Sovereign immunity vs International Commercial Arbitration;
N.K.Assumi
(Querist) 04 September 2008
This query is : Resolved
Dear All,
There are strings of International conventions to resolved International commercial disputes such as the Geneva convention,New york convention,UN Resolutions, and Indian Arbitration and Conciliation Act etc.
My query is this? State itself is an abstract notion and it is run by natural man but again natural man alone can not function effectively to run the State, as such juristic person are created. Under International Law, State is granted Sovereign Immunity and all State are of ejusdem generis at least on this point. But gone are the days where sovereign functions were confined to the throne alone. In today's world sovereign sits in the market place such as the World Trade Organization by State Ministers and almost all the important commercial transactions are made by those juristic persons.
The question is whether Sovereign Immunity can be extended to those juristic persons such as the RBI etc.
Sovereign no longer Act as Dr.Jekyll and Mr.Hyde, and to protect her commercial interest it is actively sitting in the market place without shying away as in the olden days.Under the circumstances should it not be proper to extend Sovereign Immunity to State juristic Person?
Murali Krishna
(Expert) 05 September 2008
As far as this country is concerned, Supreme Court in umpteen number of cases held that State is not immune from liability just because it is Sovereign act. Gone are the days of Sovereign immunity of 1950-60s view point now. You can refer to Nilabati Behra, Chandrima Das, D.K.Basu etc.
As far as commercial matters are concerned, they are all contractual transactions and no State has any sovereign immunity.
