Chanakya National Law University

STATE
IMMUNITY
Submitted to:- Mrs.Sugandha Sinha
Assisstant Professor of Law
Chanakya National Law University

Submitted by:- Ayushi Amod

3rd Year 5th Semester
Roll no. 1125
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Acknowledgement

First of all I want to thank GOD for enabling me to successfully complete this project. Then I
would like to give my sincere thanks to our respected Public International Law faculty
Mrs.Sugandha Sinha Mam who has guided me all the way in completing this project and
enlightening me from time to time in understanding the technicalities pertaining to the project

Then I would like to give sincere thanks to our librarians who have helped me all the way in
searching through the source materials and guiding me in my research work at the library.

The list couldnt be completed without thanking all my friends and family who have
encouraged me in successful accomplishment of this project and been a pillar of support all
through the completion of the project.

Ayushi Amod

Roll Number: 1125

Vth Semester
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RESEARCH METHODOLOGY

Aims and Objectives:

The aim of the project is to present a detailed study of the topic State Immunity. through
reports, suggestions and different writings. The aim has been to come to a conclusion very much
indigenous.

Scope and Limitations:

Though the topic Investor Education Protection Fund. is an immense project and pages can be
written over the topic but because of certain restrictions and limitations we might not have dealt
with the topic in great detail.

Sources of Data:

The following secondary sources of data have been used in the project-

1 Books

2 Internet

3 Reports

Method of Writing and Mode of Citation:

The method of writing followed in the course of this research paper is primarily analytical. The
researcher has followed Uniform method of citation throughout the course of this research paper.

Hypothesis The researcher feels that the initiative towards State immunity through State
Immunity Act 1870 has been quite successful and efficient in its operation.
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Table of Contents

1. The Concept of State Immunity

2. The Doctrinal Approach
3. The Legal Framework of State Immunity
4. The New UN Convention

Introduction:-
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Foreign states are generally entitled to be granted immunity from the jurisdiction of other states.
This is known as foreign state immunity. In the last decades States have generally accepted the
restrictive doctrine of State immunity. The article presents a short overview of the development
of the restrictive state immunity doctrine and deals with the main problems applying the
doctrine.
Immunity from jurisdiction is distinct from immunity from execution. Immunity from execution,
which means measures of constraint directed against property of the foreign state, will not be
analysed in this article. This article analyses only the immunity from jurisdiction, its evolution
and operation. Immunity of jurisdiction can be defined as limitation on the Forum State to
exercise jurisdiction over a foreign state.

State immunity is an institution that at its basis belongs to public international law1. Under
the doctrine of foreign state immunity, one State is not subject to the full force of rules applicable
in another State; the doctrine bars a national court from adjudicating or enforcing certain claims
against foreign States. Immunity is gained to legal proceedings against the foreign state itself, its
organs and companies, and its agents.

In summary, the rules of state immunity concern the protection which a state is given
from being sued in the courts of other states; the rules relate to legal proceedings in the
courts of another state, not in a states own courts. The rules developed at a time when it
was thought to be an infringement of a states sovereignty to bring proceedings against
it or its officials in a foreign country. But there are now substantial exceptions to the rule
of immunity; in particular, a state can be sued when the dispute arises from a commercial
transaction entered into by a state or some other non-sovereign activity of a state. The
new UN Convention, which is not yet in force, formulates the rules and the exceptions to
them. It does not cover criminal proceedings, and it does not allow civil actions for human
rights abuses against state agents where the abuse has occurred in another country. These
are two of the points discussed in this paper.

The Concept of State Immunity

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State immunity is an institution that at its basis belongs to public international law1. Under
the doctrine of foreign state immunity, one State is not subject to the full force of rules applicable
in another State; the doctrine bars a national court from adjudicating or enforcing certain claims
against foreign States. Immunity is gained to legal proceedings against the foreign state itself, its
organs and companies, and its agents.

