A Plea for Legal Peace

Abstract

This chapter advocates legal peace between Germany and Italy as the most sensible and appropriate way to deal with the aftermath of Sentenza 238/2014 of the Italian Constitutional Court and its declaration of the unconstitutionality of the 2012 International Court of Justice (ICJ) Judgment in Jurisdictional Immunities. This plea does not only arise from frustration with the current impasse but also from the suspicion that the public good of legal peace has never seriously been canvassed by the Italian and German governments. Section II takes stock of the legal developments relating to the dispute between Germany and Italy since Sentenza 238/2014 was delivered. It especially focuses on the attitudes of the governments concerned, both in the context of the ongoing proceedings before Italian courts and elsewhere. It finds such attitudes opaque and unduly dismissive of the necessity to devise legal peace in the interest of the victims and of the integrity of international law. Section III highlights how the behaviour of the governments so far was at odds with the successful outcome of other intergovernmental negotiations concerning reparations for crimes committed during World War II (WWII), a process which has not been entirely finalized, as evidenced by the 2014 Agreement between the US and France on compensation for the French railroad deportees who were excluded from prior French reparation programmes. The Agreement between the US and France and all previous similar arrangements were concluded under mounting pressure of litigation before domestic courts against those states (and/or their companies) that were responsible for unredressed WWII crimes, thus a situation resembling the current state of the dispute between Germany and Italy. It is telling that litigation ended when the courts took cognizance of the stipulation of intergovernmental agreements establishing fair mechanisms for compensating the plaintiffs and victims of the relevant crimes. Such practice, therefore, is essentially in line with the proposition that state immunity (for human rights violations) is essentially conditional on effective alternative remedies for the victims. This and other controversial aspects related to the law of state immunity—such as the nature of state immunity, the North American remedies against immunity for state sponsors of terrorism, and the persistent dynamism of pertinent practice—are revisited in section IV. The purpose is to suggest that certainty about the law of international immunities, as allegedly flowing from the 2012 ICJ Judgment, is more apparent than real and that this consideration should a fortiori urge the realization of legal peace in the German–Italian affair.

I. Introduction

This chapter argues that ‘legal peace’ between Germany and Italy is the most sensible and appropriate way of dealing with the aftermath of Sentenza 238/2014 of the Italian Constitutional Court (ItCC),¹ which in substance held that the 2012 International Court of Justice (ICJ) Judgment in Jurisdictional Immunities² could not be given effect as it breached the human right to judicial protection under the Italian Constitution. The ItCC also refused to afford any domestic legal effects to the ICJ-backed rule of state immunity for unredressed international crimes. Although such a plea for legal peace arises, in part, from the frustrating impasse that presently characterizes the dispute between Germany and Italy, it is especially driven by the disturbing impression that, in the context of unredressed World War II (WWII) crimes, the public good of legal peace has never been canvassed seriously by either the Italian or German government.

Admittedly, there is no silver bullet for shaping legal peace against the background of the German–Italian affair. Legal peace might well be channelled through arbitration, thereby conclusively determining whether Germany or Italy, or both, have defaulted with respect to compensation owed to Italian Military Internees (IMIs) and similarly situated victims of Nazi crimes. In any event, the crucial step would be the elaboration of a fair institutional and exclusive funding mechanism entrusted with processing outstanding compensation claims. While foreclosing parallel private litigation, this mechanism should be capable of giving victims a voice. The lack of an effective remedy for the victims, other than judicial proceedings in Italy, was indeed a key consideration underlying Sentenza 238/2014.³ There are sound reasons for believing that the setting up of a meaningful compensatory procedure would lead to the suspension or termination of the remaining cases pending against Germany before Italian courts.⁴

Section II takes stock of the legal developments in the German–Italian affair since Sentenza 238/2014 was delivered. It focuses on the attitudes of the governments concerned within the proceedings before Italian courts and elsewhere. It finds these attitudes opaque and unduly dismissive of the necessity to promote legal peace in the interest of the victims and for the integrity of international law. Section III highlights how the behaviour of the two governments is at odds with the successful outcomes of other intergovernmental negotiations prompted by litigation before US courts relating to crimes committed during WWII, a process meaningfully started in the 1990s and still unfinished. Tellingly, litigation ended when the courts took cognizance of the stipulation of intergovernmental agreements establishing fair mechanisms for compensating victims, whereas the outstanding cases currently pending before US courts precisely involve situations that are not covered by such agreements. Such practice, therefore, is essentially in line with the proposition that state immunity (for human rights violations) should be conditional on effective alternative remedies for the victims.⁵ Accordingly, section IV underscores that a number of tensions and controversial issues continue to affect the doctrine of state immunity, starting from the unresolved question of its rationale and nature. The best illustration thereof is no doubt offered by the contemporary practice of Canada and the US. The ultimate purpose of section IV is to suggest that certainty about the law of international immunities, as allegedly flowing from the 2012 ICJ Judgment, is more apparent than real and that this consideration should a fortiori urge the realization of legal peace in the German–Italian affair. A few concluding remarks are made in section V.

