Fifty-ninth General Assembly

Sixth Committee

18^th Meeting (AM)

Delegates seek precision, clarity in framing of rules on diplomatic

protection, international liability for injurious acts

 

Legal Committee Continues Debate on Law Commission Report, Written

Views Promised; Defining Nationality of Corporations Said to Be Issue

The question of diplomatic protection for corporations and for refugees and stateless persons was raised this morning, along with the form to be taken by a set of principles on international liability, as the Sixth Committee (Legal) continued debate this morning on the International Law Commission’s report.

India’s representative said diplomatic protection should serve the interest of nationals and it should not require a State to espouse a claim to the exclusion of political or other sensitivities.  It should not be extended now to stateless persons or refugees because there was ambiguity about definitions and legal applications relative to other instruments.

The representative of the United Kingdom said the diplomatic protection of legal persons, including corporations, raised difficult issues.  Was it practical, for example, to allocate the right of protecting a defunct company to the company’s State of nationality rather than that of the shareholders?  What real interest did the State have in taking action if the shareholders came from another State?  Balance had not been achieved in the articles.

The delegate of the Republic of Korea said the articles should give more guidance on determining the nationality of a corporation.  The present definition left some ambiguity.

Many delegates said they would submit written reports on both issues.  Austria’s representative was one of those.  He called for clarifications on both the draft articles and the draft principles, saying the latter should be adopted as guidelines to be used as a starting point for negotiations.

The full title of the subject the draft principles on international liability is:  “International liability for injurious consequences arising out of acts not prohibited by international law (international liability in case of loss from transboundary harm arising out of hazardous activities)”.

Speaking on international liability, the representative of Germany said the time was not yet ripe for a binding general convention on it.  The types of transboundary environmental risk to be covered were still too heterogeneous.  A framework convention or model law and a high-level reference document would be helpful to future development of the law on liability.  A future model law should contain core elements such as prompt response measures to prevent loss or damage, adequate financial security and effective judicial protection, particularly in transboundary cases.

Japan’s delegate said international liability covered an extremely wide area with major implications for many fields.  Work, particularly with regard to scope, should follow the draft articles on prevention of transboundary harm.  Emphasis should be on the primary responsibility of operators.  Articles that place undue emphasis on the responsibility of States in the aftermath of an incident were likely to be both unnecessary and an inaccurate reflection of the present-day reality of international law.

Also speaking this morning were the representatives of Canada, Brazil, Iran, Guatemala, France, Slovenia, Spain, Gabon and Mexico. 

The Committee will meet again at 9:30 a.m. tomorrow, Wednesday, 3 November, when discussion of the International Law Commission’s report will continue, with a focus on diplomatic protection and international liability.

Background

The Sixth Committee (Legal) met this morning to continue debate on the report of the International Law Commission.  (For background on the report, see Press Release GA/L/3263 of 1 November.

Statements

COLLEEN SWORDS (Canada) said her Government would provide more details of its position on the principles in written form to the Secretary-General by next January, as requested by the Commission; it had noticed an ambiguity at a fairly fundamental level in terms of the scope of the draft articles on diplomatic protection.  The ambiguity needed to be resolved as it went to the very meaning of diplomatic protection and, hence, had an impact on the approach taken throughout the text.

The definition of diplomatic protection in article 1 of the text appeared to be limited to cases where a State adopted in its own right the cause of its national.  That would exclude some of the consular functions in the Vienna Conventions as they were not situations of a State adopting as its own the cause of a national.  Issues relating to the Vienna Convention on Consular Relations were increasingly being considered, both in international and domestic courts, making clarity all the more important.  Canada sought to provide consular assistance to Canadian citizens regardless of any other nationalities they might possess.

THOMAS LAUFER (Germany) said his country fully subscribed to the legal position -- now expressed in article 2 -- that under international law the exercise of diplomatic protection constituted a right and not a duty of States.  On the whole, it agreed with the rules adopted by the International Law Commission for the diplomatic protection of legal persons.

