International Law in Brief

International Law In Brief

Developments in international law, prepared by the
Editorial Staff of International Legal Materials

October 31, 2005
The American Society of International Law

©2005 American Society of International Law
(Educational copying is permitted with due acknowledgment)

JUDICIAL AND SIMILAR PROCEEDINGS

World Trade Organization : United States- Tax Treatment for "Foreign Sales Corporations"- Second recourse to Article 21.5 of the DSU by the European Communities, Report of the Panel


International Criminal Tribunal for Rwanda: Jean de Dieu Kamuhanda v. The Prosecutor

Special Court for Sierra Leone: Decision on Motions for Judgment of Acquittal Pursuant to Rule 98

Oberlandesgericht Stuttgart: Center for Constitutional Rights v. Rumsfeld et al.


U.S. District Court for the Southern District of New York: In Re: Terrorist Attacks on September 11, 2001
BRIEFLY NOTED

Kyrgyz Republic Challenges Petrobart Award


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JUDICIAL AND RELATED DOCUMENTS

World Trade Organization (WTO): United States- Tax Treatment for "Foreign Sales Corporations"- Second recourse to Article 21.5 of the DSU by the European Communities, Report of the Panel (September 30, 2005)

Click here for the Panel report.

The compliance Panel found that the United States, by maintaining prohibited subsidies, fails to fully implement the Dispute Settlement Body ("DSB") recommendations.

The European Communities (the "EC") brought a second compliance request under Article 21.5 of the Dispute Settlement Understanding (the "DSU"). Article 21.5 of the DSU reads in pertinent part:

Where there is disagreement as to the existence or consistency with a covered agreement of measures taken to comply with the recommendations and rulings such dispute shall be decided through recourse to these dispute settlement procedures, including wherever possible resort to the original panel.

The DSB, which adopted the original Panel and Appellate Body reports in March 2000, requested in its rulings and recommendations that the United States bring its Foreign Sales Corporations ("FSC") measures into conformity with the Agreement on Subsidies and Countervailing Measures (the "SCM Agreement"), and the Agreement on Agriculture. The original FSC taxing scheme of the Internal Revenue Code provided for a tax exemption of "foreign trade income" of a FSC. Following the DSB's recommendation that the United States withdraw the prohibited FSC subsidies, the United States enacted the "FSC Repeal and Extraterritorial Income Exclusion Act of 2000" (the "ETI"), which, in the United States' view, implemented the recommendations. The EC requested that an Art. 21.5 compliance Panel review the measures taken by the United States, and the Panel found the ETI to be inconsistent with the SCM Agreement and the Agreement on Agriculture, because the subsidies were not fully withdrawn. The compliance Panel did not, however, issue a new recommendation pursuant to Article 4.7 of the SMC agreement, and it concluded that the original DSB recommendation "remained operative." In 2004, the United States enacted the "American Jobs Creation Act of 2004" (the "Jobs Act"), the "transition provision" of which made the ETI scheme available on a reduced basis, and also grandfathered the ETI scheme in respect of certain transactions.

The EC requested the Panel to find that "by promulgating the Jobs Act, the United States has not fully complied with the findings and recommendations made by the Panel and the Appellate Body." The United States requested that the claims be rejected.

The United States asserted, inter alia, that a new recommendation from the first compliance Panel under the SCM Agreement- which would call upon the United States to discontinue the measures under the ETI scheme- would have been necessary in order for the EC to prevail. The Panel rejected this argument and stated: "[w]e see no express requirement in the text of Article 21.5 of the DSU that a compliance Panel must formulate recommendations upon finding an inconsistency with Article 3 of the SCM Agreement" Rather, the Panel found that the original rulings and recommendations of the DSB remain in effect until they are complied with, and that no further recommendation from the compliance Panel is necessary.

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International Criminal Tribunal for Rwanda (ICTR): Jean de Dieu Kamuhanda v. The Prosecutor (September 19, 2005)

Click here for the decision.

While vacating the appellant's convictions for instigating and aiding and abetting the crimes of extermination and genocide, the Appeals Chamber of the International Criminal Tribunal for Rwanda (the "Court") affirmed the sentence as imposed by the Trial Chamber.

The appellant, Jean de Dieu Kamuhanda, was Minister of Higher Education and Scientific Research in the interim government from May to July 1994. According to the findings of the Trial Chamber, the appellant distributed weapons to members of the Interhamwe and participated in attacks against the Tutsi in the Gikomero Commune in April 1994. The Trial Chamber found the appellant individually criminally responsible for instigating, ordering, and aiding and abetting the killing and extermination of member of the Tutsi ethnic group in the Gikomero Parish Compound. The appellant was found guilty of genocide and extermination as a crime against humanity and was sentenced to imprisonment for the remainder of his life.

