NERINGA TOLEIKYT

THE CONCEPT OF STATE IMMUNITY

AND THE MAIN CHALLENGES
Neringa Toleikyt*
Vilnius University, Lithuania
Abstract. The purpose of this article is to analyse the doctrine of state immunity. Customary international
law inflicts a general requirement that foreign states should not be subject to suit in foreign state. State
immunity is an institution that is originated from public international law and concern the protection which
a state is given from being sued in the foreign state. It is widely known that it derives from the principle of
equality of states (par in parem non habet imperium) and is an expression of non-interference and respect
for the sovereignty of other States. The international community has tried for many years to agree a treaty
on the subject, but they all failed.
Keywords: state immunity, absolute immunity, restricted immunity.

INTRODUCTION

Foreign states are generally entitled to be granted immunity from the jurisdiction of other states.
This is known as foreign state immunity. In the last decades States have generally accepted the
restrictive doctrine of State immunity. The article presents a short overview of the development
of the restrictive state immunity doctrine and deals with the main problems applying the doctrine.
Immunity from jurisdiction is distinct from immunity from execution. Immunity from execution,
which means measures of constraint directed against property of the foreign state, will not be
analysed in this article. This article analyses only the immunity from jurisdiction, its evolution and
operation. Immunity of jurisdiction can be defined as limitation on the Forum State to exercise
jurisdiction over a foreign state.
I. THE CONCEPT OF STATE IMMUNITY

State immunity is an institution that at its basis belongs to public international law1. Under
the doctrine of foreign state immunity, one State is not subject to the full force of rules applicable
in another State; the doctrine bars a national court from adjudicating or enforcing certain claims
against foreign States2. Immunity is gained to legal proceedings against the foreign state itself, its
organs and companies, and its agents.
* Vilnius University Faculty of Law, Department of Private Law, Saultekio al. 9, LT-00117 Vilnius, Tel. +370 614 24694;
e-mail: neringa.toleikyte@gmail.com
1
R. Nowosielski, State Immunity and the Right of Access to Court. The Natoniewski Case Before the Polish Courts.
<http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2173035>
2 D. Gaukrodger, Foreign State Immunity and Foreign Government Controlled Investors, OECD Working Papers on
International Investment, 2010/2, OECD Publishing. doi: 10.1787/5km91p0ksqs7-en
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State immunity derived from state sovereignty and the equality of states. Customary international law inflicts a general requirement that foreign states should not be subject to suit in foreign
state. Customary international law is a widely accepted source of international law, but it is poorly
analysed. The doctrine of state immunity originated from customary international law and also
entails many disadvantages to domestic courts, because there are no uniformed rules that should
be used in all countries and regulated the same state activities.
The law of state immunity has been subject to numerous proceedings before domestic courts.
When the courts of one state assume jurisdiction over another state or its representatives, the
authority of the forum state to adjudicate the dispute conflicts with the principle of state equality,
often expressed by the maxim par in parem non habet imperium 3. State sovereignty implies
two principles: the principle of territorial jurisdiction of the forum state (this principle demands
unlimited exercise of jurisdiction) and the principle of sovereign equality of states (two equals
cannot rule over each other and means respect for the sovereignty of other States).
The principles of international law regarding jurisdictional immunities of states have derived
mainly from the judicial practice of individual nation4. This first articulation of the principle of state
immunity was recognized by the United States Supreme Court in its famous 1812 judgment of The
Schooner Exchange v. McFaddon5. Chief Justice Marshall clearly enunciated the principle: [The] full
and absolute territorial jurisdiction being alike the attribute of every sovereign, and being incapable
of conferring extraterritorial power, would not seem to contemplate foreign sovereigns nor their
sovereign rights as its objects. One sovereign being in no respect amenable to another; and being
bound by obligations of the highest character not to degrade the dignity of his nation, by placing
himself or its sovereign rights within the jurisdiction of another, can be supposed to enter a foreign
territory only under an express license, or in the confidence that the immunities belonging to his
independent sovereign station, though not expressly stipulated, are reserved by implication, and
will be extended to him. Since then the recognition of State immunity became firmly established
in the general practice of the United States and the majority of modern European States.
II. THE DOCTRINAL APPROACH