II. Confrontation and Mutual Neglect Versus Legal Peace

The conduct of the two governments concerned both prior to and in the aftermath of Sentenza 238/2014 has been characterized—to different degrees and with different modalities—by reticence, ambiguity, and underground talks. Paradigmatic of this conduct was the inaugural event in late 2016 of the permanent exhibition dedicated to IMIs in the Berlin-Schöneweide Lager, a rather well-preserved WWII concentration camp. On that occasion, speaking before a wide audience including representatives of IMIs associations, the German and Italian Foreign Ministers made absolutely no mention of the unresolved legal issues raised by the exclusion of IMIs from any meaningful WWII reparation scheme and the related litigation against Germany in Italian courts.⁶ After all, the two countries were smoothly proceeding along the direction set forth in their 2008 Trieste Joint Declaration, whence they announced the objective of creating a ‘common culture of memory’ regarding WWII (with a focus on the terrible vicissitudes of IMIs) and the establishment of an Italo-German Historical Commission for that purpose. There was apparently no link between the financing of the exhibition and the German–Italian dispute. It is clear, however, that the great absentees in that context were Italian judges and Sentenza 238/2014.

Interestingly, a few days later the Chamber of Deputies of the Italian parliament—endorsed by the executive—passed a motion concerning WWII crimes committed against Italian nationals, which indirectly allows us to understand the approach of the Italian government toward the WWII German reparations affair.⁷ The motion did not even mention Sentenza 238/2014, whereas it gave account of the 2012 ICJ Judgment and recalled that the latter ‘unfortunately’⁸ upheld Germany’s immunity before Italian courts. It committed the Italian government to make sure that Germany will continue to finance initiatives aimed at the reconstruction of a ‘shared historical memory’⁹ and ‘moral reparation’¹⁰ for the victims of WWII crimes. The next steps, according to this motion, should therefore consist in having Germany renew its contribution to the German–Italian Fund for the Future (Fondo italo-tedesco per il futuro) for the years 2018–2021. This fund was jointly established in 2013 and operationalized thanks to an initial contribution by Germany to the amount of €4 million. These resources should be channelled into the construction or restoration of places of commemoration and comparable monuments, as well as into the development of memory-related online resources, such as an Atlas of the Nazi–Fascist massacres committed in Italy between 1943 and 1945 and a Biographic Lexicon of IMIs.¹¹ Thus, the 2016 motion of the Italian parliament overlooked the many final judicial decisions awarding civil damages against Germany and diverted attention to the need for the government to secure German cooperation in the execution of criminal convictions of German nationals found responsible for Nazi crimes by Italian courts (which is a reference to the long-standing problem of the failed extradition of such nationals by Germany).

Therefore, several years after Sentenza 238/2014, the Italian government has yet to illustrate to its citizens its own official position on this decision, especially to those citizens most concerned: the plaintiffs and the judgment holders in the various pending or concluded proceedings relating to WWII Nazi crimes.

Clues about the Italian executive’s position may emerge from a perusal of its legal arguments outlined before the Italian courts dealing or having dealt with WWII Nazi-related cases. But this is deeply unsatisfactory when seen against rule of law notions such as a government’s responsiveness and transparency to its citizenry. While Sentenza 238/2014 may arguably be considered a ‘shock to the international legal community’,¹² the Italian lay public are largely unaware of this judgment, despite its importance for Italian national history and for the evolution of Italian sociological attitudes towards a tragic past which large sectors of the (older) population have never come to terms with.¹³

What is clear is that, regardless of their political inclination, the changing majorities leading the Italian government over the past decades have consistently pursued agendas that were decidedly at variance with the positions and parallel activities of the Italian judiciary. Soon after Sentenza 238/2014, the government surreptitiously took advantage of the parliamentary debates on the conversion into law of a decree containing a variety of measures on civil procedure in order to introduce an amendment making the attachment of any bank account held in Italy by foreign states in fact impossible. According to this provision,¹⁴ such bank accounts are not subject to execution provided that the head of a diplomatic mission or consular post of a foreign state has declared to the Italian Ministry of Foreign Affairs and the relevant bank that the money deposited therein is exclusively intended for use in the performance of diplomatic and/or consular functions. The foreign state’s declaration triggers an absolute protection for such bank accounts, as it cannot be rebutted or challenged in court on any ground whatsoever. This is a very generous provision¹⁵ on foreign state bank account immunity, which goes beyond customary international law and Article 21(1)(a) of the UN Convention on Jurisdictional Immunities of States and Their Property (UNCSI).¹⁶ Arguably, by essentially obliterating the role of the judiciary in this matter, the provision is inconsistent with the Italian Constitution.¹⁷ However, the key point here is that, by hastily seeking solutions to the German–Italian contingencies, the Italian government runs the risk of turning a blind eye to opaque transactions and abuses facilitated by the privilege afforded to any foreign state bank accounts held in Italy. One should hope that the competent authorities will retain sufficient surveillance powers over such accounts.

