1999 International Law Update, Volume 5, Number 1 (January).
"ACT OF STATE" DOCTRINE
In civil action by finder against Ferdinand Marcos for converting gold plundered and buried by General Yamashita in Philippines during World War II, Hawai'ian Supreme Court rejects "act of state" defense since defendant failed to prove that Marcos had seized treasure for other than private purposes
While he was working as a locksmith in Baguio City, the Philippines in 1961, Roger Domingo Roxas ran into two individuals who claimed to know where Japanese General Tomoyuki Yamashita had buried large amounts of gold and other valuables looted from conquered nations during World War II.
During 1970, after 7 months of digging near a General Hospital, the Roxas team broke through into tunnels where they found a one-ton golden buddha statute and a thousand cubic feet of boxes containing gold bars. To finance a more complete exploration, Roxas sold some of the gold bars and tried to sell the buddha.
In April 1971, men in military uniforms raided Roxas' house, seizing the buddha, the diamonds, and the gold bars. Roxas complained to Judge Pio Marcos who said he had signed the warrant on the orders of Ferdinand Marcos.
Two weeks later, three "civilians" again arrested Roxas. Later, soldiers unsuccessfully demanded that Roxas sign a cooperation agreement. The soldiers then tortured him with electric shocks, burned him with cigarettes and beat him unconscious. Roxas escaped, however, and told his story at a Philippine senate hearing on June 30, 1971.
After Roxas came out of hiding in July 1972, two men arrested him and confined him in a Naval stockade. Upon his release in November 1974, Roxas observed the military excavating for the treasure near the General Hospital but turned down their requests for help. He then moved to another town where, for ten years, he had no more to do with the treasure.
Meanwhile, a hospital attendant and a military cook reported that they saw soldiers carrying large heavy wooden boxes out of a tunnel near the Hospital during 1974 and 1975 and placing them in guarded trucks. Their uniforms bore a "PSC" [Presidential Security Command] insignia. The cook estimated that, over a one year period, they were loading about ten boxes per day containing gold-colored bars.
In late 1974, a presidential confidante appro-ached Robert Curtis, a Nevada metals refiner, and asked him if would resmelt and remark some gold bars, changing their composition so as to defeat later identification. After Curtis had begun designing and building a gold refinery, threats on his life persuaded him to flee the Philippines. Various foreign businessmen and an ex-policeman reported secret efforts to use them to "launder" large amounts of Marcos gold on the world markets. Several persons personally observed vast stores of gold hidden on Marcos properties.
In February, 1986, the U.S. government transported a deposed Ferdinand and Imelda Marcos to Hawai'i. Roxas then had a Georgia friend incorporate the Georgia Budha Company (GBC) and hired an attorney to press his claims against the Marcoses.
Roxas and GBC sued Ferdinand and Imelda in Hawai'i in February 1988 for damages for Roxas' detention and torture and for various acts of converting the Yamashita hoard. Defendants moved to dismiss, inter alia, based on "head-of-state" immunity, and the "act of state" doctrine. In April 1989, the court denied the motions. [See below on issues of "head-of-state" immunity and choice of law.
After a jury trial, the court entered a judgment awarding plaintiffs over $22,000,000,000. From this judgment both sides appealed on a variety of issues. The Supreme Court of Hawai'i affirms in part and reverses in part.
In denying the Marcoses motion to dismiss, the lower court had rejected defendants' claim that the "act of state" doctrine based on international comity precluded litigation of the case. Under the classic statement of this doctrine, the courts of one sovereign state will not sit in judgment on the acts of another state carried out within its own territory.
In Banco Nacional de Cuba v. Sabbatino, 376 U.S. 398 (1964), the Supreme Court made clear that the doctrine was also bound up with the constitutional separation of powers at the federal level. While the doctrine is not irrevocably jurisdictional, "[i]t arises out of the basic relationships between branches of government in a system of separation of powers. It concerns the competency of dissimilar institutions to make and implement particular kinds of decisions in the area of international relations." [Slip op. 36] Nevertheless, the doctrine is also a federal limitation on state courts.
As to this case, defendants contended that, regardless of whether the government's action was unlawful under international or local law, the act of state doctrine warranted dismissal. The Hawai'ian court disagrees. It cites analogous civil actions against the Marcoses where the Ninth and Second Circuits gave little or no weight to the doctrine since a deposed ruler or government was invoking it to bar recovery of plunder by the successor government.
