10.6092/issn.2531-6133/7666
When  aprivate party enter into arbitration with a State Owned Enterprise (S.O.E.), there always a concern as to how the arbitral award might be enforced. It becomes even more worry some if the assets of the S.O.E. are mainly located in its own country or in a country, which practices absolute immunity principle and treats S.O.Es as part of a State. Such practice creates an uncertainty for the private parties who are doing businesses with S.O.Es. On a practical side it is also well known that S.O.Es are big market player as buyer or seller and therefore they cannot be ignored at least in commercial sense. This paper analyses the two distinctive approaches adopted by courts in the U.K. and in Hong Kong on a similar set of facts in which the same group of S.O.Es were involved. As both Hong Kong and the U.K. are part of the same common law tradition, this paper also attempts to highlight that courts are now ready to see S.O.Es as a pure commercial entity rather that as an instrumentalities of a State so far as enforcement of arbitral awards are concerned. 
application/pdf
2531-6133
7666
2
en
Rajesh Sharma
University of Bologna Law Review
Treatment of  State  Assests and SOEs Assets for Enforcement of Awards
Enforcement of Arbitral Awards Against a State-Owned Entity: A Tale, Two Jurisdictions
Text.Serial.Journal
https://bolognalawreview.unibo.it/
2
Articles & Essays
2018-02-19
2018-01-04
2017-11-22
2018-12-14
346-366
UBLR
Rajesh Sharma
2017
10.6092/issn.2531-6133/7666
346
RMIT University
2531-6133
2
Treatment of  State  Assests and SOEs Assets for Enforcement of Awards
en
366
Enforcement of Arbitral Awards Against a State-Owned Entity: A Tale, Two Jurisdictions
https://bolognalawreview.unibo.it/article/download/7666/7578
2
ARTICLES & ESSAYS                                                         https://doi.org/10.6092/issn.2531-6133/7666




Enforcement of Arbitral Awards Against a State-Owned Entity: A Tale,
Two Jurisdictions
                                              RAJESH SHARMA†



TABLE OF CONTENTS: 1. Introduction; 2. Worldwide Enforcement Proceedings by F.G.
Hemisphere; 3. F.G. Hemisphere from Jersey to the U.K.; 3.1. Targeted Assets; 3.2.
Ruling by the Royal Court; 3.3. Ruling by the Royal Court of Appeal; 3.4. Ruling by the
Privy Council; 4. F.G. Hemisphere in Hong Kong; 4.1. High Court of Hong Kong; 4.2.
Court of Appeal; 5. The Gécamines Case – Is it Based on Principle?; 6. Gécamines’
Status Considered in Hong Kong; 7. The Impact of the Gécamines Case on Future Cases;
7.1. Where the Liability Is Incurred by the State; 7.2. Where Liability Is Incurred by the
S.O.E.; 8. Conclusion.


ABSTRACT: When a private party enter into arbitration with a State Owned Enterprise
(S.O.E.), there always a concern as to how the arbitral award might be enforced. It
becomes even more worry some if the assets of the S.O.E. are mainly located in its own
country or in a country, which practices absolute immunity principle and treats S.O.Es
as part of a State. Such practice creates an uncertainty for the private parties who are
doing businesses with S.O.Es. On a practical side it is also well known that S.O.Es are
big market player as buyer or seller and therefore they cannot be ignored at least in
commercial sense. This paper analyses the two distinctive approaches adopted by
courts in the U.K. and in Hong Kong on a similar set of facts in which the same group
of S.O.Es were involved. As both Hong Kong and the U.K. are part of the same common
law tradition, this paper also attempts to highlight that courts are now ready to see
S.O.Es as a pure commercial entity rather that as an instrumentalities of a State so far
as enforcement of arbitral awards are concerned.



KEYWORDS: Enforcement of Awards; Sovereign Immunity and Enforcement of Awards; Effect of
Absolute and Restrictive Sovereign Immunity on of Awards; Enforcement Against SOEs,
Treatment of State Assests and SOEs Assets for Enforcement of Awards.




                                            UNIVERSITY OF BOLOGNA LAW REVIEW

                                                    ISSN 2531-6133

                                                     [VOL.2:2 2017]

           This article is released under the terms of Creative Commons Attribution 4.0 International License


                                                         346
                                                              University of Bologna Law Review
                                                                                  [Vol.2:2 2017]
                                                                 https://doi.org/10.6092/issn.2531-6133/7666




        1. INTRODUCTION

When a private party enter into arbitration with a State Owned Enterprise
(S.O.E.), there always a concern as to how the arbitral award might be
enforced. It becomes even more worry some if the assets of the S.O.E. are
mainly located in its own country or in a country, which practices absolute
immunity principle and treats S.O.Es as part of a State. Such practice creates an
uncertainty for the private parties who are doing businesses with S.O.Es. On a
practical side it is also well known that S.O.Es are big market player as buyer or
seller and therefore they cannot be ignored at least in commercial sense. In
recent Transpacific Partnership Agreement (T.P.P.) an attempt is made to
control this unruly horse, S.O.Es, though not from commercial arbitration
point of view.1 This paper analyses the two distinctive approaches adopted by
courts in the U.K. and in Hong Kong on a similar set of facts in which the same
group of S.O.Es were involved. As both Hong Kong and the U.K. are part of the
same common law tradition, this paper also attempts to highlight that courts
are now ready to see S.O.Es as a pure commercial entity rather that as an
instrumentalities of a State so far as enforcement of arbitral awards are
concerned.