Moreover, far from withdrawing from treaty provisions conferring jurisdiction on disputes involving Italy to international bodies, on 25 November 2014 the Italian government deposited its declaration of acceptance of the compulsory jurisdiction of the ICJ under Article 36(2) of the ICJ Statute.¹⁸ This course of action seems imprudent and untimely in the wake of Sentenza 238/2014, as the latter may spur domestic judicial proceedings against any foreign states accused of international crimes.¹⁹ Such proceedings may in turn be easily challenged before the ICJ on the strength of its 2012 Judgment. The Italian declaration contains no reservation to the ICJ jurisdiction relating to disputes in this area. The initiative of the Italian government in question also glaringly confirms the absence of dialogue between the executive and the judiciary on the problems arising from the Italian jurisprudence denying state immunity for international crimes.

As to the ambiguous judicial strategies pursued by the Italian government in the outstanding proceedings against Germany, very little has changed vis-à-vis the pre-Sentenza situation.²⁰ The government supports Germany’s position with respect to most of the key aspects of the dispute (such as the absence of jurisdiction of Italian courts, the unconditional obligation to comply with the 2012 ICJ Judgment, the prescription of the actions), save that it strongly contests its duty to hold Germany harmless from any WWII reparation claims by Italian nationals, a duty allegedly flowing from the 1947 Peace Treaty and the bilateral 1961 Bonn Agreements.²¹

On the other side, the most salient feature of Germany’s recent conduct is a refusal to participate in the compensation proceedings resumed in Italian courts in the wake of Sentenza 238/2014. In all such proceedings Germany has been and will be a respondent in absentia,²² as well as the addressee of a number of default judgments awarding damages and costs. Germany has consistently communicated to the courts that its decision stemmed from the consideration that such proceedings constituted a violation of the principles of international law upheld by the 2012 ICJ Judgment and has made reference to a diplomatic Note Verbale of 5 January 2015 from Germany’s embassy in Rome to the Italian Ministry of Foreign Affairs for further explanation.²³ According to this Note Verbale, Sentenza 238/2014 ‘cannot change anything of what has been found by the ICJ with respect to the content and scope of the jurisdictional immunity enjoyed by Germany before Italian courts’.²⁴ Indeed, the Note continues, pursuant to a well-settled rule of international law ‘the principle of State immunity cannot be limited by the domestic law of a State, not even by fundamental principles of the national constitutional order’.²⁵ The Note also takes the view that the plaintiffs would be able to enjoy equivalent protection before German courts.²⁶ It concludes with a ‘precautionary warning’²⁷ reminding the Italian government of the risk of further litigation and outlining the consequences arising from the continuation of judicial proceedings in terms of state responsibility and reparation.

Germany has thus chosen a confrontational posture vis-à-vis Italian courts, which have at times reacted with irritation and bewilderment.²⁸ Crucially, Germany has also taken an uncompromising attitude by refusing to accede to the requests from several courts to negotiate an out-of-court settlement with the plaintiffs (where the latter were heirs of the victims) and Italy through conciliation or mediation by a commission chosen by the parties and including lawyers with an expertise in public international law. The Tribunal of Florence has been the most creative in this context by submitting its own proposed settlements to the parties. For instance, the proposal in the Alessi case envisaged a study or cultural visit to Germany worth €15,000 for each of the three plaintiffs, in exchange for the withdrawal of their compensation claims.²⁹ In the face of Germany’s tacit dismissal of these proposals, the courts proceeded to adjudicate the merits of the cases in favour of the plaintiffs and awarded them substantial damages.³⁰ On its part, the Italian government has also never expressed any interest in participating in these non-adversarial conciliatory procedures. Given the apparent disengagement of the two governments, the Italian courts were trying to make the best out of the ICJ’s consideration that the unredressed grievances of Italian victims of Nazi crimes ‘could be the subject of further negotiation (…) with a view to resolving the issue’.³¹

Despite the obiter dictum nature of this remark by the ICJ, and if only for reasons of transparency, the Italian and German governments should clearly communicate to the international community whether and to what extent they have carried out such negotiations in good faith. Most significantly, do they think they have already reckoned with the historical ‘justice/equity gap’,³² which has uniquely affected IMIs and similarly situated victims? Are monuments and historical reports sufficient to close in a dignified way this specific and tragic chapter of WWII?³³ Since they—as well as scholars³⁴—disagree on the nature and scope of the labyrinthine post-WWII regulation of reparations by Germany, why has arbitration or similar means of dispute settlement not been contemplated?

