Amicus Brief – Human Rights and Climate Change The territorial principle 17. Many respondents place great emphasis on the territorial principle, i.e. the authority of a state to exercise legislative or adjudicative jurisdiction over acts that take place in its territory. Shell’s response, for example, asserts that the territorial principle is the ‘primary basis for a state’s jurisdiction’.43 In support of this proposition, Shell cites Vaughan Lowe’s International Law as follows: The most obvious basis upon which a State exercises its jurisdiction is the territorial principle, that is, the principle that virtue of its sovereignty over its territory the State has the right to legislate for all persons within its territory.44 18. Shell’s response, however, omits to cite another crucial passage from the same book, according to which ‘Territoriality and nationality are not the only bases of jurisdiction’.45 The respondents also omit to mention that the territorial principle does not preclude states from regulating conduct which is wholly or partially carried outside a state’s territory. The territorial principle is subdivided into a subjective territorial principle, which allows states to exercise jurisdiction over activities committed within that state, even if completed abroad. Conversely, the objective territorial principle allows a state to exercise jurisdiction over activities that are completed within its territory, even if initiated abroad.46 Both principles therefore allow states to regulate conduct with an extra-territorial element. 19. If the conduct is neither initiated nor completed within their territory, states may assert jurisdiction over conduct that has an ‘effect’ on their territory. The effects doctrine is generally regarded as falling under the territorial principle, rather than as an extraterritorial basis for jurisdiction.47 The doctrine was developed to give States ‘more leeway to unilaterally stretch the arm of their domestic laws in order to clamp down on harmful acts arising beyond their borders.’48 20. The effects doctrine has been acknowledged in the Lotus case49 and by judges of the International Court of Justice in the Arrest Warrant case.50 It is presently widely applied, especially in relation to antitrust, tort, bribery and corruption, security, insolvency and criminal law.51 The effects doctrine was confirmed by the US Court of Appeals in 1945 in the Alcoa case52 where a Canadian corporation was charged with a violation of US antitrust law regarding a cartel-type of market allocation agreement reached in Switzerland by aluminium companies of various nationalities. Judge Learned Hand noted: It is settled law…that any state may impose liabilities, even upon persons not within its allegiance, for conduct outside its borders that has consequences within its borders, which the state reprehends.53 21. Accordingly, and contrary to what is suggested by the respondents, the territorial principle does not preclude states from regulating conduct or actors outside their territory. The US, for example, has a long history of regulating conduct outside its territory.54 Its unilateral prohibition of imports of shrimp caught in violation of US law protecting endangered sea turtles indirectly regulated conduct carried out outside the US territory. The ensuing dispute famously ended before the World Trade Organisation Appellate Body. In the first Shrimp-Turtle case,55 the WTO Appellate Body found that there was ‘sufficient nexus between the migratory and endangered marine populations involved and the United States for purposes of Article XX(g)’ of the 1994 General Agreement on Tariffs and Trade.56 This has been interpreted as a justification for environmental policies with extraterritorial reach.57 In a second case, the Appellate Body endorsed unilateral measures to protect the environment when good faith efforts to reach a multilateral agreement have failed.58 Today the practice of import restrictions for environmental concerns is widespread, as exemplified by measures concerning the trade in chemicals59 and forest products.60 22. To conclude, the territorial principle provides ample scope for the Philippines to regulate conduct outside its territory and for the Commission to exercise its jurisdiction to consider complaints for human rights violations carried out by corporations headquartered outside the Philippines, as long as it is satisfied that the relevant conduct is either initiated or completed within the Philippines, or because of its effects within the Philippines. 9