On September 22, FACING FINANCE organised a round table titled „Ban investments in cluster munition and anti-personnel mines“ in the German Bundestag in cooperation with Uta Zapf, Director of the subcommittee on disarmament, arms control and non-dissemination. At a first information meeting at the Bundestag, the so called „Parliamentarian ‘ Breakfast“ in May 2011, delegates had called for more dialogue with German financial institutions and reports of other countries which had already adopted measures to prohibit the production of cluster munition. FACING FINANCE took up these suggestions and gathered all relevant stakeholders and actors in this field.
Videos of the individual statements only available in German.
Ambassadors from Luxembourg and Belgium as well as associates of the Swiss Department for Foreign Affairs gave account of their experience with relevant prohibitive legislation. Besides delegates of all parliamentary fractions, representatives of several non-governmental organisations (urgewald, Netwerk Vlaanderen, Pax Christi Netherlands, Earthlink and Handicap International Germany) took part in the discussions. Moreover, all leading German banks – such as Commerzbank, Deutsche Bank, Allianz and the Unicreditgroup/HvB – showed their interest. Rating agencies, social and ecological banks such as the GLS and associates of FINANZTEST/Stiftung Warentest (German consumer organisation for financial products) also participated in the debate. While the discussion on the legal details was rather extensive, there was overall consensus on a general need for action.
Both invited ambassadors, the Belgian Renier Nijskens and Martine Schommer from Luxembourg, stressed the „unacceptable harm“(Nijskens) and the tremendous „damage“ (Schommer) caused by cluster munition in the very beginning of the event. Mutilation and hundreds of casualties, persistent danger for the civilian population even years after the actual armed conflicts have ended – these were essentially the issues in question. As long as money flows into the production of cluster munition, these will cost lives.
The 2008 Oslo-Convention to ban cluster munition was only a first step to prohibit these controversial weapons. However, its provisions leave a lot of room for interpretation. Assistance granted to producers of cluster munition is prohibited under Article 1(c) of the Oslo-Convention but its scope is interpreted in various ways. According to the current German government, it does not imply a prohibition of investments. The Research and Legislative Reference Services of the German Bundestag, however, has recently declared the opposite. Such a loophole of interpretative latitude needs to be closed. This would enable a sound legal protection of the matter, said Sandra Lendenmann from the federal department of foreign affairs speaking about the Swiss experience with decision-making in this field at the round table.
The banks also gave their opinion. Uwe Prim from Commerzbank underlined the voluntary guidelines of his bank which prohibit investments in all controversial weapons. Yet, he admitted that the implementation of these guidelines remains challenging in his institution.
An obstacle which needs to be overcome by legislation? Barbara Happe from the NGO urgewald e.V. highlighted that even private financial institutions encourage the active involvement of the state in this area to control such investments.
Indeed, none of the banks’ representatives present at the round table argued explicitly against an investment ban in producers of cluster munition. The different speakers rather stimulated reflection on implementation and details of the law. The question, for example, whether a „black list“ of producers was to be adopted or whether a ban would include direct investments as well as indirect ones was heavily discussed. Reinhilde Weidacher from the Swedish consultancy Ethix SRIAdvisor argued in favor of a prohibition of both direct and indirect investments, because the actual scope of direct investments was quite limited.
Thomas Küchenmeister from FACING FINANCE stressed that it was not sufficient to adhere to regulations which merely condemn intentional financing (which is the case in Luxembourg) and indirect financing only if it was meant to circumvent direct financing (for example in Switzerland). This was almost impossible to prove, said Küchenmeister. Arms producers usually do not request financial measures for the production of internationally condemned weapons, but use conventional company loans and the issuance of shares and bonds to finance these activities. Furthermore, Küchenmeister denounced any public subsidies of pension funds which invest in legally arbitrary weapons and called for a renewal of the Pension Fund Certification Act (a measure which serves to prove whether a pension product is eligible for public subsidy). Moreover, producers of internationally condemned weapons should be entirely excluded from public deals, demanded the coordinator of FACING FINANCE.
The contributions of the delegates of all fractions focused mainly on the wording of the legislation and other law-related issues. While the opposition parties – Greens, Linke and Social Democrats – explicitly supported a motion initiated by Bündnis 90/Grünen (Greens), the governing coalition avoided any clear positioning. The speakers of Christian Democrats (CDU/CSU) and Liberals (FDP) did not generally oppose a prohibition, but merely participated in the discussions on the open questions already mentioned. Roderich Kiesewetter (CDU) warned that in case such a policy entered into force, it „must not be lax“. Christoph Schnurr (FDP) called for a measure which should be „clear, revisable and effective“. Thus, all participants seemed to have implicitly accepted the necessity of a law based on Article 1(c) and the moral imperative.
At the next stage, the German Bundestag will decide on the request by the Green fraction on March 22, 2012.
An approval of the request would trigger the following:
§ 18(a1) of the Arms Control Act would be amended. It needs to include that a ban on investments in the production and development of anti-personnel mines and cluster munition falls within the scope of the prohibitive provisions;
Any public funding or subsidy of investments in cluster munition and anti-personnel mines via the Pension Fund Certification Act would be forbidden as foreseen by FACING FINANCE.