He said the time was not yet ripe for a binding general convention on liability.  The types of transboundary environmental risk that needed to be covered were still too heterogeneous.  A framework convention (model law) and a high-level reference document which extracted commonalities from the existing treaties and carefully developed them would be helpful to the future development of the law in that area.  To that extent, he welcomed the principles elaborated by the Commission.  A future model law should contain core elements such as prompt response measures to prevent loss or damage; adequate financial security, and the creation of effective judicial protection, particularly in transboundary cases.

SYDNEY LEON ROMEIRO (Brazil) said the concept of diplomatic protection was not to be confused with human rights issues, although the conditions under which it was exercised could be such as would involve those issues.  The rule on treatment of exhausting local remedies was well done in accordance with customary practice.  Further opening up the exceptions to the rule should be approached cautiously, with the complexity of the issues involved being carefully considered.

Noting that the principles on international liability were related to the articles on prevention, he said there was a great need for setting out principles for allocating liability and compensating for loss or harm arising from transborder activities.  However, the principles did not provide enough specific guidance on the general principle that the operator was in control of activities and should bear primary responsibility for harm or loss along the lines of the polluter pays principle.

BIKRAM KESARI DEO (India) said diplomatic protection should serve the interest of nationals, and the concerns of individuals should not be stretched beyond the point where the State was obliged to espouse the claims to the exclusion of political or other sensitivities.  Diplomatic protection should not be extended at present to stateless persons or refugees.  The definition of “lawfully and habitually resident” with regard to stateless persons referred only to a national law and not an international standard, while the term “refugee” could be covered by certain regional instruments and, therefore, its use in this context deviated from the universally accepted definition.

He said the set of principles on international responsibility was an in-depth analysis of needing to protect the interest of innocent victims of transboundary harm caused by hazardous activities.  The scope of the topic and the triggering mechanism should be the same as that of preventing transboundary harm.  However, the indication that transboundary damage caused to environment could be subject to compensation was not supported by State practice.  Moreover, the environmental losses referred to in the principles could not be quantified in monetary terms, not to mention the difficulty of establishing the standing claim for the damage.  That element needed modification.  Perhaps differential standards should be applied in the matter of environmental protection, similar to extending capacity-building and technology transfer between developed and developing countries.

TAKEO AKIBA (Japan) said the approach adopted by the Commission on diplomatic protection was a right one.  It was correct not to include the subject of functional protection provided by international organizations in the text.  The treatment of foreign individuals was now covered in a more extensive and comprehensive manner through international human rights laws.  Rights concerning foreign investments could better be protected by a variety of arbitration clauses in investment treaties.  In its second reading of the draft principles, he hoped that Commission members would maintain their prudent and self-restrained approach and not become too ambitious in expanding the scope of their discussion.  Japan was confident that the Commission would meet the expectations of governments.

On international liability, he said the topic covered an extremely wide range of areas, which had major implications for international law in various fields.  The Commission must adopt the approach of basing its present work, particularly the scope of the work, on its own recent work on the draft articles on prevention of transboundary harm.  It was also appropriate for the Commission to put considerable emphasis on the primary responsibility of operators.  Articles placing undue emphasis on the responsibility of States regarding the aftermath of an incident resulting in damages were likely to be both unnecessary and an inaccurate reflection of the present-day reality of international law. The current draft principles still remained very general in their description, he said.

MOSTAFA DOLATYAR (Iran) said States should avoid adopting laws which increased the risk of dual nationality, multiple nationality or statelessness. The acquisition and granting of citizenship should be consistent with international law.  A criterion was required to identify a predominant nationality.  The provisions of article 7 on multiple nationality and claim against a State of nationality did not reflect customary international law and might bring controversies.

He said he had concerns with the provisions of article 16 regarding exceptions to local remedies rule.  The draft text had the potential to jeopardize the rule and make it redundant in most of the cases.  The relationship between the clean hands doctrine and diplomatic protection deserved more study, he said, and he welcomed the Commission’s decision to return to it at its next session.

