Source: http://www.thealiadviser.org/us-foreign-relations-law/sovereign-immunity-approved/
Timestamp: 2019-04-19 12:45:33+00:00

Document:
At ALI’s Annual Meeting on Monday, May 22, members voted to approve the drafts for the Jurisdiction, Sovereign Immunity, and Treaties portions of the Foreign Relations Law Restatement.* This completes these three portions of the project.
New content reviewed and approved at this meeting includes the following in the Sovereign Immunity draft (Reporters Memorandum – edited).
The Introductory Note, like the Restatement Third, briefly sets out the history of foreign sovereign immunity in U.S. courts from The Schooner Exchange through the Tate Letter and the enactment of the FSIA, with some discussion of international developments. It provides and overview of the FSIA, including the relationship between immunity and subject-matter jurisdiction.
A discussion of the U.N. Convention on the Jurisdictional Immunities of States and Their Property and on other developments in international law, including the International Court of Justice’s decision in Germany v. Italy (Greece: intervening) has been added.
Section 452, Definition of Foreign State: Law of the United States, sets out the relationship between foreign states, political subdivisions, and agencies and instrumentalities, including the presumption that agencies and instrumentalities are distinct entities from foreign states for the purposes of both immunity and substantive liability. The black letter of the Restatement Third addressed only the relationship between instrumentalities and between instrumentalities and states for the purposes of substantive liability. The focus is shifted to immunity. The Comments in this draft take up a number of issues that have generated significant litigation, including what constitutes a “foreign state,” a term left undefined by the statute; how to distinguish between the foreign state itself and its agencies and instrumentalities; why that distinction is significant; and what constitutes an “organ” of a foreign state for purposes of the first prong of § 1603(b)(2). The last issue has become increasingly important since the Supreme Court’s decision in Dole v. Patrickson, 538 U.S. 468 (2002), which held that the second prong of § 1603(b)(2) does not apply to indirectly owned subsidiaries of foreign states. The Comments also address the First Nat. City Bank v. Banco Para El Comercio Exterior de Cuba, 462 U.S. 611 (1983) (Bancec) case and the presumption of separate legal personality for the purposes of both immunity and substantive liability, issues that were the primary focus of this Section of the Restatement Third.
Section 454, Claims Based upon Commercial Activity, is a revised version of § 453 of the Restatement Third. Subsections (1) and (3) are substantially the same as the old, although they have been reorganized to put domestic law before international law. Subsection (2) is new. It defines “commercial activity,” “commercial activity carried on in the United States,” “based upon,” and “direct effect.” Each is an important element in resolving many commercial-activity cases under the FSIA. The Comments and Reporters’ Notes to § 454 have been completely overhauled, although some language is retained from the Restatement Third where possible. The corresponding material in § 453 of the Restatement Third focused on the nature versus purpose distinction, due process, and state long-arm statutes. The Supreme Court addressed the nature or purpose issue in Republic of Argentina v. Weltover, 504 U.S. 607 (1992), and much of the legislative history quoted at length in the old Reporters’ Note 2 is no longer helpful. Similarly, the detailed discussion of minimum contacts under International Shoe and of state long-arm statutes seems misplaced, because under contemporary case law they do not play a very significant role in determining whether the statute’s nexus requirement has been satisfied. See Reporters’ Note 12. Nevertheless, as Reporters’ Note 8 makes clear, dueprocess-based analysis in particular continues to play a role in some decisions, as also addressed in Comment f. The new Comments and Reporters’ Notes focus on the more heavily litigated issues under the commercial-activity exception, which are the subject of the new subsection (2) of the black letter.
Section 454 has been revised in light of OBB Personenverkehr AG v. Sachs, 136 S. Ct. 390 (2015). The Sachs decision was quite narrow. The Court decided the case through analysis of the “based upon” language in the statute. We have accordingly made changes to the “based upon” language in § 454. Those changes are to the black letter in § 454(2)(a), Comment c, and Reporters’ Note 4.
Section 457, Claims in Noncommercial Tort, is a revised version of the Restatement Third § 454. The title has been changed to include the term “noncommercial” and the text revised to make clearer that the commercial-activity exception does include some tortious conduct. Some other countries, as well as the U.N. Convention on the Jurisdictional Immunities of States and Their Property, exclude torts from their versions of the commercial-activity exception to immunity, leading to potential confusion. The Comments and Reporters’ Notes have been revised for clarity and to reflect recent developments. A separate discussion has been included in the Notes regarding suits arising from alleged torts committed by the military or in the context of military activities.
Section 464, Execution or Other Enforcement of Judgment Against Foreign State: Law of the United States, makes only relatively minor changes to the black-letter provisions of § 460 of the Restatement Third. However, the Comments and Reporters’ Notes have been revised and expanded. A number of the changes reflect the fact that this remains an area of active litigation and judicial interpretation.
*All approvals by membership at the Annual Meeting are subject to the discussion at the Meeting and usual editorial prerogative.

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