Commercial Litigation and Arbitration

Foreign Sovereign Immunities Act — Arbitration Abroad — Enforcement in the United States

Does a foreign sovereign’s agreement to arbitrate outside the United States waive sovereign immunity to an action brought here to enforce the resulting award rendered against that sovereign? No — at least, that is the answer if the foreign sovereign is not a signatory to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, 9 U.S.C. § 201, et. seq. — under the decision in Strategic Technologies PTE, Ltd. v. Republic of China (Taiwan), 2007 U.S. Dist. LEXIS 34258 (D.D.C. May 10, 2007). District Judge Rosemary M. Collyer also rejected the argument that the commercial activity exception of the FSIA (28 U.S.C. § 1605(a)(2)) was met because the underlying arbitration award arose from the sovereign’s commercial activity because that activity took place outside the United States. Held: ‛The commercial activity that provides the jurisdictional nexus must be the same activity on which the lawsuit is based.“

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