        2. WORLDWIDE ENFORCEMENT PROCEEDINGS BY F.G. HEMISPHERE

F.G. Hemisphere, a Delaware company, took out court proceedings in various
jurisdictions to enforce the two              International Chamber                of     Commerce
(hereinafter I.C.C.) arbitral awards against the Democratic Republic of Congo
(hereinafter D.R.C.). However, F.G. Hemisphere was not a party to the original


†
 Senior Lecturer, Criminology and Justice, RMIT University, Melbourne, Arbitrator at Korean
Commercial Arbitration Board; Associate Director and Research Fellow at the Hong Kong WTO
Research Institute; Member, Asian WTO Research Network; Research Fellow at the China-Latin
America Research Centre, Shanghai; Research Fellow at the International Academy of Belt and
Road, Hong Kong; Member, The Centre for Social and Global Studies Centre, Melbourne; Elected
Associate Member of the Academy of Comparative Law. The opinion expressed here is of the
author and that does not represent the opinion of any institution or organization to which the
author is affiliated. The author can be contacted at Rajesh.Sharma@rmit.edu.au.
1
  See Sean Miner, Comments on State-Owned Enterprises, in 2 ASSESSING TRANSPACIFIC PARTNERSHIP-
INNOVATIONS IN TRADING RULES, 91-100 (Jeffrey J.Schott & Cathleen Cimino-Isaacs eds., 2016).



                                             347
                                                                  University of Bologna Law Review
                                                                                      [Vol.2:2 2017]
                                                                     https://doi.org/10.6092/issn.2531-6133/7666




arbitral proceedings under which the awards were made. The arbitration
agreement was between Energoinvest, a Yugoslavian company and the D.R.C.
In the 1980s, Energoinvest had agreed to construct a hydro-electric facility and
high tension electric lines in the D.R.C. The D.R.C. and the D.R.C.’s State Owned
Enterprise (hereinafter S.O.E.), Société Nationale d’Electricité (hereinafter S.N.E.)
entered into credit agreements with Energoinvest to finance the works. It was
these credit agreements that contained I.C.C. arbitration clauses. The works
were completed but the D.R.C. and S.N.E. defaulted on their payment
obligations, despite revision and rescheduling. Energoinvest then instituted
arbitral proceedings against the D.R.C. in Switzerland and France. Two awards
were rendered on 30th April 2003 by the respective arbitral tribunals in favour
of Energoinvest against the D.R.C. and S.N.E. for US$11,725,000 and
US$22,525,000 respectively plus interest.

         F.G. Hemisphere then entered the picture as a “vulture fund”. Vulture
funds have been opportunistically profiting from the financial crisis that has
been brewing in the past few years. They are particularly active in Africa, Latin
America and now Europe. This lucrative enterprise involves the purchase of
debts from distressed entities at large discounts. 2 This helps ease the burden of
the assignor of the debt because at least part of the outstanding debt has been
repaid by the vulture fund. The vulture funds then seek to enforce the
purchased debts at their full value against the debtors’ assets in different
jurisdictions. F.G. Hemisphere can thus be labelled as such a “vulture fund”.




         3. F.G. HEMISPHERE FROM JERSEY TO THE U.K.

    3.1. TARGETED ASSETS

One of the proceedings instituted by F.G. Hemisphere was in Jersey, a British
crown dependency. F.G. Hemisphere claimed that the D.R.C. had assets in

2
  The actions of Vulture Funds have been criticized widely which can be summed up in the words
of U.N. independent expert on foreign debt and human rights as “ It is illogical to grant debt relief
to poor countries while at the same time allowing vulture funds to litigate against these countries
and thereby dilute the gains from debt relief”. See JUBILEE AUSTRALIA, Briefing Paper: Vulture Fund
(Jun. 2011), http://www.jubileeaustralia.org/_literature_87200/Briefing_Paper_-
_Preying_on_the_Poor_(2011).



                                                348
                                                                     University of Bologna Law Review
                                                                                         [Vol.2:2 2017]
                                                                        https://doi.org/10.6092/issn.2531-6133/7666




Jersey, which it could execute the outstanding amount of the awards against.
The targeted assets were the 20% shareholding held by La Générale des Carrières
et des Mines (hereinafter Gécamines), an S.O.E. of the D.R.C., in a joint venture
mining company called Groupement pour le traitment du Terril de Lumumbashi Ltd
(hereinafter G.T.L.).3 Also targeted was the right of Gécamines to receive certain
payments due to Gécamines by G.T.L. in respect of the supply of cobalt and
copper-bearing slag.4 F.G. Hemisphere accordingly argued that Gécamines was
an organ of the state and so its assets could be equated with those of the D.R.C.
in execution of the awards. Gécamines, on the other hand, argued that it was an
entity wholly independent of the D.R.C. and it could not be held liable for the
debts of the D.R.C.




    3.2. RULING BY THE ROYAL COURT

The Royal Court of Jersey found on the facts that Gécamines was an organ of the
D.R.C.5 Therefore, it held that the assets of Gécamines could be equated with
those of the D.R.C. and Gécamines could be held liable for the debts of the D.R.C.
In determining whether Gécamines was an organ of the D.R.C., the Royal Court
applied Lord Denning’s two-limb test as set out in the Trendtex case 6 and
considered (i) whether there was governmental control over Gécamines and (ii)
whether Gécamines exercised governmental functions.7

         In reaching its conclusion, the Royal Court examined (i) Gécamines’
constitutional position and (ii) the occasions on which the D.R.C. took the
assets of Gécamines for its own use without compensation. The Royal Court
considered two main factors as supporting F.G. Hemisphere’s contention that
Gécamines was an organ of the state. First, the Royal Court was of the view that
the review instigated by the D.R.C. of mining contracts since 2007 and the
recommendations made by the D.R.C. for renegotiation of the mining contracts




3
  See F.G. Hemisphere Associates LLC v. The Democratic Republic of Congo and La Générale des Carrières et
des Mines [2010] JRC 195, para. 6 (hereafter referred to as the ‘Royal Court judgment’ ).
4
  Id.
5
  Id. , paras. 140, 194.
6
  See Trendtex Trading Corp v. Central Bank of Nigeria [1977] 1 QB 529, 560C-D.
7
  See supra note 3, para. 16.