State immunity derived from state sovereignty and the equality of states. Customary international
law inflicts a general requirement that foreign states should not be subject to suit in foreign
state. Customary international law is a widely accepted source of international law, but it is
poorly analysed. The doctrine of state immunity originated from customary international law and
also entails many disadvantages to domestic courts, because there are no uniformed rules that
should be used in all countries and regulated the same state activities.
The law of state immunity has been subject to numerous proceedings before domestic courts.
When the courts of one state assume jurisdiction over another state or its representatives, the
authority of the forum state to adjudicate the dispute conflicts with the principle of state equality,
often expressed by the maxim par in parem non habet imperium 3. State sovereignty implies
two principles: the principle of territorial jurisdiction of the forum state (this principle demands
unlimited exercise of jurisdiction) and the principle of sovereign equality of states (two equals
cannot rule over each other and means respect for the sovereignty of other States).
The principles of international law regarding jurisdictional immunities of states have derived
mainly from the judicial practice of individual nation4. This first articulation of the principle of
state immunity was recognized by the United States Supreme Court in its famous 1812 judgment
of The Schooner Exchange v. McFaddon. Chief Justice Marshall clearly enunciated the principle:
[The] full and absolute territorial jurisdiction being alike the attribute of every sovereign, and
being incapable of conferring extraterritorial power, would not seem to contemplate foreign
sovereigns nor their sovereign rights as its objects. One sovereign being in no respect amenable
to another; and being bound by obligations of the highest character not to degrade the dignity of
his nation, by placing himself or its sovereign rights within the jurisdiction of another, can be
supposed to enter a foreign
territory only under an express license, or in the confidence that the immunities belonging to his
independent sovereign station, though not expressly stipulated, are reserved by implication, and
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will be extended to him. Since then the recognition of State immunity became firmly
established in the general practice of the United States and the majority of modern European
States.

The Doctrinal Approach:-

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The doctrine of foreign state immunity has changed over the last centuries and has been subject
to constant evolution, progressing through several distinct periods. From the doctrinal approach,
there are two opposite doctrines regarding state immunity: the absolute doctrine and the
restricted doctrine. The first period, covering the eighteenth and nineteenth centuries, has been
called the period of absolute immunity, because foreign states are said to have enjoyed complete
immunity from domestic legal proceedings. The idea of absolute state immunity was generally
accepted by domestic courts in the 19th century. But absolute immunity caused unjust and unfair
circumstances on private enterprises trading with governmental entities.
The second period emerged during the early twentieth century, when Western nations adopted
a restrictive approach to immunity in response to the increased participation of state governments
in international trade.7 So-called restrictive doctrine of state immunity is more suitable: a
foreign state will be able to use immunity only for claims arising out of sovereign acts (acta jure
imperii), but there will not be a possibility to use immunity to the claims arising out of private
law acts (acta jure gestionis). As States became involved in commercial activities, national
courts began to apply a restrictive law of immunity. One purpose of the commercial exception is
to protect the legitimate expectations of business partners that engage in commercial transactions
with foreign States. The restrictive approach is now widely reflected in case law, national statutes
and international conventions, although it cannot yet be said to be universally recognized8.
Under this theory, states are immune from suit in respect of acts of government, but not in
respect of commercial activities. But the biggest problem is that there is no clear boundary
between commercial acts and acts of government.
The aim of state immunity law is to enhance relations between states and to bring collectively
benefits to the community of nations. Thus, where state conduct is clearly detrimental to
interstate relations but still protected by domestic state immunity laws, the restrictive approach is
inconsistent with the strictures of international law and should be amended. But under the
normative hierarchy theory, a states jurisdictional immunity is abrogates when the state violates
human rights protections that are considered peremptory international law norms, known as jus
cogens.

The Legal Framework of State Immunity:-

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As it was said before, the immunity of states is no longer absolute and it has derives mainly
from judicial practice of individual nations. The practice of states on state immunity is not
uniform.
International consensus on the matter exists only at a rather high level of abstraction, and the
details of the international law of state immunity are not always certain.
The international community has tried for many years to agree a treaty on the subject. In 2004
the United Nations enacted Convention on Jurisdictional Immunities of States and Their
Property, but was not signed by proper number of states. The convention includes customary
international rules of state immunity and consolidates the restrictive approach to state immunity,
but the degree to which the restrictive approach is recognized by States today remains a subject
of debate. But this convention is modern multilateral instrument that provides a comprehensive
approach dealing with complicated issues of state immunity.
Also there were several attempts to codify the state immunity doctrine, but they all failed. It is
needed to mention the European Convention on State Immunity, which came into force in 1976.
However, only eight States (Austria, Belgium, Cyprus, Germany, Luxembourg, the Netherlands,
Switzerland and the United Kingdom) are parties.
Some states, particularly the common-law countries, developed a functional variation on the
restrictive approach in the 1970s and 1980s, and enforced national immunity legislation. The
State Immunity Act 1978 (U.K) and Foreign Sovereign Immunity Act 1976 are analysed as
examples of codification of state immunity. Both acts include commercial activities as major
criterion providing the doctrine of restricted state immunity.
It can be seen that some countries lack of their own legislation in this field. Civil Procedure
Code of The Republic of Lithuania, passed in 1964, entrenched the rule of absolute immunity,
that the potential litigants were allowed to pursue claims in the courts against foreign states only
in case of a written consent of the foreign state, the execution of the judgment in respect of
foreign states property was possible only with the same condition. This rule was the inheritance
of the USSR times not matching changed social relations and political and economic state system
of Lithuania.

