The importation of sexism: a cost-benefit approach to the U.S.-South Korea Friendship, Commerce and Navigation Treaty.

• Author: Fease, Jennifer D.

ABSTRACT

The U.S.-South Korea Friendship, Commerce and Navigation Treaty was entered into by the signatory countries following World War H and governs the actions of corporations operating in a foreign country. One provision of the Treaty allows foreign corporations in the United States to choose executives "of their choice," arguably without regard to the statutory protections that the United States affords in the hiring process. In this Note, the Author contends that the U.S.-South Korea Friendship, Commerce and Navigation Treaty results in discrimination against women in the United States because South Korean employers tend to choose South Korean men to fill particular positions. To address this discrimination, the Author proposes that the United States either abolish the U.S.-South Korea Friendship, Commerce and Navigation Treaty or, alternatively, replace it with a bilateral investment treaty.

TABLE OF CONTENTS I. INTRODUCTION II. GENDER ROLES IN SOUTH KOREA A. Home and Personal Lives B. Corporate Culture III. SOUTH KOREAN EMPLOYMENT LAWS A. Statutory Protections B. Laws in Practice IV. SOUTH KOREAN COMPANIES OPERATING IN THE UNITED STATES: TREATMENT OF AMERICAN WOMEN V. U.S.-SOUTH KOREA FCN TREATY: DO THE COSTS--IMPORTED SEXISM--OUTWEIGH THE BENEFITS? A. Original Purpose of the Treaty B. The Courts Weigh In 1. Fifth Circuit: Spiess v. C. Itoh & Co. (America), Inc 2. Supreme Court: Avigliano v. Sumitomo Shoji America, Inc 3. Recent Circuit Court Interpretations VI. ANALYSIS AND PROPOSED SOLUTION: BILATERAL INVESTMENT TREATIES VII. CONCLUSION I. INTRODUCTION

The Friendship, Commerce and Navigation (FCN) Treaty has been called "one of the most familiar instruments known to diplomatic tradition." (1) The first FCN treaty negotiated by the United States was with France in 1778, (2) and in accord with most of the earliest treaties, mainly concerned the treatment of citizens abroad. Since 1945, however, FCN treaties have increasingly focused on protecting corporations and attempting to define their rights. (3) Following World War II, as the United States looked to promote and advance international investment, the United States entered these treaties with more than two dozen countries, including Japan, Germany, and Greece. (4)

Generally, FCN treaties protect persons by defining the treatment each signatory country owes the citizens of the other, the rights of those citizens to engage in business and other activities within the boundaries of the other signatory nations, and the respect due those citizens, their property, and their enterprises. (5) Under the terms of a typical FCN treaty, a corporation is protected by receiving legal recognition from each signatory to the treaty. (6) Those corporations may then conduct business in a signatory foreign country on a comparable basis with that country's domestic companies. (7)

The FCN Treaty between the United States and South Korea, signed in 1956 by President Dwight D. Eisenhower and Foreign Affairs Minister Chung W. Cho, gives Korean and U.S. companies mutual rights while operating within the other's borders. (8) The nations signed it with the goals of "strengthening the bonds of peace and friendship traditionally existing between" each other and of "encouraging closer economic and cultural relations between their peoples." (9)

One particular provision in many FCN treaties, including that between the United States and South Korea, is the "employer choice provision," which gives companies the right to hire the executive personnel "of their choice" in their operations abroad. (10) The provision provides a protection to foreign corporations that hire their own citizens to fill high-level positions. (11) Article VIII(1) of the FCN Treaty between the United States and South Korea provides that "[n]ationals and companies of either Party shall be permitted to engage, within the territories of the other Party, accountants and other technical experts, executive personnel, attorneys, agents and other specialists of their choice." (12)

Employer choice provisions have sparked much debate among courts and commentators. Some read the provision broadly, arguing that it authorizes foreign companies to "control their investment" by hiring their own citizens, for whatever reason, to fill high-level positions. (13) Others believe that the authorization should be read narrowly, extending only to the hiring of one's own citizens solely because of their citizenship, and not because of any other factors such as sex or age. (14) The central controversy over the employer choice provision in the U.S.-South Korea FCN Treaty concerns its potential inconsistency with Title VII of the U.S. Civil Rights Act of 1964. Title VII provides, in part, that "[i]t shall be an unlawful employment practice for an employer--(1) to fail to hire or to discharge any individual, or otherwise to discriminate against any individual with respect to his compensation, terms, conditions, or privileges of employment, because of such individual's race, color, religion, sex, or national origin...." (15) Title VII, by using the broad term "any individual" to describe those within its statutory coverage, applies to nationals and aliens alike. (16)