While answers to these questions are long overdue, the present situation may be regarded as a recipe for failure, which especially runs against the interest of the individual direct victims who, being now in their (late) nineties, are sadly passing away at an accelerating rate. Whereas further litigation will likely perpetuate the ‘zero-sum game’³⁵ that the whole dispute so far has turned out to be, another key question remains: why have the two governments—at least throughout the past 20 years—not meaningfully embraced ‘legal peace’ as the overarching public good guiding their actions? Broadly understood, legal peace would involve a negotiated settlement agreement prescribing the termination of the outstanding judicial proceedings against Germany in exchange for a reasonable compensatory scheme available to the plaintiffs and co-funded by the two governments.

In the first place, legal peace would be in the interest of the victims, but it would also be in the interest of the integrity of the international and national legal orders. Taking a confrontational, unbending position is unhelpful to both sides when national supreme courts plausibly invoke fundamental constitutional principles as the last bulwark against international law rules. Such a position only exacerbates the impression that international law and domestic legal orders are two irreconcilable worlds apart. Dialogue and interaction among the relevant actors, as well as salutary competition between and mutual reinforcement of international and domestic law, seem necessary instead. Moreover, the achievement of legal peace has always been a crucial consideration for German and other governments when dealing with the outstanding problems arising from WWII reparation regimes.

III. Why the French Railroad Deportees and Not IMIs?

It is frequently suggested that the time factor runs against the soundness of the reparation claims of IMIs and similarly situated Italian victims of Nazi crimes. For instance, it has been stated that, as compared to state immunity litigation involving torture and comparable crimes ‘of current or recent regimes’,³⁶ the issue of IMIs makes a bad case because it ‘concerns crimes committed more than one generation ago’.³⁷ This would imply that ‘[e]ven if we do not accept any formal prescription for the prosecution of such egregious crimes, the lapse of time does weaken the claims’.³⁸

On the basis of intertemporal fairness and other grounds, I think that the lapse of time does weaken the argument that immunity should be lost when the defendant state is accused of grave breaches of human rights, thereby creating the possibility that the relevant ‘ancient’ conduct might come to be reassessed through the prism of modern legal achievements and standards. I have always had the impression that a significant part of the criticism levelled against the Italian Ferrini jurisprudence³⁹ stems from these intertemporal considerations,⁴⁰ where ‘intertemporal’ is not necessarily used in a technical sense but also refers to the contemporary uneasiness of Italy and Germany, and Italians and Germans alike, about discussions that might reopen the old wounds of their respective national history. With its historical overtones, the German–Italian controversy has unduly monopolized the ‘human rights versus immunity’ debate, thus detracting attention from the legal advancement that might result from the contemporary affirmation of a narrow human rights limitation to state immunity, namely, one confined to the most serious breaches of human rights that have not been, and cannot be, redressed by the responsible state.

Conversely, I do not think that the passage of time per se constitutes a valid reason for dismissing the substantive claim for reparation of a whole class of victims of war crimes, even though such crimes date back to many decades ago. This is especially true in our case where the responsibility for those crimes is acknowledged and what is disputed is only whether Germany has fully discharged its obligation to provide reparation for the resulting injuries. Rather, the time factor should encourage a sense of urgency in the governments’ approaches to, at the very least, the outstanding claims of Italian WWII direct victims, that is, the survivors who are now in their (late) nineties.

It is precisely this sense of urgency—and the determination to attain a lasting legal peace in the face of increasing WWII litigation before national courts—that, as recently as 2014, led to an agreement between the US and France on compensation for the so-called French railroad deportees who were excluded from prior French reparation programmes.⁴¹ The basic bargain is well-known, as it builds upon extensive US practice in this area:⁴² France made US$60 million available to satisfy claims of uncompensated railroad deportees,⁴³ while the US was obligated ‘to recognize and affirmatively protect the sovereign immunity of France within the United States legal system with regard to Holocaust deportation claims and, consistent with its constitutional structure, to undertake all actions necessary to ensure an enduring legal peace at the federal, state, and local levels of the Government of the United States of America’.⁴⁴

The reason for mentioning the 2014 French Railroad Deportees Agreement is by no means to suggest that it should be taken as a template for a similar outcome to potential negotiations on the unresolved issue of Italian victims of Nazi crimes. The historical and legal backgrounds are obviously different. Instead, the Agreement is an indication that states are still reckoning with their historical wrongs and that, under the pressure of litigation and legislative initiatives jeopardizing their entitlement to immunity,⁴⁵ they are willing to settle past accounts.

