CYIL 2014

KLARA POLACKOVA VAN DER PLOEG CYIL 5 ȍ2014Ȏ Three general methodologies have emerged in State practice. 58 Initially, the scope of State immunity was determined on the basis of the so-called “purpose” test. Pursuant to this view, immunity attached if the relevant act was performed for a sovereign or governmental purpose. The vast majority of States have, however, abandoned this position because of its overinclusiveness as all acts of States are ultimately, directly or indirectly, for sovereign or public purposes. The predominant position today is the “nature-of-the-act” approach, 59 pursuant to which the decisive factor for the question of immunity is the nature, not the purpose, of the particular act. If the act is by its nature a commercial or private-law act, then it is acta jure gestionis , and it makes no difference whether that act serves some sovereign or public purpose. While the “objective” nature-of-the-act criterion would appear to be simple to apply, in practice it also tends to be underinclusive if strictly construed. In common law countries, which do not readily distinguish between private and public law, it additionally merely postpones the difficulty. Most importantly, the nature-of-the-act approach fails to fully describe how courts actually adjudicate in hard cases. Although the criterion works quite well in a strictly commercial context, States seem to consider it much less satisfactory in other areas, including employment and tort cases. 60 Consequently, a “context” approach has been articulated as an alternative, demanding that the whole context of the State’s activity be considered. It takes the position that an isolated characterization of an activity without regard to its meaning is often misleading, and while the purpose may not be decisive (as it would turn virtually every act of a commercial agent of the State into acta jure imperii ), it may clarify what was actually done. 61 The UN Convention in this respect represents a compromise designed to accommodate the various State practices. Although it provides, in its Article 2(2) that “[i]n determining whether a contract or transaction is a ‘commercial transaction’ … reference should be made primarily to the nature of the contract or transaction” , it also retains a (limited) role for the ‘purpose’: “[P]urpose should also be taken into account if the parties to the contract or transaction have so agreed, or if, in the practice of the State 58 Yang X, State Immunity in International Law , 85-108; Fox H. and Webb P., The Law of State Immunity, 404-414. 59 See the well-known decision Empire of Iran Case , German Federal Constitutional Court, Judgment of 30 April 1963, 45 ILR 57, in which Germany shifted from absolute to restricted immunity doctrine. 60 In employment cases, it does not provide any scope for the recognition of sovereign activity. Crawford J., Brownlie’s Principles of Public International Law, 497. In tort cases, the distinction between acta jure gestionis and acta jure imperii has proved to be largely irrelevant as the forum States interest in asserting jurisdiction over the tort which has occurred within its territory prevails. Yang X., State Immunity in International Law, 207-215. 61 See , Lord Wilberforce in I° Congreso , a leading precedent in English courts. I° Congreso [1983] 1 AC 244, 267; 64 ILR 307 (England, House of Lords); Re Canada Labour Code , Canada, (1992), 91 DLR (4 th ) 449, 460–474; 94 ILR 264, 275-289.

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