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Created on Saturday, 10 March 2007 00:00

Last Updated on Sunday, 17 February 2013 19:16

Requirements to Flatly Waive Diplomatic Immunity

The BVerfG in Karlsruhe decided on December 6, 2006 (re 2 BvM 9/03) following legal question: Is there an overall rule in the law on nations by which a foreign country can generally waive its diplomatic immunity against the enforcement of a judgment into the bank accounts of the embassy in a foreign country?

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As a result of the financial crashes suffered by Argentina, government loans were raised to cover expenses. German private creditor loans, subject to German law, were made to the Argentinean government. The terms and conditions of these loans included a waiver of sovereign immunity. One creditor obtained judgment due to failure to honor the loan in a Frankfurt court and sought execution against an embassy bank account in a Berlin court. Where the creditor argued that the contractual clause not only waived the right of immunity of execution but superseded diplomatic immunity.

If a person enjoys immunity then no action of force of the state may be used against him unless he accepts it. The controlling laws are the Vienna Convention on Diplomatic Relations and the drafted but not yet ratified laws of the International Law Commission was silent on this issue. Can bank accounts from which an embassy is operated be attached or not?

The Republic of Argentina holds against the plaintiff that the general waiver of immunity in the terms of the loans does not extend to the immunity of the embassy’s accounts. Pursuant to the legal principle “ne impediatur legatio”, the hosting country has to forbear all any and any measures which interfere with the diplomatic mission. The Federal Constitution Court has acknowledged that accounts of an embassy are not subject to execution (BVerfGE 46, 342, 364).

The Federal Constitution Court declared that there is no overall rule allowing to generally waive immunity for such property that is needed to uphold the operation of an embassy. Nevertheless, the law of nations generally allows a country to waive immunity in the realm of government loans when suing in court or during execution. For all other cases, the express approval of the country will be necessary. Previous court rulings did not allow seizure of funds with transfer to creditor.

A state’s seizure of another country’s bank accounts on the state’s territory is a very intensive intervention in its sovereignty. Nevertheless, a general prohibition of executing against a foreign state does not exist. In the mean time, the practices of countries differentiates between execution in a country’s property for commercial purposes and for sovereign purposes. Generally, all property of country not intended for sovereign use is subject to execution and does not require prior acceptance or waiver of the effected country. Such will typically be property of institutes for culture, research, trade and others more. Ne impediatur legatio remains insofar valid. A bank account which the embassy needs to meet its costs and expenses is always sovereign property (BVerfGE 46, 342, 364 ff.).





Published on the old CMS: 2007/3/10
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