Indeed, the French Railroad Deportees Agreement is an example of the key role played by state immunity litigation before domestic courts in the area of human rights and international crimes. Whichever way one leans in the ‘immunity versus human rights’ debate, it cannot reasonably be denied that often times and for the sake of legal peace such litigation prompts the relevant states to go back to the negotiating table, take a fresh look at the underlying issues, and accordingly devise fair arrangements affording a decent measure of justice to uncompensated victims. At the time of writing, it is uncertain whether that scenario will be replicated, even to a degree, with regard to the claims lodged by IMIs and comparable victims before Italian courts. Nevertheless, we should not overlook that, were it not for the Italian Ferrini jurisprudence, the tragic and paradoxical historical trajectory of IMIs would largely have been forgotten, as has been true for too many decades.

In this context, it is clear that US immunity practice is paradigmatic. That practice is multifarious and constantly evolving and it would be unwarranted to briskly marginalize it altogether as completely detached from the international legal framework.⁴⁶ Insofar as it is relevant for current purposes, such practice includes a substantial number of WWII reparations cases that have spurred intergovernmental settlements and were dismissed when those settlements were finalized. The most famous examples involve Austria,⁴⁷ France,⁴⁸ and Germany.⁴⁹ In all these instances, the mounting pressure from WWII-related litigation against certain companies and agencies of those states, and/or against those states as such, was a fundamental factor paving the way for the negotiations leading up to the settlement agreements.⁵⁰

Although the details of the various arrangements may be significantly different, their common rationale, or grand bargain, is a constant feature: an exclusive compensatory mechanism funded by the responsible state (and often co-funded by the companies implicated in the relevant crimes) is set up in exchange for legal peace in the forum state; legal peace involves the termination or suspension of judicial proceedings against the responsible state and its companies, as well as a best-efforts obligation on the forum state’s executive to prevent and oppose any future challenges to the responsible state’s immunity, or at least challenges arising from claims covered by the pertinent agreement.

As to the practice concerning Germany, it is usually recalled that US Holocaust litigation was crucial for the conclusion of the 2000 Agreement establishing the Foundation ‘Remembrance, Responsibility and Future’ (Erinnerung, Verantwortung und Zukunft).⁵¹ By contrast, less attention is paid to an earlier WWII reparations agreement⁵² stipulated in 1995 by a recently reunified Germany in the wake of the Princz affair, which had hitherto resulted in a decade-long diplomatic action by the US and one of the most famous cases discussing (and rejecting) a ius cogens exception to state immunity.⁵³ The 1995 Agreement was thus a sort of ad personam arrangement (and an effective exercise of diplomatic protection) making DM (Deutsche Mark) 3 million available ‘[f]or the prompt settlement of known cases of compensation claims’⁵⁴ advanced by victims of Nazi persecution who were US nationals at the time of the injury.⁵⁵ The close link between state immunity litigation and ensuing intergovernmental negotiation and settlement is crystal clear.

Most important, legal peace was actually achieved as a result of such diplomatic activity. US courts, including the US Supreme Court,⁵⁶ cooperated in good faith to that end by rejecting all remaining Holocaust claims covered by those agreements and lodged against the states concerned and/or their agencies and companies. The courts justified their decisions on a variety of grounds, which prominently feature the non-justiciability of political questions and international comity.⁵⁷

Unsurprisingly, the current residues of US Holocaust litigation precisely concern situations involving either an absence of reparations agreements between the US and the respondent states along the lines mentioned earlier or subject matters that were not (or not clearly) dealt with by such agreements. The first category of situations includes a number of high-profile disputes against Hungary and several of its state agencies for their role in the mass deportation of Hungarian Jews towards the end of WWII (which resulted in the extermination of more than 500,000 persons) and the ensuing systematic deprivation of their property and assets.⁵⁸ The second category involves, most significantly, cases relating to cultural property confiscated by the Nazis and their accomplices during the Third Reich. Thus, Germany was recently denied immunity in a prominent dispute involving a complaint for the restitution of precious medieval devotional objects known as the Welfenschatz and currently housed by the Museum of Decorative Arts in Berlin.⁵⁹ The plaintiffs, who are legal successors to the original owners, successfully claimed (so far) that these art objects were forcibly sold to the state of Prussia (a then political subdivision of the Third Reich) in 1935, as a result of persecution against the Jewish ‘sellers’. Crucially, the courts held that the absence of any intergovernmental agreements with Germany covering the restitution of Nazi-looted art⁶⁰ was a chief reason for dismissing all German defences based on an encroachment of the foreign affairs power of the US President, non-justiciability, international comity, and forum non conveniens.⁶¹ The 1998 Washington Conference Principles on Nazi-Confiscated Art,⁶² as implemented by Germany through the creation of an Advisory Commission for the Return of Cultural Property Seized as a Result of Nazi Persecution, were no bar to that conclusion, given the non-binding nature of the former instrument and the ineffectiveness of the latter remedy.

