Romano Prodi
President,
European Commission,
200, rue de la Loi,
1049 Brussels,
Belgium

22 October 2003

Dear President,

As you probably know, a number of EU companies have been sued in United States Federal District Courts under an 18th century law - the Alien Tort Statute of 1789 - for alleged violations outside the United States of human rights, labour rights and environmental standards. It is the view of the International Chamber of Commerce (ICC), representing the world business community, that the practice of suing companies in the US, whether domestic or foreign, for alleged events occurring in third countries is an unacceptable extraterritorial extension of US jurisdiction. The same position holds with cases filed in European courts against companies, European and foreign, for actions alleged to have occurred in third countries.

As Secretary General of ICC, I ask you to add your voice to those of European governments to encourage the United States Government to continue its efforts to stop the abusive use of this ancient statute against EU companies. The growing number of cases filed in US courts is causing great anxiety to European business and has already inflicted significant litigation costs on many EU companies, not to mention considerable negative publicity.

The climate of legal and commercial uncertainty arising from the proposed extraterritorial reach of US law is creating unnecessary disputes and tension between EU countries and the United States Government, at a time when international cooperation is seen as a key condition for global economic recovery. It must be made clear to US authorities that the practice of suing EU companies in the US for alleged events occurring in third countries could have the effect of reducing investment by EU companies in the United States, or in third countries if one of the consequences would be exposure to the Alien Tort Statute.

The United States Government has already taken steps to protect US and foreign companies from the threat posed by the Alien Tort Statute. ICC believes that it is still very important that the United States Government hear from other governments, and especially from EU members and the EU Commission, that the flood of litigation stemming from the misuse of the Alien Tort Statute is causing great harm to international business and should be halted.

ICC has consistently drawn the attention of governments to the dangers inherent in laws that purport to grant national courts universal jurisdiction. The problems raised by the abusive use of the Alien Tort Statute are perfect examples of how the extraterritorial reach of national laws results in unwarranted costs to business and ultimately discourages cross-border trade and investment - a major driving force for global economic growth and job creation.

We have also noted that courts in some EU member countries are being used for legal actions similar to those being filed under the Alien Tort Statute in the United States. We were concerned about the implications of a law enacted by Belgium that would have allowed a flood of law suits in that country against companies for alleged actions in third countries. Fortunately, that law has recently been amended to restrict its application.

We recently noticed that the same attorneys who are responsible for a suit in the United States against a large number of companies, US and foreign, for alleged liability for the losses suffered by the non-white population of South Africa during the apartheid period have now filed a similar suit in the United Kingdom, alleging responsibility for pension fund violations by European and American companies during the apartheid regime. In such cases, we believe the Commission should also make clear to the governments of the EU countries involved that this extraterritorial extension of the authority of their courts is unacceptable. It will be much more difficult to make our case against the abusive application of the Alien Tort Statute in the United States if European courts are taking similar actions, including against American companies.

On behalf of ICC and its member companies and business associations around the world, we therefore urge you to encourage the United States Government in its effort to intervene through the federal court system to stop the abusive use of the Alien Tort Statute.

Yours sincerely,

Maria Livanos Cattaui
Secretary General
International Chamber of Commerce


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