Absent potential constraints, Title VII applies to a foreign employer when it discriminates within the United States. (17) But a treaty--such as the U.S.-South Korea FCN Treaty--confers special privileges or immunities on foreign firms and their operations in the United States. (18) The U.S.-South Korea FCN Treaty and Title VII are thus in conflict, particularly with respect to U.S. subsidiaries of South Korean firms. It is notable that the U.S-South Korea FCN Treaty was negotiated before the adoption of the Civil Rights Act of 1964. (19) One court thus concluded that "in the absence of evidence suggesting Congress intended subsequent legislation to affect existing treaty rights, and in the event the enactments conflict, the Treaty must prevail." (20) The court went on to note that there was no evidence that Congress, in enacting Title VII, "intended to abrogate" the right granted by the employer choice provision "in any way." (21) One commentator challenged the court's point of view by considering how the 1964 Congress would answer the following question: "In passing this legislation did you intend to assure that Ford and General Motors can no longer discriminate on the basis of sex, but that such discrimination is permissible at Honda's American plant?" (22)

If indeed U.S. subsidiaries of South Korean firms may hire executive personnel of their choice without regard to U.S. antidiscrimination laws, the effect on the employment of women in the United States at these subsidiaries may be devastating, given the cultural differences in gender roles. South Korean women, in the Confucian tradition, have a different social position from men. (23) South Korean customs and practices prevent women from fully benefiting from their economic and social rights, even in the twenty-first century. (24) This Note will explore whether women employed by U.S. subsidiaries of South Korean companies are entitled to Title VII protections.

To answer that question, this Note will analyze the relationship between the employer choice provision in the U.S.-South Korea FCN Treaty and Title VII, focusing specifically on South Korean companies doing business in the United States and their treatment of women in the United States. Part II will examine gender roles in South Korea, both at home and in the workplace. In order to understand a South Korean company's actions abroad, it is first important to understand its cultural roots. With the same goal in mind, Part III will analyze current South Korean employment laws, as compared to those in the United States. Part IV will then specifically address U.S.-based South Korean firms' treatment of American women. Part V will examine the U.S.-South Korea FCN Treaty in order to assess whether the Treaty itself promotes the importation of South Korean corporate sexism. Finally, this Note will conclude that the costs of the U.S.-South Korea FCN Treaty are greater than the benefits, ultimately suggesting either abolishment of the Treaty or, alternatively, adoption of a bilateral investment treaty.

2. GENDER ROLES IN SOUTH KOREA

   1. Home and Personal Lives

      From the fifteenth century to the present, Confucianism, based on the teachings of the Chinese philosopher Confucius, has had a powerful influence on South Korean society. (25) One writer described Confucianism as "not a religion ... but rather a type of humanism aimed at social ethics." (26) South Koreans have taken Confucius' teachings much more seriously and integrated his values in their attitudes and behaviors with a greater intensity than have the people of other Asian countries. (27) In historical Confucian ideology, every person had a proper place in society and a corresponding role to play. (28) Author Donald N. Clark notes that "[i]t was important to define the proper spheres for men and women in Korean society and to enforce their adherence to the rules of propriety." (29) The ethical justification for restrictions on women in society is found in Confucian ideology. (30) In the historical Confucian tradition, women were expected to follow the ideals of modesty, seclusion, faithfulness, sacrificial motherhood, and even loyalty to their husbands after the husband's death. (31)

      The historical Confucian tradition has continued, and even today a South Korean woman's role is traditionally confined to household affairs. (32) A common Chinese saying is often repeated in South Korea: "When a girl is young, she is ruled by her father; when she marries, by her husband; and when she is widowed, by her eldest son." (33) Though women's social status has improved as South Korea has become more industrialized, South Korean women still do not fully enjoy their rights. (34)

   2. Corporate Culture

      South Korea's long...