The ILA Study Group on ‘Principles on the Engagement of Domestic Courts with International Law’ has issued a call for papers. Those selected will be invited to participate in the discussion of their papers by the Study Group, and will be potentially included in a relevant publication. The deadline for submission of proposals is the end of May. Full details can be found on the Study Group’s website, and the call may be directly downloaded (pdf) here.
Last week in Canada, with federal MPs returning to Parliament amidst the continuation of countrywide protests by indigenous peoples, an opposition MP introduced a private member’s bill (Bill C-469) to require the Canadian government to ensure that all federal laws are consistent with the United Nations Declaration on the Rights of Indigenous Peoples (A/RES/61/295). I’ll state clearly at the outset that this isn’t the first such proposal of its kind, with two other private member’s bills with the same general intent of giving domestic legal effect to the Declaration having been introduced in June 2008 (Bill C-569) and February 2009 (Bill C-328), later reinstated in March 2010. But the discussion that has ensued with respect to enacting domestic legislation to give a non-legally binding declaratory text status and pull within domestic law raises interesting questions for our understanding of the sources of international legal obligation (versus the sources of aspiration and political commitment), as well as concerns about the impact of UN efforts that raise unmet expectations. On the other hand, this may simply strike readers in other jurisdictions as very strange, at least in those jurisdictions where there is no chance that a domestic court would ever rely upon, or even cite, a General Assembly resolution text.
On 15 December, the International Tribunal for the Law of the Sea (ITLOS) ordered Ghana to release the Argentine military training vessel ARA Fragata Libertad (see oral proceedings). NML Capital, an investment company focused on distressed debt based in the Cayman Islands and owned by Elliot Associates, a US hedge fund, had earlier obtained an order from the Ghana Superior Court of Judicature (Commercial Division) to attach the Libertad moored in the port of Trema to satisfy a judgment by a US District Court for payment on defaulted Argentine bonds. The Libertad was on an official goodwill mission in Ghana’s internal waters at the time of the attachment. Read the rest of this entry…
More than ten years have passed since Argentina defaulted on its external debt obligations in December 2001. However, the repercussions of the Argentine financial crisis continue to contribute to the development of international law. This brief note provides a short overview of the most recent decisions of different domestic courts arising out of this Argentinian saga: NML Ltd et al. v the Republic Argentina before the US Court of Appeals decided on 26th October 2012 (see reporting here, here, here and here), and the decision of the Ghanaian Commercial Court of 2nd October 2012 (see Opinio Juris, BBC, Al Jazeera, and elsewhere: here, and here), while reference will be made to the NML v Argentina case, before the UK Supreme Court which was decided on 6th July 2011 (see reporting here and here).
These three cases pronounced on inter-related, but distinct, legal issues (enforcement of foreign awards, state immunity, and non-discriminatory treatment of bondholders) arising out of the Argentine decision to default on its external debt. In combination, they have far-reaching legal implications. It is noteworthy that different courts from around the globe repeatedly ruled in favour of bondholders and against Argentina. Although Argentina in and out of court has invoked political arguments, such as the implications of the court’s approach to the Eurozone crisis resolution efforts (in NML v Argentina before the US Court of Appeals) and the nature of the claimants as ‘vulture funds’ (see here reacting to the Ghanaian Commercial Court ruling; see also Lord Phillips and Lord Collins in NML v Argentina  UKSC 31, paragraphs 1 and 104-107 respectively), domestic courts consistently prioritise a more legal or stricto sensu approach and promote the Rule of Law in international economic and financial relations.
Background and US Proceedings
After the default in 2001, Argentina made exchange offers to holders of bonds, which were governed by the Fiscal Agency Agreement (FAA). Read the rest of this entry…
On October 18, the Kenyan Court of Appeal in Nairobi handed down a pivotal decision in In re Mohamud Mohammed Hashi, et al. It held that Kenya has jurisdiction to try piracy suspects whose alleged acts occurred beyond the country’s territorial waters. Due to Kenya’s central role in the emerging global network of piracy prosecutions, the Court’s ruling in Hashi will have positive implications both within and outside of Kenya.
