Monthly Archives: March 2017

By Lea Brilmayer

“Success, in domestic and international litigation alike, depends on finding a court with jurisdiction over the defendant. American constitutional law, which governs assertion of jurisdiction even over international defendants in American courts, has developed the subject of personal jurisdiction into a fine art. It’s all a question of whether ‘minimum contacts’ exist between the defendant and the forum, and whether the assertion of jurisdiction satisfies a standard of ‘fair play and substantial justice.’”

Written by Tracy Nelson

On the very first day of the 115th Congress, Representative Mike Rogers (R-AL) introduced H.R. 193, the American Sovereignty Restoration Act of 2017. The bill orders the President to terminate membership in the United Nations and all related agencies, withdraws financial and peacekeeping support for the organization, and retracts the agreement establishing the U.N. headquarters in New York. The legislation collected eight cosponsors and plentiful critics during its first month of existence. While many have reacted strongly to this proposed legislation, the suggestion is neither innovative nor unique but instead part of a much larger history. This article seeks to examine the process of leaving the United Nations, the probability of the United States making such a move, and its linkages to a larger movement away from intergovernmental and international organizations.

Withdrawal from the United Nations and the Indonesian Experience

While the U.N. Charter provides for the expulsion of member nations, it does not outline procedures for a nation to voluntarily withdraw or resign its membership. Article 54 of the Vienna Convention on the Law of Treaties states that a country may withdraw from a treaty in accordance with the procedures outlined in the treaty or by unanimous consent of the other countries bound by the treaty. Article 62 of the Convention allows nations to leave a treaty due to an unforeseen “fundamental change in circumstances,” given that those circumstances were the basis of the original treaty. While this Convention is not technically applicable to the United Nations, nor is the United States a member of the treaty, its principles are generally accepted as customary international law.

Very little precedent exists for potential exit from the United Nations. In 1965, prior to the adoption of the Vienna Convention, Indonesia withdrew from the United Nations. Indonesia objected to the creation of Malaysia and viewed the non-permanent seating of Malaysia on the Security Council as an act of neo-colonialism. President Sakarno sent a telegram to the United Nations withdrawing its membership and also forsaking $50 million in economic and technical aid already earmarked for Indonesia. The next year, General Suharto seized power in a coup and notified the United Nations that Indonesia would resume cooperation with the organization. Because the United Nations had never formally acknowledged Indonesia’s withdrawal, Suharto’s message was accepted and the Indonesian delegation asked to return. By not formally recognizing the withdrawal notice and instead treating the instance as a case of non-cooperation, the United Nations avoided the opportunity to create a policy for exit.

Customary law and a lack of precedent suggest that the United States would have an extraordinarily difficult time leaving the United Nations while abiding by international norms. No clear exit path has been created, either through the terms of the U.N. Charter or through the experience of other nations. Unanimous consent allowing any nation to leave the organization, much less its largest financial supporter, is unimaginable. Finally, a “fundamental change in circumstances” argument might be attempted, but would be weak due to the continued membership of the United States throughout many more drastic periods of domestic and international change. Leaving the United Nations would be extremely difficult to do within the context of existing international legal norms.

Potential for U.S. Withdrawal

This is not the first time that a bill has been introduced to withdraw the United States from the United Nations. Already this year, several bills have been introduced to defund or review membership in the United Nations based on specific positions of the United Nations, like Israel-Palestine issues or environmental policies. Such bills are relatively common and rarely gain traction. However, the motivation behind this most recent bill makes it unique. H.R. 193 instead objects to continued U.S. membership in the United Nations based on the merits of the organization itself, suggesting that the United Nations has a “dangerous agenda” and is “a waste of taxpayer dollars.”A bill identical to H.R. 193 has been cosponsored by a host of Republican representatives and introduced in every Congress since the 105th Congress in 1997, though the bill has never moved beyond referral to a standing committee.

Despite this legislative history, the introduction of H.R. 193 during this Congress has raised eyebrows because of the quick uptick in cosponsorship and the potential support of President Trump. The current legislation has attracted more cosponsors in one month than the bill often has over the course of a whole year. Past presidents have been hesitant to criticize the work of the United Nations or the continued membership of the United States. President Trump, however, was critical of the United Nations on the campaign trail and has reportedly drafted executive orders mandating the review and reduction of U.S. funding to international organizations.  According to Gallup polling, approval ratings for the United Nations have tumbled amongst Americans over the last fifteen years. In 2002, 58% of respondents said that they believe that the United Nations is doing a “good job” in solving the world’s problems, while today that number hovers around 38%.