"The act of state doctrine is supple, flexible, ad hoc. [It] is meant to facilitate the foreign relations of the United States, not to furnish the equivalent of sovereign immunity to a deposed leader." [Slip op. 38]. Nor does the doctrine apply to the “private” acts of a head of state, i.e., actions taken for the leader's own selfish interests. The Court is more than a little dubious about defendants' claim that Roxas had found treasure on public property and had wrongfully appropriated some of it for his personal use rather than for the public good. This is not enough to meet the defense burden of proving that Marcos' dealings with Roxas amounted to "public" acts.
"First, the testimony of Olsson, Doel, and O'Brien regarding (1) the storage of gold in Ferdinand's 'summer palace' and at the Malacanang and (2) Ferdinand's surreptitious attempts to sell it, combined with (3) Hirschfield's testimony regarding Ferdinand's post‑presidential attempts to use the gold as security for a personal loan, was sufficient for the circuit court to reasonably infer, ... that Ferdinand had converted the treasure strictly for his benefit, rather than for that of the state. ... [Moreover], [t]he circuit court could reasonably have inferred that [Roxas'] detention and torture were carried out at Ferdinand's personal command and effectuated in order for Ferdinand personally to appropriate the treasure." [Slip op. 40]
Finally, the apparent illegality of the Marcos conversion of the treasure found by Roxas is significant. "... Congress has expressly exempted confiscations of personal property that are illegal under international law from the scope of the act of state doctrine. This provision, variously referred to in the case law as the 'Sabbatino amendment' and the 'Hickenlooper amendment,' was enacted in response to the Supreme Court's decision in Sabbatino. Despite its 'constitutional underpinnings,' the power of Congress to limit the act of state doctrine has been upheld by virtue of its peculiarly prudential character." [id.]
Citation: Roxas v. Marcos, No. 20606 (Supreme Court of Hawai'i, November 17, 1998).
In injury case against foreign airline arising out of intrusive security search, U.S. Supreme Court concludes that Warsaw Convention provides exclusive remedies for accidental injuries arising in course of international air travel
On May 22, 1993, Tsui Yuan Tseng arrived at J.F.K. airport in New York bound for Tel Aviv on El Al Israel Airlines. When she gave "illogical" answers to routine questions, guards classified her as a "high risk" passenger and had her undergo a "security search."
This required her to remove her jacket and sweater and to lower her blue jeans to mid-hip level. By hand and security wand, a female guard then spent fifteen minutes searching plaintiff's entire body outside her clothing, including her breasts and groin area. According to El Al, it had adopted these procedures pursuant to F.A.A. regulations. Cleared of being a security risk, a ruffled Tseng boarded her flight.
A year later, Tseng sued El Al for personal (but nonbodily) injuries in New York state court. As an "agency or instrumentality of a foreign state" under § 1603(a) of the F.S.I.A., the airline removed the case to federal court. The district court, however, dismissed her personal injury claims based on the body search as not amounting to an "accident" that caused physical injury as required by the Warsaw Convention.
The U.S. Court of Appeals for the Second Circuit affirmed in part and reversed in part [122 F.3d 99; see 1997 Int'l Law Update 74]. The Court held that the body search did not constitute an "accident" giving rise to liability for bodily injury under Article 17 of the Warsaw Convention [49 Stat. 3000, T.S. No. 876 (1934), reprinted in 49 U.S.C. § 40105 note]. In the Court's view, the term "accident" does not include those typical events to which a passenger has presumably consented, i.e., those injuries that take place in the normal operation of the aircraft. Though inconvenient and embarrassing at times, their goal is to preserve airline security for all.
The Court, however, next held that the Convention is not the exclusive remedy for personal injuries sustained in the course of international air travel. The exclusivity provisions of Article 24(2) of the Convention clearly bar resort to local laws only where Article 17 "covers" the incident. As to the treaty's goal of uniformity, the Second Circuit read Zicherman v. Korean Air Lines Co., 516 U.S. 217 (1996) [see 1996 Int'l Law Update 15] as teaching specifically that the Convention expresses no interest in uniformity so compelling that it would warrant displacing an otherwise applicable body of law.
Based on a division among the Circuits, the Supreme Court of the United States granted certiorari. Over one dissent, the Court reverses. In its view, the Warsaw Convention does bar a passenger from maintaining an action for personal injury damages under local law when her claim fails to satisfy the conditions for liability demanded by the Convention.
At the outset, the Court said that it must give the specific words of a treaty a meaning consistent with the contracting parties' shared expectations. Moreover, the Court has traditionally considered the negotiating and drafting history (travaux preparatoires) and the understandings of the contracting parties under the treaty regime as guides to treaty interpretation. Here, the Executive Branch as amicus curiae also favors the exclusivity approach.