                                                  349
                                                         University of Bologna Law Review
                                                                             [Vol.2:2 2017]
                                                           https://doi.org/10.6092/issn.2531-6133/7666




left little room for departure by Gécamines.8 The renegotiated mining contracts
required private sector partners to pay substantial or substantially increased
premiums in order to enter into a joint venture with Gécamines to exploit
mining rights in the D.R.C.9 Under the renegotiated mining contracts,
Gécamines’ stance was that it was the rightful owner of these “entry fees”,
which constituted “part of its assets”.10 Instead of requiring all the “entry
fees” to be remitted to the State Treasury, the D.R.C. agreed to have half
remitted to the state and the other half to Gécamines.11 The Royal Court took the
unsuccessful bargaining by Gécamines with the D.R.C. in respect of its claim to
the “entry fees” into account in concluding that the D.R.C. controlled
Gécamines.12

       Secondly, the Royal Court relied on its finding that Gécamines was used
“as an instrument for the implementation of policies and projects of national
importance”.13 The project concerned was a massive inter-state infrastructure
project, which was to be funded by a Chinese consortium. 14 A joint venture
company, Sicomines, was formed by Gécamines and the Chinese consortium to
exploit mining rights in the D.R.C. However, revenue from Sicomines was to
fund not Gécamines’ activities, but the D.R.C.’s infrastructure project. The Royal
Court saw the mining rights as being mortgaged by Gécamines as security for
loan finance by the Chinese consortium for both the infrastructure project and
the Sicomines project.15 The Royal Court was of the opinion that were it not for
the “overall direction and control” of the D.R.C., this project would not have
been possible16 and Gécamines would not have been able to afford the
exploitation of these mining rights. The Chinese consortium was also required
to pay “entry fees” of US$350 million under the Sicomines project. Over 70%
of the “entry fees” were designated to go to the D.R.C. and the remaining to




8
   Supra note 3, para. 101.
9
   Supra note 3, para. 103.
10
   Supra note 3, para. 105.
11
   Supra note 3, para. 106.
12
   Supra note 3, paras. 103, 105.
13
   Supra note 3, paras. 109, 132.
14
    The Chinese consortium comprised the Export-Import Bank of China, China Railway and
Sinohydro.
15
   Supra note 3, para. 130.
16
   Supra note 3, para. 129.




                                         350
                                                                     University of Bologna Law Review
                                                                                         [Vol.2:2 2017]
                                                                        https://doi.org/10.6092/issn.2531-6133/7666




Gécamines.17      Again,     the     Royal     Court     viewed      this     as      supporting             F.G.
Hemisphere’s contention of “the Government making free with Gécamines”
revenue”.18

         Based on these two main factors, the Royal Court concluded that the
two limbs of the Trendtex test were satisfied, in that Gécamines was under
government control and carried out governmental functions. The Royal Court
stated, using rather strong language:19

           The picture that emerges strongly in Gécamines’ case is that of an
           entity which has in many ways been dressed in the garb of an
           independent body, but whose formal constitution counts for little or
           nothing when the state so chooses: a creature that has sometimes
           been allowed a considerable autonomy but which, when it matters,
           can be and is unceremoniously subjected to the controlling will of
           the state.

As such, the Royal Court held that Gécamines could be regarded as an organ of
the state and the assets of Gécamines were liable to execution in satisfaction or
part satisfaction of the awards.20




     3.3. RULING BY THE ROYAL COURT OF APPEAL

Gécamines then appealed to the Royal Court of Appeal, which affirmed the
findings of the lower court on similar grounds.21 Going further than the Royal
Court, the Court of Appeal was of the view that governmental control and the
exercise of government functions alone could not suffice to regard an entity as
an organ of the state. It was necessary that “the principal functions and
activities of the entity are properly to be viewed as governmental”, but there
need not be “any actual sovereign acts”.22 The Court of Appeal was satisfied




17
   Supra note 3, para. 120. US$250 million was to go to the State Treasury of the D.R.C. and the
balance to Gécamines.
18
   Supra note 3, para. 109.
19
   Supra note 3,para. 141.
20
   Supra note 3, para. 195.
21
   With Pleming J. dissenting.
22
   See F.G. Hemisphere Associates LLC v. The Democratic Republic of Congo and La Générale des Carrières et
des Mines [2011] JCA 141, paras. 71, 78.



                                                  351
                                                             University of Bologna Law Review
                                                                                 [Vol.2:2 2017]
                                                                https://doi.org/10.6092/issn.2531-6133/7666




that Gécamines had met this threshold and its assets could be equated with
those of the D.R.C.



     3.4. RULING BY THE PRIVY COUNCIL

This case then went up to the Privy Council, the highest court for British crown
dependencies. In La Générale des Carrières et des Mines v. F.G. Hemisphere
Associates LLC (hereinafter the Gécamines case),23 the Privy Council overturned
the decision of the Royal Court of Appeal. It held that Gécamines was not an
organ of the state but a separate entity. As such, the assets of Gécamines could
not be equated with those of the D.R.C. and it could not be held liable for the
debts of the D.R.C.