Despite the seeming swell of public and elected official support for H.R. 193, it seems highly unlikely that the United States would leave the United Nations. Leaving the organization would leave the other treaties and organizations to which the United States belongs unstable and vulnerable. Other critics of the bill suggest that leaving the United Nations would allow China and other rising powers to gain international influence. Furthermore, the bill lacks the congressional support to secure passage. Neither Rep. Rogers nor any of the bill cosponsors sit on the House Committee on Foreign Affairs to which the bill has been referred. While withdrawal may be an increasingly popular policy move, it lacks sufficient support to rationalize upsetting the international order.

Recent Resistance to Intergovernmental Organizations

Regardless of the probability of success of the proposals for a U.S. exit from the United Nations, they highlight a very important recent trend in international law – a push away from intergovernmental organizations. Arguably the most well-known example of this trend is the United Kingdom’s June 2016 “Brexit” vote to leave the European Union. However, the phenomenon is more widespread than just nationalist momentum in the United Kingdom and United States. Since 2012, eight nations have left the United Nations Industrial Development Organization, citing lack of efficacy. In 2016, President Duterte of the Philippines threatened to leave the United Nations in response to the organization’s criticism of extrajudicial killings in the Philippines. Earlier this month, the African Union endorsed the mass withdrawal of its member states from the International Criminal Court. Should this anti-intergovernmental and international organization trend continue, it could spiral and potentially normalize departure from international organizations and increase popular support for the United States to leave the United Nations.

Written by Iulia E. Padeanu

In a recent article, Professor Ryan Goodman puts forth a controversial argument: “war sustaining” objects in non-international armed conflicts,[1] used to generate revenue for an enemy’s armed forces, should be targetable under international humanitarian law. In office, former president Barack Obama embraced a similar view, condoning strikes against “tanker trucks, wells and refineries,” as well as “storage sites where ISIL holds its cash.”[2] This broad view of targetable objects is, at best, unworkable and, at worst, truly dangerous.

Donald Trump’s rhetoric has been even more concerning. He campaigned on a promise to “bomb the s— out of” ISIL. In the now famous sound-bite, he went on to say that he would also “blow up the pipes” and, generally, “blow up every single inch.” And, so far, President Trump and his Secretary of Defense, James Mattis, have kept Trump’s promise. In his first official day on the job, Secretary Mattis oversaw a total of 31 airstrikes against ISIL in Syria and Iraq.

Targeting “war sustaining” activities, even in the context of the fight against ISIS, sets a dangerous precedent and violates the established rules of International Humanitarian Law (“IHL”). Fighting ISIL is truly “one of the most complex [challenges] the world has seen in recent times,” and it should be done in a smart and decisive way. However, the claim that states should be allowed to target those activities that only contribute to sustaining the war effort of non-state groups is untenable and not the right approach. This complex and desperate fight should not be used by those in power to expand the boundaries of acceptable in-war behavior beyond what is currently permissible.

This would not be the first time President Trump alluded to violating international law. He has previously maintained that, had the U.S. “taken the oil” when it withdrew from Iraq, ISIL would not exist today. Not only is there nothing to suggest that ISIS is dependent solely on Iraqi oil, but what President Trump suggested would have been a violation of the IHL rule against pillage.

Professor Goodman’s argument, if adopted by the administration, would allow President Trump an even wider range of targets in the Middle East, likely resulting in a breach of several other IHL rules. Under Article 52 of the Additional Protocol I (“API”) of the Geneva Convention, the class of objects that can be lawfully targeted are those that “make an effective contribution to military action.” Under this definition, most states agree that only targets that make a direct contribution to military action are targetable. As Oona Hathaway writes, “[t]he weight of scholarly opinion has long maintained that [war sustaining] objects are not legitimate military targets.” Although some states have taken a broad view of targetable objects in the current fight against ISIL, many states reject the view that purely “war sustaining” objects can be targetable. Several academics have similarly rejected this view of targetable objects.[3]

One of the biggest weaknesses of Professor Goodman’s argument is the lack of clear limiting principles. If Professor Goodman and President Obama are correct in suggesting it is legal and reasonable to target oil refineries because they generate revenue for ISIL, where do we draw the line? When taken to its logical conclusion, Professor Goodman’s argument could eventually be used to support notions of scorched earth and leave virtually nothing untouchable in war. Professor Goodman does suggests a few limiting principles: the targetable object must provide “definite military advantage,” and economic contributions that can be traced through strong connections to military action. However, even when taken together, these limiting principles cannot prevent future strikes against other objects (such as agricultural fields and factories) that might provide substantial revenue to ISIL, but that may be civilian in nature and only loosely connected to ISIL’s war activities.

