The Unique Legal Status of the Bank for International Settlements Comes into Focus

Leiden Journal of International Law

Volumn 16, Issue 4, 2003, Pages 787-794

  Bederman, David J ^a  

^a EMORY UNIVERSITY   (United States)

Author keywords

Bank for International Settlements; international institutions; international legal personality; state responsibility; stock valuation

Indexed keywords

EID: 34248061360     PISSN: 09221565     EISSN: 14789698     Source Type: Journal    
DOI: 10.1017/S0922156503001444     Document Type: Article

References (36)

1. Dr Horst Reineccius, et al. v. Bank for International Settlements, Partial Award of the Lawfulness of the Recall of Privately Held Shares on 8 Jan. 2001 and the Applicable Standards for Valuation of those Shares, Arbitration Tribunal Established Pursuant to Art. XV of the Agreement Signed at The Hague on 20 January 1930 (partial award issued 22 Nov. 2002), available atwww.pca-cpa.org(hereinafter cited as ‘Award’, with the relevant paragraph numbers).
2. This Agreement was constituted by a number of elements. For the purposes of this casenote the primary instruments are (i) the Convention respecting the Bank for International Settlements, Ger.-Bel.-Gr.Brit.-It.-Japan-Switz., 20 Jan. 1930, 104 LNTS 441, reprinted in (1930) 24 AJIL Supp. 323 (BIS Convention); (ii) the annexedConstituent Charter of the Bank for International Settlements, 104 LNTS 445, reprinted in (1930) 24 AJIL Supp. 324 (BIS Charter); (iii) the annexed Statutes of the Bank for International Settlements, 104 LNTS 449, reprinted in (1930) 24 AJIL Supp. 326 (BIS Statutes). The primary document of the set was the actual Reparations Agreement with Germany, also known as the Young Plan, 104 LNTS 244, reprinted in (1930) 24 AJIL Supp. 262, of which Art. XV provided for a dispute settlement mechanism and arbitration of any disputes arising from under any of the elements or instruments of the Agreement.
3. See BIS Statutes, This Agreement was constituted by a number of elements note 2, at Art. 3.
4. Formore on the history and evolution of the Bank, see R. Auboin, The Bank for International Settlements, 1930-1955 (1955); J. C. Baker, The Bank for International Settlements : Evolution and Evaluation (2002); D. J. Bederman, ‘The Bank for International Settlements and the Debt Crisis : A New Role for the Central Bankers Bank?’, (1988) 6 International Tax and Business Law 92; E. L. Dulles, The Bank for International Settlements atWork (1932); P. Einzig, The Bank for International Settlements (1930); M. Giovanoli, ‘The Role of the Bank for International Settlements in International Monetary Cooperation and its Tasks Relating to the European Currency Unit’, (1989) 23 International Law 841; ‘International LegalNotes, FiftiethAnniversary of the Bank for International Settlements’, (1980) 54 Australian Law Journal 560; G.U. Papi, The First Twenty Years of the Bank for International Settlements (1951); H. H. Schloss, The Bank for International Settlements (1958); G. K. Simons and L. G. Radicati, ‘A Trustee in Continental Europe : The Experience of the Bank for International Settlements’, (1983) 30 Netherlands International Law Review 330; G. B. Tarin, ‘The Bank for International Settlements :Keeping a Low Profile’, 5 Transnational Law 839 (1992).
5. BIS Statutes, Formore on the history and evolution of the Bank note 2, Art. 1.
6. See Award, BIS Statutes note 1, paras. 4 and 5.
7. See BIS Statutes note 1., para. 5.
8. Two preliminary orders of the ArbitralTribunal merit somemention.The first, ProceduralOrderNo. 6 (Order with Respect to Discovery of Certain Documents forWhich Attorney-Client Privilege Has Been Claimed), issued 11 June 2002, available at www.pca-cpa.org, dealt with the increasingly contentious issue in international arbitrations (including those with a public element) of discovery abuses and contentions of evidentiary privileges, and applicable waivers of attorney-client privilege. The Tribunal ordered the protection of a wide set of legal opinions offered to the managers of the Bank. The arbitral panel consisted of ProfessorsW. MichaelReisman (president), JochenA. Frowein,Mathias Krafft, Paul Lagarde, and Albert Jan van den Berg. at 10-12; see also Award, The arbitral panel consisted of ProfessorsW. MichaelReisman (president), JochenA. Frowein,Mathias Krafft, Paul Lagarde, and Albert Jan van den Berg note 2, at para. 45. The second order, In re theMatter of ReginaldH.Howe, issued 31Aug. 2001, available at www.pca-cpa.org, concerns the rights of non-parties to arbitration regarding public disclosures of certain sorts of information about the parties and their claims, especially where the results of the arbitration could affect (and benefit) a wide class of non-parties. Although the Tribunal disclaimed any interest in promoting an international ‘class action’ approach to litigation, it did allow for certain information to be disclosed, and held open the possibility of allocating costs.
