State immunity, or sovereign immunity as it is often referred to, is a principle of international law that has become part of the national law of many states. Venezuela and the United States would require that award creditors file a complaint seeking entry of judgment on the award; serve the complaint on the foreign sovereign award debtor; and comply with the venue requirements of the FSIA, with these three steps conferring jurisdiction over the foreign sovereign in the federal district court and permitting that court to enter a valid judgment. The FSIA defines what entities are included within the meaning of a “foreign state”. Section 1611 of the FSIA also provides that certain types of property are immune from execution in all circumstances, such as (i) assets detained by a foreign central bank or monetary authority, or (ii) property that is or is intended to be used in connection with military activity, with (a) military character or (b) under the control of a military authority or defence agency. State Sovereign Immunity and Tort Liability. [8], [1]    Frischknecht Andreas, Poplinger Andrew, Enforcement of Foreign Arbitral Awards and Judgments in New York, Kluwer Law International 2018, [2]    Mobil Cerro Negro, Ltd. v. Bolivarian Republic of Venezuela, 863 F.3d at 114 (“Actions to enforce ICSID awards rendered against foreign sovereigns fall neatly into the FSIA’s specific exemptions from immunity under Sections 1605(a)(1) (waiver) and (6) (arbitration)”), [3]    https://www.law.cornell.edu/uscode/text/28/1609, [4]    https://www.law.cornell.edu/uscode/text/28/1610, [5]    https://www.law.cornell.edu/uscode/text/28/1611, [6]    https://www.law.cornell.edu/uscode/text/28/1603, [7]    https://www.law.cornell.edu/uscode/text/28/1603, [8]    USAA Cas. [6] Section 1603(b)(2) of the FSIA defines an agency or instrumentality of a foreign State as any entity that is an organ or political subdivision of the State. Generally, a state government is immune from tort suits by individuals under the doctrine of sovereign immunity. The main issue related to enforcement of an arbitral award against a State in the United States is the State’s sovereign immunity. Sovereign immunity in international law makes one State’s property immune from interference by another State in two ways: jurisdictional immunity, which limits the adjudicatory power of national courts against a foreign State, and enforcement immunity, which limits the taking of or interference with State property by executive authorities of foreign States. Co. v Permanent Mission of the Republic of Namib.,681 F.3d 103, 107 (2d Cir. The District of Columbia Court confirmed waiver of immunity from jurisdiction based on arbitration. Sovereign or governmental immunity concern themselves with the various legal doctrines or statutes that provide federal, state, or local governments immunity from tort-based claims, as well as exceptions to or waivers of that immunity. Under the Foreign Sovereign Immunities Act (“FSIA”), foreign sovereigns enjoy immunity from jurisdiction, a presumptive immunity from suit in U.S. federal and state courts, and immunity from execution, whereby their property is immune from attachment and execution. Section 1610(a) of the FSIA allows execution against a foreign State’s property located in the United States if the property is used for commercial activity. [18] In the past two decades, nearly every major opinion on sovereign immunity—majority, concurrence, or dissent—recounts some version of this tale.

The Judicial power of the United States shall not be construed to extend to any suit in law or equity, commenced or prosecuted against one of the United States by Citizens of another State, or by Citizens or Subjects of any Foreign State. [5], Also, the FSIA provides that the property subject to attachment and execution must be property in the United States of a foreign State. [7] Courts across the U.S. have found that political subdivision refers to diplomatic agencies such as embassies or consulates. Starting in the mid-1900s, however, a trend toward government accountability began to erode sovereign immunity. Ins. 2012); Frischknecht Andreas, Poplinger Andrew, Enforcement of Foreign Arbitral Awards and Judgments in New York, Kluwer Law International 2018, p. 312, Filed Under: Enforcement of Arbitration Awards, Investment Arbitration, United States Arbitration, Europe | Middle East | Africa | Asia | Americas, Providing the Highest Quality International Arbitration Legal Representation, Globally, https://www.law.cornell.edu/uscode/text/28/1609, https://www.law.cornell.edu/uscode/text/28/1610, https://www.law.cornell.edu/uscode/text/28/1611, https://www.law.cornell.edu/uscode/text/28/1603, Aceris Law Successfully Resolves Dispute in Solar Industry, Initiating Arbitrations Under Multiple Arbitration Agreements, Arbitration Under the OIC Investment Agreement. For most of American history, sovereign immunity almost universally protected federal and state governments and their employees from being sued without their consent. It derives from the theory of the sovereign equality of states, as a consequence of which one state has no right to judge the actions of another by the standards of its national law. The main issue related to enforcement of an arbitral award against a State in the United States is the State’s sovereign immunity. [1], However, by consenting to arbitration, States waive their immunity from jurisdiction. [4] The FSIA defines “commercial property” as “either a regular course of commercial conduct or a particular commercial transaction or act”. If the foreign state has not waived its immunity and property is held for its own account, such property may not be attached even if it is used for commercial purposes.

[2], To enforce an award against a State’s assets located in the United States, Section 1609 of the FSIA provides that the court must determine whether the assets meet restrictive exceptions to immunity from execution that provides general protection of State property from attachment.[3].



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