39–006 

113TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 2d Session 113–435 

FOREIGN CULTURAL EXCHANGE JURISDICTIONAL 

IMMUNITY CLARIFICATION ACT 

MAY 6, 2014.—Committed to the Committee of the Whole House on the State of the 

Union and ordered to be printed 

Mr. GOODLATTE, from the Committee on the Judiciary, 

submitted the following 

R E P O R T 

[To accompany H.R. 4292] 

[Including cost estimate of the Congressional Budget Office] 

The Committee on the Judiciary, to whom was referred the bill 

(H.R. 4292) to amend chapter 97 of title 28, United States Code, 

to clarify the exception to foreign sovereign immunity set forth in 

section 1605(a)(3) of such title, having considered the same, reports 

favorably thereon without amendment and recommends that the 

bill do pass. 

CONTENTS 

Page 

Purpose and Summary ............................................................................................ 1 

Background and Need for the Legislation ............................................................. 2 

Hearings ................................................................................................................... 8 

Committee Consideration ........................................................................................ 8 

Committee Votes ...................................................................................................... 8 

Committee Oversight Findings ............................................................................... 8 

New Budget Authority and Tax Expenditures ...................................................... 8 

Congressional Budget Office Cost Estimate .......................................................... 8 

Duplication of Federal Programs ............................................................................ 9 

Disclosure of Directed Rule Makings ..................................................................... 10 

Performance Goals and Objectives ......................................................................... 10 

Advisory on Earmarks ............................................................................................. 10 

Section-by-Section Analysis .................................................................................... 10 

Purpose and Summary 

Currently, a provision in the Foreign Sovereign Immunities Act 

(FSIA) discourages foreign governments from lending governmentowned artwork and objects of cultural significance to U.S. museums 


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1 22 U.S.C. § 2459. 

2 H.R. Rep. No. 89–1070 (1965). 

3 28 U.S.C. § 1605(a)(3). 

4 Yin-Shuan Lue, Polly Clark, & Marion R. Fremont-Smith, Countering a Legal Threat to Cultural Exchanges of Works of Art: The Malewicz Case and Proposed Remedies 3 (Hauser Center 

for Nonprofit Organization, Working Paper No. 42, 2007). 

and educational institutions for temporary exhibition or display. 

Foreign governments are discouraged from such lending by the possibility that it will open them up to litigation in U.S. courts for 

which they would otherwise be immune. This legislation fixes this 

problem by making a narrowly tailored change to FSIA. This 

change will make it easier for U.S. museums and educational institutions to borrow works of art and other objects from abroad, increasing Americans’ opportunities for cultural and educational development. 

Background and Need for the Legislation 

The Immunity from Seizure Act (IFSA) provides the President, 

or the President’s designee, with authority to grant a work of art 

or other object of cultural significance immunity from seizure by 

U.S. courts whenever it is determined that its temporary exhibition 

or display in the United States is within our national interest.1 The 

intent of the IFSA is to encourage the cultural and educational exchange of artwork and other culturally significant objects which, in 

the absence of the legislation, would not be made available for exchange. In enacting IFSA, Congress recognized that cultural exchange can produce substantial benefits to the United States, both 

artistically and diplomatically.2

However, for artwork and cultural objects owned by foreign governments, the intent of IFSA is being frustrated by the Foreign 

Sovereign Immunities Act (FSIA). Recent court decisions have interpreted a provision of FSIA in a manner that opens foreign governments up to the jurisdiction of U.S. courts if foreign government-owned artwork is present in the United States in connection 

with a commercial activity and there is a claim that the artwork 

was taken in violation of international law.3 Courts have determined that the non-profit exhibition or display of the artwork can 

be considered ‘‘present in the United States in connection with 

commercial activity’’ even if the artwork has been granted immunity under IFSA. 

This has led, in many instances, to foreign governments declining 

to export artwork and cultural objects to the United States for temporary exhibition or display. Future cultural exchanges may be seriously curtailed by foreign lenders’ unwillingness to permit their 

artwork and other cultural objects to travel to the United States. 

In order to keep the exchange of foreign government-owned cultural objects flowing, this legislation clarifies the relationship between the immunity provided by IFSA and the exceptions to sovereign immunity provided for in FSIA. 

