Just a short post to note a judgment issued by the Supreme Court of India (reported in today’s Hindu here) on the issue of sovereign immunity in India.
In the instant case, Ethiopian Airlines was aggrieved by a National Consumer Disputes Redressal Commission order holding that a dispute against it was maintainable and asking the Maharashtra State Commission to decide the issue afresh on its merits.
Complainant Ganesh Narain Saboo, who had booked a consignment with the airline, moved the State Commission, contending that gross delay in delivery at Dar es Salaam, Tanzania, led to deterioration of the goods.
Writing the judgment, Justice Bhandari rejected the contention that a foreign state or its instrumentality could not be proceeded against under the Consumer Protection Act for deficiency in service without obtaining prior permission from the Central government.
The Bench also did not accept the plea that a foreign state or its instrumentality could legitimately claim sovereign immunity from being proceeded against under the Act in a civil claim.
Countries which participate in trade, commerce and business with different countries ought to be subjected to normal rules of the market. If state-owned entities operate with impunity, “the rule of law would be degraded and international trade, commerce and business will come to a grinding halt,” said a Bench of Justices Dalveer Bhandari, Mukundakam Sharma and Anil R. Dave.
On international law:
“That Ethiopian Airlines was not entitled to sovereign immunity with respect to a commercial transaction is also consonant with the holdings of other countries’ courts and with the growing international law principle of restrictive immunity,” the Bench said.
“On a careful analysis of the American, English and Indian cases, it is abundantly clear that Ethiopian Airlines must be held accountable for the contractual and commercial activities and obligations that it undertakes in India”, the Bench said…
Readers may be interested in a related recent development in Hong Kong, where the Court of Final Appeal (CFA), in Democratic Republic of the Congo v FG Hemisphere Associates LLC, ruled that foreign states enjoy absolute immunity from jurisdiction of Hong Kong courts, and there is no exception even in cases the activity and assets are of a commercial nature. (A Fulbright and Jaworski publication on the case here.)
[Apologies for not providing a direct link to the judgment, I am currently traveling with minimal access to the Internet and hope to return to this once I get back to base.]