Implications Of The Argentina Debt Litigation For Foreign Sovereign Immunity

Foreign sovereigns have long assumed that the Foreign Sovereign Immunities Act (FSIA) provides them with substantial protection against litigants in United States courts. Although the immunity afforded by the FSIA has never been absolute, two recent developments in the Supreme Court of the United States – both involving the Republic of Argentina – have expanded plaintiffs' ability to locate sovereign assets and force satisfaction of a judgment, notwithstanding the seemingly broad protections of the FSIA.

The rulings are important for sovereign investors for a number of reasons:

• By declining to accept review of a significant decision by the Second Circuit Court of Appeals in New York, the Supreme Court effectively upheld injunctions against a foreign sovereign's agents in the United States in order to achieve ends that might not have been directly achievable against the sovereign itself.