A. IMPORTANCE OF CULTURAL EXCHANGE THROUGH MUSEUM LOANS

‘‘The United States has long recognized the importance of encouraging the cultural exchange of ideas through international loan exhibitions.’’ 4 Art exhibitions enrich the cultural life of Americans 

and serve a number of public interests, including education of the 


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5 Id. at 21. 6 Id. 

7 IFSA applies to artwork owned by private entities as well as foreign states. This legislation 

only applies to artwork owned by foreign states. 8S. Rep. No. 89–747, at 2 (1965). 

9 22 U.S.C. § 2459(a). 

10 Id. 11 Id. 

public, scholarship, promotion of further artistic activity, and entertainment. Exhibitions of international artwork in particular inspire 

cultural exploration, the expansion of the global community, and 

the exchange of ideas through art. 

International loans of artwork produce significant benefits for the 

countries on both sides of the exchange. For the country exporting 

the artwork, ‘‘art serves as an ‘ambassador’ which ignites interest 

in, understanding of, and compassion for that country. As such, 

international exchange of artworks can foster the breakdown of parochialism and increase international harmony.’’ 5 And, for the 

country importing the artwork, ‘‘art serves to widen its citizenry’s 

cultural horizons and stimulate new art and scholarship.’’ 6 In 

short, the international exchange of artwork serves as a ‘‘good ambassador’’ for the exporting country and enriches the importing 

country by both educating and stimulating further artistic activity. 

B. THE IMMUNITY FROM SEIZURE ACT

In 1965, Congress enacted the Immunity From Seizure Act to 

allow foreign entities 7 to lend artwork and other objects of cultural 

significance without fear that the loan would subject them to the 

jurisdiction of U.S. courts.8 IFSA creates a mechanism by which 

the President, or the President’s designee (currently the Department of State), may grant immunity to objects to be imported that 

are determined to be of ‘‘cultural significance and that the temporary exhibition or display thereof within the United States is in 

the national interest.’’ 9

In order to qualify for immunity, there must be an agreement between the foreign owner or custodian and a U.S. cultural or educational institution ‘‘providing for the temporary exhibition or display’’ of the artwork ‘‘at any cultural exhibition, assembly, activity, 

or festival administered, operated, or sponsored, without profit, by 

any such cultural or educational institution.’’ 10 Additionally, the 

State Department must determine that (1) the object is of cultural 

significance, and (2) the temporary exhibition of the object in the 

United States is in the national interest. If the State Department 

determines that the requirements have been met and it publishes 

notice in the Federal Register of its determinations before the objects are imported: 

no court of the United States, any State, the District of Columbia, or any territory or possession of the United States 

may issue or enforce any judicial process, or enter any 

judgment, decree or order, for the purpose or having the 

effect of depriving such institution, or any carrier engaged 

in transporting such work or object within the United 

States of custody or control of such object.11

In enacting IFSA, Congress recognized that cultural exchange 

can produce substantial benefits, both artistically and diplomatiVerDate Mar 15 2010 05:48 May 07, 2014 Jkt 039006 PO 00000 Frm 00003 Fmt 6659 Sfmt 6601 E:\HR\OC\HR435.XXX HR435

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12 H.R. Rep. No. 89–1070, at 2. 13S. Rep. No. 89–747, at 1–2. 14 Id. at 3. 15 H.R. Rep. No. 89–1070. 16 Because each of the notices published in the Federal Register can include multiple objects, 

the works involved actually number in the many thousands. 17 11 U.S. (7 Cranch) 116 (1812). 18Letter from Jack B. Tate, Acting Legal Adviser, U.S. Dept. of State, to Acting U.S. Attorney 

General Phillip B. Perlman (May 19, 1952). 19 Verlinden B. V. v. Central Bank of Nigeria, 461 U.S. 480, 486–87 (1983). 20 Id. at 487. 21 Id. at 488. 22 Argentine Republic v. Amerada Hess Shipping Corp., 488 U.S. 428, 434 (1989). 