The doctrine of foreign state immunity has changed over the last centuries and has been subject
to constant evolution, progressing through several distinct periods. From the doctrinal approach,
there are two opposite doctrines regarding state immunity: the absolute doctrine and the restricted
doctrine6. The first period, covering the eighteenth and nineteenth centuries, has been called the
period of absolute immunity, because foreign states are said to have enjoyed complete immunity
3 S. Knuchel, State Immunity and the Promise of Jus Cogens. Northwestern University School of Law Volume 9, Number 2 (Spring 2011) Northwestern Journal of International Human Rights
4 F. J. Nicholson, Sucharitkul: State Immunities and Trading Activities, 2 B.C.L. Rev. 459 (1961), http://lawdigitalcommons.bc.edu/bclr/vol2/iss2/42
5 The Schooner Exchange v. McFaddon and Others, 11 U.S. 116 (1812).
6 M. Maw, Recent Trends In The Principle of State Immunity. http://dspace.lib.niigata-u.ac.jp:8080/dspace/bitstream/10191/1055/1/18..
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from domestic legal proceedings. The idea of absolute state immunity was generally accepted by
domestic courts in the 19th century. But absolute immunity caused unjust and unfair circumstances
on private enterprises trading with governmental entities.
The second period emerged during the early twentieth century, when Western nations adopted
a restrictive approach to immunity in response to the increased participation of state governments
in international trade.7 So-called restrictive doctrine of state immunity is more suitable: a foreign
state will be able to use immunity only for claims arising out of sovereign acts (acta jure imperii),
but there will not be a possibility to use immunity to the claims arising out of private law acts
(acta jure gestionis). As States became involved in commercial activities, national courts began to
apply a restrictive law of immunity. One purpose of the commercial exception is to protect the
legitimate expectations of business partners that engage in commercial transactions with foreign
States. The restrictive approach is now widely reflected in case law, national statutes and international conventions, although it cannot yet be said to be universally recognized8. Under this theory,
states are immune from suit in respect of acts of government, but not in respect of commercial
activities. But the biggest problem is that there is no clear boundary between commercial acts
and acts of government.
The aim of state immunity law is to enhance relations between states and to bring collectively
benefits to the community of nations. Thus, where state conduct is clearly detrimental to interstate
relations but still protected by domestic state immunity laws, the restrictive approach is inconsistent with the strictures of international law and should be amended9. But under the normative
hierarchy theory, a states jurisdictional immunity is abrogates when the state violates human
rights protections that are considered peremptory international law norms, known as jus cogens10.
III. THE LEGAL FRAMEWORK OF STATE IMMUNITY

As it was said before, the immunity of states is no longer absolute and it has derives mainly
from judicial practice of individual nations. The practice of states on state immunity is not uniform.
International consensus on the matter exists only at a rather high level of abstraction, and the
details of the international law of state immunity are not always certain11.
The international community has tried for many years to agree a treaty on the subject. In 2004
the United Nations enacted Convention on Jurisdictional Immunities of States and Their Property,
but was not singed by proper number of states. The convention includes customary international
7 L. M. Caplan, State Immunity, Human Rights, and Jus Cogens: A Critique of the Normative Hierarchy Theory, AJIL
97 (2003), 741 et seq. (745)
8 D. Gaukrodger, Foreign State Immunity and Foreign Government Controlled Investors, OECD Working Papers on
International Investment, 2010/2, OECD Publishing. doi: 10.1787/5km91p0ksqs7-en
9 L. M. Caplan, State Immunity, Human Rights, and Jus Cogens: A Critique of the Normative Hierarchy Theory. AJIL
97 (2003), 741 et seq. (745)
10 L. M. Caplan, State Immunity, Human Rights, and Jus Cogens: A Critique of the Normative Hierarchy Theory. AJIL
97 (2003), 741 et seq. (745)
11 J. W. Dellapenna, Foreign State Immunity in Europe, 5 N.Y. INTL L. REV. 51, 61 (1992)
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rules of state immunity and consolidates the restrictive approach to state immunity, but the degree
to which the restrictive approach is recognized by States today remains a subject of debate. But
this convention is modern multilateral instrument that provides a comprehensive approach dealing
with complicated issues of state immunity.
Also there were several attempts to codify the state immunity doctrine, but they all failed. It is
needed to mention the European Convention on State Immunity, which came into force in 1976.
However, only eight States (Austria, Belgium, Cyprus, Germany, Luxembourg, the Netherlands,
Switzerland and the United Kingdom) are parties.
Some states, particularly the common-law countries, developed a functional variation on the
restrictive approach in the 1970s and 1980s, and enforced national immunity legislation. The State
Immunity Act 1978 (U.K) and Foreign Sovereign Immunity Act 1976 are analysed as examples of
codification of state immunity. Both acts include commercial activities as major criterion providing
the doctrine of restricted state immunity.
It can be seen that some countries lack of their own legislation in this field. Civil Procedure
Code of The Republic of Lithuania, passed in 1964, entrenched the rule of absolute immunity, that
the potential litigants were allowed to pursue claims in the courts against foreign states only in
case of a written consent of the foreign state, the execution of the judgment in respect of foreign
states property was possible only with the same condition. This rule was the inheritance of the
USSR times not matching changed social relations and political and economic state system of
Lithuania. In 1998 The Supreme Court of Lithuania made the decision in civil case V. Stukonis v.
USA embassy12, in which stated the restrictive theory of state immunity. The decision indicated
the main landmarks of the restrictive theory such as the distinction between acta jure imperii or
sovereign acts and acta jure gestionis or private, non-sovereign acts.13 Civil Procedure Code of The
Republic of Lithuania, passed in 2002, does not include the rule of absolute immunity, but there is
no other regulation related to the state immunity, therefore courts decisions are the main source
of legislation of state immunity in Lithuania.
CONCLUSION