The Court of Appeal decision overturns a ruling from the High Court of Mombasa, which concluded that, “[Kenyan] Courts can only deal with offences or criminal incidents that take place within the territorial jurisdiction of Kenya.” For an excellent analysis of the lower court’s decision, I would point readers to this post on Communis Hostis Omnium.
Ecuador has announced that it is granting asylum to Julian Assange, the Wikileaks founder, who has taken refuge in the Ecuardor’s embassy in London. Assange sought refuge in the Embassy after the UK Supreme Court ruled a few weeks ago that he may be extradited to Sweden where he is wanted for trial on allegation of committing sexual offences. In this dispute there are some points in the UK’s favour. It is fairly clear that Assange is not covered by Refugee Convention and is therefore not entitled to asylum as a matter of international law. That Convention does not apply to persons in respect of which there are serious reasons to believe they have committed a serious non-political crime (Art. 1(F)(ii)). Furthermore, as Matthew Happold pointed out in a previous post, general international law does not provide for diplomatic asylum. Thus, States are not required to grant safe passage out of their territory to those who seek asylum in diplomatic premises within their territory (unless there is a specific treaty which provides for such an obligation, which there is not in this case).
However, the UK also faces a number of legal difficulties. The main challenge it faces is that international law (in the form of Art. 22 of the Vienna Convention on Diplomatic Relations) provides that the premises of a diplomatic mission are inviolable and agents of a State may not enter them to perform law enforcement (or other) functions without the consent of the head of the diplomatic mission. So UK agents may not enter into the Ecuadorian Embassy to arrest Assange. The question raised is whether this inviolability is absolute and whether there are any ways in which the UK could get hold of Assange, without violating international law. In particular, may the UK unilaterally terminate the diplomatic status of Ecuador’s embassy by withdrawing its consent for that building to be regarded as diplomatic premises? If the UK did withdraw that consent, would the building then cease to be inviolable such that UK agents could go in to it?
Review of Expert Determinations of the International Swaps and Derivatives Association by Domestic Courts
A central policy concern since the onset of the Greek debt crisis in 2010 has been whether sovereign debt restructurings trigger credit default swaps (CDS). CDS are insurance-like financial products whereby a protection seller agrees to pay the protection buyer in case of a credit event on a reference entity (in this case Greece) in return for a premium over a defined period of time. The legal framework for CDS transactions is largely standardized. More than 90 percent of CDS transactions are based on the ISDA Master Agreement. As a mechanism for creditors to hedge against the default of a debtor, CDS are financial instruments to redistribute risk (or, according to their defenders, to shift risk onto those entities willing and capable of better bearing such risks). Over the last two decades, CDS on sovereign debtors became increasingly common.
Greece’s debt restructuring in February/March 2012 was the first to be implemented under the umbrella of a large number of CDS (more than 2.5 billion Euros in net terms). During the implementation phase of the Greek restructuring in March 2012, several interested market participants raised the question whether the Greek restructuring triggered an obligation for the sellers of CDS on Greece to pay. The Determinations Committee (DC) of the International Swaps and Derivatives Association (ISDA) for Europe, Middle East and Africa, the body established by ISDA and given decision-making power under the ISDA documentation to rule on credit events, found that a restructuring credit event was triggered on March 9 2012. The parties to CDS have agreed by contract that a credit event occurs only if the competent DC has said so.
As the Greek restructuring in February/March 2012 demonstrated, the consequences of such expert determinations by DCs can be momentous in financial terms not only for the parties to CDS transactions themselves, but also for the broader public and for taxpayers. A case in point is the Austrian bank KA Finanz, the bad bank split off from Kommunalkredit, the comparatively small Austrian lender to municipalities previously owned by Dexia that the Austrian government nationalized at the height of the global financial crisis. KA Finanz had taken over about 500 million Euros of CDS on Greece from Kommunalkredit. As a result of the payouts following the March 9 decision, the Austrian government had to inject another 1 billion Euros into the bank in order to stave off its collapse.