cally. The House Judiciary Committee reported that ‘‘the purposes 

of this proposed legislation are salutary and will contribute to the 

educational and cultural development of the people of the United 

States.’’ 12 The accompanying Senate report recognized that the legislation was ‘‘a significant step in international cooperation.’’ 13 The 

legislation was intended to accomplish its purposes by encouraging 

‘‘the exhibition in the United States of objects of cultural significance which, in the absence of assurances such as are contained in 

the legislation, would not be made available.’’ 14 The adoption of 

IFSA was supported by the State Department, the Justice Department, the Smithsonian Institution, and the American Association 

of Museums.15

Since its enactment in 1965, IFSA has served to facilitate cultural exchanges with foreign countries, thereby building international understanding and appreciation of other cultures, and conferring educational and artistic benefits on Americans. In recent 

years, IFSA has been used with increasing regularity to provide assurances to foreign lenders when they temporarily export their artwork to the United States. Indeed, from 2000 to the beginning of 

2008, the State Department has published in the Federal Register 

determinations for more than 650 temporary exhibits.16 However, 

recent court decisions addressing the relationship between IFSA 

and FSIA have undercut the ability of IFSA, in many cases, to provide foreign governments with the assurances they require to be 

willing to export artwork to the United States for temporary exhibition or display. 

C. THE FOREIGN SOVEREIGN IMMUNITIES ACT

From the Supreme Court’s 1812 decision in Schooner Exchange 

v. McFaddon 17 until the State Department’s 1952 Tate letter,18 the 

United States adhered to the ‘‘absolute’’ theory of sovereign immunity, pursuant to which foreign sovereigns were absolutely immune 

from suit in U.S. courts.19 In 1952, the United States switched to 

the ‘‘restrictive’’ theory of sovereign immunity, under which ‘‘immunity is confined to suits involving the foreign sovereign’s public 

acts, and does not extend to cases arising out of a foreign state’s 

strictly commercial acts.’’ 20 Congress passed FSIA in 1976 to codify 

the restrictive theory of sovereign immunity. FSIA for the first 

time established a ‘‘comprehensive set of legal standards governing 

claims of immunity in every civil action against a foreign state or 

its political subdivisions, agencies, or instrumentalities.’’ 21 It is the 

‘‘sole basis for obtaining jurisdiction over a foreign state in our 

courts.’’ 22


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23 28 U.S.C. § 1604. 24See 28 U.S.C. §§ 1605–1607. 25 A ‘‘foreign state’’ includes a political subdivision of a foreign state or an agency or instrumentality of a foreign state. 28 U.S.C. § 1603. 26 28 U.S.C. § 1605(a)(3). 27 Nout van Woundenberg, State Immunity and Cultural Objects on Loan 116 (2012). 28See, e.g., Malewicz v. City of Amsterdam, 362 F. Supp. 2d 298 (D.D.C. 2005). 29 Charlene A. Caprio, ‘‘Artwork, Cultural Heritage Property and the Foreign Sovereign Immunities Act,’’ 13 Int’l J. of Cultural Prop.285, 287 (2006). 

FSIA sets forth a general rule that foreign states are immune 

from the jurisdiction of U.S. courts.23 Courts may exercise jurisdiction over foreign states only if the suit comes within one of the specific statutory exceptions to that rule.24 For international loans of 

foreign government-owned artwork, the relevant exception is set 

forth in 28 U.S.C. § 1605(a)(3). This exception, commonly referred 

to as the ‘‘expropriation exception,’’ provides that a foreign state 25

is not immune from suit in any case ‘‘in which rights in property 

taken in violation of international law are in issue and that property . . . is present in the United States in connection with a commercial activity carried on in the United States by the foreign 

state.’’ 26 Thus, 28 U.S.C. § 1605(a)(3), allows a suit against a foreign state when (1) rights in property were taken in violation of 

international law, (2) the property is present in the United States, 

and (3) the property has a connection to a commercial activity in 

the United States conducted by the foreign state. The United 

States is the only nation to have such an exception.27

D. THE RELATIONSHIP BETWEEN IFSA AND FSIA

The United States has a strong national interest in facilitating 

cultural exchanges of artwork with other nations. In furtherance of 

that interest, the State Department has regularly exercised authority delegated to it to grant immunity for temporary art loans from 

abroad that are of cultural significance and in the national interest. 

