Collecting from Sovereigns: The Current Legal Framework for Enforcing Arbitral Awards and Court Judgments Against States and Their Instrumentalities, and Some Proposals for its Reform
67 Pages Posted: 30 Oct 2009
Date Written: October 29, 2009
This article provides an overview of the current international legal framework for the enforcement of arbitral awards and court judgments against sovereign States and their instrumentalities, examines the policy rationales on which that framework is based, and offers proposals for its reform. Part I highlights the importance of having an effective enforcement framework in light of the growing frequency with which private companies and individuals are doing business or otherwise interacting with sovereigns. Part II summarizes the steps required for a private creditor to enforce a ruling against a sovereign - including identifying non-immune assets, domesticating the ruling in countries where assets are located, and attaching and executing against assets - and explores the doctrine of sovereign immunity and other unique complications that often arise in enforcement proceedings against sovereigns. Part III identifies the policy rationales that have been cited by courts and commentators in support of the current parameters of sovereign immunity, and considers the extent to which these are supportable. Part III also sets forth proposed adjustments to the sovereign immunity doctrine as it is presently formulated in the United States, which are intended to provide creditors with more reliable prospects for enforcing valid debts, without giving rise to the adverse consequences that the doctrine is designed to avoid. In addition, the author proposes an international convention that would establish an alternative to judicial enforcement in certain cases, permitting creditors to collect via a surety mechanism funded with contributions from participating States.
Keywords: sovereign immunity, enforcement, collection, arbitration, New York Convention, FSIA, Foreign Sovereign Immunities Act, execution, attachment, confirmation, recognition, arbitral awards, judgments, sovereigns, states, agencies, instrumentalities
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