MICHAEL WOOD (United Kingdom) said he had few significant differences with the Commission on the diplomatic protection articles.  They were indeed related to the articles on State responsibility, and the Commission had done well to keep the focus on admissibility of claims, or nationality and local remedies.  The Commission was also right to reject the proposition that a State had a duty to exercise diplomatic protection; it was a right, not an obligation.  Rules on nationality of claims conformed to State practice, but they must be looked at again from the angles of principle and practicality.

He said nationality of natural persons needed clarification, while nationality of legal persons raised more difficult issues and would require further study.  Was it practical, for example, to allocate the right of protecting a defunct company to the company’s State of nationality, rather than that of the shareholders?  What real interest did the State have in taking action if the shareholders came from another State?  Balance had not yet been achieved in those articles.  Those on local remedies were broadly along the right lines, though further clarifications were needed.

Continuing, he said the set of principles on international liability was an ambitious project.  They were general, with a potentially wide scope.  The Commission should clarify what it saw as the status of the various elements.  Then they could be adopted in a non-binding form.  As to substance, comments would be submitted in writing.  But more thought should be given to the relationship of these principles and those on State responsibility.  More prominence should be given to the “polluter pays” principle.

ROBERTO LAVALLE-VALDES (Guatemala) said the rules of diplomatic protection should not apply when other diplomatic protections were in place, and there should be an exception to the rule of continuous nationality in the case of a person applying for nationality of the State protecting it.  The article on the State of nationality of a corporation was elliptical and should be clarified as to the definition which linked a corporation’s nationality to the place where its major activities took place.  There was also some ambiguity in the term “corporation” in the Spanish and French versions of the articles, since “corporation” was defined as an entity whose capital was represented by shares versus a “limited liability company” whose members had direct capital interest in it.  There should be express mention of a limited company whose capital is represented by shares.

RONNY ABRAHAM (France) said the progressive development and codification of international law being undertaken by the International Law Commission showed its essential role.  That role must be preserved.  States also had a responsible role to play by responding to requests from the Commission for their comments and observations on some of its texts.  The Commission must also improve the effectiveness of its work.  He had expressed in the past concerns about the delays in the publication of the Commission’s reports.  The situation had deteriorated considerably.  He invited the Commission to undertake some in-depth thinking on ways of improving the situation.  He also said the Commission must establish priorities in its work, and selection of themes for study.

Turning to the topic of diplomatic protection, he said a detailed response on the draft principles adopted, on first reading, by the Commission would be presented as requested.  He went on to express limited comments on the question of diplomatic protection for corporations and shareholders.

META BOLE (Slovenia) said her delegation would like to see the final form of the text on international liability as “draft articles” similar to one adopted for the text on “prevention”.  That would enhance the development of more detailed and specific regimes in international agreements on a regional and bilateral basis.  It would also ensure prompt remedial measures, including compensation for activities involving a risk of causing significant transboundary harm.  Her delegation believed that the text on compensation in cases where the operator bore primary liability was in line with principles of the Rio Declaration on Environment and Development and other treaty practice that endorsed the “polluter pays” principle.  The important role of the State was also reflected by the establishment of applicable conditions for the liability imposed on the operator.

HANS WINKLER (Austria) said he would be submitting detailed comments.  In the meantime, two articles on diplomatic protection raised problems:  the one dealing with actions or procedures other than diplomatic protection, and the other on special treaty provisions.  Since the former was not limited to redress of indirect injury, it also included measures for possible redress for direct injuries, including resort to countermeasures.  That raised some ambiguities, inconsistencies and complications between the rights of the individual and the State’s right to exercise diplomatic protection.  As for special treaty provisions, the clear wording of the commentary, which simply referred to the exclusion of resorting to diplomatic protection, should be used.

