Remodel RE/MAX: Statement

September 2013 report filed with the U.N. General Assembly by Richard Falk, the Special Rapporteur on the situation of human rights in the Palestinian territories occupied since 1967

Section of Falk's report dealing with Re/Max International 

B. Re/Max International

48. Re/Max International is a privately held real estate company in the United States that has an international network of franchisee-owned and operated offices. Re/Max International receives 1 per cent of the revenue of sales and a flat fee per associate. 50 Re/Max International franchises its international brand name affiliation and recognition, start-up training, ongoing training, technological resources, and advertising and marketing support. 51 Re/Max Israel is itself a franchise of Re/Max International. It opened in 1995 and has more than 100 branches, including in settlements on the West Bank. Israeli branches advertise properties and execute sales of settlement homes in the West Bank. 52 The Re/Max Israel franchise office in Jerusalem, called Re/Max Vision, targets international clients who may be interested in purchasing a home in or around Jerusalem. 53 Re/Max International promotes the same properties on its website. A search of its website in June 2013 indicated that there were 51 residential properties advertised in 9 settlements. 54

49. Can Re/Max International be held accountable for settlement properties sold by Re/Max Israel? By providing international brand name affiliation and recognition, start-up training, ongoing training, technological resources, and advertising and marketing, as well as by profiting from such sales, Re/Max International has constant interaction and influence over its franchises. Similar to the Dexia Group case study, the methodology used in the legal analysis set out below will be applied in order to assess the legal plausibility of such a case.

1. International humanitarian law

50. Promoting the sale of (for example by advertising) or selling property on or as part of a settlement contributes to the commission of the international crime of transferring citizens of the Occupying Power onto occupied territory. In fact, advertising and selling such properties to citizens of the Occupying Power constitute instances par excellence of participating in such transfers.

2. International human rights law

51. The responsibility to respect human rights requires businesses to avoid contributing to adverse human rights impacts and to mitigate such impacts when linked to their operations. 55 Re/Max International, through selling properties on Palestinian land, is directly contributing to adverse human rights impacts, such as the restrictions on freedom of movement that obstruct Palestinians’ access to land, which is often used for agricultural purposes, and arbitrary and unlawful interference with Palestinians’ privacy, family and home. 56 States parties to the International Covenant on Civil and Political Rights are obliged to regulate the conduct of private groups and ensure that such conduct will not result in violating human rights and, where it does, ensure that effective remedies are available.

52. Re/Max International’s code of ethics states that “its affiliates shall undertake to eliminate any practice by real estate professionals in their community which could be damaging to the public”. 57 The statement reveals two things. First, if the Palestinian population is considered to be part of the public in Israel (given that Israel effectively controls the population) then the establishment of settlements is clearly damaging to that sector of the public. Second, the code of ethics extends to the “affiliates” of Re/Max International, which form part of its “community”, therefore reconfirming the connection between the global company and its local franchises.

3. International criminal law

53. Neither the United States nor Israel are States parties to the Rome Statute. That makes it difficult to bring a case of complicity against a Re/Max International employee, except if the employee is a national of a party to the Rome Statute. In terms of the causal connection between Re/Max International and its franchises, the fact that it advertises on its website the sale of the properties in settlements demonstrates that it knows about such sales and draws a 1 per cent profit from each sale. Again, by providing international brand name affiliation and recognition, start-up training, ongoing training, technological resources, and advertising and marketing, Re/Max International has an ongoing interaction and influence over its franchises. The Special Rapporteur believes that a strong case could be made that this amounts to knowing assistance in the commission of a crime. Further, the explicit connection of individual salespersons to the promotion and sale of homes in Israeli settlements greatly increases prospects for holding individuals accountable for such crimes.

4. Civil liability

54. Civil liability for corporate complicity may prove a difficult avenue for redress in this case. The United States Supreme Court decision on Kiobel v. Royal Dutch Petroleum Co. presents a challenge to litigation against corporations through the Alien Tort Statute, which had been a valuable mechanism to hold corporations accountable for violating international law. 58 This would make it difficult to bring a case of corporate complicity against Re/Max International in the United States. Nonetheless, civil liability could be prosecuted against individuals within Re/Max International for their role in knowingly assisting in the commission of a crime by providing advertising and other administrative support to Re/Max Israel’s property sales in the West Bank, including East Jerusalem. Furthermore, the Guiding Principles on Business and Human Rights emphasize that States must take appropriate steps to ensure that effective remedy is available through judicial, administrative and legislative means. 59

55. Real estate agents who promote and/or sell properties in settlements in Palestine to citizens of the Occupying Power may be held liable for complicity in the crime of promoting settlement activity in occupied territory. While the present case study examined Re/Max International, the same analysis would apply to other real estate agencies. The unavailability of civil relief in United States court at the present time does not establish that such a remedy might not be available in other national legal systems.

C. Conclusions on case studies

56. The present report proposed a model for legal analysis by focusing on two companies chosen for the particular ways in which their activities potentially implicate them in international crimes. The legal model can be applied to other situations and other companies. The Special Rapporteur stresses again that the companies discussed herein are illustrative examples; however, some conclusions can be drawn about the case studies.

57. Financial institutions and real estate agents may be held accountable for their involvement with settlements in occupied Palestine. Pressure by the international community to uphold international law is no longer limited to States as the primary duty-bearers. Companies, individuals and groups can be implicated for behaviour that contributes to wrongful acts. The Dexia Group and Re/Max International, in different ways, assist in the growth of settlements: the Dexia Group by providing financial services connected to the settlements, and Re/Max International by selling settlement properties. In terms of assessing the causal connection to the policy and practice by Israel of transferring its citizens to Palestine, this must largely be based on the connection between the global companies and the settlement activity. Do the activities of the global companies directly contribute to the violations of international law that the settlements constitute? Voluntarily playing a causal role in the commission of a crime can in certain instances be enough to make them accomplices to that crime.

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