An additional challenge to Goodman’s analysis, hinted at by Marty Lederman, is the complex organizational structure of non-state groups, the wide range of activities they depend on for financial survival, and the civilian nature of these activities.[4] This poses two related issues Goodman does not anticipate.

First, if a non-state group’s sole mission is to wage war, it is easier to conclude that any and all revenue generated supports its sole function as a military group. As such, targeting activities that directly support its military actions would fall within the limitations set by Art. 52 of API. Many non-state groups that engage in war and terrorist activities, however, also operate as political bodies, engage in non-military undertakings, and may even take on governance functions. Even ISIL, a particularly vicious group engaged in truly horrific activities, has hopes of governing and growing into a formal political entity. When a non-state group is actively engaged in war, but also in the collection of revenue and taxes for the purpose of running schools, building hospitals, and providing services to a population, it becomes increasingly difficult to distinguish which revenue-generating operations support military action and what revenue is for political, civilian purposes. Research has shown that ISIL has gone “from being a purely military force to building a system that can provide basic services, such as making sure that gas and food are available, to its new citizens.” Over time, ISIL will likely evolve into “a government whose political decision-making cannot be separated from its military capabilities.” This weakens the direct connection between much of the revenue and the direct military advantage it provides. It further complicates the link between the finances and the military action, in effect rendering Professor Goodman’s limiting principles meaningless.

Secondly, even if ISIL continues its brutal regime without providing much in the way of services, the reality is that its revenues depend as much, if not more, on taxing the population it controls as they do on oil revenues. If Goodman’s argument holds, are the thousands of people ISIL is currently taxing also legitimate military targets? They provide a distinct advantage to ISIL’s military capabilities by providing the group with significant revenue. In a recent Foreign Affairs article, researcher Mara Revkin describes the story of Ahmed, an employee in an advertising agency working in Deir ez-Zor, who was forced to pay 2.5% of his income to ISIL’s bayt al-mal (the financial institution responsible for the collection of money). Ahmed’s relatively small contribution may not compare to the millions of dollars ISIL gains from oil sales, but the collective contributions of civilians (from their personal wages and businesses) can provide the organization with significant financial support. The connection between the taxes and the military advantage may be looser than that between oil revenues and the military, but ultimately, money is money, and if oil revenues can be sufficiently linked to providing ISIL a “definite military advantage,” then why shouldn’t taxes? If taxes can be traced to supporting military action, then can civilians and civilian objects be targeted as “war sustaining” activities and objects? If civilian objects and activities contribute just as much and just as directly to ISIL war activities, how can we argue these are not also legitimate “war sustaining” activities? The dangerous connection between taxing a population and their activities and their “war sustaining” capabilities leads us down a road we do not want to go.

Proponents of Professor Goodman’s theory, and perhaps Professor Goodman himself, might argue that it is not civilians like Ahmed who should or will be targeted, but rather the bayt-al-mal. Even if this may be the case, the argument remains problematic. First, this proposition raises the same issue of unclear links between the revenue and the war activities. If there is proof that all the revenue collected is indeed used to support ISIL’s military campaign, attacks on the financial institution may be permissible under Art. 52 of API. However, the revenue collected could very possibly be used for entirely civilian purposes: building schools, roads, and hospitals. If this is the case, we are back to the same problem discussed above. Secondly, pushing the boundaries of acceptable targets in war will likely create a precedent for targeting clearly civilian activities and objects. Ahmed as an individual may not yet be considered a target, despite the tax revenue he provides to ISIL, but a group of civilians, or a business run primarily for civilians and civilian purposes, could fall under the broader category of targetable objects Professor Goodman proposes.

It is easy to be sympathetic to Professor Goodman’s argument. Proposing a way to weaken one of the most terrifying groups we have ever encountered is an important endeavor. The complications raised by the ISIL example, however, illustrate the dangerous logical end to this argument. If ISIL depends on revenues from taxes and civilian activities just as much as it does from oil revenues, the United States runs the risk of creating a precedent where civilian objects and actions are also considered “war sustaining” and thus targetable. Defeating ISIL should be a priority for any government, but it should not be done at the cost of risking civilian lives and it should not serve as the basis for setting such a dangerous precedent.

