Specific Instance between Ghislain Bahati Muhangaza and Citibank, N.A. Regarding Events in the Democratic Republic of the Congo

Overview of the NCP and Its Role

The OECD Guidelines for Multinational Enterprises (the Guidelines)^[1] are voluntary, non-binding recommendations for responsible business conduct in a global context.  In the Guidelines, adhering governments, of which there are currently 51, provide guidance to multinational enterprises operating in or from their territories.  Adhering governments have committed to a) encouraging their multinational enterprises to follow the Guidelines in their global operations, and b) appointing a National Contact Point (NCP) to assist parties in seeking a consensual resolution to issues that may arise under the Guidelines.

As a part of its function, the U.S. NCP can help to resolve issues related to implementation of the Guidelines, arising from the business conduct of a multinational enterprise in specific instances.  Generally, such issues are dealt with by the NCP of the country in which the issues have arisen.  The U.S. NCP handles such issues in accordance with procedures described in the U.S. NCP Guide.^[2]  Further background on the Specific Instance process and the procedures and policies of the U.S. NCP can be found at the website of the U.S. NCP.^[3]

Executive Summary

This Final Statement concludes the Specific Instance submitted to the U.S. NCP on April 20, 2021, by Ghislain Bahati Muhangaza (the submitter).  The Specific Instance alleged conduct inconsistent with the Guidelines on the part of New York-headquartered financial company Citibank, N.A. (Citibank) with respect to employment-related actions of a local company in the Democratic Republic of the Congo (DRC).

The U.S. NCP concludes that the issues raised by the submitter do not merit further examination under the Guidelines, and thus declines to offer mediation to the submitter, because the Guidelines do not normally cover an individual labor dispute such as that raised here.

Substance of the Specific Instance, and Response

The submitter is a former employee of the DRC bank Trust Merchant Bank S.A. (TMB).  TMB is central to this specific instance.^[4]  According to its website and other public sources, TMB was founded in 2004, and is headquartered in Lubumbashi, in the DRC’s Haut-Katanga province.  It is the third largest commercial bank in the DRC, and bills itself as “the DRC’s home grown universal bank.”  TMB’s strategy has been to serve people previously excluded from the DRC’s banking system.  As examples relevant to this statement, it has over 100 branch offices across the DRC, more than any other bank, and those include offices to support MONUSCO, the UN peacekeeping force in the DRC.^[5]  On August 2, 2022, the Kenyan bank KCB Group Plc announced it had reached an agreement to acquire 85% ownership of TMB, and on December 15, 2022, KCB announced the completion of that transaction.^[6]  The acquisition does not directly affect this Specific Instance, however.

On April 20, 2021, the submitter submitted a Specific Instance to the U.S. NCP alleging conduct inconsistent with Chapters I (Concepts and Principles), II (General Principles), IV (Human Rights), V (Employment and Industrial Relations), IX (Science and Technology), and XII (Taxation) of the Guidelines.  It was followed on August 6, 2021, by a “summary,” and accompanied by supporting documentation, with more provided later.  Following conversations with both parties, the U.S. NCP formally provided the submission to Citibank on May 11, 2022, and twenty supporting documents on June 17, 2022.  Citibank provided a written response on August 2, 2022, taking the position that the Specific Instance should not be accepted for further examination.  The submitter responded on August 6, 2022.  On August 26, 2022, Citibank responded that it would have no further formal response.

According to the submission, the submitter worked for TMB in his hometown of Bukavu, in the DRC’s South Kivu province, from November 18, 2010, until May 2015, when TMB appointed him to a new position as the manager of TMB’s branch in Kalemie, Tanganyika province, nearly 250 miles from Bukavu by air.  The bank paid to move his family and household goods to Kalemie.  Under his supervision, TMB’s Kalemie branch grew from 10 employees to 29.  On August 21, 2019, TMB dismissed the submitter, wrongfully according to him (the stated reason related to his temporarily closing a sub-office located in the Kalemie regional headquarters office of MONUSCO, during a telecommunications failure).  In addition to claiming wrongful termination, the submitter alleges that he was underpaid upon his termination, including that TMB did not move his family back from Kalemie to Bukavu, as he states DRC law required.  He brought legal action against TMB, demanding $3.18 million in a submission to a labor inspector, and his case went before a labor tribunal in Kalemie, but TMB’s counsel reportedly asked for four of that court’s six judges to be recused, requiring the case to be sent to a court in distant Kinshasa, where it is now pending.

