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Congo Waiver and Arbitration
One June 8, 2004, the D.C. Circuit appeared to expand jurisdiction over
foreign nations under the Foreign Sovereign Immunities Act.
Ultimately, the ruling in the matter of Gulf Resources
Am., Inc. v. Republic of Congo, docket number 03-7118, would appear,
however, to involve a matter of contractual construction.
The Republic had waived its immunity in a contractual framework for
commercial oil transactions and also agreed on arbitration. Later, another oil
company sued the Republic on breach of contract and torts claims. The
Republic won in the District Court which found the waiver not to apply.
The Court of Appeals examined the framework contract and determined that its
terms were to apply to other companies which, at a minimum, were contractual
beneficiaries. While the term waiver applied only to the principal contractual
party, the court found other language covering such beneficiaries to have no
other but the meaning of a waiver. Since the waiver applied, the court declined
to examine whether the Republic may have lost the FSIA protection under the
exception for commercial activities. The case was remanded to the District
Court which may now determine whether the parties are bound by the arbitration clause.
- by Clemens Kochinke, Berliner, Corcoran & Rowe, LLP, Washington, DC.
Mon, / / Embassy Law Link