The article analysed overview of the law of state immunity in which describes principle and
development of state immunity. The topic of sovereign immunity is one of the profound subjects
in international law. It stands as a customary international law which is justified on general principles of international law: the principle of territorial jurisdiction of the forum state (this principle
demands unlimited exercise of jurisdiction) and the principle of sovereign equality of states (two
equals cannot rule over each other and means respect for the sovereignty of other States).
As it was said in this article, in the 19th century the absolute rule of sovereign immunity prevailed. Due to the amount of State trading in the 19th century, a number of countries developed
12 V. Stukonis v. US embassy, 1998-01-05 LAT nutartis c.b. Nr. 3K-1/98
13 K. Baleviien, Riboto valstybs imuniteto doktrina ir jos taikymas Lietuvos Respublikoje. Jurisprudencija, 2004,
t. 58(50); p. 138145.
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the restrictive theory of immunity, which divides states acts into governmental (acta jure imperii)
and commercial acts (acta jure gestionis). There is no common ground to formulate a criterion
that would be acceptable to all countries and this in turn has led to persistent divergence in the
practice of states.
The State Immunity Act 1978 (U.K) and Foreign Sovereign Immunity Act 1976 are analysed as
examples of codification of state immunity that determines the restrictive theory of immunity.
In 2004 the United Nations enacted Convention on Jurisdictional Immunities of States and Their
Property which includes customary international rules of state immunity and consolidates the
restrictive approach to state immunity, but was not singed by proper number of states. Thus the
practice of states on state immunity is not uniform and causes many troubles to local courts to
use this doctrine suitable.

B i b l i o g ra phy
1. M. Maw, Recent Trends In The Principle of State Immunity. <http://dspace.lib.niigata-u.ac.jp:8080/dspace/
bitstream/10191/1055/1/18>;
2. R. Nowosielski, State Immunity and the Right of Access to Court. The Natoniewski Case Before the Polish
Courts. < http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2173035>;
3. D. Gaukrodger, Foreign State Immunity and Foreign Government Controlled Investors, OECD Working Papers
on International Investment, 2010/2, OECD Publishing. doi: 10.1787/5km91p0ksqs7-en;
4. S. Knuchel, State Immunity and the Promise of Jus Cogens. Northwestern University School of Law Volume
9, Number 2 (Spring 2011) Northwestern Journal of International Human Rights;
5. F. J. Nicholson, Sucharitkul: State Immunities and Trading Activities, 2 B.C.L. Rev. 459 (1961), <http://lawdigitalcommons.bc.edu/bclr/vol2/iss2/42>;
6. The Schooner Exchange v. McFaddon and Others, 11 U.S. 116 (1812);
7. L. M. Caplan, State Immunity, Human Rights, and Jus Cogens: A Critique of the Normative Hierarchy Theory,
AJIL 97 (2003), 741 et seq. (745);
8. D. Gaukrodger, Foreign State Immunity and Foreign Government Controlled Investors, OECD Working Papers
on International Investment, 2010/2, OECD Publishing. doi: 10.1787/5km91p0ksqs7-en;
9. J. W. Dellapenna, Foreign State Immunity in Europe, 5 N.Y. INTL L. REV. 51, 61 (1992);
10. V. Stukonis v. US embassy, 1998-01-05 LAT nutartis c.b. Nr. 3K-1/98;
11. K. Baleviien, Riboto valstybs imuniteto doktrina ir jos taikymas Lietuvos Respublikoje. Jurisprudencija,
2004, t. 58(50); p. 138145.

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