Noting the Convention's complete scheme of liability rules and its textual emphasis on uniformity, the Court finds it hard to infer that the Warsaw delegates intended to subject air carriers to the distinct, nonuniform liability rules of the individual signatory nations. The Second Circuit thus misread Zicherman. It merely decided that the Warsaw drafters meant the Treaty to resolve whether there is liability. It then left to domestic law (the local law identified by the forum under its choice of law rules or approaches) all matters dealing with the compensatory damages available to the suitor.
Articles 17, 22, and 24 of the Convention sought to balance the interests of passengers seeking recovery for personal injuries, against the interests of air carriers seeking to limit potential liability. The Second Circuit's construction, however, would encourage artful pleading by plaintiffs seeking to opt out of the Convention's liability scheme when local law promised a higher recovery than that set out in the treaty. Such a reading would hardly promote the predictability that adherence to the treaty has brought about worldwide.
The U.S. has recently approved Montreal Protocol No. 4. Clarifying the Convention's exclusivity, it prospectively amends Article 24 to provide, in relevant part: "In the carriage of passengers ..., any action for damages ... can only be brought subject to the conditions and limits set out in this Convention ...." Plaintiff admits that this preemptive language would be fatal if applied to her case.
Plaintiff then argued that federal courts generally disfavor federal preemption of state law especially in matters of health and safety. The Court notes, however, that the Convention focuses upon the nation‑state, not subdivisions within one nation. Thus U.S. courts should not mechanically apply a domestic preemption analysis in determining the nation's international obligations. Finally, the Court finds comfort in the decisions of other signatory courts, including the House of Lords, that consistently uphold the exclusivity of the Convention.
The dissenting Justice summarizes his views as follows. "Everyone agrees that the literal text of the treaty does not preempt claims of personal injury that do not arise out of an accident. It is equally clear that nothing in the drafting history requires that result. On the contrary, the amendment to the title of the Convention made in response to the proposal advanced by the Czechoslovak delegation, suggests that the parties assumed that local law would apply to all nonaccident cases. I agree with the Court that that inference is not strong enough, in itself, to require that the ambiguity be resolved in the plaintiff's favor. It suffices for me, however, that the history is just as ambiguous as the text. I firmly believe that a treaty, like an Act of Congress, should not be construed to preempt state law unless its intent to do so is clear." [Slip op. 14]
Citation: El Al Israel Airlines, Ltd. v. Tsui Yuan Tseng, No. 97-475 (U.S. Supreme Court, January 12, 1999).
CHOICE OF LAW
In civil action against Marcoses over conversion of buried war treasure found by plaintiff, Supreme Court of Hawai'i agrees that Philippine law would govern survival or abatement of suit but declines to "judicially notice" that law for failure of parties to present evidence of its content
[For background facts, see "Act of State" above] An important issue in this case involved the law applicable to the survival of Roxas' claim against Marcos who died before the court had finally determined the merits. Under Hawai'ian law [HRS § 634-61 (1993)], the death of a defendant does not prevent the continuation of the suit against a properly substituted party. On several substantive issues, the lower court had applied the law of the Philippines as the jurisdiction with the most significant relationship to the parties and the subject matter. It applied HRS § 634-61, however, to the abatement issue. This posed the problem of whether the appellate court could or should "judicially notice" Philippine law on this point.
The Court first points out that acting as forum furnished the only Hawai'ian link to the subject matter of the suit. All other factors invoked the interests of the Philippines. Thus, the lower court had properly applied Philippine law to the substantive claims.
"In light of the foregoing, it would have made sense for the circuit court to have applied Philippine law as to the survival or abatement of those claims for relief. However, as far as we can discern, the parties never addressed Philippine law, if there is any, on the question at trial, and their appellate briefs are silent on the issue. This court may take judicial notice of the law of foreign countries. See Hawai'i Rules of Evidence (HRE) Rule 202(c)(5) (1993). ... [On proof of foreign law, see] HRCP Rule 44.1 (1996) ..."
"In the present matter, we need not directly address whether it is generally appropriate for courts in this jurisdiction to ascertain foreign law ex officio because reliable sources of Philippine law are not available. Under such conditions, it is eminently sensible to cast the burden of apprising the court regarding foreign law on the parties, and, where they fail to meet their burden, to assume acquiescence in the application of local law. Accordingly, we apply HRS § 634‑61 to our analysis." [Slip op. 22, note 16]
[Editorial Note. Rule 201 of the Federal Rules of Evidence restricts judicial notice to "adjudicative facts." Though a few states, such as Hawai'i, have added a Rule 202 to deal with other matters deemed appropriate for judicial notice, the Advisory Committee's Note to federal Rule 201 specifically characterizes proof of foreign law as "procedural" and thus, within Fed.R.Civ.Pro. 44.1]
Citation: Roxas v. Marcos, No. 20606 (Supreme Court of Hawai'i, November 17, 1998) [See also under Immunity (Head of State), below].
