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Periodical article Periodical article Leiden University catalogue Leiden University catalogue WorldCat catalogue WorldCat
Title:The regulation of multinational companies operating in developing countries: a case study of the Chad-Cameroon pipeline project
Author:Mujih, Edwin
Periodical:African Journal of International and Comparative Law
Geographic terms:Cameroon
Subjects:multinational enterprises
petroleum extraction
legal procedure
External link:http://www.heinonline.org/HOL/Page?handle=hein.journals/afjincol16&id=87&collection=journals&index=
Abstract:The Chad-Cameroon oil and pipeline project is intended to develop oil resources discovered in the Doba region of southern Chad. It is being executed by two joint venture companies established by a consortium of multinational oil companies with the governments of Chad and Cameroon respectively. The project included the construction of an approximately 1070 km underground pipeline to carry the crude oil from landlocked Chad across Cameroon to a proposed marine terminal near Kribi, which was completed in mid-2003. This is an instructive empirical example of issues relating to the regulation of multinational companies (MNCs) (in the extractive industry) operating in developing countries. As entities that operate across borders, MNCs are difficult to regulate on a unilateral basis, and as private entities, MNCs are not directly subject to international law. MNCs are thus not regulated by the international legal system. The project illustrates the novel phenomenon whereby critics intervene in the activities of MNCs in developing countries to fill in the regulatory vacuum. Changes to the project were made only after numerous criticisms from local and international NGOs and foreign governments and individuals. This puts into question the ability of developing host countries to effect such changes through traditional legal methods of control. The project also illustrates how while appearing to concede to the critics, MNCs have developed ingenious methods for circumventing their watchful eyes and protecting themselves by creating subsidiary companies and excluding national legislation. The 1998 Convention of Establishment between the Republic of Cameroon and the Cameroon Oil Transportation Company (COTCO Convention), which is the legal framework for the project, gives the oil companies rights which are disproportionate to their liabilities. Notes, ref. [ASC Leiden abstract]