For 40 years, this immunity provided foreign lenders with the assurance that immunized loans of artwork would not serve as the 

basis for the jurisdiction of U.S. courts. However, these assurances 

and the willingness of foreign government lenders to loan their artwork have been threatened by recent Federal court decisions holding that foreign sovereigns waive their sovereign immunity under 

FSIA by sharing their artwork with American museums and educational institutions even if the loan is made pursuant to a grant 

of IFSA immunity.28 These decisions hold that the presence in the 

United States of artwork protected under IFSA can serve as the 

basis for jurisdiction under the FSIA expropriation exception, 28 

U.S.C. § 1605(a)(3). 

Thus, in a manner that substantially undermines the purposes 

of IFSA, courts have extended the FSIA ‘‘commercial activity nexus 

to cover cross-border museum loans . . . [and] stripped the IFSA 

of its ability to provide any sort of meaningful immunity to art 

loans coming into the United States, by holding that immunity 

under IFSA prohibits seizure but does not bar judicial proceedings 

against the property under immunity.’’ 29 In other words, ‘‘what 

were formerly viewed as educational and cultural promotions for 

international art exhibitions now can take the form of commercial 


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30 Id. at 291. 31 Id. at 303. 32 111 Cong. Rec. 25,929 (1965) (remarks of Rep. Rogers) (emphasis added). 

activities capable of stripping foreign sovereigns of their immunity.’’ 30

These decisions, however, defeat the purpose of IFSA by allowing 

the very type of lawsuit that motivated the passage of the statute 

in the first place. By allowing the presence in the United States of 

immunized works to form the basis for depriving foreign states of 

sovereign immunity, courts have turned IFSA on its head and 

paved the way for further lawsuits of the very sort that Congress 

intended to prevent. As one scholar has observed, ‘‘[a] museum promotion or art loan into the United States is not the best mechanism to trap foreign sovereigns into U.S. courts. It mixes together 

two separate interests: promoting (by protecting) cross-cultural art 

and cultural heritage exchanges, and providing a forum for 

wronged individuals to seek justice for their private claims.’’ 31

In enacting IFSA, Congress made the policy decision to promote 

Americans’ exposure to objects of cultural significance over the potential rights of individual claimants. Congress’s aim was to ensure 

that foreign lenders would not be subject to the jurisdiction of U.S. 

courts when they loaned immunized artwork for temporary exhibits 

in the United States. As Representative Byron Rogers explained 

during floor debate on IFSA, the bill was designed to assure the 

foreign lender that it could lend artwork to the United States without incurring the risk that the artwork would be seized or the lender would become subject to suit: 

If a foreign country or an agency should send exhibits to 

this country in the exchange and cultural program and 

someone should decide that is necessary for them to institute a lawsuit against that particular country or those who 

may own the cultural objects, the bill would assure the 

country that if they send the objects to us they would not 

be subjected to a suit and an attachment in this country.32

The ongoing effectiveness of IFSA to encourage foreign governments to lend artwork depends upon the ability to provide assurance to foreign lenders that participating in an immunized exhibit 

will, in fact, protect them from litigation in the United States based 

on the exhibit. 

In sum, court decisions interpreting FSIA’s expropriation exception, 28 U.S.C. § 1605(a)(3), have undermined the interests that 

IFSA was designed to foster and have created tension in U.S. relations with other countries that IFSA was intended to facilitate. As 

a result, foreign nations are less willing to loan cultural objects for 

exhibition in the United States, and American institutions are less 

able to host exhibitions of such objects, depriving the American 

public of opportunities to view and learn from such exhibitions. 

E. THE LEGISLATION

H.R. 4292 makes a very modest but important change to FSIA 

to restore the protections that IFSA was intended to provide and 

to bring the two statutes into harmony. Foreign government lenders will once again be assured that if they are granted immunity 

from seizure under IFSA, the loan of artwork or other objects of 


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33 22 U.S.C. § 2459. 34The Conference on Jewish Material Claims Against Germany, Inc. and the American Jewish 

Committee have reviewed the text of this exception and have no objection to it. Letter from Conference on Jewish Material Claims Against Germany, Inc. to the Association of Art Museum Directors (Dec. 19, 2013) (on file with the Committee). 35Shira T. Shapiro, ‘‘How Republic of Austria v. Altmann and United States v. Portrait of 

Wally Relay the Past and Forecast the Future of Nazi Looted-Art Restitution Litigation,’’ 34 

Wm. Mitchell L. Rev. 1147, 1150 (2008). 36 Id. at 1152–1153. 

cultural significance for temporary non-profit exhibition or display 

in the United States will not open them up to the jurisdiction of 

U.S. courts. 

