1 119 Cong. Rec. (daily ed.) S. 1298 (1973); 12 ILM 118 (1973). By way of background material See also, American Society of International Law, [1969] Proc., 176; Lowenfeld, , Claims Against Foreign States—A Proposal for Reform of United States Law , 44 N.Y.U.L. Rev. 901 (1969)Google Scholar and the “Section by Section Analysis” of the bill, Cong. Rec., Feb. 6, 1973 at S. 2118 (hereinafter referred to as “Analysis”).

2 See e.g., among an abundant literature on the subject, Boynton, , International Law—Sovereign Immunity—The Last Straw in Judicial Abdication , 46 Tulane L. Rev. 841 (1972)Google Scholar.

3 Italy, Decree-Law of Aug. 30, 1925 and Law of July 15, 1926, Art. I, as translated in Sereni, , The Italian Conception of International Law 239 (1943)Google Scholar; Greece, Law 15/1938, See Cass, Greece, Case No. 460/1962, 16 Rev. Hellénique De Droit International 355 (1963). See generally, Delaume, , Legal Aspects Of International Lending and Economic Development Financing 204–06 (1967)Google Scholar.

4 Delaume, preceding note, 156–57.

5 Id. 157–59.

6 Id. 159, 204. See also text and note 32 infra.

7 Id. 160, 205. Cf. Isbrandtsen Tankers v. President of India, 446 F.2d 1198 (2d Cir. 1971). See also, “Analysis” (note 1 supra), at S. 1301–02.

8 In this country, some lenders have gone so far as to add to waivers of immunity a stipulation to the effect that the loan should be considered as “a private and commercial act” rather than a “governmental or public act,” thereby attempting to get to the root, or one of the roots, of the problem. See Delaume, note 3 supra, 171.

Whether such a stipulation, assuming that it would have been sufficient to overcome a plea of immunity from suit, would have had the same effect in regard to execution against the assets of the borrower is doubtful. See Dexter and Carpenter v. Kunglig Jarnvagsstyrelsen, 43 F.2d 705 (2d Cir. 1930); Weilamann v. Chase Manhattan Bank, 192 N.Y.S. 2d 469, 21 Misc. 2d 1086 (Sup. Ct. 1959).

9 (a) A foreign state shall be immune from the jurisdiction of the courts of the United States and of the States in any case relating to its public debt, except if:

(2) the case whether or not falling within the scope of Section 1605 (applicable among other things to commercial acts carried out by foreign sovereigns), relates to the public debt of a political subdivision of a foreign state, or of an agency or instrumentality of such a state or subdivision . . .

10 Delaume, note 3 supra, 157–60. See also, Cour d’appel, Paris (ler Ch.) Nov. 5, 1969, Gouvernement du Land de Hesse v. Neger, 59 Rev. Critique de Droit International Prtve 703 (1970).

11 See note 9 supra.

12 Delaume, note 3 supra, 157–60. See also, the European Convention on State Immunity of May 16, 1972, 11 ILM 470 (1972), Arts. 27 and 28.

13 §1606(a)(1).

14 See supra note 1, at S.2118–20.

15 Delaume, note 3 supra, 174 and note 66.

16 Id. 170–72.

17 “Analysis” (note 1 supra), at S.2120, according to which:

While there is no clear definition of “public debt,” the concept seems to embrace not only direct bank loans but also governmental bonds and securities sold to the general public through bond markets and stock exchanges.

18 This solution is subject to the additional requirement that the transaction must be connected with Switzerland, e.g., either because the loan contract was made, or the bonds were issued, or payment is to be made in that country. See e.g., Tribunal fédéral, March 18, 1930, République Héllenique v. Walder, R.O. 56.1.237; Tribunal fédéral, June 6, 1956, Royaume de Grèce v. Banque Julius Bär et Cie, R.O. 82.1.75, 23 Int. L. Reports, 195 (1956); Tribunal federal, March 13, 1918, K.K. Oesterreichisches Finanzministerium v. Dreyfus, R.O. 44.1.49; Tribunal fédéral, Oct. 7, 1938, Etat Yougoslave v. S.A. Sogerfin, 81 La Semaine Judiciatre 327 (1939). Cf. Tribunal fédéral, Feb. 10, 1960, République Arabe Unie v. Dame X. . . . , R.O. 86.1.23; 88 J. De Droit International 458 (1961); 55 AJIL 167 (1961).

