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Published online by Cambridge University Press: 27 February 2017
1 21 ILM 371 (1982).
2 Czechoslovakian Claims Settlement Act of 1981, 95 Stat. 1675, Pub. L. No. 97–127 (1981), reprinted in 21 ILM at 414 [hereinafter cited as the 1981 Act].
3 On Jan. 29, 1982, American, British, and Czechoslovak representatives signed a protocol in Prague providing for the modalities of the return to Czechoslovakia of the monetary gold held in the West.
4 The settlements included agreements with Bulgaria (July 2, 1963), Hungary (May 29, 1956 and March 6, 1973), Poland (July 16, 1960), Romania (March 30, 1960), and Yugoslavia (July 19, 1948 and Nov. 5, 1964). See also Rode, , The American–Polish Claims Settlement Agreement of March 30, 1960 , 55 AJIL 452 (1961)Google Scholar; Christenson, , U.S.–Rumanian Claims Settlement Agreement of March 30 , 1960, id. at 617 Google Scholar; Lillich, , The United States–Bulgarian Claims Settlement Agreement of 1963 , 58 id. at 686 (1964)Google Scholar; Sipkov, , United States–Bulgarian Claims Settlement Agreement of July 2, 1963 , 4 Va. J. Int’l L. 187 (1964)Google Scholar; Peselj, , The New Yugoslav–American Claims Agreement , 59 AJIL 362 (1965)Google Scholar; Sutton, , American Claims Against Yugoslavia , 3 Int’l Law. 262 (1969)Google Scholar; 2 Lillich, R. & Weston, B., International Claims: Their Settlement by Lump Sum Agreements (1975)Google Scholar.
5 Czechoslovakia has concluded claims settlement agreements with the following Western countries: Austria (Dec. 19, 1974), Belgium/Luxembourg (Sept. 30, 1952), Canada (April 18, 1973), Denmark (Dec. 23, 1958), France (June 2, 1950), Iceland (Nov. 24, 1947), Great Britain (Sept. 28, 1949 and Dec. 16, 1981), the Netherlands (June 11, 1964), Norway (June 9, 1954), Sweden (Dec. 22, 1956), and Switzerland (Dec. 22, 1949). In addition, Czechoslovakia concluded a number of treaties with socialist countries, providing for a mutual waiver of claims and obligations arising out of one another’s nationalization programs. See Drucker, , Compensation Treaties Between Communist States , 10 Int’l & Comp. L.Q. 238 and 904 (1961)Google Scholar.
6 Past U.S. foreign claims settlements typically have netted claimants only about 40 cents on the dollar of the principal amount of their claims, and no payment of interest. Under the 1981 Agreement, full compensation, plus some interest, will be paid.
7 Arts. 1, 2, 3, 4, and 8. Article 1 is so drafted as to emphasize that the above sum and further amounts due to the United States under the Agreement are in full settlement and discharge of all the mutual claims of the parties.
8 Arts. 5 and 6. The gold issue was the major leverage of the United States in the negotiations, especially after the dramatic increase in world gold prices of the last several years; the current value of the 18.4 metric tons of gold released to Czechoslovakia is about $250 million.
The principal transaction under the Agreement, the transfer of the gold to Czechoslovakia in exchange for the cash payment of the settlement, was effected in the manner set forth in an annex to the Agreement and involved intermediary countries, principally the United Kingdom, and banks.
9 Art. 10.
10 Art. 9.
11 There is no direct reference in the Agreement to this particular counterclaim. The claim is covered by the general clause of Article 1(2); see note 7 supra. The steel mill was seized by the U.S. Government in 1948 and later sold to Argentina for $9 million.
12 Art. 11.
13 See the Letter of Czechoslovakia attached to the Agreement, 21 ILM at 395.
14 Nos. 100–103/1945, Collection of Laws and Regulations of the Czechoslovak Republic. See also Oatman, , The Nationalization Program in Czechoslovakia , 15 Dep’t State Bull. 1027 (1946)Google Scholar; and Rado, , Czechoslovak Nationalization Decrees: Some International Aspects , 41 AJIL 795 (1947)Google Scholar.
15 Nos. 114, 115, 117, 118, 120, 122–126, 171/1948, Collection of Laws and Regulations of the Czechoslovak Republic.
16 61 Stat. 2431, TIAS No. 1569, 7 UNTS 119.
17 Bystrický, R., Základy mezinárodniho práva Soukromého (Fundamentals of International Private Law) 222 (1958)Google Scholar.