Kamuhanda contended, inter alia, that the Trial Chamber erred in holding him responsible under Article 6 (1) of the Statue of the Court (the "Statute"), as none of the modes of participation could be imputed to him. Article 6 (1) reads:

A person who planned, instigated, ordered, committed or otherwise aided and abetted in the planning, preparation or execution of a crime referred to in Articles 2 to 4 of the present Statute, shall be individually responsible for the crime.

With respect to the mode of participation of instigation, the Court found that the "Trial Chamber's conclusion that the appellant instigated assailants to kill members of the Tutsi ethnic group is not supported by the evidence." The Trial Chamber also found that the appellant aided and abetted the commission of the crimes in the Gikomero Parish Compound by distributing weapons and by leading the attackers to the Gikomero Parish Compound. While the Appeals Chamber affirmed the latter finding, it disagreed with the former, as it held that the evidence did not "support any connection between the distribution of weapons and the subsequent attack on the Gikomero Parish Compound." However, because Kamuhanda also gave the orders for the killings at the Gikomero Parish Compound, the Appeals Chamber concluded that, due to the fact that "both modes of responsibility [1) ordering and 2) aiding and abetting] are based on essentially the same set of facts: the appellant "led" the attackers in the attack and he ordered the attackers to start the killings," the "remaining facts [are not] sufficiently compelling to maintain the conviction for aiding and abetting. In this case the mode of responsibility of ordering fully encapsulates the appellant's criminal conduct." The remaining grounds of appeal were dismissed.

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Special Court for Sierra Leone: Decision on Motions for Judgment of Acquittal Pursuant to Rule 98 (October 21, 2005)

Click here for the Court's web site.

The Trial Chamber I of the Special Court for Sierra Leone ("the Court") dismissed the motion of each of the accused (Sam Hinga Norman, Moinina Fofana and Allieu Kondewa) for a Decision of Acquittal in respect of one or more counts in the indictment for crimes against humanity. Notwithstanding its dismissal of the motion for a Decision of Acquittal, the Court found insufficient evidence with respect to some allegations contained in the indictment.

In dispute was the meaning of Rule 98 of the Court's Rule of Procedure which provides:

"If after the close of the case for the Prosecution, there is no evidence capable of supporting a conviction on one or more of the counts of the indictment, the Trial Chamber shall enter a Judgment of acquittal on those counts."

In their written submissions, counsel for Norman claimed that the applicable standard for Rule 98 should be whether a reasonable trier of fact could be satisfied beyond reasonable doubt that the evidence adduced, if believed, could sustain a finding of guilt of the first accused. The Court disagreed, finding that Rule 98 is a rule "that limits and restricts a tribunal only to a determination as to whether the evidence adduced by the Prosecution at the close of its case, is such as is legally capable of supporting a conviction on one or more of the counts in the Indictment."

The Court held that it has reviewed the evidence as it relates to the participation of the accused in the alleged crimes, and found, for the purposes of the Rule 98 standard, that the accused participated in each of the crimes charged in counts 1 to 8 of the indictment.

Click here for the Court's Rules of Procedure.

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Oberlandesgericht Stuttgart: Center for Constitutional Rights v. Rumsfeld et al. (September 13, 2005)

The document was provided to the ILM office by the German court.

The Oberlandesgericht Stuttgart dismissed the appeal against the decision of the prosecutor.

In November 2004, the Center for Constitutional Rights (the "CCR") and four Iraqi nationals filed a complaint with the German Federal Prosecutor's Office against high-ranking United States civilian and military officials over alleged war crimes committed in Abu Ghraib prison and elsewhere in Iraq.

The complaint was filed against, inter alia, Secretary of Defense Donald Rumsfeld, Former CIA Director George Tenet, Undersecretary of Defense for Intelligence Dr. Stephen Cambone, Lieutenant General Ricardo Sanchez. The German courts, pursuant to the German Code of Crimes against International Law, have universal jurisdiction to adjudicate crimes of war. The initial complaint was rejected by the German prosecutor, because he found that the principle of subsidiarity and the principle of non-interference outweighed the interest of prosecution. Moreover, the prosecutor contended that the alleged crimes were being prosecuted in the United States.

The CCR appealed the prosecutor's decision not to open investigations, claiming that the case at issue did not fall under the category in which the prosecutor has discretion to prosecute. Rather, the CCR argued, the case was one in which investigations were mandatory. The Court rejected the arguments and stated that the discretionary decision of the prosecutor was not illegal, and that a prosecution, the initiation of which lies within the discretion of the prosecutor, cannot be compelled through judicial proceedings.

Click here for the English translation of the original complaint filed with the German Federal Prosecutor.

For more information on this case, see the website of the CCR.

Click here for a December 2004 ASIL Insight on the complaint.

