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Western Sahara Conflict Reopens Amid Flawed Trade Agreements

A decades-old conflict between Morocco and the Polisario Front over Western Sahara’s independence has reignited, threatening to disrupt global trade and business operations. The dispute centers around Morocco’s consolidation of its presence in the territory through flawed trade agreements that disregard UN resolutions and international law.

EU-Morocco Deals Under Scrutiny

The European Union holds several trade agreements with Morocco, but a series of court rulings have raised questions about the legality of these deals. In 2016 and 2018, the European Court of Justice (ECJ) ruled that the EU’s agreements with Morocco cannot include Western Sahara in their scope of application, as this would violate international law.

The ECJ’s decisions have far-reaching implications for businesses operating in or trading with Western Sahara. Several companies have already faced legal action and reputational damage due to their involvement in trade deals with the disputed territory.

  • In 2017, a South African court seized a vessel carrying phosphate rock from Western Sahara, citing the ECJ’s ruling.
  • A Danish vessel was detained in Canada for similar reasons.
  • Six major companies were accused of colonization crimes by the Polisario Front before French courts.

Increased Risk and Uncertainty

The conflict’s resurgence increases operational risks for businesses operating in Western Sahara. With hostilities escalating, companies face uncertainties about doing business in the territory and may be vulnerable to sanctions.

  • A group of 19 MEPs has urged the EU to warn European companies involved in large-scale green-energy projects in Western Sahara of the legal and moral risks.
  • Sanctions risks are also rising, with some NGOs calling for institutions to impose penalties on Morocco for violating human rights in the territory.

Reliable Information Crucial

To navigate these complex threats, businesses need reliable information. Companies should design business continuity plans, monitor developments through media and corporate communications, and conduct enhanced due diligence to assess and prevent risks.

Dow Jones Risk & Compliance provides businesses with access to reliable information and risk assessments through its risk database, due diligence reports, and adverse media screening services.

Author Bio

Davide Contini is a researcher for Dow Jones Risk & Compliance’s adverse media entities unit. He covers Italian and Francophone sources and has expertise in English-, French-, Spanish- and Italian-language research, as well as knowledge of the political environments of North and Francophone Africa.