19 See text and notes 31 and 42 infra.

20 Delaume, note 3 supra, 174. See also text and note 42 infra.

21 In France, it has recently been held that the guarantee by a foreign (Turkish) government of bonds issued by a municipality (the City of Constantinople) should be characterized as an act jure gestionis and that the guarantor could not plead sovereign immunity. See Court of Appeal of Rouen February 10, 1965, Société Bauer, Marchal et Cie v. Ministre des Finances de Turquie, 92 J. de Droit International 655 (1965); 54 Rev. Critique de Droit International Prtve 565 (1965). See also in the same case, Court of Cassation Dec. 19, 1961, Juris-Classeur Périodique, La Semaine Juridique, II, 12 489 (1962); summarized in 56 AJIL 1112 (1962).

22 See text and notes 39 to 43 infra.

23 To which express reference is made in S.566, §1608(b).

24 Delaume, note 3 supra, 52–70.

25 Ibid., 185–87.

26 11 ILM 470 (1972).

27 Arts. 3 to 14. Art. 15.

28 Art 5.

29 European Convention, Arts. 27 and 28. S.566, §1610.

30 Art. 23.

31 Trib. Civ. Brussels April 30, 1951, Socobelge et Etat Beige v. Etat Hellérique, J. Des Tmbunaux 298 (1951); 79 J. De Droit International 244 (1952); 18 Int. L. Reports 3 (1951); Tribunal federal, February 10, 1960, Republique Arabe Unie v. Dame X. . . . , R.O. 86.1.23; 88 J. De Droit International 458 (1961); 55 AJIL 167 (1961). In Royaume de Grèce v. Banque Julius Bar et Cie, Tribunal fédéral, June 16, 1956, R.O. 82.1.75, the action was dismissed but only on the ground that the loan transaction (bonds payable outside Switzerland) did not have a sufficient connection with the Swiss territory to enable the Swiss courts to exercise jurisdiction and validate the attachment in Switzerland of funds deposited in that country by the Greek Government.

32 Cass. Nov. 2, 1971, Clerget v. Banque Commerciale pour 1’Europe du Nord, 61 Rev. Critique de Droit International Privé 310 (1972); 99 J. de Droit International 267 (1972).

33 Dexter and Carpenter cited note 8 supra.

34 In the same connection, it should be noted that whereas under §1606(a)(1) a waiver of immunity from suit in connection with the public debt of foreign states must be “explicit,” a waiver of immunity from execution under §1610(a)(l) may, in respect of commercial acts, be made “explicitly or by implication.” A choice between the two alternatives would appear useful for the sake of consistency.

35 Delaume, note 3 supra, 169–70; 174.

36 See text and notes 15 and 16 supra.

37 Delaume, note 3 supra, 174, n. 66, and 175–77.

38 Delaume, Choice of Law and Forum Clauses in Euro-Bonds, 11 Col. J. Trans. L. 240, at 248 and 252–54 (1972).

39 See e.g., the prospectus of the U.S. $15 million 8 3/4 per cent guaranteed Bonds due 1986 of Pekema Oy, unconditionally guaranteed by the Republic of Finland:

The guarantee is governed by English law. The Republic has agreed to accept the jurisdiction of the English Courts.

See also, the Republic of South Africa, DM 100 million 7 per cent Bonds of 1972:

The forum for all actions arising from matters which have been provided for in these Conditions [of issue] shall be Frankfurt am Main. In this respect, the Republic of South Africa submits to the jurisdiction of the German courts. The bondholders, however, may waive such forum and pursue their claims before courts within the Republic of South Africa where German law shall likewise be applied to those Conditions.

A similar provision is found in the Mexico, DM 100 million 7 1/4 per cent Bonds of 1973.

40 See e.g., the Republic of South Africa 1970–1982 External Loan of 20 million European Units of Account, which, after providing for the application of the law of the Grand Duchy of Luxembourg, stipulates that:

The bondholders shall be free to enforce their rights against the Republic in the courts of the Grand Duchy of Luxembourg and/or of the Republic of South Africa. The Republic has expressly waived sovereign immunity with respect to any action or proceeding brought in the courts of the Grand Duchy of Luxembourg or in the courts of the Republic of South Africa in connection with the Bonds. For the purpose of any action or proceeding brought in the Grand Duchy of Luxembourg, the Republic has elected domicile at the principal office of the Fiscal Agent for all acts, formalities or procedures in connection with the present loan and has irrevocably submitted to the jurisdiction of the courts of the Grand Duchy of Luxembourg.

Similar provisions are found in the Kingdom of Denmark 1972–1987 External Loan of French Francs 100 million and the Commonwealth of Australia 8 per cent 1971–1986 Loan of European Units of Account 15 million.