[1] The categorization and definition of types of armed conflict is complex and beyond the scope of this paper. For more on this, see ICRC Opinion Paper, How is the Term “Armed Conflict” Defined in International Humanitarian Law?.

[2] For the purposes of this piece I will be referring to the Islamic State of Iraq and the Levant as ISIL. The group is also often referred to as ISIS and IS.

[3] See, e.g., HPCR Manual on International Law Applicable to Air and Missile Warfare (2002) (arguing that the connection between revenues generated from oil exports and armed conflict is “too remote” and thus rejecting the “war sustaining” argument); Tallinn Manual on the International Law Applicable to Cyber Warfare (2013) (stating that it would be unlawful to launch cyber-attacks on a state’s oil export industry even if the war effort depended on revenues from oil sales).

[4] “Because ISIL, unlike al Qaeda, is not exclusively a military organization—it holds territory and engages in at least some ‘civilian’ governance functions—the targeting of these facilities and stockpiles raises important issues under the laws of armed conflict.”

Written by Hyun-Soo Lim

Home to the highest mountain in South Korea, the world’s longest lava caves, and unique lava forests, Jeju Island is the only place on Earth to receive all three UNESCO designations in natural sciences.

In 2010, the ‘Treasure Island of Korea’ became a trial site of the Investment Immigration System. Under this system, non-Korean nationals are given F-2, a pre-permanent resident status, for purchasing $500,000 USD in certain real estate units, including condominiums, hotels, or vacation houses for tourists in a Ministry of Justice-designated investment area. The immigration status is then upgraded to F-5, or permanent residency, in five years.

This perk created an immediate surge of Chinese capital. Jeju is particularly attractive to Chinese middle- and upper-class families who are eager to escape the pollution and congestion in the mainland, and feel insecure about their property rights at home. Since the implementation of the Investment Immigration System, Chinese land ownership increased by an incredible 483.7% between December 2011 and 2014. By the end of December 2015, 73% of foreign-owned buildings were under Chinese ownership. The numbers may even be higher in reality, given that many Chinese buyers purchase land through a Korean friend or agent to get around registration requirements, or to hide overseas property from the Chinese government.[1]

Public reaction in Korea to the sudden increase of Chinese land ownership has been characterized by panic and concern. “Chinese Money Gobbles Up Jeju Island,” “Will Jeju be a Chinese Garden in Twenty Years?” and “Are We Just Going to Sit and Watch Mr. Wang’s Grab All the Land in Jeju?” are some of the media headlines that gained much public attention. In a 2015 survey conducted by the Jeju Provincial Government, 40% of Jeju residents responded that China-targeting investment efforts are “grossly inappropriate.”[2]  Woo Geun-Min, a former Jeju Governor and a leading advocate of the Real Estate Investment Immigration System, decided not to run for re-election when his support fell to an embarrassing 9% amidst allegations that he took bribes from Chinese investors to “sell off” the island.

In the context of rising foreign investment and international business transactions worldwide, the detrimental effects of an abrupt influx of Chinese real estate investment in Jeju warn policymakers to be mindful that long-term consequences may outweigh short-term benefits to the economy. There are three key areas of concern fueling the backlash: limited value added to the local economy, eviction of long-term tenants, and environmental consequences. Characteristics of investment patterns, rather than the nationality of the capital, appear to be the root cause of these problems.[3]

Limited value added to the local economy

Most investment from China comes in the form of large development projects of resort towns and condominiums targeting Chinese customers. Of over 4,700 cases of land purchased by Chinese investors, roughly 80% are vacation or resort-style buildings for lease; less than 10% of these purchases are for individual homes.[4]

However, the resorts and tourist-focused accommodation that form the bulk of Chinese real estate investment add only limited value to the local economy. Construction of hotels and entertainment facilities targeting the Chinese exacerbate the problem of the so-called ‘Chinese Circle’ in Jeju tourism that excludes local businesses from profiting.[5] Furthermore, there is very little indication that Chinese investment has created meaningful employment opportunities for Jeju residents, since many employees are hired only on temporary contracts or outsourced from China or other cities in Korea. Moreover, tax benefits given to Chinese enterprises are grossly generous. For instance, duty-free shops, which many hotels run alongside their accommodation services, have paid a total income tax of only $250,000 between 2010 and 2013; during the same period, their revenues reached $33 million. These are clear indications that Jeju is failing to capture the gains of Chinese investment in the island.