DCs recruit their members from among financial institutions and investment managers, which will often have positions on either side of CDS transactions. In view of their composition and the considerable practical importance of their decisions, concern has arisen that DC members may be tempted to “vote their own book” – i.e. to reach credit determinations in part based on whether the firm is on the buying or selling side of CDS for a particular reference entity. For instance, two members of the Steering Committee of the Institute of International Finance which negotiated the restructuring of Greek debt on behalf of private creditors of Greece, are voting members of the DC for Europe (BNP Paribas and Deutsche Bank). They were net sellers of CDS protection on Greece, meaning that both institutions had to pay out to protection buyers when the credit event occured. Given these concerns about independence of DCs and the right to a fair trial in civil matters under Article 6 of the European Convention, it is an open question whether competent domestic courts could in effect review decisions and potentially overturn decisions of DCs. Read the rest of this entry…
Barrie Sander has law degrees from Cambridge and Leiden, and from September 2012 will be a PhD candidate in International Law at the Graduate Institute of International and Development Studies in Geneva.
In an earlier post, I considered the question of corporate liability under international law in light of the case of Kiobel v Royal Dutch Petroleum (“Kiobel”), which is currently before the US Supreme Court. Kiobel, a case brought under the Alien Tort Statute (“ATS”), concerns claims that various Shell entities (“the respondents”) planned, conspired and facilitated extrajudicial executions, torture and crimes against humanity by Nigeria in the Niger Delta between 1992 and 1995.
It had been thought that the question of whether corporations may be sued under the ATS would be the central issue before the Supreme Court in Kiobel. However, during oral argument the Justices became preoccupied with the wider issue of the extraterritorial nature of the ATS. In particular, they focussed on the question whether US federal courts may rely on the ATS to exercise jurisdiction over human rights abuses which have no connection to the US, i.e. abuses committed by non-US entities against non-US victims on non-US territory. In short, is universal civil jurisdiction permissible under the ATS? Such was the focus of the Justices on the extraterritorial reach of the ATS that on 5 March 2012, only one week after hearing oral arguments, the Supreme Court ordered briefing and re-argument on:
“[w]hether and under what circumstances the Alien Tort Statute, 28 U.S.C. §1350, allows courts to recognize a cause of action for violations of the law of nations occurring within the territory of a sovereign other than the United States.”
Prior to this order, almost all briefing on this issue had been submitted by the respondents and their supporters, who have argued that broad assertions of universal civil jurisdiction by US federal courts may violate international law. In this post I consider some of the counter-arguments that the petitioners and their supporters may seek to raise in response. I suggest that though reliance on the Lotus principle, which would require a rule prohibiting an exercise of jurisdiction (rather than one permitting jurisdiction) may initially seem attractive, that approach is likely to fail. The strongest point that may be put in support of universal civil jurisdiction is that the existence of universal criminal jurisdiction contemplates a degree of civil jurisdiction as well. Read the rest of this entry…
Yesterday the Guardian published a top secret policy in place for the UK intelligence service since 2002 in several versions, dealing with their obtaining intelligence from detainees in the custody of foreign services who may be subject to mistreatment. The document is entitled ‘Agency Policy on Liason with Overseas Security and Intelligence Services in Relation to Detainees Who May Be Subject to Mistreatment,’ and is available with a few redactions here. The policy is sure to be prove controversial; as readers are aware, an inquiry is underway in the UK regarding complicity of UK services in overseas torture, while a judicial review case has recently been brought before the High Court (see Dapo’s recent post). The policy has been replacedy a more anodyne and public version in 2010 by the new coalition government.
Note that there is at least one more prior policy that is yet to be disclosed, which covered circumstances in which UK agents were ‘directly involved’ in the questioning of a detainee in the custody of a foreign intelligence service (see para. 2 of this policy). That other document may prove to be at least as interesting.
