Embassy May Lose Its Building

In TIG Insurance Co. v. Republic of Argentina, the United States Court Appeals for the District of Columbia Circuit ruled on July 30, 2020, that the lower court must look at the totality of circumstances when assessing whether real estate owned by a foreign state is immune from jurisdiction and execution. The plaintiff sought to execute a judgment into such a property in Washington, DC, arguing that it was used commer­ci­al­ly when the embassy put it up for sale. The embassy countered that it was not com­mer­cially used because (1) it held embassy files, and (2) it was removed from the mar­ket before the court ruled on the registration of the judgment in Wa­sh­ing­ton and issued a writ of execution.

The appellate court found that the lower court based its dismissale of the plaintiff's motion on too narrow grounds. It explains the factors in the analysis of the ex­cep­ti­ons of a state from foreign sovereign immunity under the Foreign Sovereign Im­mu­nities Act which range from jurisdictional immunity to execution immunity. After considering the standards proposed by the parties, it sent the case back to the Uni­ted States District Court for the District of Columbia, ordering an assessment of the totality of circumstances. Ultimately, the embassy may lose its property to the creditor. -- Clemens Kochinke, partner, Berliner Corcoran & Rowe LLP, Washington, DC.

Thu, 17:34:28 30 Jul 2020 / Embassy Law Link

FSIA Effect of Joining European Union

In Micula v. Government of Romania, the United States Court of Appeals for the Di­strict of Columbia looked at the arbitration exception in the Foreign Sovereign Im­munities Act in the context of an arbitration agreement signed by an E.U. member state. The member now be­longs to the E.U. but did not when it signed. The E.U. Com­mission joined the matter as an amicus to state that the court lacked jurisdiction over the foreign sovereign under the FSIA. On May 20, 2020, the court held:

A U.S. court lacks jurisdiction over a foreign sovereign unless an exception to so­ve­reign immunity applies. 28 U.S.C. §§1330(a); 1604. As Romania now ag­re­es, the district court properly invoked the exception for actions to enforce ar­bitration awards. Id. § 1605(a)(6). The European Commission questions whe­ther Ro­mania's agreement to arbitrate was nullified by its ascension to the Euro­pe­an Union. But as the district court carefully explained, Romania did not join the EU until after the underlying events here, so the arbitration agree­ment applied. See Micula v. Gov't of Rom., 404 F. Supp. 3d265, 276-80(D.D.C. 2019).
The United States District Court for the District of Columbia had granted a petition of the plaintiff and three affiliated corporations to confirm an arbitration award against the Government of Romania. -- Clemens Kochinke, partner, Berliner Corcoran & Rowe LLP, Washington, DC.

Wed, 15:53:00 20 May 2020 / Embassy Law Link