Argentina amends Intellectual Property Law to permit licensee to copy programs for personal use
With a law promulgated on November 11, 1998, the Argentine Congress has modified the Argentine Intellectual Property Law (Ley No. 11.723 sobre Propiedad Intelectual) to permit software licensees to make copies of computer programs for personal use.
It provides that someone who has properly acquired certain software may make copies of the original software without the express consent of the licensor. These copies may only be used to replace the original in case of loss or inability to function (Article 9). The amendment also adds computer software and databases to the definition of protected works in the Intellectual Property Law (Article 1).
Citation: Ley No. 25036, Modificacion de la Ley No. 11.723 (Approved October 14, 1998, promulgated November 11, 1998).
Fourth Circuit reverses dismissal of criminal charges for violating export ban to Iran holding that term “export” not ambiguous despite lack of definition in Iranian Transactions Regulations
A federal grand jury indicted Mohammad Reza Ehsan for shipping equipment to Iran in violation of export restrictions imposed on Iran based on an Executive Order and its implementing regulations [Exec. Order No. 12959, 60 Federal Register 24757 (1995), 31 C.F.R. §§ 560-203-.205, .406 (Iranian Transactions Regulations)]. President Clinton had issued that Executive Order to counter Iran’s threat to U.S. national security, foreign policy, and economy. It bans most imports, exports, and transshipments of goods between the U.S. and Iran. The implementing regulations issued by the Office of Foreign Assets Control bar any exports, or financing thereof, to Iran.
In 1996, Ehsan had ordered "Transformer Oil Gas Analysis Systems" (TOGASs) for shipment to Dubai, United Arab Emirates (U.A.E.), though the ultimate destination was Iran. TOGASs were not subject to export license application requirements at that point and were exempt from the reexportation ban. Customs Agents created a dummy package for a controlled delivery. Authorities arrested Ehsan after the package reached the U.A.E.
Pointing to the absence of definitions in the Executive Order’s and regulations' lack of definitions, Ehsan argued that his planned shipment of the goods to Iran was a permissible "reexport," not an impermissible "export" or "transshipment." The district court agreed with Ehsan that the provisions were ambiguous. Under the rule of lenity, the court dismissed counts two and three of Ehsan’s indictment that charged violations of the export ban.
The U.S. Court of Appeals for the Fourth Circuit reverses and remands to reinstate counts two and three of Ehsan's indictment. Even though the regulations do not define "export," its ordinary meaning is clear. It merely involves the transit of goods from one country to another for the purpose of trade. If Ehsan had intended to sell the products in Iran, then the shipment plainly amounted to an "exportation" to Iran.
This view is consistent with the purpose of the Executive Order, which is to isolate Iran from trade with the U.S. Absent a severe ambiguity, to apply the rule of lenity would take this important foreign policy decision out of the hands of the Executive and put it into those of the courts.
"Ehsan's transaction may indeed have constituted a reexport, if he shipped the TOGAS with the purpose of joining them with the commerce of the U.A.E. and then shipped them from the U.A.E. with the intent to join them with the commerce of Iran. ... This, however, is a question for the jury, not an ambiguity in the regulatory scheme. Ehsan also places great weight on the fact that the TOGAS cleared customs in Dubai. Once the shipment cleared customs, he argues, the ‘export’ to the U.A.E. was complete. Customs clearance, however, is simply another fact for the jury to weigh in determining whether Ehsan intended to export the goods to Dubai or to Iran – just as bills of lading, his purchase orders, and the situs of his ultimate customer certainly will be.” [Slip op. 12]
Citation: United States v. Ehsan, No. 98-4036 (4th Cir. December 15, 1998).
In case of first impression, Florida federal court rules that International Covenant on Civil and Political Rights does not bar United States from prosecuting persons already convicted for same crime in another country
In June 1982, a federal grand jury indicted Rene Benitez and Jose Duarte‑Acero for assaulting two special agents of the United States Drug Enforcement Administration ("DEA"). This assault allegedly took place in February of 1982, outside of Cartagena, Colombia. The U.S. next sought to extradite them for trial on the present offense. The Colombian government, however, declined to do so. In 1987, in fact, the Colombian Supreme Court annulled the extradition treaty between that nation and the U.S.
In 1995, by some "informal" means other than extradition, someone brought defendant Benitez from South America to the U.S. and, in 1997, the same thing happened to defendant Duarte‑Acero. U.S. authorities arrested and arraigned the two men on the DEA assault charge. Defendants alleged [but have not yet proven] that before their excursion to the United States, the Colombian government had tried, convicted, and incarcerated them in Colombia for the present offense.