         The Privy Council considered that the Royal Court and the Royal Court
of Appeal incorrectly formulated and applied the Trendtex test in determining
whether a S.O.E. can be held liable for state debts. 24 The Board was of the view
that if constitutional and/or factual control alone sufficed, almost any state
trading corporation may then be liable for state debts. 25 The Board also pointed
out that this situation would be inconsistent with the common law and the
spirit of the United Kingdom’s State Immunity Act 1978 (hereinafter the 1978
Act),26 which took up the approach of the European Convention on State
Immunity.27 The Board quoted section 14 of the 1978 Act, section 14(1) of which
provides that immunity does not apply “to any entity (hereafter referred to as
a “separate entity”) which is distinct from the executive organs of the
government of the State and capable of suing and being sued.” Section 14(2)
goes on to list the only situations in which such a separate entity could be
immune in the courts of the United Kingdom. This, the Board stated, showed
that the 1978 Act was “at pains to recognise the separateness and distinctness
of state-owned corporations, notwithstanding they may have been entrusted




23
   [2012] UKPC 27; Privy Council Appeal No 0061 of 2011, 17 July 2012.
24
   Id., para. 51.
25
   Id., para. 19.
26
   State Immunity Act, 1978, c. 33 (U.K.).
27
   Council of Europe, European Convention on State Immunity, May 16th, 1972, ETS No. 074, 1495
U.N.T.S. 182. The 1978 Act was extended to Jersey by the State Immunity (Jersey) Order 1985.



                                             352
                                                                    University of Bologna Law Review
                                                                                        [Vol.2:2 2017]
                                                                       https://doi.org/10.6092/issn.2531-6133/7666




with public functions including activities involving the exercise of sovereign
authority.”28

The Board considered the traditional Saloman principle 29 that a company has
its own legal personality and the circumstances in which the corporate veil
could be pierced.30 However, the Board made it clear that a body could be
regarded as an organ of the state despite its separate legal personality. 31 This
meant that a separate legal personality was not conclusive as to whether an
entity was to be regarded as an organ of the state. 32 Although relevant, nor
were constitutional and factual control and the exercise of sovereign functions
without more conclusive.33 It follows from this statement that the Board
regarded the Trendtex test as insufficient or too simple a test in determining
whether Gécamines was an organ of the D.R.C. The Board went on to state:34

           . . . . Where a separate juridical entity is formed by the State for what
           are on the face of its commercial or industrial purposes, with its own
           management and budget, the strong presumption is that its separate
           corporate status should be respected, and that it and the State
           forming it should not have to bear each other's liabilities.

The Board set a rather high threshold for the assets of a state-owned entity to
be equated with those of the state. Extreme circumstances were required. To
displace the presumption, the affairs of the entity and the State had to be “so
closely intertwined and confused that the entity could not properly be regarded
for any significant purpose as distinct from the State and vice versa.”35 The
Board then stated an exception: “circumstances in which the State has so
interfered with or behaved towards a state-owned entity that it would be
appropriate to look through or past the entity to the State, lifting the veil of
incorporation.”36 The Board added that merely because a state’s conduct makes


28
   See supra note 22, para. 19.
29
   Salomon v. A. Salomon & Co Ltd [1897] AC 22.
30
   The Board accepted that a court is only justified to pierce the corporate veil if there is control by
the wrongdoer and some impropriety linked to the use of the company structure to avoid or
conceal liabilitysee Ben Hasham v. Ali Shayif [2008] EWHC 2380 (Fam), paras. 159-163.
31
   See supra note 22, para. 25.
32
   See supra note 22, para. 29.
33
   See supra note 22, para. 29.
34
   See supra note 22, para. 29.
35
   See supra note 22, para. 29.
36
   See supra note 22, para. 30.




                                                 353
                                                             University of Bologna Law Review
                                                                                 [Vol.2:2 2017]
                                                                https://doi.org/10.6092/issn.2531-6133/7666




it appropriate to lift the corporate veil to enable a creditor of a S.O.E. to look to
the state does not mean the creditor of a state could look to the S.O.E.37 In
respect of when the corporate veil could be lifted, the Board further considered
that “the international element may raise different considerations . . . . from
those that would arise under purely domestic circumstances.”38 Ultimately, the
Board decided, “an overall judgment is required as to whether “the required
degree of separation” is present”.39 In other words, whether the entity was an
organ of the state did not depend on a single factor, but on a consideration of
all the relevant circumstances.40

        The Board pointed out that the Royal Court and the Royal Court of
Appeal did not consider as important whether or not Gécamines was fulfilling a
sovereign function (acta jure imperii). 41 The Board further regarded the Royal
Court of Appeal as having adopted a very broad concept of government.42 By
this, the Royal Court of Appeal was stated to have unjustifiably considered
whether the functions, which could otherwise be viewed as ordinary trading
activities, were ancillary to a principal function of the government or functions
like carrying out government policies.43 The Board was of the view that the
Royal Court of Appeal diluted the approach to sovereign activity as indicated by
Lord Wilberforce in Il Congresso del Partido: that mere governmental purpose
or motive did not convert a commercial act into a sovereign act and that it was
necessary to consider the whole context of the activity to see whether it was
sovereign in nature.44

        On an examination of the constitution and activities of Gécamines, the
Board decided that Gécamines was not an organ of the D.R.C. and F.G.
Hemisphere could not look to its assets for enforcement. There was also no
justification to lift the corporate veil. 45 The fact that Gécamines was controlled
by the D.R.C. was not surprising to the Board, because, after all, it was a

37
   See supra note 22, para. 30.
38
   See supra note 22, para. 42.
39
   See supra note 22, para. 34.
40
   See ANDREW DICKINSON, RAE LINDSAY & JAMES P. LOONAM, STATE IMMUNITY, SELECTED MATERIALS AND
COMMENTARY (2004).
41
   See supra note 22, paras. 44, 45.
42
   See supra note 22, para. 45.
43
   See supra note 28, paras. 45, 47.
44
   See supra note 22, paras. 46, 47.
45
   See supra note 22, para. 77.




