Pressure mounts on companies involved with illegal tramway

3 April 2008

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The tramway under construction in Jerusalem, 10 February 2008. (Anne Paq/Activestills)


Recently the French engineering and consulting company Egis Rail joined European companies Veolia Transport and Alstom in their tramway project being built on Palestinian land in Jerusalem. Alstom won the construction bid in 2000 and two years later Veolia Transport obtained the operating rights. The tramway will connect the ring of illegal Jewish settlements in the West Bank with Jerusalem, for which Palestinian land is being confiscated, on top of other violations of international law.

On 13 February 2008 The French-Israeli chamber of commerce reported on its website that Egis Rail won a 11.9 million euro contract with Jerusalem Transportation Master Plan (JTMP). A public body, the JTMP team is managed and funded in cooperation with the Israeli Ministry of Transport and the Jerusalem municipality and operates through the Association for Urban Development, Preservation and Planning in Jerusalem with the mayor of Jerusalem as its director. Egis Rail will assist in the project management of the construction of three tramway lines. The contract includes support to a seven-kilometer extension to the north and the south of a line that is already under construction, and a branch of one and a half kilometers towards the Old City. A team of six Egis Rail specialists is currently based in Jerusalem to manage the project.

Veolia and Alstom’s role

In August 2007 the respected Palestinian human rights organization Al Haq wrote the presidents of Veolia and Alstom to inform them that the construction of the tramway in East Jerusalem is in violation of international law. According to Article 49 of the Fourth Geneva Convention, an occupying power is forbidden from transferring its population to the territory it occupies. The organization explained that under international law this is considered a war crime. The Jerusalem tramway strengthens the infrastructure of the Israeli occupation and is therefore an obstacle for the indigenous Palestinian people to exercise their right to self-determination. According to the Israeli human rights organization B’Tselem, almost 250,000 Israeli civilians have already been transferred to the settlements in East Jerusalem. Recently Israeli Prime Minister Olmert vowed to a Reuters journalist that he will not stop building settlements on occupied land in and around Jerusalem.

At the end of October 2007, Veolia Transport and Alstom were taken to court by Association France Palestine Solidarite (AFPS) because of their involvement in the Israeli tramway project. Veolia has been under international pressure to withdraw from the project, but so far refuses. The Palestinian Liberation Organization (PLO), as the legitimate representative of the Palestinian people, joined AFPS in the legal action against the two companies, inovoking French Civil Code which states in its Articles 6, 1131 and 1133 that any agreement can be discharged of its powers when its aim is in contradiction with the public order or good morals. As they are in violation of international law, the contracts of Alstom and Veolia Transport are therefore also illegal under French law. The legal action undertaken by AFPS is based on this rule in French law and is seeking the cancellation of the contracts for the construction and running of the tramway in Palestine between Alstom, Veolia and the Israeli government. At the same time the legal action is aimed to prohibit the companies from executing the contract.

In early January 2008 the court in Nanterre ordered Veolia and Alstom to provide the tramway contract with the city of Jerusalem and the Israeli government. Until then the companies argued they were not involved in the City Pass contract, and had refused to submit the contract. Reluctantly, they handed over the contract to the Nanterre court the end of February 2008. The contract is under the study of the court at present.

Veolia and Swiss and Dutch banks

On 11 March this year activists approached the Swiss bank Sarasin to question its investment in Veolia because of the company’s complicity in violations of international law. One week later the bank’s assistant vice-president of sustainability research responded by email, stating: “We agree that the issue is controversial. As you probably know, the court of Nanterrre will soon decide whether it will start a court case. We will await this decision and then decide on the further rating implications of this issue.”

Dutch SNS Bank is the owner of ASN Bank which decided to exclude Veolia Environment from its portfolio in November 2006, and SNS Bank was approached by activists to follow the example of ASN Bank. Last summer SNS sharpened its investment policy and developed criteria for divestment. SNS Bank has informed the author that it will make a decision about the exclusion of Veolia from its portfolios at the end of April. The decision will be based on its new investment policy and the assessment of Veolia Environnement that ASN Bank also used.

It is clear that the pressure on Veolia to withdraw from the tramway in East Jerusalem is building up. The effect will not be lost on the management of Veolia. The image that it meets the needs of people and sustainable development is at the heart of the company. The tramway in East Jerusalem is a hindrance to the basic need of the indigenous Palestinians to exercise their right to self-determination. A key value of Veolia is supposed to be responsibility. Veolia states on its website, “We are aware of the impact our everyday actions have in improving the living conditions of people worldwide. We never forget how our business affects our employees and society as a whole and base our actions on our understanding of the general public interest.” Being Israel’s partner in crime, however, reveals a completely different image of Veolia.

Adri Nieuwhof is a consultant and human rights advocate.

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