Moving to dismiss, defendants claimed that, because of their Colombian convictions, the U.S. cannot prosecute them again for the same offense. They rely mainly on the International Covenant on Civil and Political Rights (ICCPR) (December 16, 1966, 999 U.N.T.S. 171).
The district court denies the motion. The Court first remarks that whether the ICCPR bars a second prosecution for an offense for which another nation has convicted defendant seemingly is a matter of first impression.
In September 1992, the President ratified the ICCPR subject to a number of reservations, declarations and understandings. As its preamble shows, the ICCPR aims to provide international protection for the civil and political rights of the individual, as well as certain economic, social and cultural rights.
Article 14(7) of the ICCPR provides, "No one shall be liable to be tried or punished again for an offence for which he has already been finally convicted or acquitted in accordance with the law and penal procedure of each country." [emphasis added] According to defendants' reading, the ICCPR bans a prosecution of X by one national government for an offense for which another national government has already either convicted or acquitted X. The Court disagrees with Defendants, however,and finds that the ICCPR, Article 14(7), bars only successive internal prosecutions by the same government.
By its language, the ICCPR does not purport to regulate affairs between nations. Rather, the ICCPR is an international agreement mandating how each state party is to treat individuals within its jurisdiction. "In a document that Defendants provided to the Court, the Human Rights Committee‑‑created under Article 20 of the ICCPR‑‑states that the ICCPR is not a mere exchange of obligations between States, but rather, a human rights treaty which is 'for the benefit of persons within their jurisdiction.'" [Slip op. 2]
Moreover, in A.P. v. Italy, Communication No. 204/1986, the same Committee held that the ICCPR did not bar Italy, as a signatory nation, from prosecuting an individual for the same offense for which Switzerland had previously convicted and sentenced him.
Finally, the Court declares, "In ratifying the ICCPR, the Senate [sic] stated that the United States 'understands the prohibition upon double jeopardy in paragraph 7 to apply only when the judgment of acquittal has been rendered by a court of the same government unit, as is seeking a new trial for the same cause.' 138 Cong. Rec. S4781‑01, S4783. The import of this qualification is that the Senate understood this paragraph to apply to a nation's internal prosecutions." [Slip op. 3]
[Editorial Note: The Court could also point out that one of the Senate's reservations was that the ICCPR was not self-executing within the United States.]
Citation: Benitez v. United States, No. 82-292-CR-Gonzalez (S.D.Fla., November 4, 1998).
IMMUNITY (HEAD OF STATE)
Where finder of buried World War II treasure sued deposed Philippine President Marcos for converting hoard to his personal use, head-of-state immunity does not apply to former leader’s actions
[For background facts, see "Act of State" above] Imelda Marcos (as substituted defendant) also argued that her husband was immune from suit in Hawai'i under the "head of state" doctrine.
The Court first notes that this type of immunity stems from customary international law and seeks to advance international comity and respect among sovereign nations. It does this by making sure that leaders are free to perform their governmental duties without being subject to detention, arrest, or embarrassment in a foreign country's legal system. It generally holds that a head of state is not subject to the jurisdiction of foreign courts, at least as to official acts taken during the ruler's term of office.
The Court concludes that this form of immunity does not apply here. "In any case, other than the nineteenth century New York decision cited by Imelda, we have found no other authority that applies head of state immunity to former heads of state. Modern authority is to the contrary. As the plaintiffs‑appellees have observed, Ferdinand has repeatedly and unsuccessfully claimed head of state immunity in various lawsuits around the country. ... Accordingly, we hold that Ferdinand is not protected by head of state immunity." [Slip op. 42]
Citation: Roxas v. Marcos, No. 20606 (Supreme Court of Hawai'i, November 17, 1998). [For another branch of this complex case, see "Choice of Law" above].
In suit against Libya arising out of Pan Am 103 bombing, Second Circuit rejects constitutional challenge to new anti-terrorist amendment to Foreign Sovereign Immunities Act since Libya already on State Department’s list at time of enactment
This is another case in the saga of the Pan Am 103 flight that a bomb blew out of the sky over Lockerbie, Scotland, in December 1988. The representatives of the victims brought suit against Libya because it had allegedly sponsored the terrorists who had planted the bomb. Libya argued that the applicable jurisdictional section of the Foreign Sovereign Immunities Act (FSIA), 28 U.S.C. Section 1605(a)(7), is an unconstitutional delegation of the power to determine the jurisdiction of the federal courts. It essentially allows the U.S. Department of State to determine judicial jurisdiction by designating a foreign state as a sponsor of terrorism.
