The Extraterritorial Application of the Freeze Order and the Litigation in European Courts

  • Mahvash Alerassool
Part of the International Political Economy Series book series

Abstract

President Carter’s executive order freezing Iranian assets and the US Treasury regulations implementing the freeze posed many questions, with important implications for the safety of sovereign assets in US banks both inside and outside the United States. One of the most controversial aspects of the freeze was the extraterritorial application of the freeze regulations.

Keywords

Europe Expense Defend Libya 

Preview

Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.

Notes

  1. 20.
    See R. Carswell, ‘Economic Sanctions and the Iran Experience’, Foreign Affairs, 60, Winter 1981/2, pp. 250–1.CrossRefGoogle Scholar
  2. 21.
    See R. Assersohn, The Biggest Deal, Methuen, London, 1982, pp. 86–7.Google Scholar
  3. 24.
    For a discussion of cases in which the courts in different countries have adopted this view of the term ‘exchange contracts’ see J. S. Williams, ‘Extraterritorial Enforcement of Exchange Control Regulations Under the International Monetary Fund Agreement’, Virginia Journal of International Law, vol. 15 no. 2, 1975, pp. 333–6.Google Scholar
  4. 25.
    For the cases in which this view has been adopted by courts, see ibid., pp. 338–42. Scholars like Sir Joseph Gold, F. A. Mann, Ellias Krispis and others have advocated a liberal view of the meaning of ‘exchange contracts’ in section 2(b). See Sir Joseph Gold, The Fund Agreements in the Courts, IMF Staff Papers 193 (1977), pp. 216–17, 219Google Scholar
  5. F. A. Mann, The Legal Aspects of Money, 3rd. ed., Oxford University Press, Oxford, 1971, pp. 439–42Google Scholar
  6. E. Krispis, Money in Private International Law, 120 Recueil Des Cours 191, (1967 I), pp. 286–290.Google Scholar
  7. 26.
    See A. Nussbaum, Money in the Law, National and International (rev. ed., 1950), Foundation Press, Brooklyn, pp. 543–4; and ‘Exchange Control and the International Monetary Fund’, Yale Law Journal, vol. 59, 1950, pp. 426–7.Google Scholar
  8. 27.
    See F. A. Mann, op. cit., pp. 442–4; J. Gold, The Cuban Insurance Cases and the Articles of the Fund, 46 (IMF Pamphlet Series No. 8, 1966), pp. 27, 34; and The Fund Agreements in the Courts, in IMF Staff Papers, Part XIV (1979), pp. 590–1 & 608–9; Williams, op. cit., pp. 345–51;Google Scholar
  9. and F. Gianviti, ‘Le blocage des avoir officiels Iraniens par les Etats-Unis (executive order du 14 novembre 1979)’, Revue Critique de Droit International Prive, no. 2, April–June 1980, pp. 283–6.Google Scholar
  10. 30.
    See G. Delaume, Legal Aspect of International Lending and Economic Development Financing, Oceana, New York, 1967, p. 294; Williams, op. cit., p. 353; Mann, op. cit., p. 444.Google Scholar
  11. 34.
    The IMF uses a weighted voting system based on quotas. See J. Gold, Voting Majority in the Fund (IMF Pamphlet Series No.20, 1977).Google Scholar
  12. 36.
    See R.W. Edwards, ‘Extraterritorial Application of the U.S. Iranian Assets Control Regulations’, American Journal of International Law, vol. 75, 1981, p. 875, note 24.CrossRefGoogle Scholar
  13. 37.
    N. A. Simon has argued: ‘The Fund’s approval of these regulations, tacit or otherwise, does not make the regulations consistent with the spirit and letter of the Fund’s Agreement.’ N.A. Simon, ‘The Iranian Assets Control Regulations and the International Monetary Fund: Are the Regulations “Exchange Control Regulations”?’, Boston College International and Comparative Law Review, vol. iv, no. 1, 1981, p. 221.Google Scholar
  14. 54.
    The details of the case that follows are from the notes taken by the author who attended the hearings. See M. Alerassool, ‘Extraterritorial Powers: Libya’s Foreign Assets and the Question of the External Application of the Freeze Order’, International Currency Review, vol. 18, no. 4, August 1987, pp. 12–20.Google Scholar
  15. 68.
    R. M. Goode, Payment Obligations in Commercial and Financial Transactions, Sweet & Maxwell, London, 1983, p. 120.Google Scholar

Copyright information

© Mahvash Alerassool 1993

Authors and Affiliations

  • Mahvash Alerassool
    • 1
  1. 1.London School of EconomicsUK

Personalised recommendations