While the complaint focuses on the submitter’s termination, it states a number of other allegations against TMB, principally various corporate irregularities and the lack of union representation of its employees.  These additional claims do not warrant further discussion because they are vague, are supported only minimally if at all, and appear unrelated both to the submitter’s main point and (in the case of alleged corporate irregularities) to the Guidelines.

However, TMB is a DRC-headquartered company and the allegations concern its operations in the DRC.  Furthermore, the DRC government is not an adherent to the Guidelines.  The submitter’s allegation against Citibank is that it breached the Guidelines by its failure to execute due diligence and remediation in its ongoing business relationship with TMB.  (The business relationship is undisputed; according to both Citibank’s submission and TMB’s website, Citibank serves as the U.S. correspondent bank for TMB.  Citibank adds that TMB has been among its clients since about 2008.)  Specifically, the submitter claims that Citibank failed to prevent or mitigate adverse impacts linked to his dismissal, while benefitting from its business relationship with TMB.  He seeks, as an outcome of this process, that Citibank “should influence its partner TMB SA, to respect my rights and those of other TMB SA workers,” as well as “financial compensation for the damages suffered by myself,” estimated as $5 million.

In response, Citibank states that it is recognized as a “champion of human rights,” that it is “committed to responsible business conduct and global corporate citizenship in a manner consistent with the OECD Guidelines,” and that it has “operationalized this commitment” in its corporate governance programs.  Citibank contends that the case should not receive further attention, for several reasons including that the case involves an individual labor dispute with no particular issues under the Guidelines, and it is pending in DRC courts.

Initial Assessment

The initial assessment does not determine whether or not a company has acted consistently with the Guidelines, but rather is a process to determine whether the issues raised merit further examination.  In its initial assessment, the U.S. NCP determined that the issues raised by the submitter do not merit further examination under the Guidelines, and thus decided not to accept the Specific Instance.  The U.S. NCP made this decision based on the Guidelines, and considering the OECD’s guidance on initial assessments.^[7]  In particular, according to the Commentary on Implementation Procedures, an initial assessment involves determining “whether the issue is bona fide and relevant to the implementation of the Guidelines,” taking into account the following criteria:^[8]

1. The identity of the party concerned and its interest in the matter

The U.S. NCP is satisfied that Mr. Bahati Muhangaza has provided sufficient information regarding his interest in the issues raised.  He states, and his supporting documentation indicates, that he is a former employee of TMB.

2. Whether the issue is material and substantiated

The fundamental issue in this case is an individual labor dispute, specifically regarding the allegedly wrongful termination of an employee, and failure to provide required compensation.  In a recent Final Statement, the U.S. NCP stated its position that such individual labor disputes are in principle not covered by the Guidelines, unless there are wider aspects or implications to the case that are relevant to the Guidelines.^[9]  This case presents no such wider implications.

For this reason, the U.S. NCP concludes that the Specific Instance is not material to the Guidelines, and is not sufficiently substantiated.

3. Whether there seems to be a link between the enterprise’s activities and the issue raised in the specific instance

Based on the business relationship between Citibank and TMB, there appears to be a link between Citibank’s activities and the issues raised.

4. The relevance of applicable law and procedures, including court rulings

Mr. Bahati Muhangaza sought recourse to domestic legal remedies, and his case is pending.  The OECD Commentary on the Implementation Procedures states that in such a situation, the existence of what it calls “parallel proceedings,” “NCPs should evaluate whether an offer of good offices could make a positive contribution to the resolution of the issues raised and would not create serious prejudice for either of the parties involved in these other proceedings or cause a contempt of court situation.”^[10]  The submissions do not indicate any serious prejudice, although that question is impossible to assess completely, since the other party in the parallel proceedings is TMB, which has not been consulted.  The record is thus indeterminate on this criterion.

5. How similar issues have been, or are being, treated in other domestic or international proceedings

The recent U.S. NCP case cites Dutch and French cases that support the conclusion that an NCP should not ordinarily address an individual labor dispute, absent some particular reason (or “wider aspects or implications,” in the words of the Dutch NCP) relevant to the Guidelines.