[New York federal courts have dismissed several previous cases based on the same facts for lack of subject matter jurisdiction. In 1996, Congress amended the FSIA with the Antiterrorism and Effective Death Penalty Act (AEDPA) by adding paragraph (7) to § 1605(a). Under this new section, foreign nations that the State Department has designated as state sponsors of terrorism have no immunity from damage actions for personal injury or death resulting from torture, murder, aircraft sabotage, or hostage taking.]
The district court denied Libya’s motion to dismiss, reasoning that Section 1605(a)(7) does not confer jurisdiction but simply deprives Libya of the affirmative defense of sovereign immunity. Libya filed an interlocutory appeal. The U.S. Court of Appeals for the Second Circuit affirms in part and dismisses in part.
The U.S. Secretary of State designates state sponsors of terrorism under 50 U.S.C. App. § 2405(j) or 22 U.S.C. § 2371, for export and foreign aid purposes. Under the new FSIA section 1605(a)(7), this designation also affects federal court jurisdiction over actions against foreign states. The Court finds that 28 U.S.C. §1605(a)(7) is constitutional, but its reasoning differs from that of the district court. In this case, there simply was no unconstitutional delegation of powers because, when enacting Section 1605(a)(7), Congress knew that Libya was already on the list of state sponsors of terrorism.
"The issue of delegation [however] might be presented if another foreign sovereign – one not identified as a state sponsor of terrorism when § 1605(a)(7) was passed – was placed on the relevant list by the State Department and, on being sued in federal court, interposed the defense that Libya now raises. It might also arise if a state on the list when § 1605(a)(7) was enacted was later dropped from the list. In that scenario, a plaintiff could put forth a claim of unduly delegated authority. But Libya has no similar complaints in the case before us. For that reason, we need not now express any opinion on whether such hypothetical cases would ... implicate the doubts expressed by the Seventh and Eleventh Circuits. As here applied to Libya, § 1605(a)(7) creates jurisdiction directly at the behest of Congress and without any intervening decision by another body. Accordingly, we find no delegation of legislative power and, necessarily, no unconstitutional delegation either." [Slip op. 41-42]
Citation: Rein v. Socialist People's Libyan Arab Jamahiriya, Libyan External Security Organization, No. 98-7467 (2d Cir. December 15, 1998).
44 nations agree to restitution guidelines for art looted by Nazis
During a conference organized December 1-3, 1998, by the U.S. Department of State and the Holocaust Memorial Museum, 44 nations and 13 NGOs discussed restitution practices and policies. The participants agreed to guidelines for the restitution of works of art looted during the German Third Reich by the National-Socialist regime. The "Washington Principles On Nazi-Confiscated Art" call for the:
- Opening of all records and archives where information may be found,
- Identification of looted works of art,
- Establishment of a central registry of such information,
- Claimants to come forward, and
- "Just and fair" solutions.
The participating countries pledge to implement the guidelines into their national laws even though these guidelines do not have the force of an internationally binding treaty. Russian officials indicated that they would follow the guidelines except when confiscated, previously state-owned "trophy art" is concerned.
Citation: Washington Conference Principles On Nazi-Confiscated Art (December 3, 1998), available on the U.S. Department of State's website at www.state.gov/www/regions/eur/holocausthp.html; Washington Post, December 4, 1998, page A2.
U.S. and 32 other nations that take part in "Wassenaar Arrangement" agree in Vienna to restrictions on international transfers of data-scrambling technologies
On December 3, 1998 in Vienna, the U.S. and 32 other countries agreed to restrict the international transfer of encryption technology. The member countries of the so-called Wassenaar Arrangement, which coordinates export policies for "dual use" goods that have both civil and military uses, fashioned the arrangement.
Under Dual-Use List Category 5, Part 2 ("Information Security"), countries will allow the license-free export of commercially available encryption systems that do not contain "symmetric algorithms" with a key length exceeding 64 bits, or a "symmetric algorithm" exceeding 56 bits (Editorial Note: The more bits a key contains, the more difficult it is to extract the encrypted information). Commercial software for broad audiences – such as internet browsers or e-mail programs – may use up to 64-bit keys.
There will be no restrictions on encrypting entertainment products such as video transmissions.
Some important parties are the U.S., Australia, Japan, Russia and the UK. Notably absent from the Agreement are China and Israel.
In a related matter, the U.S. Department of Commerce recently clarified the law on exports of encryption technology with an interim rule [see 1998 Int'l Law Update 135]. In addition, on December 30, 1998, the U.S. Department of Commerce published an amendment to the Export Administration Regulations (EAR) with a request for comments. The amendments would virtually abolish restrictions on "scrambling" products sent to foreign subsidiaries of U.S. corporations. They also do away with the license requirement for encryption technology up to 56 bits or equivalent strength.