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U.S. District Court for the Southern District of New York: In Re: Terrorist Attacks on September 11, 2001 (September 21, 2005)

The U.S. District Court for the Southern District of New York ("the Court") dismissed the plaintiffs' claims against most of the defendants, including the Saudi High Commission ("SHC") and two Saudi princes, finding that they were entitled to sovereign immunity under the Foreign Sovereign Immunities Act ("FSIA"). It denied one of the defendants' motion to dismiss without prejudice pending discovery.

The plaintiffs in this case were representatives, survivors and insurance carriers of the victims of the attacks of September 11, 2001. They relied on several theories of liability under the Antiterrorism Act ("ATA"), 18 U.S.C. §2331 et seq.; the Alien Tort Claims Act ("ATCA"), 28 U.S.C. §1350, the Racketeer Influenced and Corrupt Organizations Act ("RICO"), 18, U.S.C. §1961 et seq., the Torture Victim Protection Act ("TVPA"), 28 U.S.C. §1350. The plaintiffs' theories of liability included aiding and abetting, civil conspiracy, intentional infliction of emotional distress, negligence, survival, wrongful death, trespass and assault and battery. They alleged that the defendants were responsible for the September 11th attacks as terrorists, state sponsors of terror, or material sponsors of terror.

The SHC was formed by order of the Kingdom of Saudia in 1993, an order which also named Prince Salman bin Abdulaziz Al-Saud ("Prince Salman") as the president of SHC. The defendants, including the SHC and Princes Salman and Naif, moved to dismiss the complaints for lack of subject matter jurisdiction pursuant to the FSIA, lack of personal jurisdiction and failure to state a claim. The defendants Rabita Trust, Wa'el Jalaidan and International Islamic Relief Organization ("IIRO") also moved to dismiss the complaints for lack of personal jurisdiction and failure to state a claim.

The plaintiffs claimed, inter alia, that the defendants diverted funds for al Qaeda's terrorist activities instead of providing charitable assistance, and that they were therefore responsible for providing material assistance for the September 11th attacks. The plaintiffs alleged, for example, that Prince Naif, as Minister of Interior in Saudi Arabia "controls the activities of Islamic Charities and is empowered to verify their legality and conduct" and oversees the Saudi Joint Relief Committee, which they contend has diverted over $74 million to al Qaeda., and that Prince Salman provided material support to bin Laden and al Qaeda.

The plaintiffs further claimed that any immunity enjoyed by SHC, Prince Salman and Prince Naif is overcome, inter alia, by the FSIA's torts exception. The Court found that in order for the plaintiffs to prevail on the torts exception, they would have to show (1) that the defendants' tortious acts caused the plaintiffs' injuries, and (2) that the defendants acts were not discretionary, i.e., not grounded in the social, economic, or political policies of the Kingdom of Saudi Arabia. The Court found that the evidence was undisputed that all decisions concerning the distribution of humanitarian relief funds were discretionary, and that the plaintiffs could not overcome the discretionary exception to the torts FSIA exception. For example, it noted that Prince Naif's role on the Council of Ministers included the implementation of defense policies, including managing Saudi relations with Osama bin Laden, to the extent that he himself became a target of al Qaeda. The Court further found that the plaintiffs could not establish personal jurisdiction over Prince Salman and Prince Naif. Citing Helicopteros Nacionales de Colombia, S.A. v. Hall, 466 U.S. 408 (1984), the Court found that Prince Salman's ownership of shares in Texas corporations, on its own, could not be considered sufficiently systematic and continuous to establish general jurisdiction. The Court also found that a 1989 visit to the White House and to Maryland was too removed in time from the 2001 attacks.

The only defendant whose motion was not dismissed was that of Rabita Trust, a charitable organization which was created to assist the repatriation and rehabilitation of stranded Pakistanis from Bangladesh. On October 12, 2001, the U.S. Treasury Department designated Rabita Trust as a Specially Designated Global Terrorist Entity and froze its assets. The Court noted that, in assessing whether Rabita Trust purposefully directed its activities at the United States, it would give some deference to the executive branch's designation, since in the realm of foreign affairs, the executive branch has access to confidential sources of information. It therefore ordered discovery for purposes of assessing whether Rabita Trust's activities were directed against the United States.

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BRIEFLY NOTED

Kyrgyz Republic Challenges Petrobart Award (September 2005)

The Kyrgyz Republic is challenging the $1.1 million arbitration award issued on March 29, 2005 in Petrobart Ltd. v. Kyrgyz Republic on the grounds that the United Kingdom, (the country of the investor, Petrobart) was only a provisional member of the 1994 Energy Charter Treaty. The challenge is being brought before Swedish courts.

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International Law In Brief (ILIB) - Copyright 2005 - The American Society of International Law (ASIL)
Authors: Elena Papangelopoulou, Ruth Teitelbaum

ILIB is a free-of-charge electronic resource. To sign up for ILIB or ASIL Insights, click here.
To comment on this publication, send an e-mail message to Ruth Teitelbaum, ILM Managing Editor at rteitelbaum@asil.org