Pari passu goes to the Peace Palace

Joseph Cotterill Author alerts | Aug 07 18:36 | 1 comment | Share

Part of the PARI PASSU SAGA SERIES

That is, Argentina filed a case at the International Court of Justice in the Hague on Thursday — claiming that US court decisions in the pari passu saga have violated its sovereign immunity in public international law.

Note that Argentina originally waived immunity within the New York law bonds owned by the holdouts.

But never mind that. Can Argentina get jurisdiction against the US anyway? (In the ICJ states sue each other.)

Here’s the court’s release, which hints at one problem here…

THE HAGUE, 7 August 2014. The Argentine Republic filed today in the Registry of the International Court of Justice a document, dated 7 August 2014, entitled “Application instituting proceedings” against the United States of America, regarding a “Dispute concerning judicial decisions of the United States of America relating to the restructuring of the Argentine sovereign debt”.

The Argentine Republic contends that the United States of America has committed violations of Argentine sovereignty and immunities and other related violations as a result of judicial decisions adopted by US tribunals concerning the restructuring of the Argentine public debt.

The Argentine Republic “seeks to found the jurisdiction of the Court on the basis of Article 38, paragraph 5, of the Rules of Court”. Under that Article:

“When the applicant State proposes to found the jurisdiction of the Court upon a consent thereto yet to be given or manifested by the State against which such application is made, the application shall be transmitted to that State. It shall not however be entered in the General List, nor any action be taken in the proceedings, unless and until the State against which such application is made consents to the Court’s jurisdiction for the purposes of the case.”

In accordance with Article 38, paragraph 5, of the Rules of Court, the Application by the Argentine Republic has been transmitted to the US Government. However, no action will be taken in the proceedings unless and until the United States of America consents to the Court’s jurisdiction in the case.

And as any international law student knows… the US agreeing to ICJ jurisdiction (especially when its courts are involved) happens to be a tricky subject.

PARI PASSU SAGA SERIES

The "trial of the century" in sovereign debt restructuring, in our humble opinion. The story of Argentina, its holdout creditors, the grande finale (or is it?) of their battle in US courts