ition in their national treaty ratification laws, officials from a number of states party to the Mine Ban Treaty and/or the Convention on Cluster Munitions have made interpretative statements in which they clarified their view that the assistance clause is a de facto prohibition on financing.
“Don’t Bank on the Bomb,” a project by Dutch NGO PAX in collaboration with the International Campaign to Abolish Nuclear Weapons (ICAN) that focuses on links between financial institutions and companies involved in nuclear weapons, states the following concerning the TPNW’s potential implications for investors:
“There is a growing shared understanding that financing is a form of prohibited assistance. This is shown by state practice around the Convention on Cluster Munitions, the rationale behind the International Convention for the Suppression of the Financing of Terrorism and the practice of financial institutions from countries that have joined Nuclear Weapon Free Zone treaties. Just as with Chemical Weapons, the treaty prohibits any form of assistance. In the Oxford Public International Law commentary on the Chemical Weapons Convention, assistance is understood to include the provision of ‘through financial resources…. to anyone who is resolved to engage in such prohibited activity’ and anyone that could be ‘not only be a State, irrespective of whether or not it is a Party to the Convention, but also an organization, an enterprise, a person, or a group of persons, regardless of Citizenship.’ Many countries raised concerns with financing the production, testing, development and manufacture of nuclear weapons during the treaty negotiations. And Cuba, when it ratified the treaty, made it explicitly clear: ‘The financing of any activity prohibited to a State Party under this Treaty is also a prohibited activity according to the provisions of Article 1(e).’ While the financial sector cannot sign or ratify the treaty, divestment activities and policy changes send a clear signal that nuclear weapons are unacceptable, and that clears the path towards their total elimination.”
As of today, only three countries with significant financial markets have become state parties to the TPNW: Austria, Ireland and New Zealand. These countries have neither included explicit financing restrictions in national legislation as part of their TPNW ratification, nor have they made official statements confirming that they interpret the “assistance clause” to cover financing.
By Henning Weber, Lawrence Dermody and Verena Simmel, ISS ESG