6. Whether the consideration of the specific issue would contribute to the purposes and effectiveness of the Guidelines

The reasoning cited under criterion (b) above suggests that consideration of this Specific Instance would not contribute to the purposes and effectiveness of the Guidelines.  While the submitter summarily states that “TMB’s boss commonly treats employees this way,” and “the case of Mr. Ghislain is one of several other cases of abuse,” he provides no support containing any specific details for these vague allegations.  Accordingly, the U.S. NCP concludes that further consideration would not contribute to the purposes and effectiveness of the Guidelines.

For the reasons stated above, the U.S. NCP determined in its initial assessment that it should not accept the Specific Instance.

There will be no Initial Assessment document separate from this Final Statement.  This Final Statement fills the role of both documents—it describes the initial assessment, in addition to concluding the Specific Instance.

Resolution

Because of its decision not to offer mediation, the U.S. NCP brings this Specific Instance to a close with this Final Statement.  The U.S. NCP would like to thank both parties for their detailed submissions, and for treating the process seriously.

David B. Sullivan
U.S. National Contact Point for the OECD Guidelines
U.S. Department of State

[1] Available at http://www.oecd.org/daf/inv/mne/48004323.pdf.

[2] “A Guide to the U.S. National Contact Point for the OECD Guidelines for Multinational Enterprises,” available at https://www.state.gov/u-s-national-contact-point-for-the-oecd-guidelines-for-multinational-enterprises/a-guide-to-the-u-s-national-contact-point-for-the-oecd-guidelines-for-multinational-enterprises.

[3] https://www.state.gov/u-s-national-contact-point-for-the-oecd-guidelines-for-multinational-enterprises/.

[4] TMB is not a party to this Specific Instance, and so has not had an opportunity to review or correct anything said in this Statement about it.

[5] TMB website, at https://tmb.cd/?lang=en, https://tmb.cd/network/?lang=en, and https://tmb.cd/the-bank-2/branch-network-and-rep-office/?lang=en (sources for all statements except as otherwise specified); Otiato Guguyu, “KCB targets Equity with Sh15bn DRC bank acquisition,” Business Daily Africa (Aug. 3, 2022) (source for “third largest”); “We Need to Reinvent Ourselves: Profile: Yannick Mbiya, Director of Trust Merchant Bank,” African Business (February 2015) (source for “founded in 2004,” and “TMB’s strategy”).

[6] KCB Group, “KCB Group Shareholders Approve Proposed Trust Merchant Bank SA (TMB) Acquisition” (Sep. 21, 2022), available at https://ke.kcbgroup.com/about-us/news-room/business/kcb-group-shareholders-approve-proposed-trust-merchant-bank-sa-tmb-acquisition; “KCB Completes TMB Acquisition,” KCB Press Release (Dec. 15, 2022), available at https://www.marketscreener.com/quote/stock/KCB-GROUP-PLC-6493488/news/KCB-Press-Release-ndash-KCB-Completes-TMB-Acquisition-42555005/.

[7] OECD, Guide for National [Contact] Points on the Initial Assessment of Specific Instances (2019), available at https://mneguidelines.oecd.org/Guide-for-National-Contact-Points-on-the-Initial-Assessment-of-Specific-Instances.pdf .

[8] OECD, Commentary on the Implementation Procedures of the OECD Guidelines for Multinational Enterprises, paragraph 25, in OECD Guidelines, supra note 1.

[9] U.S. NCP, Final Statement, Specific Instance between Maurice Matadi Kajangu, Romain Bazira Bankulikire, Chrispain Belebele Ntumba, Telesphore Kazunguzibwa Masumbuko, and the Coca-Cola Company Regarding Events in the Democratic Republic of the Congo (April 28, 2022), available at https://www.state.gov/specific-instance-between-maurice-matadi-kajangu-romain-bazira-bankulikire-chrispain-belebele-ntumba-telesphore-kazunguzibwa-masumbuko-and-the-coca-cola-company-regarding-events-in-the-democratic/ .

[10] OECD, Commentary on the Implementation Procedures of the OECD Guidelines for Multinational Enterprises, paragraph 26, in OECD Guidelines, supra note 1.