Tenant evictions

The Korean Ministry of Land, Infrastructure and Transport’s estimates of the “benchmark price” (a measure of the value of a “typical property” in the region) demonstrate that the land value in the island increased more than 40% between 2012 and 2016. But market price rose more dramatically, because Chinese buyers are willing and able to pay three or four times the market price.

The lure of Chinese money has forced many tenants to the streets. Small business owners in popular shopping districts are kicked out by their landlords through a variety of tactics in order to give space to Chinese buyers who are willing to pay much higher prices. One widely known example is Baozhen Street, where Chinese businesses are eager not to miss lucrative tourist sales; rent there has risen  50 – 250% since 2011. Some estimate that the rent usually increases 50-100% in buildings that change ownership from Korean to Chinese.[6]

Moreover, as Chinese investors are generally interested in large-scale opportunities, they attempt to buy all units of a building, or multiple buildings in a given area. As a result, merchants who occupy single units in a building are under augmenting pressure to leave. Reluctant evictions under compulsion are only expected to be more frequent as investment becomes more saturated, and land less available.

Environmental consequences

The most significant and widely-shared concern about Chinese real estate development is environmental damage. Chinese-owned land is dispersed throughout the island in both coastal areas and traditionally protected environmental districts, development of which was allowed amid growing pressure to meet the demand for land.

At the center of environmental woes is the damage to the Middle Mountainous Regions. These regions surround Mount Hallasan at the center of the island, and are some of Jeju’s most diverse ecosystems. In particular, gotjawals (lava forests) that populate the region are extremely valuable; they are the only forests in the world where both tropical and polar plants grow, thanks to the uniquely formed volcanic rocks that preserve heat and moisture in certain corners.

Unfortunately, Middle Mountainous Regions are more attractive than inner-city areas to Chinese investors because there are less regulations on construction compared to more populated areas. Land is also less expensive, yet have more scenic views. Moreover, there are more large, communal lands, making bigger purchases easier. Finally, there are ample opportunities for further expansion as many areas remain undeveloped. As a result, an estimated 32% of gotjawals has already been destructed to make room for golf courses, entertainment museums, and resorts.

The continuing destruction of gotjawals and other environmental treasures of Jeju Island would have serious, lasting consequences. Besides being the ‘lungs’ of the island by providing oxygen, gotjawals’ reserves of underground water serve as the main source of drinking water for islanders. Mass demolition of forests destroys the unique ecosystem of the island. Considering that Jeju’s natural resources have been formed over centuries of volcanic activity and unique landscape, such environmental loss would not be easily recovered.

Treasuring the “Treasure Island”: A New Direction for Jeju

What should the Jeju government change to promote sustainable, healthy development? Modifications to investment immigration policies in other countries facing similar problems may serve as guidance.

Comparative modifications in other countries

Countries often make a distinction between an Investment Immigration System and a Real Estate Investment Immigration System. In fact, it is rare to find a healthy, well-functioning economy providing immigration visas for purchases as low as $500,000.  Jeju is not alone in facing problems caused by a sudden influx of foreign capital in real estate. Countries with comparable investment immigration policies have recently withdrawn or modified them amidst growing concerns that the investment adds little to the economy and creates an unaffordable housing crisis. Facing a surge of Chinese investment immigration, Australia increased the minimum investment requirement to $5 million Australian dollars in 2012. When Chinese-run casinos started to overtake local hotels and entertainment businesses, Laos prohibited Chinese casinos in the country in 2012. Singapore eliminated immigration visas for real estate entrepreneurs in May 2013, after housing prices started to grow out of hand.

Canada’s example may be of particular interest to Jeju. From the early 2010s, Canada began discussing reforms to its investment immigration policy as foreign capital started to price young families out of the market, especially in Vancouver. More than 80% of this capital driving up housing prices is flowing in from China, Taiwan, and Hong Kong. Under the original framework, applicants received permanent resident status after six or more years if they had $1.6 million CAD in capital at the time of application and put up $800,000 CAD (raised from $400,000 in 2010) to the federal government at no interest. However, concerns over, inter alia, the housing market bubble led to a suspension in accepting new applications altogether in July 2012. Applicants now need $10 million in order to qualify, and must invest $2 million in a Canadian venture capital fund over fifteen years. They must also demonstrate language abilities (English or French), a college degree, and demonstrable entrepreneurial experience; permanent residency is granted within six months if the application is accepted. These revisions largely succeeded in cooling the Chinese investment frenzy.

