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12 

JAM v. INTERNATIONAL FINANCE CORP. 

BREYER, J., dissenting 

A 
The  “commercial  activity”  exception  to  the  sovereign
immunity of foreign nations is broad.  We have said that a 
foreign  state  engages  in  “commercial  activity”  when  it
exercises  “ ‘powers  that  can  also  be  exercised  by  private 
citizens.’ ”  Republic of Argentina, 504 U. S., at 614.  Thus, 
“a contract to buy army boots or even bullets is a ‘commer-
cial’  activity,”  even  if  the  government  enters  into  the 
contract  to  “fulfil[l]  uniquely  sovereign  objectives.”    Ibid.; 
see also H. R. Rep. No. 94–1487, p. 16 (1976) (“[A] transac-
tion to obtain goods or services from private parties would 
not lose its otherwise commercial character because it was 
entered  into  in  connection  with  an  [Agency  for  Interna-
tional Development] program”).

As a result of the majority’s interpretation, many of the
international  organizations  to  which  the  United  States
belongs  will  discover  that  they  are  now  exposed  to  civil
lawsuits  based  on  their  (U. S.-law-defined)  commercial 
activity.  And because “commercial activity” may well have
a  broad  definition,  today’s  holding  will  at  the  very  least 
create  uncertainty  for  organizations  involved  in  finance,
such as the World Bank, the Inter-American Development 
Bank, and the Multilateral Investment Guarantee Agency.
The  core  functions  of  these  organizations  are  at  least 
arguably  “commercial”  in  nature;  the  organizations  exist
to  promote  international  development  by  investing  in
foreign companies and projects across the world.  See Brief 
for  International  Bank  for  Reconstruction  and  Develop-
ment  et al.  as  Amici  Curiae  1–4;  Brief  for  Member  Coun-
tries  and  the  Multilateral  Investment  Guarantee  Agency 
as  Amici  Curiae  13–15.  The  World  Bank,  for  example,
encourages  development  either  by  guaranteeing  private
loans  or  by  providing  financing  from  its  own  funds  if  pri-
vate capital is not available.  See Articles of Agreement of 
the  International  Bank  for  Reconstruction  and  Develop-
ment,  Art. I,  Dec.  27,  1945,  60  Stat.  1440,  T. I. A. S.  No.