Although this legislation is of great importance to ensuring the 

continued willingness of foreign states to lend their artwork to U.S. 

institutions, it is narrowly tailored for at least three reasons. First, 

the immunity applies to only one of several FSIA exceptions to sovereign immunity—the exception related to rights in property taken 

in violation of international law, often called the ‘‘expropriation exception.’’ 

Second, the immunity provided by this bill only applies to foreign 

government-owned artwork and cultural objects for which the 

President, or the President’s designee, has granted immunity from 

seizure under IFSA.33 Thus, if foreign government-owned work has 

not been granted immunity pursuant to IFSA, the protection provided by this legislation will not apply. 

Third, the immunity provided by this bill does not apply to 

claims arising from artwork and objects of cultural significance 

that were taken in violation of international law by the Nazi government of Germany and its allied and affiliated governments between January 30, 1933 and May 8, 1945.34 This exception is included in the bill because of the systematic looting of artwork by 

the Nazis in Europe during Hitler’s reign—looting that was ‘‘on a 

historically unmatched level.’’ 35 According to one commentator, 

Between 1938 and 1945, the Nazi regime looted and confiscated an estimated three million artworks throughout 

occupied Europe. In doing so, the Third Reich effectively 

looted between one-fourth and one-third of European 

art. . . . The racial and cultural purity fundamental to 

Nazi ideology extended to Hitler’s plan to appropriate European art. It was not enough merely to steal the art; rather, the Nazis’ exhausting and extensive processes intended 

to strip European Jews of their dignity and cultural lifestyles. Thus, Nazi looted-art restitution claims represent 

more than the theft of a particular family’s private collection—they instead symbolize the profound depths of the 

Nazis’ crimes against humanity. . . . To establish Germany as the world’s most civilized society, Hitler implemented an unprecedented, ruthless, and immoral scheme 

to steal all European art for German ownership.36

Additionally, it is worth recognizing that without the protections 

provided for in this legislation, the artwork and cultural objects 

covered by this bill would not, in all likelihood, be imported into 

the United States for temporary exhibition or display. Therefore, 

this legislation does not, as a practical matter, change the status 

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ments have simply avoided the jurisdiction of U.S. courts by refusing to export their artwork to the United States for temporary exhibition or display. In other words, the practical effect is that 

whether or not this legislation is enacted, claimants will not, in 

most cases, be able to bring suit under 28 U.S.C. § 1605(a)(3). Without this legislation, however, Americans will be deprived of the opportunity to view these works of art and cultural objects if a foreign government believes loaning its property will open it up to litigation under FSIA. 

Hearings 

The Committee on the Judiciary held no hearings on H.R. 4292. 

Committee Consideration 

On April 2, 2014, the Committee met in open session and ordered 

the bill H.R. 4292 favorably reported, without amendment, by voice 

vote, a quorum being present. 

Committee Votes 

In compliance with clause 3(b) of rule XIII of the Rules of the 

House of Representatives, the Committee advises that there were 

no recorded votes during the Committee’s consideration of H.R. 

4292. 

Committee Oversight Findings 

In compliance with clause 3(c)(1) of rule XIII of the Rules of the 

House of Representatives, the Committee advises that the findings 

and recommendations of the Committee, based on oversight activities under clause 2(b)(1) of rule X of the Rules of the House of Representatives, are incorporated in the descriptive portions of this report. 

New Budget Authority and Tax Expenditures 

Clause 3(c)(2) of rule XIII of the Rules of the House of Representatives is inapplicable because this legislation does not provide new 

budgetary authority or increased tax expenditures. 

Congressional Budget Office Cost Estimate 

In compliance with clause 3(c)(3) of rule XIII of the Rules of the 

House of Representatives, the Committee sets forth, with respect to 

the bill, H.R. 4292, the following estimate and comparison prepared 

by the Director of the Congressional Budget Office under section 

402 of the Congressional Budget Act of 1974: 


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U.S. CONGRESS, CONGRESSIONAL BUDGET OFFICE, Washington, DC, May 21, 2014. 