Curbing current investment levels

The surge in housing prices and deterioration of communities are among the challenges faced by Jeju Island as well. Perhaps the easiest problem to address is the increase of land purchase for real estate development. Scholars agree that the sudden and dramatic nature of investment made it more detrimental, as the government had little time to modify its regulations in response to the arising consequences.  Fortunately, reducing incentives for investment immigration has immediate and significant impact on demand. For instance, the Jeju Provincial Government increased the property tax from 4.6% to 13.4% for property acquired under the Investment Immigration System in 2015, which decreased investment immigration by 80% that year. Heightened property tax is a commendable change not only because it cools down the investment frenzy, but also because it allows the government to reap more benefits from the investment that are currently being lost to the ‘Chinese circle’ of profit. Similar initiatives of making real estate purchases less attractive would further cool the heat of Chinese investment.

Enhancing regulations for environmental protection and preservation of Jeju landscape

One way of protecting the most vulnerable and valuable environmental areas is dividing the island into different zones, each with its own investment regulations reflecting its current status of development and natural traits. For instance, areas that are 200 meters or more above sea level are generally of heightened environmental value, as they mostly fall under the middle mountainous regions. Their landscape is also unique to Jeju and reflects the special character of the island.  As a principle, these areas should be preserved by being designated as special protected zones. For more densely populated areas within the city, limits on the height and width of buildings, or other specific design guidelines on construction, could be placed to preserve the unique landscape of the island. The regulations should also take into account the needs of current residents; for instance, the government could require proposed for-profit hospitals to show that there is a demonstrated demand in the community for certain services. This is one way of ensuring that development projects are carefully planned and constructed.

In addition, it would be wise to implement a total per capita investment limit to ensure that the landscape of Jeju is preserved, and to caution against concentrated regions of foreign capital that alienates the rest of the Jeju community. To help prevent the invasion of traditional communities like the unfortunate case of Baozhen Street, the government would be well-advised to limit foreign investment in certain areas that have already received saturated Chinese capital.

The Jeju Free International City Special Law states in Article 1 that the purpose of the law is to “promote Jeju Island’s regional, historic, humanistic specialties and to establish a special self-governing province with its own governing rights on the basis of autonomy, responsibility, creativity and diversity.”  The introduction of a Real Estate Investment Immigration System has achieved exactly the opposite, leading Jeju in an unsustainable, ill-fitted direction of becoming a “global” city that disregards its unique value as an environmental and cultural treasure. Given the demonstrated problems posed to the local economy, environment, culture, and community of Jeju Island, significant reforms to the investment immigration policy are needed immediately.

[1] Interview with Tae-Ho Ko at Jeju Development Research Institute.

[2] Jeju Development Institute, Jae Ee Cha Jeju Gukjae Jayoo Dosi Jonghab Gaehyoik Pyungga [Second Comprehensive Plan Evaluation of Jeju Free International City], 37 (2015).

[3] Interview with Young-Shin Chung of Jeju National University (Social Science Korea Research Team). Although Americans remain the largest foreign land owner in Jeju Island, scholars are much less worried about their impact because most investors are buyers of individual private property, and cause little damage to the environment

[4] Tae-Il Kim, Jeju Eui Gaebal, Eedaero Joeunga! [Jeju’s Development, Is Status Quo Sustainable!], 2014 Yeurushi Hamggae Suppi Doeja 53 (S. Kor.) 22, 45.

[5] Many Chinese tourists now come to the island under Chinese-owned and operated tourism packages that are offered at extremely affordable prices, staying in Chinese-owned hotels and restaurants. Chinese travel agencies work almost exclusively with Jeju agencies that are themselves Chinese-run and operated. Big Chinese enterprises investing millions into tourist destinations and accommodation are now going to enter this loop of Chinese profit-making.

[6] Hyun-Gook Kim, Joonggook Jabon Tooja Mit Guangwang Munjaejumgwa Gaesun Bangan [Problems with Chinese Capital Investment and Tourism and Solutions], 2013 Yeurushi Hamggae Suppi Doeja 52 (S. Kor.) 8, 34.