In 1998 The Supreme Court of Lithuania made the decision in civil case V. Stukonis v.
USA embassy, in which stated the restrictive theory of state immunity. The decision indicated
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the main landmarks of the restrictive theory such as the distinction between acta jure imperii or
sovereign acts and acta jure gestionis or private, non-sovereign acts.13 Civil Procedure Code of
The Republic of Lithuania, passed in 2002, does not include the rule of absolute immunity, but
there is no other regulation related to the state immunity, therefore courts decisions are the main
source of legislation of state immunity in Lithuania.

The New UN Convention:-

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Rules of state immunity and consolidates the restrictive approach to state immunity, but the
degree to which the restrictive approach is recognized by States today remains a subject of
debate. But this convention is modern multilateral instrument that provides a comprehensive
approach dealing with complicated issues of state immunity.
Also there were several attempts to codify the state immunity doctrine, but they all failed. It is
needed to mention the European Convention on State Immunity, which came into force in 1976.
However, only eight States (Austria, Belgium, Cyprus, Germany, Luxembourg, the Netherlands,
Switzerland and the United Kingdom) are parties.
Some states, particularly the common-law countries, developed a functional variation on the
restrictive approach in the 1970s and 1980s, and enforced national immunity legislation. The
State Immunity Act 1978 (U.K) and Foreign Sovereign Immunity Act 1976 are analysed as
examples of codification of state immunity. Both acts include commercial activities as major
criterion providing the doctrine of restricted state immunity.
It can be seen that some countries lack of their own legislation in this field. Civil Procedure
Code of The Republic of Lithuania, passed in 1964, entrenched the rule of absolute immunity,
that the potential litigants were allowed to pursue claims in the courts against foreign states only
in case of a written consent of the foreign state, the execution of the judgment in respect of
foreign states property was possible only with the same condition. This rule was the inheritance
of the USSR times not matching changed social relations and political and economic state system
of Lithuania. In 1998 The Supreme Court of Lithuania made the decision in civil case V.
Stukonis v. USA embassy12, in which stated the restrictive theory of state immunity. The
decision indicated the main landmarks of the restrictive theory such as the distinction between
acta jure imperii or sovereign acts and acta jure gestionis or private, non-sovereign acts.13 Civil
Procedure Code of The Republic of Lithuania, passed in 2002, does not include the rule of
absolute immunity, but there is no other regulation related to the state immunity, therefore courts
decisions are the main source of legislation of state immunity in Lithuania.

Conclusion:-
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The article analysed overview of the law of state immunity in which describes principle and
development of state immunity. The topic of sovereign immunity is one of the profound subjects
in international law. It stands as a customary international law which is justified on general
principles of international law: the principle of territorial jurisdiction of the forum state (this
principle demands unlimited exercise of jurisdiction) and the principle of sovereign equality of
states (two equals cannot rule over each other and means respect for the sovereignty of other
States). As it was said in this article, in the 19th century the absolute rule of sovereign immunity
prevailed.Due to the amount of State trading in the 19th century, a number of countries
developed the restrictive theory of immunity, which divides states acts into governmental (acta
jure imperii) and commercial acts (acta jure gestionis). There is no common ground to formulate
a criterion that would be acceptable to all countries and this in turn has led to persistent
divergence in the practice of states.
The State Immunity Act 1978 (U.K) and Foreign Sovereign Immunity Act 1976 are analysed as
examples of codification of state immunity that determines the restrictive theory of immunity.
In 2004 the United Nations enacted Convention on Jurisdictional Immunities of States and Their
Property which includes customary international rules of state immunity and consolidates the
restrictive approach to state immunity, but was not singed by proper number of states. Thus the
practice of states on state immunity is not uniform and causes many troubles to local courts to
use this doctrine suitable.

Bringing the Convention into force might freeze the law and stop the development of state
practice outside the Convention. One alternative is to leave it to lie on the table as a generally
accepted picture of the current position under international law. This would allow further
developments of the law in line with the needs of businesses, individuals and governments. One
way or another, it is important that there is wide discussion of the new Convention and its
likely effects, so that a decision on signature and ratification can be taken in full knowledge of all
the different interests concerned.

Bibliography:-
1. www.scribd.com
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2. www.lawnotes.com
3. www.preservearticle.com
4. S. Knuchel, State Immunity and the Promise of Jus Cogens. Northwestern University School of
Law Volume 9, Number 2 (Spring 2011) Northwestern Journal of International Human Rights;
5. L. M. Caplan, State Immunity, Human Rights, and Jus Cogens: A Critique of the Normative
Hierarchy Theory, AJIL 97 (2003), 741 et seq. (745);