Citation: Washington Post, December 4, 1998, page D1; 63 Federal Register 72156 (December 31, 1998). U.S. Department of Commerce, Bureau of Export Administration press release of December 30, 1998 [Commerce Updates Export Controls on Encryption Products]. [Detailed information is available on website of Wassenaar Agreement at "www.wassenaar.org", including Public Statement on meeting and summary of changes in regulated items].
According to U.S. Department of Commerce, WTO Panel sides mostly with U.S. in U.S.-Korea dispute over U.S. antidumping measures imposed on Korean semiconductors
The U.S. Department of Commerce has issued statements on the Report of the Dispute Settlement Panel of the WTO in the U.S.-Korea dispute over the U.S. antidumping order on "dynamic random access memory semiconductors" (DRAMs) from Korea (WT/DS99/1). [Editor's Note: The Report has not yet been officially published].
Under current Commerce Department regulations, the Department can revoke an antidumping order only when future dumping is "not likely" to take place. The Commerce Department has not revoked the anti-dumping duty on DRAMs despite Korea's claim that Korean manufacturers have not dumped their products for more than three- and-a-half consecutive years.
The Panel Report found only one aspect of the Commerce Department antidumping rules that did not square with the WTO Antidumping Agreement. The Panel considered the "not likely" test at odds with the Article 11.2 of the WTO Antidumping Agreement. It requires that national authorities determine whether antidumping orders remain “necessary to offset dumping." In the Panel's view, the U.S. regulations tended to foster the continuation of dumping duties rather than their revocation.
According to the statements released by the U.S. Department of Commerce, however, the Panel did agree with the U.S. on several key points:
- A nation can use prospective analysis in determining whether to cancel or maintain an antidumping order.
- But it does not have to show to a mathematical certainty that dumping will recur to keep up an antidumping order.
- The mere absence of dumping for three years does not require authorities to self-initiate an injury review of such an order.
- The Commerce Department's regulation setting a 0.5% rather the WTO's 2% de minimis standard for the post-investigation phase of an antidumping proceeding is consonant with the WTO Antidumping Agreement.
Also, the Report does not require the U.S. to rescind its antidumping order on DRAMs. There is a "range of possible ways" in which the U.S. can implement the Panel's recommendations.
Citation: U.S. Department of Commerce, International Trade Administration, ITA NewsBytes, December 10, 1998; United States Department of Commerce News, December 8, 1998. [The WTO Panel Report will become available on the WTO's website at www.wto.org.]
U.S. plans to retaliate against EU banana regime by imposing 100% duties on certain EU products except those from Netherlands and Denmark
The U.S. has long castigated the EU's favorable treatment of French and British banana companies, compared to the burdensome import policies it imposes on other Latin American bananas. In May 1997, a WTO Dispute Settlement Panel ruled that the EU's banana regime failed to comply with WTO rules.
The subsequent Appellate Body report essentially agreed with the Panel. According to a statement of the U.S. Trade Representative, the U.S. will increase tariffs for certain EU products in response to EU's continued discriminatory banana policies [see 1998 Int’l Law Update 23 & 123].
The U.S. Trade Representative has prepared a list of European products on which the U.S. is planning to impose 100% duties beginning between February 1 and March 3, 1999. The additional duties will apply to imports from EU countries except the Netherlands and Denmark. The latter nations had opposed the EU banana regime.
Citation: U.S. Trade Representative press release 98-113 (December 21, 1998) [includes the preliminary list of EU products that are subject to additional duties]; European Union News press release No. 106/98 (December 21, 1998).
U.S. and Canada agree to open Canadian agricultural markets more widely to U.S. products
On December 4, 1998, U.S. Trade Representative Charlene Barshefsky and Secretary of Agriculture Dan Glickman announced an agreement on U.S.-Canada Agricultural Market Opening Measures. The purpose is to further open Canadian markets to American agricultural products.
In the grain sector, the Agreement does two things. First, it allows Montana and North Dakota farmers to ship grain directly to 27 Canadian elevators near the border [before, U.S. growers could only sell to Canadian end users after the testing of each shipment]. Second, it will do away with burdensome testing for the plant disease "Karnal bunt" in grain from the 14 states that are free from it.
The Agreement will also achieve two major objectives in the livestock sector. First, it will oust the Canadian 30-day quarantine for U.S. live hogs from 33 states. Second, within 30 months, Canada agrees to overhaul its animal health regulations as applied to U.S. livestock.