                                            354
                                                              University of Bologna Law Review
                                                                                  [Vol.2:2 2017]
                                                                 https://doi.org/10.6092/issn.2531-6133/7666




S.O.E.46 Nor was the fact that Gécamines assisted, promoted and advanced
development,      prosperity     and    economic      welfare    and       carried         out      such
government policies. The reasoning of the Board was that such features were
“of the essence of many state-controlled corporations’ functions’ and did not
make them part of the state.”47 The Board also addressed the two principal
areas relied on by the Royal Court as supporting F.G. Hemisphere’s case: (i) the
mining review instigated by the D.R.C. and the treatment of the “entry fees”
and (ii) the Sicomines transaction.

        In relation to the review instigated by the D.R.C. of the mining
contracts, the Board was of the view that Gécamines’ position was one of
insisting on its right to set-off the “entry fees” paid to the D.R.C. against its
tax and other liabilities.48 This suggested that Gécamines considered itself an
entity with interests separate from the D.R.C. It was:49

          A real and functioning corporate entity, having substantial assets
          and a substantial business including interests in over thirty joint
          ventures with outside concerns. It had its own budget and
          accounting, its own borrowings, its own debts and tax and other
          liabilities and its own differences with government departments.

As for the Sicomines transaction, the Board disagreed with the Royal Court that
Gécamines was “unceremoniously subjected to the controlling will of the state”
because not only did the D.R.C. contribute to the transaction, Gécamines derived
real commercial benefits from the transaction.50 The Board concluded that
neither of the two areas relied on by the Royal Court went to show that
Gécamines was exercising sovereign functions.




        4. F.G. HEMISPHERE IN HONG KONG

46
   See supra note 22, para. 43.
47
   See supra note 22, paras. 44, 48, 54.
48
   See supra note 22, paras. 61, 68.
49
   See supra note 22, para. 70.
50
   See supra note 22, para. 69. These commercial benefits are, as pointed out by the Board, the
US$50 million loan made to Gécamines by the Chinese consortium, the US$100 million premium
(part of the “entry fees” to be paid by the Chinese consortium), the US$32 million loan made to
Gécamines by the Chinese consortium to enable it to subscribe for shares in Sicomines and
Gécamines’ 30% shareholding in Sicomines.



                                             355
                                                                    University of Bologna Law Review
                                                                                        [Vol.2:2 2017]
                                                                       https://doi.org/10.6092/issn.2531-6133/7666




F.G. Hemisphere was also involved in a spate of litigation in Hong Kong. This
time, the assets targeted for execution of the awards against the D.R.C. were
the part of the “entry fees” to be paid by the Chinese consortium to the D.R.C.
under the Sicomines transaction.51 The case went up all the way to the Court of
Final Appeal.52 The two main issues before the Hong Kong courts in this case
were whether (i) the doctrine of restrictive immunity or the doctrine of
absolute immunity applied to Hong Kong post-handover and (ii) whether the
D.R.C. had waived any immunity by virtue of agreeing to the application of the
I.C.C. Rules.53 This paper does not aim to go into a detailed discussion of the
issues.54 Instead, the focus is on how the courts viewed the “entry fees” under
the Sicomines transaction for the purposes of execution of the awards.

         The Court of Final Appeal, however, did not go to the issue of execution
against the “entry fees” because it had already held that the D.R.C. was
absolutely immune from proceedings. The majority opinion was that following
the handover in 1997, Hong Kong followed the doctrine of absolute immunity,
consistent with the People’s Republic of China (hereinafter P.R.C.).55 It also
held that there had been no waiver of immunity by the D.R.C. The judgment of
the Court of Final Appeal was provisional as the majority was of the view that
the Court was obliged to seek an interpretation from the Standing Committee
of the National People’s Congress (hereinafter NN.P.C.S.C.) of the Basic Law
provisions engaged pursuant to Article 158(3) of the Basic Law. Upon receiving
the sought interpretation from the N.P.C.S.C., the Court of Final Appeal


51
   Then believed to be US$221 million (as opposed to the US$250 million figure stated in the
Gécamines case). See F.G. Hemisphere Associates LLC v. Democratic Republic of Congo & Ors [2009] 1 HKC
111, para 4 (Hong Kong Court of First Instance) (hereafter referred to as the ‘C.F.I. judgment’).
52
   See Democratic Republic of Congo & Ors v. F.G. Hemisphere Associates LLC FACV Nos. 5,6,7 of 2010, 8th
June 2011 (Hong Kong Court of Final Appeal) (hereafter referred to as the ‘C.F.A. judgment’).
53
   See Int'l Chamber of Commerce [ICC], International Chamber of Commerce Arbitration Rules
1998 art. 28, para. 6, which governed the 2 ICC arbitrations, provides: ‘Every Award shall be
binding on the parties. By submitting the dispute to arbitration under these Rules, the parties
undertake to carry out any Award without delay and shall be deemed to have waived their right to
any form of recourse insofar as such waiver can validly be made.’
54
    These have been discussed in detail see Rajesh Sharma, Enforcement of Arbitral Awards and
Defence of Sovereignty: The Crouching Tiger and the Hidden Dragon, LAPLAND L. REV., no 1, 2011, at 252.
55
   Application of absolute immunity in Hong Kong by China has been seen negatively from the
international arbitration perspective. See generally Ashley Bell, Big Trouble in ‘Little China, 28 J.
INT’L ARB. 643-652 (2011). Nicholas A. Brown & James D.A. Lewis, Game of Thrones: A Narrowing
Immunity?, 30 J. INT’L ARB. 689-700 (2013); Nicholas Pengelley, Waiver of Sovereign Immunity from
Execution: Arbitration is Not Enough, 26 J. INT’L ARB. 859-872 (2009); TERESA CHEN & ADRIAN LAI,
Lesson Learned From the FG Hemisphere and Huatianlong Case, ARBITRATION-ICCA.ORG,
http://www.arbitration-icca.org/media/4/13523372058325/media1132342764462706-
lessons_learned_from_the_fg_hemisphere_vs_drc_and_huatianlong_case.pdf.