The reason for discussing this US practice is that it provides a most useful lesson to the German and Italian governments: dialogue and non-adversarial means of dispute settlement, transparently implemented with the involvement of the victims, are the only avenues to achieve legal peace and resolve the current impasse. Such conduct would also dispose of any unpleasant feelings that the US, due to its political and economic leverage, is capable of accomplishing in this area what is beyond the reach of other states.

Reliance on US Holocaust litigation and practice would have provided significant support to the Italian Ferrini jurisprudence. The Ferrini Court instead preferred to quote the controversial US terrorism exception to state immunity and related US judicial decisions.⁶³

IV. North American Remedies Against Immunities

The ICJ’s holding that immunity gives rise to a right enjoyed by states under customary international law should not be taken as an obvious and granitic conclusion.⁶⁴ A more comprehensive and nuanced position was possible and would have been preferable.⁶⁵ Anne Peters, for instance, points out that immunities are a ‘messy affair’⁶⁶ as they ‘oscillate between law, politics, and comity’;⁶⁷ they are ‘bastards’,⁶⁸ she insists, created by the ‘engagement of law with politics, of international law with domestic law, of public law with private law’.⁶⁹ Further, she convincingly highlights that, ‘to the extent that immunities do pertain to the legal realm’,⁷⁰ the relentless interaction of pertinent international and national jurisprudence makes this area of law ‘dynamic, complex, and partly inconsistent’.⁷¹

Anne Peters is in good company. In addition to a sizable scholarship,⁷² her views are echoed in the Kazemi decision⁷³ of the Supreme Court of Canada involving (and upholding) state immunity for torture, a decision delivered a few days before Sentenza 238/2014. The Supreme Court noted: ‘[S]tate immunity is not solely a rule of customary international law. It also reflects domestic choices made for policy reasons, particularly in matters of international relations’.⁷⁴ The Court also made clear that comity provides a rationale for the recognition of immunity additional to, inter alia, sovereign equality,⁷⁵ thus essentially endorsing the same approach that famously informs US jurisprudence.⁷⁶

These unprecedented observations by the Supreme Court of Canada were prompted by Canada’s adoption, just a few weeks after the 2012 ICJ Judgment, of a terrorism exception to state immunity, according to which a foreign state does not enjoy immunity in proceedings relating to loss or damage arising from that state’s terrorist activity (carried out on or after 1 January 1985), and provided the same state has been included in a list of supporters of terrorism by the government.⁷⁷ This background led the Supreme Court to conclude that ‘the amendment to the SIA [State Immunity Act] brought by Parliament in 2012 demonstrates that forum states (…) have a large and continuing role to play in determining the scope and extent of state immunity’.⁷⁸

The persistent dynamism of the law of international immunities seems beyond question. Despite the widespread impression that international court decisions like the Jurisdictional Immunities Judgment⁷⁹ and the Jones Judgment⁸⁰ are bound to yield a desirable stabilization of the pertinent practice, this field of law seems more vibrant than ever and continues to generate high-profile disputes. Two relevant cases are pending before the ICJ. One case⁸¹ involves the immunity from criminal jurisdiction of a senior state official and the inviolability of diplomatic premises, whereas the other⁸²—which is much more interesting in our context—concerns the alleged responsibility of the US for having repeatedly denied Iran’s immunity from adjudication and execution in the framework of the notorious legislation⁸³ targeting state sponsors of terrorism designated as such by the US executive (currently, Iran, North Korea, Sudan, and Syria). In addition, the potentially powerful stabilizing factor represented by the UNCSI is languishing in the ratification process: more than 15 years after its adoption, only 22 states have consented to be bound by this convention, whereas 30 ratifications are necessary for its entry into force; most worryingly, however, only one state has ratified it over the last five years, and many ‘key’⁸⁴ states, such as Germany and the UK, appear uninterested in becoming parties. One plausible explanation is that the large majority of states are unwilling to sacrifice their scope for manoeuvre in immunity issues to the altar of legal predictability and harmonization resulting from multilateral treaty obligations.

Yet the US and Canadian terrorism exceptions to state immunity, together with the Italian Ferrini and Sentenza 238/2014 jurisprudence, remain the most controversial manifestations of the contemporary practice in the area of international immunities. Nearly 25 years after its enactment, damages awarded under the US exception have now reached much-feared ‘astronomic dimensions’.⁸⁵ Iran is debtor to a multitude of (largely unpaid) judgments awarding damages for over US$56 billion.⁸⁶ Most significantly, a number of legislative instruments and judicial decisions have targeted various types of property held by Iran or its instrumentalities in the US, thereby paving the way for execution against them. In many instances, such property is apparently used or intended for governmental purposes, including the financial assets of the Central Bank of Iran (Bank Markazi) and state cultural objects.⁸⁷ These categories of sovereign property should thus be immune under international law.