41 See text and note 31 supra.

42 Until recently, Swiss lenders were generally satisfied with making provision for the jurisdiction of the Swiss courts over loan disputes. See Delaume, note 3, supra, 174.

Reference to possible measures of execution in Switzerland now sometimes appears in the loan documents. A typical example is the Argentine Republic 7 1/2 per cent S. Frs. 50 million Loan of 1970:

Any disputes between the bondholders, on the one hand, and the Argentine Republic, on the other hand, arising out of the bonds or coupons of this issue shall be governed by Swiss law and shall be decided by the ordinary courts of the Canton of Zurich, subject to appeal to the Federal Tribunal, at Lausanne. To that end and for the purpose of any procedure of execution in Switzerland, the Argentine Republic elects legal and special domicile in the Argentine Consulate in Zurich . . .

Bondholders shall have also the right to bring their claims and to institute legal proceedings before the courts in the Argentine Republic having jurisdiction, Swiss law remaining applicable to the terms and conditions of the Bonds (as translated, italics supp. lied).

43 Cf., the following provisions in the prospectus relating to the DM 100 million 7 1/2 per cent Bearer Bonds of 1971/1988, issued by New Zealand:

14 (1) The Bonds, coupons and the talon both as to form and content, and the rights and duties of the Bondholders [and] New Zealand . . . shall in all respects be governed by the laws of the Federal Republic of Germany; the manner of granting and foreclosure of any security shall be subject to the law of the country where such security is situate [sic].

(4) Should claims concerning matters which have been covered in these Terms and Conditions be pursued against New Zealand, New Zealand waives the right to claim extraterritoriality or immunity from jurisdiction before any court in which claims can be pursued against New Zealand under this provision and before any agency competent for the enforcement of the law but hereby submits to their jurisdiction. The place of jurisdiction for all such actions shall be Frankfurt/Main. The Bondholders and Commerzbank Aktiengesellschaft, however, are entitled to pursue their claims before courts in New Zealand and courts in any other country in which there are situate [sic] assets belonging to New Zealand and where the laws of the Federal Republic of Germany shall likewise be applied in accordance with §14(1). The German courts shall have jurisdiction over the annulment of lost or destroyed Bonds. . .

44 Such waivers of immunity are usually found in stipulations providing for the arbitral settlement of disputes between the host state and the concessionaire. See e.g., the Convention Regulating the Petroleum Activity of Chevron Oil Company of Madagascar in the territory of the Malagasy Republic (OFF. GAZ. Oct. 7, 1972, at 2262), Art. 35, para. 16(3):

The award is final and irrevocable. The parties waive as of now, formally and without any reservation, any right to attaclc the award or object to its execution by any means and any remedy before any court. In particular, the State waives its right to invoke its privilege of jurisdictional immunity with regard to the enforcement of the award. (as translated).

Cf., the Establishment Convention of June 30, 1971, between the Islamic Republic of Mauritania and AGIP Research and Exploitation (Mauritania) S.A. (annexed to Law No. 71.199 of July 20, 1971, OFF. GAZ. August 25, 1971, at 606), Art. 17.6 and 7.

. . . The arbitral award shall be final and irrevocable. The parties expressly and without any reservation waive any right to attack the award or object to its enforcement by any means or any remedy before any count.

In the event that arbitration proceedings would result in an arbitral award obligating the Islamic Republic of Mauritania to pay to the Company a sum of money, the Company will be entitled to offset such sum with amounts owed by it to the Islamic Republic of Mauritania, for any reason whatever, including obligations of a fiscal nature (as translated).

See also The Diminco Agreement (1970), Ratification Act, 1970 ratifying an agreement between the Government of Sierra Leone and Sierra Leone Selection Trust Limited (Supp. to the Sierra Leone 101 Gazette, No. 89, dated Dec. 17, 1970, Schedule E, para. 2):

The State and DIMINCO hereby expressly waive the right to avail themselves of any privilege or immunity of jurisdiction in respect of any arbitration pursuant to this Agreement or the execution or enforcement of any award or judgment as a result thereof.

45 The “Analysis” (see note 1 supra) states that:

The existing case law, both United States and foreign, could be drawn upon in aid of the interpretation and application of the provisions of this Act. As the law develops in other jurisdictions, that law may similarly be relied upon to elucidate the provisions of this Act.

This reference to interpretation of statutory provisions in the light of judicial or statutory developments outside the United States is a tribute to comparative law analysis. To be complete, however, the tribute should include comparative evaluation of contractual trends which, in practice, are often more revealing of the evolution of current legal thinking than the pronouncements of the judiciary or those of the legislature.