Written by Sarah Weiner

The American Law Institute is in the middle of an effort to update its Restatement (Third) of the Foreign Relations Law of the United States, published in 1987. The Restatement has plenty of new issues to address, but perhaps none as knotty as those posed by the Roberts Court’s federalism jurisprudence. Over the past decade, the Court has increasingly restricted the federal treaty-making power: first, in Medellín,[1] by making it harder for treaties to have binding domestic effect without an implementing statute from Congress, and second, in Bond,[2] by narrowly (and creatively) construing such an implementing statute to avoid reaching areas of traditional state regulation. Both of these cases deal in some way with statutes—whether they need to exist and, if so, how to interpret them. In interpreting statutes, the Court applies a “presumption against pre-emption in areas of traditional state regulation.”[3] But does that presumption against preemption extend to treaties as well?

The answer to that question matters more than one might think. Treaties often make commitments in areas traditionally subject to a state’s police powers, especially obligations to criminalize certain conduct,[4] and may come into conflict with state laws in various (and sometimes unexpected) ways. For example: Do “friendship, commerce, and navigation” treaties, which address the treatment of foreign companies within the United States, preempt state whistleblower protection laws?[5] Which state tort claims are preempted by the Warsaw Convention, which limits the liability of international airlines?[6] Is the means of service described in the Inter-American Convention on Letters Rogatory exclusive of alternative service options otherwise available in a state long-arm statute?[7] To know the answer to these questions, courts have to know how to interpret the underlying treaty. And to do that, they must know whether the presumption against preemption applies.

The most recent, publicly available draft of the Restatement (Fourth) does not address this crucial question in the text or the comments. Rather, it offers only a lukewarm Reporters’ Note, which states hedgingly that “[t]he case law does not clearly support any presumption regarding preemption of State law by a treaty.”[8]

This statement is too timid. The Reporters’ measured stance on the preemption presumption comes from what they perceive to be conflicting case law. But the case law is only confused because the Reporters’ Note attempts to group together unlike cases: non-self-executing treaties, implementing statutes, and self-executing treaties. Properly understood, the presumption against preemption simply does not (and should not) apply to self-executing Article II treaties.[9]

The Reporters’ Note first observes uncertainty over the applicability of the preemption presumption to foreign affairs statutes. The Note initially states that “[t]he Court has indicated that [the] presumption might not apply to statutes that concern foreign affairs,”[10] citing cases such as United States v. Locke.[11] However, the Note also cites Bond for the evidence that, in the case of a statute implementing a treaty, the Court applied the “principle that it is incumbent upon the federal courts to be certain of Congress’ intent before finding that federal law overrides the usual constitutional balance of federal and state powers.”[12]

Although the Reporters’ Note sets out these precedents as contrasting cases, they can be reconciled without much difficulty. In Bond, the Court considered whether the statute implementing the Convention on Chemical Weapons—a non-self-executing treating—“reache[d] a purely local crime” involving a woman’s assault against her husband’s mistress.[13] Applying a cousin-canon to the presumption against preemption, the Court held that the Implementation Act did not criminalize the defendant’s conduct because to “radically readjust the balance of state and national authority,” Congress “must be reasonably explicit.”[14] In other words, the Court expressed skepticism that the statute, as applied to the defendant, touched on foreign affairs. Reading Bond together with cases such as Locke, one could conclude that the Court does not extend the presumption against preemption to foreign affairs statutes (Locke), but it will not automatically assume that implementing statutes are foreign affairs statutes (Bond).

The Court engaged in considerable interpretive gymnastics in Bond to avoid answering a knottier constitutional question—whether the Implementation Act, if it did extend to Bond’s conduct, exceeded the scope of the Treaty Power and thus violated the Tenth Amendment. While Bond has raised serious constitutional questions about the scope of the Treaty Power, it does not imply that the presumption against preemption should extend to treaties. To the contrary, the Bond Court explicitly engaged in statutory interpretation to avoid interpreting the Convention itself. In fact, the Court implied—albeit in dicta—that that the presumption against preemption does not extend to treaties. Chief Justice Roberts’ majority opinion states, “Fortunately, we have no need to interpret the scope of the Convention in this case. Bond was prosecuted under [the Implementation Act], and the statute—unlike the Convention—must be read consistent with principles of federalism inherent in our constitutional structure.”[15]

Moving away from statutory interpretation to treaty interpretation, the Reporters’ Note next states that “[i]n many cases in which the Supreme Court has found State law to be preempted as the result of a treaty, it has not referred to any presumption. On a few occasions, however, the Court has suggested that the general presumption against preemption should apply to treaties.” The Note cites two cases for this claim, Guaranty Trust Co. v. United States[16] and United States v. Pink.[17] Both cases interpreted the scope of the “Litvinov Assignment,” which assigned certain claims by the Soviet Union to the United States as part of the United States’ new diplomatic recognition of the government of the Soviet Union. The trouble with the Reporters’ citation of Guaranty Trust and Pink is that the Litvinov Assignment was executed through the exchange of letters between executives; it was not an Article II treaty. To the extent that these cases address the presumption against preemption in the context of “treaties,” that discussion is appropriately understood as dicta.