On international liability, he recalled that the true issue involved in the draft principles was not the allocation of loss, but the allocation of the duty to compensate in the case of transboundary damage.  He said any environmental damage had some specific features, and the main difficulty was proving the causation of damage by certain activities.  The draft principles dealt primarily with proof of fault, but what happened in the case of a landowner who suffered damage from pollutants in a river with a factory up the hill?  Would the landowner have to prove without a doubt that no other pollutants had gotten into the river?  Or would the factory have to prove that another source of pollution existed?

As to the financing of compensations, he said, the three-tier approach with the polluter, a collective fund for the State had been suggested.  Yet, the State was provided as the source in only exceptional cases, as in nuclear pollution.  That restriction should be removed.  Finally, the question of who would be entitled to claim compensation for environmental damage should be clarified.  The principles should be adopted as guidelines to be used as a starting point for negotiations.

JULIO GONZALEZ-CAMPOS (Spain) said he would submit comments on diplomatic protection in writing.  In general, diplomatic protection was one mechanism whereby a State could take formal action against another State for injuries suffered.  What mattered for the purposes of codification was not the wrong or harm that had been committed, but rather that the conditions were set out under which the State could exercise its right of diplomatic protection.  In that regard, the definition and scope of the articles was not satisfactory since it remitted to procedures for dispute settlement.  International practice had shown that diplomatic protection as referred to in the articles did not apply in the case of diplomatic intervention, for example, on behalf of a national being held by another State or when there was resort to local remedies.  The distinction between diplomatic assistance and diplomatic protection should be made clear.

Reviewing other elements of the text, he said the commentary on protection by the State of nationality was brief and should be expanded.  Also, with regard to the State of nationality of a corporation, the definition should be considered in context of a restrictive interpretation so as to avoid a plethora of challenges to interpretation.

RUSSEL MBA (Gabon) said his delegation was satisfied, overall, with the definition proposed for diplomatic protection in draft article 1, namely, a State resorting to that means to defend the cause of a national in respect of an injury arising from an internationally wrongful act of another State.  The text could, however, be broadened to cover provisions of article 3 to ensure their harmonization.  That article dealt with protection provided by State of nationality.  He noted that existing conventions such as the New York Convention did not deal with the question of diplomatic protection for stateless persons and refugees, and said he welcomed the Commission’s work on the issue contained in draft article 8.  The text stated that a State might exercise that protection in respect of a stateless person who, at the time of the injury and at the date of the official presentation of the claim, was lawfully and habitually resident in that State.  The protection could also be extended to a person recognized by a State as a refugee.  He also talked about diplomatic protection of shareholders and corporations dealt with in draft articles 11, 12 and 13, respectively.

ARTURO DAGER (Mexico) commended the Commission on its adoption, on first reading, of the 19 draft articles on diplomatic protection.  The Commission’s work on the topic reflected the practice of States, he said.  The commentaries accompanying text were an extraordinary tool for use by governments in studying the text.  He recalled that a year ago Mexico had stated in the Committee that diplomatic protection was a central part of its foreign policy, and a fundamental right for its citizens abroad.  He also welcomed the new provisions covering diplomatic protection of crew members of ships.  Mexico would send its detailed comments and observations to the Secretary-General by 1 January 2006 as requested by the Commission.

CHOI SUK-INN (Republic of Korea) said the articles should give more guidance on determining the nationality of a corporation, so as to avoid confusion about the State’s right to diplomatic protection in that regard.  With regard to the criteria for identifying the corporation’s State of nationality, using the standard set down in the Barcelona Traction case was acceptable, meaning the State of incorporation and the location of the company’s registered office.  The definition now in the principles as “the seat of its management or some similar connection” needed clarification since it was ambiguous and could expand the scope too far.

He said the articles on exercising actions other than diplomatic protection and on special treaty provisions should be merged.  Diplomatic protection should not be intended to interfere with existing remedies or dispute settlement mechanisms that could be resorted to by not only States but non-State entities, so there was no need to deal with the two issues separately.  Finally, the right to seek redress on behalf of crew members should lie primarily in the State of a ship’s nationality, not that of the crew.

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