CYIL vol. 11 (2020)

CYIL 11 (2020) CHINA’S BROKEN PROMISES AND DIPLOMATIC GRANDSTANDING … while disregarding it in the implementation phase is disingenuous. China is blowing hot and cold air at the same time. It should not escape our minds that the concessions made in the Convention where a result of the divergence in the theoretical and practical understanding of state immunity. Moreover, there is no denying in the fact that the push for a restrictive theory was driven primarily by economic reasons. Corollary, there is no denying in the fact that a liberal capitalist agenda de facto mandated the shift in theory. China, as well as Western countries, were well-aware of the fact that the convention was “necessary to serve as a basis for the regulation of the present relations between states and private individual or entities, mostly in economic fields.” 89 Thus, the voluntary and freely undertaken obligations in embracing a restrictive theory of immunity “demonstrates the existence of a present need of this instrument; the economic globalization forbids that this matter still remains left to the individual states creating different legal regimes; it requires a universally applicable uniform solution in the interest of mutual benefits to states and private individuals and entities.” 90 With this background in mind, this paper has concluded that: First, Article 18 of the VCLT makes China obliged to refrain from defeating the object and purpose of the Convention. The “obligation in Article 18 is not a moral, but is, in fact, a legally binding obligation”. 91 Interestingly, the lower court in the FG Hemisphere case were (perhaps) unknowingly right when they stated that: “[H]aving signed the Convention, the PRC Government must be taken to have at least indicated its acceptance of the wisdom of the provisions therein.” 92 China can, for example, adopt a purpose test with respect to the use of state assets, but it cannot adhere to absolute immunity without being in conflict with public international law. Second, the fact of the matter is that the UNSCI largely constitutes a codification of customary international law, but that the gaps and its understanding could be fleshed-out by municipal decisional law and consolidated and crystalized by the ICJ. Finally, if one subscribes to the New Haven school of thought, China could be asked to obey the specific provisions of the Convention. However, this third argument is indeed a very academic statement, but nevertheless a reasonable one. On a slightly different note, but one that should close any discussion on state immunity in this twenty-first century of ours, is that of pushing for a further liberalization of the exceptions to the general rule of immunity. 93 In the give-and-take negotiations leading-up 89 Hafner & Köhler, (n 23) 48. 90 ibid. China bought into the international economic framework by subscribing to capitalism in international commerce, trade, and investment. It does so by utilizing state capitalism as opposed to liberal capitalism, and must thus follow the rules of its undertaking – even its interim obligations. 91 Gragl & Fitzmaurice, (n 46) 717. 92 See Wei, (n 31). 93 Yang, (n 15) 456 (“In brief, the UN Convention has left untouched those aspects of the law that are not yet ‘ripe’ for codification. Only by concentrating on those areas where consensus is most likely to be achieved can the prospects of winning wide acceptance be assured.9…] On the whole, the UN Convention embodies the crystallization of all the traditional aspects of the law of State immunity but stands – for better or for worse – aloof from recent developments (or thwarted attempts thereat) in other contexts, especially that of transnational human rights litigation. In other words, the UN Convention stays strictly within the traditional bounds, which have been defined and delimited chiefly by cases involving commercial and similar transactions, and are firmly rooted in the fundamental principle of territorial jurisdiction.”).

141