Other parts of the Agreement deal with cattle trade data, harmonization of pesticide registration and animal drug registration, as well as continued consultations on potato trade.
Citation: U.S. Trade Representative press release 98-107 (December 4, 1998). [Along with this press release, the USTR provides a Fact Sheet on the Agreement.]
- U.S. and Mozambique sign bilateral investment treaty. On December 1, 1998, U.S. Trade Representative (USTR) Charlene Barshefsky and Mozambican Foreign Minister Simao signed a bilateral investment treaty (BIT). According to the USTR's press release, the Treaty will provide fair treatment for both countries' investors; guarantee the free transfer of capital, profits and royalties; grant access to international arbitration; and set internationally recognized standards for expropriation and compensation. -- Of the seven BITs that have been signed with African countries, this one is the fifth with a sub-Saharan African country. Citation: U.S. Trade Representative press release 98-105 (December 1, 1998).
- ICJ holds that it lacks jurisdiction in Canada-Spain fisheries dispute. The International Court of Justice (ICJ), in a 12-5 vote, has declared its lack of jurisdiction over the case brought in 1995 by Spain against Canada regarding Fisheries Jurisdiction. Spain’s complaint was based on the Canadian seizure of the Spanish vessel Estai on the high seas [see 1995 Int'l Law Update, October, page 5]. Canada pointed out that it had acted pursuant to its Canadian Coastal Fisheries Protection Act. On the other hand, Spain argued that this case concerned a sovereignty issue since Canada had seized a Spanish ship on the high seas. The ICJ, however, agreed with Canada that it lacked jurisdiction. Canada's 1994 reservation said that it would not accept ICJ jurisdiction for fisheries measures in the Northwest Atlantic Fisheries Organization's regulatory area. Since the dispute originated from Canada's amendments to its laws to protect coastal fisheries, the dispute thus falls within the terms of Canada's jurisdictional reservation. Citation: International Court of Justice Communique No. 98/41 & No. 98/41bis (December 4, 1998).
- U.S. and Sweden resolve WTO dispute regarding intellectual property protection in Sweden. Under the WTO Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS Agreement), members must provide enforcement mechanisms for violations of intellectual property rights. In 1997, the U.S. brought a case before the WTO over Sweden's alleged lack of enforcement. On November 25, 1998, Sweden amended its Copyright Act, Trademarks Act, Patents Act, Design Protection Act, and other laws, to provide provisional remedies in civil cases involving infringement of intellectual property rights effective January 1, 1999. The measures provide for a court-issued warrant to search for incriminating evidence of infringement. On December 3, 1998, the parties jointly notified the WTO that they had resolved their dispute. Citation: U.S. Trade Representative press release 98-106 (December 3, 1998).
- ICJ removes case of Paraguay v. U.S. regarding Vienna Convention from the docket. At the request of Paraguay, the International Court of Justice has removed the case that Paraguay had brought against the U.S. regarding alleged violations of the Vienna Convention on Consular Relations from its docket. The U.S. had executed the Paraguayan citizen Angel Francisco Breard, though Paraguay claimed that the U.S. had failed to properly inform Paraguayan authorities of the case as the Convention demanded. The U.S. subsequently issued an apology [see 1998 Int'l Law Update 136]. Citation: International Court of Justice Communique No. 98/36 (November 11, 1998).
- EU issues EURO conversion rates. On December 31, 1998, the EU issued the official conversion rates for the new currency EURO. The conversion rates are fixed and irrevocable, effective January 1, 1999. For example, 1 EURO equals 1.95583 German Marks or 6.55957 French Francs. Citation: Council Regulation (EC) No 2866/98 ..., 1998 O.J. of the European Communities (L 359) 1, 31 December 1998.
- New panel of House of Lords to rehear Pinochet's appeal. On a request for extradition from a Spanish court, British authorities arrested General Augusto Pinochet, the former dictator of Chile on October 16, 1998. In November, the House of Lords ruled 3 to 2 that head-of-state immunity did not shield Pinochet from charges of crimes against humanity. The ruling cleared a path for U.K. proceedings relating to his possible extradition to Spain for trial. A month later, the House set aside that judgment when Pinochet's lawyers successfully argued that it should rehear the case. Apparently, one of the lords who had ruled against Pinochet had ties to Amnesty International. A new panel of seven law lords will hear arguments on the issues beginning on January 18, 1999. Citation: Material on the Pinochet case is available on the website of the House of Lords at www.parliament.the-stationary-office.co.uk/pa/Id/Idhome.htm; Los Angeles Times, January 15, 1999, page B1 (under byline of Ms. Anne-Marie O'Connor).