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Sovereign Bankruptcy: In re Germany (1953), In re Iraq (2004)

Published online by Cambridge University Press:  27 February 2017

Detlev F. Vagts
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Type
Editorial Comment
Information
American Journal of International Law , Volume 98 , Issue 2 , April 2004 , pp. 302 - 306
Copyright
Copyright © American Society of International Law 2004

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References

1 Richard, N. Cooper, Chapter XI for Countries? Foreign Aff.July/ Aug. 2002, at 90 Google Scholar. For more detail, see Gulati, G. Mitu & Kenneth, N. Klee, Sovereign Piracy, 56 Bus. Law. 635 (2001)Google Scholar.

2 For a more complete listing, see Hal, S. Scott, A Bankruptcy Procedure for Sovereign Debtors1 ’ 37 Int’l Law. 103 (2003)Google Scholar.

3 Feb. 27,1953,4 UST 443,333 UNTS 3 [hereinafter LDA]. I have had the benefit of reading a thorough historical treatment of the LDA, which will appear as Timothy, W. Guinnane, Financial Vergangenheitsbewältigung: The 1953 London Debt Agreement, in Of Interest and Enterprise: Essays in the History of Financial Innovation (William, N. Goetzmann & Rouwenhorst, K. Geert eds.)Google Scholar. For English-language commentaries, see Coing, Helmut, London Agreement on German External Debts, 3 Encyclopedia of Public International Law 253 (Bernhardt, Rudolf ed., 1997) (with update to 1995 by Peter-Tobias, Stoll)Google Scholar; Simpson, J. L. , The Agreement on German External Debts, 6 Int’l & Comp. L.Q. 472 (1957)CrossRefGoogle Scholar. For more extensive commentaries in German, see Coing, supra.

4 Under Article 15 of the LDA, supra note 3, only creditors who accepted settlements could receive payments under its terms. The Soviet Union did not sign the LDA or the 1952 Agreement on Reparation, note 17 infra; but it had no pre-Hider contract claims against Germany and, in an agreement with the German Democratic Republic, agreed to waive further reparations claims against Germany. Ignaz, Seidl-Hohenveldern, Reparations After World War II, 4 Encyclopedia of Public International Law, supra note 3, at 180, 183.Google Scholar

5 May 26,1952, 6 UST 4411,332 UNTS 219. Although signed in 1952 before the LDA, it did not enter into effect until 1954.

6 SC Res. 687 (Apr. 3, 1991), 30 ILM 847 (1991). Its paragraph 17 says that the Council “[d]ecides that all Iraqi statements made since 2 August 1990 repudiating its foreign debt are null and void, and demands that Iraq adhere scrupulously to all of its obligations concerning servicing and repayment of its foreign debt.”

7 For a concise statement of the odious debt assertion, see Jayachandran, Seema & Michael, R. Kremer, A Dictator’s Crippling Debt, Harv. Mag., July/Aug. 2003, at 30 Google Scholar. For further works on the subject by these authors, see the list at <http://post.economics.harvard.edu/faculty/kremer/papers.html> (visited Mar. 12, 2004).

8 Agreements with the Federal Republic of Germany, S. Exec. Doc. D, E, F, G, 83d Cong. 1 (1953)Google Scholar.

9 Id. at 13.

10 Id. at 211.

11 M a t 216.

12 The Statistical Abstract of the United States 2002, tbl. 680, shows a consumer price increase from 1953 to 2001 of about seven times and a producer index change of about five. 13 LDA, supra note 3, Annex I, pt. A.

14 Agreements with the Federal Republic of Germany, supra note 8, at 13.

15 It is not clear what impact the Islamic law on usury would have on the inclusion of interest in claims by Arab states against Iraq. Frank, E. Vogel & Samuel, L. Hayes, Islamic Law and Finance: Religion, Risk and Return(1998)Google Scholar.

16 Iwanowa v. Ford Motor Co., 67 F.Supp.2d 424, 452-60 (D.N.J. 1999). Be it noted that I filed declarations on the international law issues arising from the LDA on behalf of defendants in various class actions.

17 Those seizures were ended by the Agreement on Reparation from Germany, on the Establishment of an Inter- Allied Reparation Agency and on the Restitution of Monetary Gold, Jan. 14, 1946, 61 Stat. 3157, 555 UNTS 69.

18 Iwanowa, 67 F.Supp.2d at 455 n.40.

19 For a description of the settlement, see Sean, D. Murphy, Contemporary Practice of the United States, 94 AJIL 682 (2000)Google Scholar.

20 For a brief introduction, see John, R. Crook, The United Nations Compensation Commission—A New Structure to Enforce State Responsibility, 87 AJIL 144 (1993)Google Scholar. For developments, see GulfWar Claims Rep. (Arthur W. Rovine & Grant Hanessian eds., looseleaf, 1992-). It states that $200 billion in claims were filed with the commission. 1 id. at 1-7. 21 See Sean, D. Murphy, Contemporary Practice of the United States, 97 AJIL 966–74 (2003)Google Scholar.

22 SC Res. 1483, para. 22 (May 22, 2003), 42 ILM 1016 (2003).

23 Young Loan Arbitration (Belg. v. FRG), 59 ILR 495 (1980)Google Scholar. The “least depreciated currency” clause at issue was a substitute for the gold clause found in the original loan.

24 SC Res. 1483, supra note 22, para. 15.

26 See note 6 supra and corresponding text.

26 There is a certain irony in the U.S. government’s acceptance of such deep intrusions into national sovereignty given its record of resistance to lawmaking by international institutions.

27 José, E. Alvarez, Hegemonic International Law Revisited, 97 AJIL 873, 874–78 (2003)Google Scholar; Paul, C. Szasz, The Security Council Starts Legislating, 96 AJIL 901 (2002)Google Scholar.