Last updated: May 2007


War on Want’s John Hilary shines the spotlight on the growth of private military companies profiting from conflicts around the world.

In March 2004, four American guards were attacked and killed in the Iraqi town of Fallujah. Their charred bodies were beaten and dragged through the streets in front of television cameras, and two of the corpses were hung from a bridge over the river Euphrates.

The following month, eight commandos who were engaged in an intense firefight with Iraqi militia during an attack on the US government headquarters in Najaf, called in their own helicopter support to supply ammunition and remove the wounded.

In November 2005, a trophy video was published on the internet, showing UK personnel randomly shooting at civilian cars from the back of their vehicle on the road to Baghdad airport. Other such videos show troops engaged in fierce firefights with Iraqi insurgents.

What makes the above incidents special is that none of the soldiers were part of any national armed forces. They were all mercenaries employed by private military and security companies (PMSCs) in Iraq. These companies are paid in turn by governments and multinational corporations to provide a wide range of services, from acting as armed guards for convoys and oil installations, to running border patrols and training local police and military forces. And they are regularly involved in direct combat with Iraqi militia fighters.

According to industry figures cited by the US Government Accountability Office, anything up to 48,000 mercenaries today work alongside occupation forces in Iraq. This means that for every British soldier fighting in Iraq there are six mercenaries. And PMSCs now form the second-largest force behind the US military in Iraq. With pressure mounting for British and US troops to be withdrawn, these companies will increasingly be asked to take over from regular armed forces.

This increased privatisation of military operations has brought an unprecedented boom for the industry. Estimates suggest its total income has reached about £50 billion a year – and UK firms are among the biggest winners. British companies saw their annual income grow sixfold in the first year of the Iraqi occupation alone. Individual companies such as ArmorGroup now post an annual turnover exceeding £150 million.

Aegis Defence Services, run by former Sandline International chief executive Tim Spicer, of the 1998 ‘Arms to Africa’ scandal, saw its turnover rise from just £554,000 in 2003 to £62 million in 2005 through a three-year, US$293 million contract from the US government to co-ordinate all mercenary activity in Iraq.

It is not just these companies but their investors too who will be profiting from these conflicts.  ArmorGroup, for example, is listed on the London Stock Exchange and according to its website, significant investors as at March 14th included Barclays Plc and investment funds such as Artemis UK Smaller Companies.  There is even a chance that your pension fund could be involved through fund managers and brokers.

The big money has come from Iraq, but there are also fortunes to be made in Afghanistan, as shown by the UK government’s new £20m annual contract awarded to ArmorGroup for security services in Kabul, Kandahar and Helmand province. In fact, most conflict situations offer rich pickings to mercenary companies willing to undertake the risks. Over the years PMSCs have won contracts to provide military and security services in conflict zones as far apart as the Balkans, Sierra Leone, Colombia, Papua New Guinea and Sri Lanka.

The use of PMSCs allows governments like ours to expand their military adventures across the world even while their regular national forces shrink. They also provide governments with useful political cover – ‘plausible deniability’ in the jargon – since mercenary soldiers can perform tasks which are too controversial for national forces. And they offer governments an antidote to ‘Vietnam syndrome’, where public support for overseas wars is eroded once casualties start arriving home. The hundreds of mercenaries who have lost their lives in Iraq are, by contrast, less publicised and therefore ‘cost-free’ in political terms.


Outside the law

Yet the key difference between corporate mercenaries and regular forces is that PMSCs effectively operate outside the law. There is no international treaty covering their activity, and corporate mercenaries can rarely be brought to account before the judicial system in the country where they operate. Again, Iraq offers a stark example of the problem.

All foreign contractors were granted immunity from Iraqi prosecution under the infamous Order 17 of the US Coalition Provisional Authority, signed just as it was handing over to the interim Iraqi administration in June 2004. Despite hundreds of accounts of mercenaries abusing human rights in Iraq, including involvement in the torture of prisoners at Abu Ghraib, no private military contractor has ever faced prosecution for actions committed there.

This absence of legal accountability in the country of operation makes it doubly essential that there is legislation governing PMSCs in their home countries. Five years ago the Labour government acknowledged this need in a Green Paper outlining the options for regulation in the UK.

The paper listed possible options for legislation to control the companies, including a ban on all forms of combat and combat support, strict oversight of all contracts awarded to PMSCs and a register of the companies themselves to institute a system of proper accountability. All of these together would represent a step in the right direction – although still far short of legislation being considered in South Africa, which aims to ban all mercenary activity by its citizens.

Interestingly, British PMSCs have declared themselves ready for regulation – partly in order to brush up their own image. They have even banded together into a trade association, the British Association of Private Security Companies, in order to present a united corporate face to the outside world.

Yet since the publication of the Green Paper in 2002 the Labour government has stonewalled. Despite enthusiasm for legislation from Whitehall and growing calls for proper regulation from MPs, there seems to be a major political blockage at the heart of the Labour government itself. The political benefits which corporate mercenaries offer the government appear too important to jeopardise through regulation – as do the financial returns which this booming industry currently brings to the UK economy.

Whatever the reasons, the government must not be allowed to privatise war for its own convenience. PMSCs must not be permitted involvement in combat situations or in combat support, as defined in their widest senses, and should be subject to the strictest regulation for all their other services. If we really wish to see an end to the violence, lawlessness and human rights chaos of conflict situations such as Iraq, we should start by putting our own house in order and bringing corporate mercenaries back within the reach of the law.


Take action!

The campaign for legislation to bring PMSCs under democratic control has already succeeded in pushing the issue up the government’s agenda. Tony Blair was personally challenged on the issue at a meeting of the Labour Party’s national executive, while many media commentators have echoed the call for regulation. Yet still the government continues to stonewall, refusing to commit itself to starting work on legislation.

MPs have been more supportive, as shown in the initial cross-party support for Early Day Motion 690 in the House of Commons. The motion reads:

That this House welcomes the recent War on Want report entitled Corporate Mercenaries which examines the role of mercenaries and private military and security companies (PMSCs) in conflict zones around the world; shares its concerns over the exponential growth of PMSCs since the invasion of Iraq; notes that PMSCs work alongside regular soldiers providing combat support in conflict situations, yet remain unregulated and unaccountable leaving open the potential for human rights violations; further notes that problems posed by proliferation of PMSCs were highlighted in a Green Paper in February 2002 that originated in a request from the Foreign Affairs Committee but that almost five years later there is still no United Kingdom legislation regulating PMSCs; believes that self-regulation by the industry is not appropriate in this instance; and urges the Government to move towards binding legislation to control the PMSC sector as an urgent priority.

All readers are encouraged to take action so we can show the government the strength of feeling which exists over the creeping privatisation of war. Please contact your MP to ensure that they sign this important motion, and send a direct message to Foreign Secretary Margaret Beckett via War on Want’s email action.

Discussions are taking place now within Whitehall as to possible items for the coming year’s legislative programme, so it’s essential that public pressure is brought to bear at this time. We have a real chance to make legislation on private military companies a reality; let’s make the most of it.


The trophy videos, a full report and email action can all be viewed on War on Want’s website.


John Hilary is War on Want’s campaigns and policy director, overseeing the organisation’s broader campaign on corporations profiting from conflict.


First published Ethical Consumer 106, May/June 2007