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When the State Sovereign Immunity Rule Meets Sovereign Wealth Funds in the Post Financial Crisis Era: Is There Still a Black Hole in International Law?
Published online by Cambridge University Press: 19 September 2018
Abstract
This article examines the state sovereign immunity rule in the context of a rising number of sovereign wealth funds and their ever-increasing value of cross-border commercial activities in the aftermath of the latest global financial crisis. The concept of sovereignty and the rule of sovereignty remain in a state of flux while new actors such as sovereign wealth funds are participating in global commercial activities in a nontransparent and politically motivated manner. Accordingly, states may pursue strategic foreign policy objectives through these newer investment arms in an unconventional way, thereby being deeply involved in the political-economic arena and distorting the existing concepts of international law. This article posits that there is an international law black hole in which sovereign wealth funds have come to engage in commercial activities as well as exercise the public functions traditionally associated with states (acts jure imperii). The doctrine of restrictive immunity has come into question and the bulk of local court decisions have offered little clear guidance. Against this backdrop three interconnected perspectives are then discussed with reference to emerging economies like China: the immunity rule, the principle of sovereignty, and the balance of power in globalization.
- Type
- INTERNATIONAL LAW AND PRACTICE
- Information
- Copyright
- © Foundation of the Leiden Journal of International Law 2018
Footnotes
*
Ph.D. Candidate, Faculty of Law, Chinese University of Hong Kong and Executive Director, Free Trade and ADR Research and Development Center, Shanghai University of Finance and Economics.
**
Chair Professor of Law, Shanghai Jiao Tong University Law School [[email protected]].
An earlier draft was presented in the conference ‘Policy Coherence of Public Investment: The Public Sector as Direct and Indirect Investor’ at the University of Oslo on 18 May 2017. The authors thank comments made by Beate Kristine Sjafjell, Jukka Mähönen, Ding Chen and other participants as well as the anonymous referees and Thomas Stanton. The authors also thank Nick Trudgen, Marilyn Fisher, and Ashley Stanley-Ryan for excellent editing input. Shu Shang’s research was supported by the People’s Republic of China Ministry of Education Humanities and Social Science Project (Youth Scholars), ‘Investor Facilitation and Protection in the Shanghai Free Trade Zone (14YJC820040)’.
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