                                                 356
                                                                   University of Bologna Law Review
                                                                                       [Vol.2:2 2017]
                                                                      https://doi.org/10.6092/issn.2531-6133/7666




confirmed its provisional judgment as the interpretation was consistent with
it.56

However, in the courts below, the issue of execution in relation to the “entry
fees” was relevant as they had held that the doctrine of restrictive immunity
applied.57 It was then important for the courts to determine whether the
Sicomines transaction was one of a commercial nature such that it fell within
the exception to the doctrine of restrictive immunity.58




     4.1. HIGH COURT OF HONG KONG

In the High Court, Justice Reyes held the view that the Sicomines transaction
was not of a commercial nature.59 First, Justice Reyes considered that the
transaction was executed under the umbrella cooperation agreements between
the P.R.C. and the D.R.C.60 The Sicomines transaction was an inter-state one
between the P.R.C. and the D.R.C., notwithstanding the fact that the Chinese
side entered into the transaction through corporations. 61 The corporations, he
noted, were state owned.62

         Second, His Justice derived from the fact that the Sicomines transaction
was “massive and ambitious” that it was not a “routine trading operation” – it
could only have been carried out with state backing. 63 His Justice further noted




56
   Democratic Republic of Congo & Ors v. F.G. Hemisphere Associates LLC FACV Nos. 5,6,7 of 2010, 8
September 2011 (Hong Kong Court of Final Appeal).
57
   Justice Reyes, in the High Court did not express a definitive view of which doctrine applied. His
provisional view was that the common law restrictive immunity approach applied to Hong Kong.
It was not necessary for him to conclude on the applicable approach because he held that the
Sicomines transaction was not of a commercial nature. Therefore, it fell within the exception to
restrictive immunity which meant that whether Hong Kong followed restrictive or absolute
immunity, the D.R.C. was immune in either case: see supra note 51, paras. 69, 70.
58
   As a general trend if a property of a State-owned enterprise which is kept and used specifically
for the fulfillment of sovereign functions or used for sovereign purposes is immune from
attachment or execution. See A.F.M. Maniruzzaman, State Enterprises Arbitration and Sovereign
Immunity Issues: A Look at Recent Trends, DIS. RESOL. J., Aug.-Oct. 2005, at 1-8..See also the trend in
the context of investment arbitration in Paul Blyschak, State-Owned Enterprises and International
Investment Treaties: When Are State-Owned Entities and Their Investments Protected, 6 J. INT’L L. AND
INT’L REL., no. 2, 2011, at 1-52.
59
   See supra note 51, para. 83.
60
   See supra note 51, para. 85.
61
   See supra note 51, para. 86.
62
   See supra note 51, para. 86.
63
   See supra note 51, paras. 87, 89.




                                                 357
                                                                   University of Bologna Law Review
                                                                                       [Vol.2:2 2017]
                                                                      https://doi.org/10.6092/issn.2531-6133/7666




that the infrastructure project involved was for “the development of the whole
of the D.R.C. for the economic benefit and well-being of its citizens.”64

Third, Justice Reyes believed that the agreements were not conventional for a
trading contract.65 For instance, there were provisions dealing with tax and
customs duties exemptions. Visas and work permits were also assured for
expatriate staff in that contract. Justice Reyes opined that these terms could
only be stipulated by a state in the exercise of its sovereign power. 66

         Lastly, His Justice was of the view that a state could exact the “entry
fees” in consideration of the licence to exploit the D.R.C.’s mineral rights.67 His
Justice concluded that these features were the “hallmarks of the exercise by
states of sovereign authority in the interests of their citizens.”68 His Justice
held that even if the “entry fees” were an asset of the D.R.C., the D.R.C. could
raise immunity from execution because the transaction was not of a
commercial nature, and the D.R.C. had not waived its immunity.69




     4.2. COURT OF APPEAL

Consistent with Justice Reyes’ provisional view, the majority in the Court of
Appeal held that Hong Kong continued to follow the common law doctrine of
restrictive community following the resumption of sovereignty by the P.R.C. in
1997.70 The Court of Appeal was also of the view that submission to arbitration
under the I.C.C. Rules did not amount to a waiver of immunity by the D.R.C.




64
   See supra note 51, para. 88.
65
   See supra note 51, para. 90.
66
   See supra note 51, para. 90.
67
   See supra note 51, para. 91.
68
   See supra note 51, para 92.
69
   See supra note 51, paras 145, 110, 117, 121. For a critical view of the approach of Justice Reyes
taken in regards to the relevant ICC Rules as simply a waiver of the right of challenging an
enforcement by D.R.C. and not as waiving the right of immunity from execution see Nicholas
Pengelley, Waiver of Sovereign Immunity from Execution: Arbitration is Not Enough, 26 J. INT’L ARB 859,
866. For a detailed survey of I.C.C. cases relating to liability of state for its instrumentalities see
Eduardo Silva Romero, Are State Liable for the Conduct of their Instrumentalities: ICC Case Law, in 4
STATE ENTITIES IN INTERNATIONAL ARBITRATION ,THE INTERNATIONAL ARBITRATION INSTITUTE 31-55
(Emmanuel Gillard & Jennifer Yunan eds., 2008).
70
   [2010] 2 HKC 487, para. 122 (Hong Kong Court of Appeal) (hereafter referred to as the ‘C.A.
judgment’). With Hon Yeung JA dissenting, para 228.