The situation became particularly troublesome for the Iranian authorities when in August 2012 the US Congress approved, and the President signed into law, the Iran Threat Reduction and Syria Human Rights Act,⁸⁸ which contains a section removing any obstacle to execution against certain Iranian financial assets specifically identified as those that had already been the subject of restraining orders in a case under the terrorism exception.⁸⁹ These assets amount to some US$1.75 billion in cash proceeds of securities owned by Bank Markazi. Soon after the US Supreme Court upheld this ad hoc legislation in the 2016 Bank Markazi decision,⁹⁰ Iran filed its application with the ICJ. The Supreme Court merely considered, and ruled out, a possible violation of separation-of-powers principles by the 2012 Act. It did not even mention international law. Only Chief Justice Roberts, in his powerful dissenting opinion, underscored that the disputed legislation ‘strips the Bank of any protection that federal common law, international law, or New York State law might have offered against respondents’ claims’.⁹¹

US plaintiffs holding judgments against Iran have now found a precious ally across the northern border. One of the most salient aspects of the Canadian terrorism exception is a provision according to which Canadian courts ‘must recognize a judgment of a foreign court’⁹² in favour of a person who has suffered losses or damages as a result of terrorist activities by a state supporter of terrorism listed as such in Canada (presently, Iran and Syria). This provision has already been set in motion. For instance, a major case involves twelve US judgments against Iran that have been granted exequatur and whose enforcement proceedings in Canada are well underway.⁹³ Attachment has successfully been sought against two bank accounts held in the name of Iran’s embassy and real estate allegedly hosting Iranian cultural centres located in Ottawa and Toronto.⁹⁴ To be sure, Canada’s immunity statute makes iure imperii property held by state supporters of terrorism generally subject to execution, with the exception of diplomatic property, property that has cultural or historical value, and—possibly—military property.⁹⁵ In the Tracy case, both the buildings hosting Iranian cultural centres and the embassy’s bank accounts were found not to have ‘cultural or historical value’;⁹⁶ nor were they diplomatic property,⁹⁷ given that they were listed on Canada’s Department of Foreign Affairs website as ‘Iran’s Non-Diplomatic Assets in Canada’. The conclusion that the Iranian property at stake was not entitled to immunity from execution ‘under either domestic or international law’⁹⁸ was, however, deceiving, insofar as it was not supported by any meaningful discussion of the international instruments and practice covering mixed bank accounts or, generally, property fulfilling sovereign functions. The Canadian courts never mentioned the ICJ’s Jurisdictional Immunities Judgment, and particularly not the section concerning the illegality of the Italian courts’ grant of exequatur to the Greek decisions awarding damages and costs in the proceedings relating to the Distomo massacre.⁹⁹

One of the latest chapters in American exceptionalism within the area of international immunities is the Justice Against Sponsors of Terrorism Act (JASTA), otherwise known informally as the ‘9/11 Victims Bill’, a statute finally passed by the US Congress on 28 September 2016 when an earlier veto by President Obama was overridden.¹⁰⁰ JASTA amends the US Foreign Sovereign Immunities Act (FSIA) by introducing a new Section 1605B, according to which a foreign state is not immune from the jurisdiction of US courts in compensation proceedings brought by US nationals for physical injury to person or property, or for death caused by (i) an act of international terrorism in the US, and (ii) a tortious act of the foreign state, regardless where the tort occurred.¹⁰¹ The amendment applies to any civil action ‘arising out of an injury to a person, property, or business on or after September 11, 2001’.¹⁰² The chief reason behind the adoption of JASTA is clearly to dispose of the requirement in the existing terrorism exception that a foreign state be listed as a state sponsor of terrorism in order for compensation claims to be pursued against it for terrorist acts committed in the US, especially those that were planned and/or supported outside of US territory. Indeed, mass litigation against Saudi Arabia instigated by thousands of victims (individuals, businesses, and insurance companies) of 9/11 is currently unfolding before US courts.¹⁰³ Similarly, the amendment circumvents the conditions for triggering the territorial tort exception of the FSIA, which is applicable to claims for personal injury, death, or damage to property in the US, but only if the tortious act of the defendant foreign state also occurred in the US, and provided that act did not arise from the exercise of a discretionary function.¹⁰⁴