18 Negotiations on the amount of the compensation had been held intermittently since 1949 and had twice reached ad referendum agreements: in 1963 the U.S. Government was prepared to settle for less than 20% of the principal amount of its claim, and in 1974 for about 40%. The 1974 draft agreement further provided that the $20.5 million settlement would be payable in installments over a period of 12 years, without interest. Needless to say, the terms of the 1981 Agreement are a considerable improvement.
19 On the problem of global settlements, see generally R. Lillich & B. Weston, supra note 4; Domke, , Foreign Nationalizations , 55 AJIL 585 (1961)CrossRefGoogle Scholar; Yates, , Postwar Belgian International Claims: Their Settlement by Lump Sum Agreements , 13 Va. J . Int’l L. 554 (1973)Google Scholar; Seidl–, Hohenveldern, Austrian Practice on Lump Sum Compensation by Treaty , 70 AJIL 763 (1976)Google Scholar.
20 GA Res. 1803 (XVII), 17 UN GAOR Supp. (No. 17) 15, UN Doc. A/5217, reprinted in 57 AJIL 710 (1963), 2 ILM 223 (1963).
21 Mr. John Stevenson in 54 ASIL, Proc. 112 (1960).
22 See Schwarzenberger, , The Bank for International Settlements and the Czech Gold Assets Held by the Bank of England , 3 Mod. L. Rev. 150 (1939)CrossRefGoogle Scholar; Táborský, E., The Czechoslovak Cause in International Law 49–61 (1944)Google Scholar.
23 The Commission was established in 1946 to implement part III of the Agreement on Reparation signed in Paris on Jan. 14, 1946 by 18 nations, including Czechoslovakia. Under part III, the gold recovered by the Allied forces was to be divided among the countries from which it had been wrongfully taken according to each country’s proven losses. For the articles establishing the Tripartite Commission, see 15 Dep’t State Bull. 565 (1946).
24 See Settlement of Claims Against Czechoslovakia: Hearing Before the Subcomms. on Europe and the Middle East and on International Economic Policy and Trade of the House Comm. on Foreign Affairs, 96th Cong., 2d Sess. 28 (1980) (Legal Opinion of the Dep’t of State and the Dep’t of the Treasury).
25 See [1954] ICJ, Pleadings, Case of the Monetary Gold Removed from Rome in 1943, at 10.
26 Washington Statement of April 25, 1951, quoted in [1954] ICJ Rep. 19, 21.
27 [T954] ICJ Rep. at 29.
28 Lauterpacht, H., The Development of International Law by the International Court 164 (1958)Google Scholar.
29 For example, the Austrian Constitutional Court determined, in a decision of Sept. 27, 1967, that vesting of certain Czechoslovak assets in Austria for the purpose of inducing that Government to conclude a claims settlement agreement was justifiable in terms of a legitimate public purpose. See 97 J. Droit Int’l 340 (1970).
30 H.R. 7338, 96th Cong., 2d Sess. (1980).
31 House Hearing, supra note 24, at 122.
32 Logan v. Secretary of State, 553 F.2d 107 (D.C. Cir. 1976).
33 House Hearing, supra note 24, at 180 (letter from Deputy Legal Adviser, Dep’t of State, to Attorney General).
34 Id. at 21 (statement of Assistant General Counsel for International Affairs, Dep’t of the Treasury). A detailed argument is at p. 28 ff.
35 Id. at 24.
36 Ibid.
37 Albania did not avail itself of the opportunity and made no application to the Court. Italy instituted proceedings against the United States, the United Kingdom, and France, but the Court found that the matter upon which it had been asked to adjudicate was in fact concerned with a claim of Italy against Albania. Without Albania’s consent, the Court ruled that it had no jurisdiction in the case.
38 See Corfu Channel Case (Merits), [1949] ICJ Rep. 12, and (Compensation), id. at 244.
39 H.R. Rep. No. 97–385, 97th Cong., 1st Sess. 9 (1981).
40 Title IV of the International Claims Settlement Act of 1949, as amended, Pub. L. No. 85–604, 72 Stat. 527 (codified at 22 U.S.C.A. §1621 et seq.).
41 19 U.S.C. §2438.
42 See S. Rep. No. 93–1298, 93d Cong., 2d Sess. (1974).
43 GA Res. 3281 (XXIX), 29 UN GAOR Supp. (No. 31) 50, UN Doc. A/9631 (1974), reprinted in 69 AJIL 484 (1975), 14 ILM 251 (1975).
44 On the principle enunciated in Article 2(2)(c) of the Charter, see, e.g., Garcia–Amador, , The Proposed New International Economic Order: A New Approach to the Law Governing Nationalization and Compensation , 12 Law. Americas 1 (1980)Google Scholar; Weston, , The Charter of the Economic Rights and Duties of States and the Deprivation of Foreign–Owned Wealth , 75 AJIL 437 (1981)Google Scholar.