                                                 358
                                                              University of Bologna Law Review
                                                                                  [Vol.2:2 2017]
                                                                 https://doi.org/10.6092/issn.2531-6133/7666




However, the Court held that Justice Reyes had applied the wrong test in
determining whether the “entry fees” were immune from execution. 71 Counsel
for F.G. Hemisphere contended that the correct test was to look at the intended
purpose of the assets sought to be attached. The Court of Appeal agreed that
Justice Reyes had wrongly made reference to the nature of the Sicomines
transaction, which gave rise to the “entry fees” liability.72 The nature of the
underlying acts was relevant to the first stage when immunity from suit is
considered,73 and not at the execution stage. At the execution stage, the correct
test was to consider what the intended purpose of the “entry fees” was. 74 If the
“entry fees” were to be used for a sovereign or public purpose, they could not
be subjected to execution.75 If they were for purely commercial purposes, the
awards could be enforced against such an amount.76

        The Court of Appeal found that there was evidence suggesting that
“entry fees” going to the D.R.C. were to be used for its budget.77 Subject to
further findings of fact, the Court was of the view that this amount was
immune from execution as it was for a public purpose. 78 What was interesting
was the Court’s statement that “the plaintiff has shown a good arguable case
for injunctions over the Gécamines tranche” because this part of the “entry
fees” was intended for a commercial purpose.79 This goes to show that the
Court saw that there was a good arguable case that Gécamines’ assets could be
assimilated with those of the D.R.C. On this issue, the court ordered an
“inquiry to determine to what extent, if any, the entry fees . . . . are intended
by the D.R.C. for payment to Gécamines and, further, whether the amount thus



71
   With Hon Yeung JA dissenting on this point, Id, paras. 242, 243.
72
   See supra note 70, para. 179.
73
   The relevant acts in this case were those in relation to the entry by the D.R.C. into credit
agreements with Energoinvest. Hon Yuen JA therefore rightly stated that Justice Reyes had not
considered whether such acts were commercial or sovereign in ‘nature’ for the purposes of
determining whether the D.R.C. was immune from the jurisdiction of Hong Kong courts, under the
doctrine of restrictive immunity. Hon Yuen JA was of the view that it was clear that the
transactions were commercial in nature as they were financing arrangements. Accordingly, the
D.R.C. was not immune from being impleaded in Hong Kong courts under the doctrine of
restrictive immunity: Supra note 70, paras 268, 269.
74
   See supra note 70, para. 179.
75
   See supra note 70, paras. 179, 276.
76
   See supra note 70, paras. 179, 276.
77
   See supra note 70, para. 179.
78
   See supra note 70, paras. 179, 276.
79
   See supra note 70, paras. 179, 276.




                                             359
                                                                 University of Bologna Law Review
                                                                                     [Vol.2:2 2017]
                                                                    https://doi.org/10.6092/issn.2531-6133/7666




payable is amenable to or immune from execution”.80 Unfortunately, the Court
on this issue did not go any further.




         5. THE GÉCAMINES CASE – IS IT BASED ON PRINCIPLE?

It is submitted that the simple way of disposing of the case would have been to
determine whether Gécamines’ assets which were being sought to be attached
were for commercial or sovereign purposes. If they were for commercial
purposes, these assets would have been available to F.G. Hemisphere for
execution of the awards because of the doctrine of restrictive immunity. If they
were for sovereign purposes, these assets would have been immune from
execution. It is likely that the courts would have arrived at the former
conclusion given the extensive operation of Gécamines in the commercial arena.
F.G. Hemisphere would accordingly have been able to execute the awards
against Gécamines’ assets. Yet the courts in Jersey went a step back to look at
whether Gécamines’ assets could be said to belong to the D.R.C. for the purposes
of execution of the awards against the D.R.C. This was crucial to the case
because F.G. Hemisphere could not pursue the assets of an entity which was
not an organ of the D.R.C. The difficult question then arose as to the applicable
principles to determine whether an entity could be held responsible for the
state’s liability.81

         This Trendtex test was approved in the Kensington case by Cooke J, who
stated that the relevant factors to determine whether a body was entitled to
immunity from suit could apply to determine whether a particular body could
be held liable for the state’s debts.82 Yet the Board considered the test of
“governmental control and function” in the Trendtex case as inconclusive,
albeit relevant. Accordingly, even upon an examination of a                                       S.O.E.’s
constitution, powers, duties and activities, a court would not be able to
determine conclusively whether or not the S.O.E. is an organ of the state. Based

80
   See supra note 70, para. 284.
81
   The debate of this issue is still alive and a survey of various jurisdictions has not shown any
conclusive approach. For further discussion, see A.F.M Maniruzzaman, “State Enterprise
Arbitration and Sovereign Immunity Issues: A Look at Recent Trends”, pp.1-8.
82
   See Kensington International Limited v. Republic of Congo [2005] EWHC 2684 (Comm.) paras. 52, 53.




