US urged
to halt extraterritorial abuse of its national law
 |
| Is the long arm of
US law too long? |
Paris, 5
December 2002 - The
International Chamber of Commerce has appealed to the United States government
and Congress to prevent misuse of an 18th century law that is allowing foreign
companies to be sued in US courts for alleged events in third countries.
The ICC world leadership,
headed by the organization's American Chairman, Richard D. McCormick, objected
in a statement to "an unacceptable extraterritorial extension of US jurisdiction."
The
statement, issued on behalf of ICC's thousands of member companies and business
associations throughout the world, called on other governments to raise the
issue with Washington. It asked them to guard against any tendency themselves
to use new or existing laws to exert extra-territorial jurisdiction.
ICC said that over the past
10 years, growing numbers of US companies have been sued in US federal courts
under the Alien Tort Claims Act of 1789 for alleged violations outside the United
States of human rights, labour rights and environmental standards.
Originally intended to ensure
that legal action could be taken against violators of the 'Law of Nations' -
which in those days covered piracy and violation of the status of protected
persons (largely diplomats) - the statute is now being used against companies
by anti-business groups, ICC said. It added that in the last few years, non-US
companies have begun to be targeted.
"As a result, the threat
now applies equally to any non-US company that has some link to the United States,
such as a US subsidiary, or even a listing of its shares on a US stock exchange."
The statement said a large
number of non-US multinational companies are being sued under the statute in
an action against more than 1,000 companies, alleging complicity in, or 'vicarious
liability' for apartheid in South Africa.
"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,"
ICC declared.
Other countries, and especially
developing countries, would be justified in fearing that such an interpretation
of the law would make US companies increasingly reluctant to invest abroad.
If foreign companies investing in the United States were to be exposed to the
1789 act, this could reduce investment in the US.
The ICC statement was signed
by Mr McCormick, former Chairman and CEO , U.S. WEST, Inc.; ICC Vice Chairman
Jean-René Fourt
ou, Chairman and Chief Executive Officer, Vivendi Universal;
and Adnan Kassar, ICC Past Chairman and CEO Fransabank