45 H.R. 7338, supra note 30, and S. 754, 97th Cong., 1st Sess. (1981). However, as everybody seemed to recognize that agreement would be preferable, action on the bill was not pressed and it was reported without recommendation. S. Rep. No. 97–211, 97th Cong., 1st Sess. 3 (1981).
46 Art. 3.
47 Section 4(b)(1) of the 1981 Act.
48 The date that Congress approved Title IV (“Claims Against Czechoslovakia”) of the International Claims Settlement Act of 1949, supra note 40.
49 Section 4(b)(2) of the 1981 Act. These are not nationalization claims, as no nationalization took place in Czechoslovakia between 1958 and 1981.
50 Section 4(b)(3) of the 1981 Act.
51 For the policy with regard to claims against Czechoslovakia, see §405 of the International Claims Settlement Act of 1949, as amended, supra note 40. Under section 401 of the Act, a “national of the United States” is defined to be either a natural person who is a citizen or who owes permanent allegiance to the United States, or a legal person organized under U.S. law if more than a 50% interest is owned by nationals of the United States. It does not include aliens.
52 Art. 2.
53 Section 6(b) of the 1981 Act
54 S. Rep. No. 97–211, supra note 45, at 5 (letter of Assistant Secretary of State for Congressional Affairs).
55 H.R. Rep. No. 97–385, supra note 39, at 10.
56 Ibid.
57 Quite to the contrary: on the doctrinal plane it reaffirmed, in a face-saving clause inserted in section 6(2)(B) of the 1981 Act, the previous principle and practice of the United States, and added that “[i]n making payments under this section, the Congress does not establish any precedent for future claims payments.”
58 Compare, e.g., the recent practice of the Czechoslovak authorities with regard to property rights of Czechoslovak citizens who apply and are granted permission to emigrate from Czechoslovakia. Such persons are obliged to file with the local authorities a declaration renouncing all their property rights and interests in Czechoslovakia. Persons who have left the country without official permission are criminally prosecuted under section 109 of the Penal Code and, if convicted, are sentenced in absentia and their properties confiscated. In this way, the Czechoslovak authorities seek to prevent the espousal of claims of former citizens by their new country of residence.
59 Such protection is routinely extended to claims arising from certain material interests, such as social security or alimony payments. The 1981 Act requires in section 12 that the Secretary of State conduct a review analyzing the equity and reciprocity of the social security payments made to residents of each country by the other. The review should recommend ways to achieve greater equity for the residents of both countries and possible U.S. actions to correct the inequities.
60 In the case of the Railway Line Panevezys–Saldutiskis, [1939] PCIJ, ser. A/B, No. 76, at 16, the Permanent Court of International Justice recognized that the rule of nationality of claims was subject to exceptions; and in the Reparation for Injuries case, [1949] ICJ Rep. 174, 180, the International Court of Justice denied the applicability of the rule in the case before it and stated that there were important exceptions to the rule.
61 See the dissenting opinion of Judge van Eysinga in the Railway Line Panevezys-Saldutiskis case, especially his observation on the “doubtful reasonableness” of a rule “which would entail that, when a change of sovereignty takes place, the new State or the State which has increased its territory would not be able to espouse any claim of any of its new nationals in regard to injury suffered before the change of nationality.” [1939] PCIJ, ser. A/B, No. 76, at 35. This observation can be applied, mutatis mutandis, when a person has changed his nationality not as a result of the change of territorial sovereignty but because of voluntary or forced emigration.
62 H. Lauterpacht, supra note 28, at 352.
63 TS No. 804, 96 LNTS 2208, Art. 1.
64 See Kopal, , Pocátek válecného stavu mezi Ceskoslovenskem a Nemeckem (The Commencement of the State of War Between Czechoslovakia and Germany), 13 Casopis pro Mezinárodní Právo (Prague) 135 (1969)Google Scholar.
65 See generally Rode, , Dual Nationals and the Doctrine of Dominant Nationality , 53 AJIL 139 (1959)CrossRefGoogle Scholar.
66 See Kunz, , The Nottebohm Judgment , 54 id. at 561 (1960)Google Scholar. U.S. practice has been to pay the claimants. See note 6.
67 The “settlement date” is defined by Art. 7 of the Agreement; it is Feb. 20, 1982.
68 Art. 8(1).
69 Art. 8(2).
70 Under Article 4(2) of the Agreement, the U.S. Government undertook to furnish to the Czechoslovak Government the names of claimants who receive awards and copies of the decisions and awards.