What Is an Agency or Instrumentality?
Author | Ernesto Sanchez |
Pages | 81-92 |
81
WH AT IS A N AG E NC Y OR
INS T RU M EN TA L IT Y ?
§ 7.1 INTRODUCTION
If an entity that is not a state, nor an equivalent national government, claims FSIA immunity
and does not qualify as a political subdivision of a foreign state under the criteria illustrated in
the previous chapter, the entity must qualify as an agency or instrumentality of a foreign state,
or a foreign state’s political subdivision, for the FSIA to apply.
§ 7.2 PERTINENT STATUTORY TEXT
Section 1603(b) of the FSIA states:
An “agency or instrumentality of a foreign state” means any entity –
(1) which is a separate legal person, corporate or otherwise, and
(2) which is an organ of a foreign state or political subdivision thereof, or a majority
of whose shares or other ownership interest is owned by a foreign state or political
subdivision thereof, and
(3) which is neither a citizen of a State of the United States as dened in section
1332(c) and (e) of this title, nor created under the laws of any third country.1
§ 7.3 DETERMINING AGENCY OR INSTRUMENTALITY
STATUS
A state’s agency or instrumentality is (1) either an “organ” of a foreign state or political subdi-
vision thereof or has a majority of its shares owned by a foreign state or political subdivision
thereof and (2) is neither a U.S. citizen nor created under the laws of a dierent third country.
(1) Separate Legal Personhood
e distinction between a separate unit qualifying as a political subdivision and a unit qualify-
ing as an agency or instrumentality can often be subtle and nuanced. To use U.S. examples,
such entities as the State Department, Securities and Exchange Commission, or Internal Rev-
enue Service are part of, yet separate from, the U.S. central government itself. What the “core
functions” test illustrates is that the dierence between these two types of entities primarily
depends on the same “nature of activity” analysis underlying the restrictive approach to foreign
sovereign immunity.2
1. 28 U.S.C. § 1603(b).
2. See infra Pt. I, Ch. 1, § 1.3(2)(B).
7
ForSovImmunAct_book.indb 81 4/11/13 3:31 PM
To continue reading
Request your trial