9. In addition to the sources cited innote 4, see also M.O.Hudson, ‘The Immunities of the Bank for International Settlements’, (1938) 32 AJIL 128; Sir J. F. Williams, ‘The Legal Character of the Bank for International Settlements’, (1930) 24 AJIL 665.
10. Award, ‘The Immunities of the Bank for International Settlements’ note 1, para. 105.
11. ‘The Immunities of the Bank for International Settlements’ note 1., at para. 108 (discussing BIS Charter, ‘The Immunities of the Bank for International Settlements’ note 1 note 2, para. 5).
12. This assumption has been questioned by some. SeeD. J. Bederman, ‘The Souls of International Organizations : Legal Personality and the Lighthouse at Cape Spartel’, (1996) 36 Va. Journal of International Law 275.
13. Award, ‘The Souls of International Organizations : Legal Personality and the Lighthouse at Cape Spartel’ note 1, paras. 113 and 114 (quoting Auboin, ‘The Souls of International Organizations : Legal Personality and the Lighthouse at Cape Spartel’ note 4, at 1-2 and BIS Statutes, ‘The Souls of International Organizations : Legal Personality and the Lighthouse at Cape Spartel’ note 2, Art. 3).
14. See quoting Auboin., para. 115.
15. quoting Auboin., para. 117.
16. See quoting Auboin., para. 123.
17. BIS Statutes, quoting Auboin note 2, Art. 58.
18. See Award, BIS Statutes note 1, paras. 144-46 (relying on an interpretation of the Vienna Convention on the Law of Treaties, 23May 1969, Art. 31(3)(b), 1155 UNTS 331).
19. See relying on an interpretation of the Vienna Convention on the Law of Treaties., para. 149.
20. See relying on an interpretation of the Vienna Convention on the Law of Treaties., para. 155 ('Thus, even were, arguendo, the standards of the international law of expropriations to be applied to determine the validity of the Bank's recall of private shares, that transaction would have been lawful').
21. See 'Thus, even were, arguendo, the standards of the international law of expropriations to be applied to determine the validity of the Bank's recall of private shares, that transaction would have been lawful’., paras. 152-155.
22. See 'Thus, even were, arguendo, the standards of the international law of expropriations to be applied to determine the validity of the Bank's recall of private shares, that transaction would have been lawful’., para. 151.
23. See 'Thus, even were, arguendo, the standards of the international law of expropriations to be applied to determine the validity of the Bank's recall of private shares, that transaction would have been lawful’., para. 160.
24. See 'Thus, even were, arguendo, the standards of the international law of expropriations to be applied to determine the validity of the Bank's recall of private shares, that transaction would have been lawful’., paras. 161-171.
25. See 'Thus, even were, arguendo, the standards of the international law of expropriations to be applied to determine the validity of the Bank's recall of private shares, that transaction would have been lawful’., para. 168.
26. See 'Thus, even were, arguendo, the standards of the international law of expropriations to be applied to determine the validity of the Bank's recall of private shares, that transaction would have been lawful’., paras. 5, 171.
27. 'Thus, even were, arguendo, the standards of the international law of expropriations to be applied to determine the validity of the Bank's recall of private shares, that transaction would have been lawful’., para. 178.
28. 'Thus, even were, arguendo, the standards of the international law of expropriations to be applied to determine the validity of the Bank's recall of private shares, that transaction would have been lawful’., para. 182.
29. See BIS Statutes, 'Thus, even were, arguendo, the standards of the international law of expropriations to be applied to determine the validity of the Bank's recall of private shares, that transaction would have been lawful’ note 2, Art. 13.
30. See Award, BIS Statutes note 1, paras. 192-202.
31. See BIS Statutes., para. 201.
32. See BIS Statutes., para. 203.
33. See BIS Statutes., paras. 203, 205. Also put off was consideration of the Bank's counter-claim against one of the parties for having initiated proceedings in a US court, prior to the constitution of the Tribunal, in breach of Art. 54(1) of the Statutes. See BIS Statutes., paras. 99, 206-207. These were resolved in the Tribunal's Final Award of 19 Sept. 2003, available at www.pca-cpa.org.
34. See Williams, Also put off was consideration of the Bank's counter-claim against one of the parties for having initiated proceedings in a US court, prior to the constitution of the Tribunal, in breach of Art. 54(1) of the Statutes note 10, at 665-6.
35. Reparations for Injuries Suffered in the Service of theUnitedNations (Advisory Opinion), [1949] ICJ Rep. 174, at 178.
36. Williams, Reparations for Injuries Suffered in the Service of theUnitedNations note 10, at 672.