One may find a number of things morally objectionable upon reading the policy – and it’s precisely these parts of the document that caught the eyes of the press, e.g. the explicit reference to negative publicity for the UK as a factor in a balancing exercise in deciding whether or not to give permission for UK agents to provide information to the overseas agency even when there is a risk of mistreatment. But what I found striking about the old policy was how legalistic it was, i.e. how legal advice was used to put limits (or not) on UK participation in overseas interrogation. The new 2010 policy is very different – it seemingly quite deliberately omits any substantial legal discussion.
What is even more striking is how the policy concludes that human rights law as such does not apply to the issues at hand, although it then proceeds to import some human rights standards in the rules it sets out. Crucially, as Dapo pointed out in his earlier post and as I mentioned in a post from a couple of years ago, the key question here is the extraterritorial application of human rights treaties. Do, say, detainees in Pakistani custody questioned by a Pakistani intelligence officer who are being fed questions or information by UK agents have rights vis-a-vis the UK under the human rights treaties to which it is a party, or is it only Pakistan which has obligations in this situation?
In para. 21, the policy answers that question in the negative:
Under section 6 of the Human Rights Act 1998 it is unlawful for a public authority to commit torture , or to inflict inhuman or degrading treatment, as this would be incompatible with a Convention right [Article 3 ECHR]. However, in order for the Act to apply to a detainee held overseas, the UK would need to have “effective control” of the area in which the detainee is located, as the primary jurisdiction of the Act is territorial. The Act is therefore unlikely to apply in situations covered by this policy.
Today the UK Supreme Court decided R (Smith) v Secretary of State for Defence  UKSC 29 (press summary), yet another fascinating addition to the unfolding saga on the extraterritorial application of human rights treaties.
The plaintiff was the mother of a UK soldier stationed in Iraq who died there from a severe heatstroke. She demanded an inquiry into her son’s death that would be compliant with Article 2 ECHR, that would be able to expose what in her view were systemic faults in the UK’s provision of equipment and facilities to its soldiers in Iraq which ultimately led to her son’s death. In other words, the case is a mirror-image of Al-Skeini, which also dealt with Art. 2 procedural obligations in Iraq, but that time with respect to inquiries into the deaths of Iraqi nationals at the hands of UK troops. As the readers are aware, the Grand Chamber of the European Court held hearings in Al-Skeini just a few weeks ago (see my old post for more background).
With regard to extraterritoriality, the issue before the Supreme Court in Smith was this: does a UK soldier in Iraq enjoy the protection of the ECHR while stationed in an area not under the UK’s effective control? Incidentally, on the facts of the case, Private Smith actually died on a UK military base. Per the UK government’s concession in Al-Skeini, the House of Lords’ quite dubious analogy between a military prison or base and an embassy, and the European Court’s recent admissibility decision in Al-Saadoon, that fact alone would have brought Private Smith within the UK’s jurisdiction. Readers will recall that in Al-Saadoon the European Court brought the spatial model of Art. 1 jurisdiction as state effective overall control of a geographical area to its extreme, but saying that a military prison or base qualified as an ‘area’ susceptible to such jurisdiction and control.
In other words, under the spatial model Private Smith would have been within the UK’s jurisdiction, and therefore entitled to protection under Art. 2 ECHR. However, issue was raised in the lower courts as to whether he would have been within the UK’s jurisdiction even if he did NOT die on the base, but in essentially the same circumstances. Like the lower courts, therefore, the Supreme Court was now faced with a set of questions in a quasi-advisory posture – something that several judges openly lamented. The Court nonetheless decided to rule on the matter, because it is one of great practical relevance of UK military operations abroad; Private Smith is obviously not the only UK soldier to have died in Iraq or Afghanistan, and many soldiers lost their lives outside areas under UK effective control.
The lower courts applied to Private Smith a variant of the personal model of Art. 1 jurisdiction, as state authority and control over individuals, finding that he indeed fell within the scope of Art. 1. In their view, simply by virtue of being a part of the UK military, Private Smith was within the UK’s authority and control, and accordingly within its jurisdiction.
Today the Supreme Court disagreed. By a majority of 6 to 3 (Lady Hale and Lords Mance and Kerr dissenting), the justices found that mere membership in the armed forces was insufficient to establish a jurisdictional link for the purposes of Art. 1 ECHR.