How do we make sense of this North American practice? How do we square the widespread convictions and certainties relating to immunity law as bolstered by the ICJ with it? Is it nothing else than (North) American extravagance? It must be pointed out that there are robust reasons why the legislation and practice at stake cannot be equated to lawful countermeasures. It is true that in the North American context, unlike the Italian situation, the actual denial of immunity would usually be conditional on a prior executive’s determination of target states and that we would not, therefore, be here confronted with an instance of misconceived judicial countermeasures. It is thus tempting to interpret¹⁰⁵ the North American practice in light of the law of countermeasures, and there can be no doubt that troops of American lawyers would be willing to mount a major defence on this basis within the Iran v US case before the ICJ and/or similar future disputes. However, when one takes a closer look at that practice and reviews it against the notion and requirements of countermeasures, this view becomes untenable.¹⁰⁶ For present purposes, two points would suffice. First, as JASTA shows, the necessity of a prior executive’s determination of the commission or support of acts of terrorism by states that may be denied immunity (for example Saudi Arabia) is not an inflexible requirement of US practice. To the contrary, JASTA has been adopted by the US legislature despite strong opposition by the executive. This is an unorthodox and clumsy situation for the implementation of veritable countermeasures. Secondly, and more fundamentally, to the best of my knowledge there exist no statements or any other documentary evidence from the governments concerned characterizing the terrorism legislation and practice at stake as countermeasures, that is, as measures which would be in breach of international obligations on state immunity were they not taken in response to wrongful acts by the target states. Accordingly, this would be an unlikely instance of implicit countermeasures. In reality, the only reasonable inference is that, at best, the governments concerned might conceive of the practice in question in terms of acts of retorsion, namely, as unfriendly conduct withdrawing a privilege predominantly afforded as a matter of grace and comity, not out of respect for international legal obligations.

To be sure, if we stick to the wisdom and certainty allegedly emanating from the 2012 ICJ Judgment, there is no alternative to regarding the US and Canadian terrorism exceptions as internationally wrongful acts sic et simpliciter. It is another thing, though, to maintain that American immunity practice must be set aside as a whole and given no weight whatsoever when assessing the state of the law in this area.¹⁰⁷ This is the radical stance taken by authors such as Thomas Giegerich. He states: ‘The proper reaction of the international community to such instances of ignorance or disregard of international law is to ignore or disregard them when it comes to gathering evidence of the development of international law’.¹⁰⁸ This sentence proves too much. First, the North American legislation and judicial decisions in question do represent state practice. Such practice may then be considered as irrelevant for the formation of customary exceptions to state immunity, as it is not grounded in international opinio iuris but in considerations of comity and political convenience. Yet, it provides evidence contrary to the existence of customary rules in the field of state immunity. As it apparently involves two states only, the same practice is currently insufficient to override the contrary position of the majority of states. But it remains chiefly significant because it comes from two major countries that have been fundamental for the definitive consolidation of restrictive immunity standards and whose courts (especially US courts) adjudge a massive volume of immunity cases.

At the very least, the North American terrorism exceptions are a powerful reminder of the persistent strains and paradoxes in the law of international immunities. They are a crucial component of dissident views from certain key states that challenge common legal assumptions and debunk the myth of the universal acceptance of the customary status of immunity rules.

V. Conclusion

At the time of writing, the prospect of legal peace between Germany and Italy in relation to the litigation of Nazi war crimes reignited in Italian courts in the wake of Sentenza 238/2014 seems distant and, most worryingly, is being ignored by the governments concerned. It is as if the governments were confident that time will pass by and sooner or later heal the wounds left open by the loopholes and gaps in the reparation regimes elaborated over the past 70 years, regimes that were specifically meant to reckon with WWII crimes. However, such a failure to convincingly address the outstanding compensation claims of IMIs and comparable victims of Nazi crimes may also increasingly come to be regarded as staining the reputation of Germany and Italy, two countries which are champions of European integration and supposed to be frontrunners in the global pursuit of peace, justice, and the rule of law.

This chapter has stigmatized the opaque conduct of the governments concerned in the aftermath of Sentenza 238/2014 and their dismissive attitude vis-à-vis meaningful negotiations, which would be conducive to a just compensatory arrangement and, ultimately, legal peace. It has underscored how useful lessons in this area come from a series of WWII reparations agreements that, from the 1990s, were stipulated between the US and a number of states (including Germany) in order to put a halt to an expanding array of judicial proceedings before US courts that were endangering those states’ entitlement to immunity.

Pace the ICJ, there are continuing manifestations of US practice, and lately Canadian practice, which corroborate the view that immunity for acta iure imperii is not a universally shared, inflexible international law dogma, especially when effective remedies for the victims, other than suits in the forum state, are absent. Serious violations of international humanitarian and human rights law are exerting a sustained pressure on the law of international immunities. At the very least, history and precedent show that when such egregious breaches of international law are at stake the only way of appeasing turbulent domestic courts and achieving a sustainable legal peace is the setting up of fair and reasonable means of redress for uncompensated victims.