Hon. BOB GOODLATTE, CHAIRMAN, 

Committee on the Judiciary, 

House of Representatives, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for H.R. 4292, the ‘‘Foreign Cultural Exchange Jurisdictional Immunity Clarification Act.’’ 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contact is Martin von Gnechten, 

who can be reached at 226–2860. 

Sincerely, 

DOUGLAS W. ELMENDORF, DIRECTOR. 

Enclosure 

cc: Honorable John Conyers, Jr. 

Ranking Member 

H.R. 4292—Foreign Cultural Exchange Jurisdictional 

Immunity Clarification Act. 

As ordered reported by the House Committee on the Judiciary 

on April 2, 2014. 

Based on information provided by the Administrative Office of 

the United States Courts, CBO estimates that implementing H.R. 

4292 would have no significant effect on the Federal budget. Enacting H.R. 4292 would not affect direct spending or revenues; therefore, pay-as-you-go procedures do not apply. 

Under current law, works of art loaned by foreign governments 

generally are immune to certain decisions made by Federal courts 

and cannot be confiscated if the President, or the President’s designee, determines that display of the works is in the national interest. However, commercial activity in which foreign governments 

are engaged does not have immunity in Federal courts. H.R. 4292 

would clarify that importing works of art into the United States for 

temporary display is not a commercial activity, and thus that such 

works would be immune from seizure. 

H.R. 4292 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would 

not affect the budgets of state, local, or tribal governments. 

The CBO staff contact for this estimate is Martin von Gnechten. 

The estimate was approved by Theresa Gullo, Deputy Assistant Director for Budget Analysis. 

Duplication of Federal Programs 

No provision of H.R. 4292 establishes or reauthorizes a program 

of the Federal Government known to be duplicative of another Federal program, a program that was included in any report from the 

Government Accountability Office to Congress pursuant to section 

21 of Public Law 111–139, or a program related to a program identified in the most recent Catalog of Federal Domestic Assistance. 


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Disclosure of Directed Rule Makings 

The Committee estimates that H.R. 4292 specifically directs to be 

completed no specific rule makings within the meaning of 5 U.S.C. 

§ 551. 

Performance Goals and Objectives 

The Committee states that pursuant to clause 3(c)(4) of rule XIII 

of the Rules of the House of Representatives, H.R. 4292 clarifies 

the exception to foreign sovereign immunity set forth in section 

1605(a)(3) of title 28, United States Code. 

Advisory on Earmarks 

In accordance with clause 9 of rule XXI of the Rules of the House 

of Representatives, H.R. 4292 does not contain any congressional 

earmarks, limited tax benefits, or limited tariff benefits as defined 

in clause 9(e), 9(f), or 9(g) of rule XXI. 

Section-by-Section Analysis 

Section 1. Short title. 

Section 1 provides that the short title is the ‘‘Foreign Cultural 

Exchange Jurisdictional Immunity Clarification Act.’’ 

Section 2. Clarification of Jurisdictional Immunity of Foreign 

States. 

Section 2 amends 28 U.S.C. § 1605 to clarify the immunity foreign states are granted under the Foreign Sovereign Immunities 

Act when they temporarily export artwork or other objects of cultural significance to the United States pursuant to the provisions 

of the Immunity From Seizure Act, 22 U.S.C. § 2459. Under the 

amendments made by the Act, the temporary importation of artwork or cultural objects is not considered ‘‘commercial activity’’ for 

purposes of 28 U.S.C. § 1605(a)(3) if: (a) the work is imported pursuant to an agreement between the foreign state and the United 

States or a cultural or educational institution within the United 

States; (b) the President, or the President’s designee, has made a 

determination that the work is of cultural significance and the temporary exhibition or display of such work is in the national interest; and (c) notice of that determination has been published in the 

Federal Register. This immunity does not apply if the artwork or 

cultural object imported was taken in violation of international law 

by the Nazi government of Germany or its collaborators between 

January 30, 1933, and May 8, 1945. Finally, the section provides 

that this immunity only applies to cases commenced on or after the 

date of enactment of the Act. 

Æ 


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