More recent Supreme Court cases, also cited by the Reporters, more clearly state the rule: the presumption against preemption does not extend to treaties. For example, in El Al Israel Airlines, Ltd. v. Tsui Yuan Tseng,[18] the Court explained that “the nation-state, not subdivisions within one nation, is the focus of the [treaty] and the perspective of our treaty partners. Our home-centered preemption analysis, therefore, should not be applied, mechanically, in construing our international obligations.”[19] In so holding, the majority rejected Justice Steven’s argument in dissent that a “treaty, like an Act of Congress, should not be construed to preempt state law unless its intent to do so is clear.”[20] In rejecting a blunt presumption against preemption, the Court instead relied on a more nuanced variety of factors—including “text, purpose, and overall structure”—to discern the best interpretation of the treaty.[21]

More broadly, as a normative matter, it makes sense that the Court would apply a stronger federalism presumption against executive agreements that do not involve ex post Congressional approval than against Article II treaties. After all, treaty ratification requires the approval of two-thirds of the Senate, and Senators are better-positioned and better-incentivized to protect the interests of their home states than the Executive Branch.

The Reporters’ job is a difficult one. They must state the law as it is when the law is clear, but they must also state the law as it probably is—or probably should be—when the Court has not yet clearly spoken. When the United States negotiates, signs, and ratifies a treaty, it makes a set of commitments to international partners that should not be lightly misconstrued. Without an explicit directive from the U.S. Supreme Court to the contrary, the Reporters should state clearly that the presumption against preemption does not apply to self-executing treaties.

[1] Medellín v. Texas, 552 U.S. 491 (2008).

[2] Bond v. United States, 134 S. Ct. 2077 (2014).

[3] Egelhoff v. Egelhoff ex rel. Breiner, 532 U.S. 141, 151 (2001).

[4] See, e.g., Convention Against Torture and Other Cruel, Inhuman, or Degrading Treatment or Punishment, Dec. 10, 1984, 1465 U.N.T.S. 85, S. Treaty Doc. No. 100-20.

[5] See, e.g., Ventress v. Japan Airlines, 486 F.3d 1111 (9th Cir. 2007).

[6] See, e.g., Sompo Japan Ins., Inc. v. Nippon Cargo Airlines Co., 522 F.3d 776 (7th Cir. 2008).

[7] See, e.g., Kreimerman v. Casa Veerkamp, S.A. de C.V., 22 F.3d 634 (5th Cir. 1994).

[8] Restatement (Fourth) of the Foreign Relations Law of the United States § 108 reporters’ note 2 (Am. Law Inst., Tentative Draft No. 1, 2016) [hereinafter Draft Restatement (Fourth) of Foreign Relations Law].

[9] Section 108 addresses only self-executing treaties, and the Restatement (Fourth) covers only Article II treaties. The Drafters indicate that “[o]ther forms of international agreements may be taken up in the future.” Draft Restatement (Fourth) of Foreign Relations Law, supra note 8, at xix.

[10] Id. § 108, reporters’ note 2.

[11] United States v. Locke, 529 U.S. 89 (2000). The Reporters’ Note cites the following statement from Locke: “The state laws now in question bear upon national and international maritime commerce, and in this area there is no beginning assumption that concurrent regulation by the State is a valid exercise of its police powers.” Id. at 108.

[12] Draft Restatement (Fourth) of Foreign Relations Law, supra note 8, § 108 reporters’ note 2 (quoting Bond, 134 S. Ct. at 2089) (internal quotation marks omitted).

[13] Bond, 134 S. Ct. at 2083.

[14] Id. at 2089 (citations omitted) (internal quotation marks omitted).

[15] Id. at 2088.

[16] Guaranty Trust Co. v. United States, 304 U.S. 126 (1938).

[17] United States v. Pink, 315 U.S. 203 (1942).

[18] El Al Israel Airlines, Ltd. v. Tsui Yuan Tseng, 525 U.S. 155 (1999).

[19] Id. at 175.

[20] Id. (majority discussion); id. at 181 (Stevens, J., dissenting).

[21] Id. at 169.