have taken place in Manhattan but outside of the UN territory, or involved non-UN assets such as telephone lines, etc.? This is, after all, an investigation by a state DA, and not even a federal prosecutor. Although somewhat weirdly, given the politics at that moment, a local level investigation by a state DA of unimpeachable integrity and also a stalwart of the Democratic establishment – rather than a DOJ investigation by the then-Bush administration – turned out to be far more politically palatable.

In any case, the weakened Annan did not do what might otherwise have been an inflexible and categorical response of the UN – quite natural and routine, to be sure, for any sovereign – and robustly disclaim any jurisdictional basis for a Manhattan DA to get involved at all. Benon Sevan had diplomatic immunity, but the General Secretariat indicated that it would waive it if requested by a prosecutor – clearly meaning Morgenthau. Perhaps the senior UN management understand perfectly well that Sevan would depart to his native country which of course would do nothing.  Perhaps some small number of top UN leaders understood that this lack of accountability was a genuine problem and that Morgenthau was a decent option. (I skip over some other Manhattan DA investigations, particularly involving corruption in UN peacekeeping procurement.)

It is not hard to see, in other words, that international organizations such as the UN have massive structural agency failure problems. That is a somewhat anodyne way of putting it; the problems range from rent-seeking to major criminal corruption and fraud. They arise from a treaty structure deliberately designed to shield the organization and its agents from judicial accountability – for perfectly understandable reasons, to be sure. And from the predictable “capture” of internal review mechanisms. The result is to put the UN and international organizations and their agents in fundamental ways outside of the rule of law in the most ordinary sense. That’s not too strong a way of putting it. But again, this receives remarkably little attention from academics. The reflexive position of observers tends to be to define today’s deviancy down, discounting today against the glorious, but always-receding, always-promised future of international institutions. Mostly, I think, people just want to focus on the idealistic stuff about tomorrow and plug up their ears about anything that actually happens today.

So let me welcome a new paper up on SSRN by Matthew Parish, of the British Institute of International and Comparative Law, writing in the International Organizations Law Review, “An Essay on the Accountability of International Organizations,” offering a detailed look at the problems of legal accountability for a wide variety of international organizations and their agents. It is a fine paper on a neglected topic. I don’t say this from complete agreement; I have reservations about the paper’s proposals for accountability for national peacekeeping forces on missions in the field, for example. Nor does Parish share my fundamental skepticism about the UN and its imagined mission; far from it, he is looking for ways to make it better on its own terms. But overall I think it has many sensible things to say, and in any case offers a cogent account of the many agency failure problems at issue, from the standpoint of legal jurisdiction. I’ve put the abstract from SSRN below the fold (crosspost at OJ).

International organizations sometimes suffer from acute agency problems. Three exogenous methods of addressing those problems are considered: economic incentives, political accountability and legal accountability. For international organizations, the first is undesirable and the second inevitably weak. There is therefore an argument for heightened legal scrutiny of their actions. Yet international organizations have an unenviable track record of acting without regard to the most fundamental international standards of rule of law, and this article offers an unsightly catalogue of their legal aberrations. Moreover, the internal legal mechanisms international organizations have created ostensibly to hold themselves to account prove wanting at best. There may also be structural reasons why international courts and tribunals will never be able to conduct an adequate review of the important decisions international organizations routinely take. This makes those organizations’ assertions of blanket legal immunity from jurisdiction of domestic courts appear increasingly inexplicable, as it removes all possibility of legal accountability. The supposed rationales for legal immunities of international organizations are reviewed and proved wanting. The conclusion drawn is that international organizations should be subjected to radically improved regimes of international judicial oversight, or their immunities should be abrogated in certain areas so that they may be rendered subject to the jurisdiction of the domestic courts of the countries in which they operate, or both. Measures of this kind may dramatically improve the quality of decision-making and accountability of international organizations.