                                               360
                                                               University of Bologna Law Review
                                                                                   [Vol.2:2 2017]
                                                                  https://doi.org/10.6092/issn.2531-6133/7666




on the Board’s decision, the starting point for a court would be to presume that
a S.O.E. is a separate legal entity, because of its separate legal personality. It
would be extremely difficult for the court to justify that the S.O.E. is an organ
of the state. This would only be possible in the rare circumstances where the
affairs of the S.O.E. and the state are “so closely intertwined and confused”
that the S.O.E. cannot be regarded for “any significant purpose” as distinct
from the state.83

        In holding that there was a strong presumption that an S.O.E. with its
own management and budget was an entity distinct from the state, the Privy
Council gave due respect to the tradition Salomon principle. However, the
Board has by no means set out clear principles as to when an entity is to be
regarded as “distinct” from the state. It is argued here that the Trendtex test
provides a much more principled approach, or at least a starting point for the
courts. In looking into whether an entity exercises governmental function, the
purpose that it serves automatically comes into play. If the purpose of the
S.O.E. “is to assist, promote and advance the industrial development,
prosperity and economic welfare of the area in which it operates”, it is
carrying out government policy and assumes the position of an organ of the
state.84 This can by all means be through the carrying out of commercial
activity, like Gécamines was.

        However, the Board disapproved of this approach in relation to
Gécamines and was of the view that it was the overall context that mattered.85
The very thing that the Board went on to examine in deciding whether or not
Gécamines was an organ of the state was its constitution and activities. Whether
the “overall context” that the Board cited to reach its conclusion that
Gécamines was not an organ of the state remains unclear. The Royal Court of
Jersey and the Royal Court of Appeal had seemingly also considered the
“overall context” when one looks to the matters that were raised and


83
   See supra note 22, para. 29.
84
   See supra note 22, para 53 (Cooke J.).
85
   There has been an argument that sometimes, even where motive and purpose are judged
irrelevant to determining the commercial character of an activity, reference has been made to the
context in which the activity took place. See Yearbook of the International Law Commission 1999
para. 49, 2 Y.B. Int'l L. Comm'n, A/CN.4/SER.A/1999/Add.l (Part 2), as quoted in A.F.M
Maniruzzaman, “State Enterprise Arbitration and Sovereign Immunity Issues: A Look at Recent
Trends”, p. 3.



                                              361
                                                                    University of Bologna Law Review
                                                                                        [Vol.2:2 2017]
                                                                      https://doi.org/10.6092/issn.2531-6133/7666




considered. It is difficult to understand why the Board did not value the
overwhelming control by the D.R.C. over Gécamines and the fact that Gécamines’
assets originated from the D.R.C.86 It appears that the Board had simply
imposed its own view on the facts, and justified intervention by holding that
the lower courts had applied an incorrect test. 87




          6. GÉCAMINES’ STATUS CONSIDERED IN HONG KONG

Although the status of Gécamines was not a central issue in the Hong Kong
courts, F.G. Hemisphere did submit that Gécamines was merely an agent or
front acting for the D.R.C.88 such that the entire amount of “entry fees”
belonged to D.R.C. However, further findings of fact were necessary for the
Hong Kong Court of Appeal to come to a conclusion, so it proceeded on the
assumption that the “entry fees” were due to the D.R.C. in deciding whether
the D.R.C. was immune.89

          Even so, it is interesting to note that the Court of Appeal considered
there to be an arguable case for injunction over the Gécamines tranche of the
“entry fees”. The Court viewed that this part would have been used by
Gécamines for commercial purposes and so immunity against execution was not
available. His Honourable Justice of Appeal Yuen adopted the factors listed by
Justice Reyes to support why he considered it arguable that the “entry fees”
were the D.R.C.’s assets.90 Remarkably, these factors are in line with the
considerations that contributed to the Jersey courts’ holding that Gécamines
was an organ of the D.R.C., namely: the Sicomines transaction was made
possible only because it was an inter-state one between the D.R.C. and the
P.R.C.;   91
               the Sicomines transaction was of national importance for the benefit
of the public;92 and the D.R.C. made free use of Gécamines’ revenue.93


86
   See supra note 22, para. 54.
87
   See supra note 22, para. 51.
88
   See supra note 51, para 28; Supra note 70, para. 275.
89
   See supra note 70, para. 172.
90
   See supra note 70, 275.
91
   See supra note 51, para. 85; cf supra note 3, para. 129.
92
   See supra note 51, para. 88; cf supra note 3, paras. 109, 132.




                                                   362
                                                               University of Bologna Law Review
                                                                                   [Vol.2:2 2017]
                                                                 https://doi.org/10.6092/issn.2531-6133/7666




         It may be said that the Court of Appeal found it arguable that Gécamines’
assets could be equated with those of the D.R.C., for it was only then that the
Gécamines tranche could be subjected to enforcement for D.R.C.’s liability. Of
course, one might be stretching this argument too far — just because the Court
found it arguable on the facts that the “entry fees” in the Gécamines tranche
belonged to the D.R.C. does not mean Gécamines’ entire asset pool can be
equated with that of the D.R.C. Pursuing this line of argument would be too
narrow approach as the sole consideration taken into account is the Sicomines
transaction. Nevertheless, at the very least, the strong similarity in the
reasoning of the Jersey courts and the Court of Appeal cannot be overlooked.




         7. THE IMPACT OF THE GÉCAMINES CASE ON FUTURE CASES

This being a Privy Council case, it would only be binding on all courts in
Commonwealth countries, the U.K.’s overseas territories and British Crown
Dependencies. As for the U.K. and Hong Kong, it is likely to be highly
persuasive if a question arises as to whether an S.O.E.’s assets can be pursued
by the creditors of the state. The courts would have to decide whether the
S.O.E.’s assets can be said to belong to the state, in other words, whether the
S.O.E. is an organ of the state.94




     7.1. WHERE THE LIABILITY IS INCURRED BY THE STATE

Creditors may want to go after the assets of an S.O.E. to execute an award made
against the state, as in the Gécamines case. To justify execution against the
assets of an S.O.E., the creditor would seek to argue that the S.O.E. is an organ
of the state such that its assets can be equated with those of the state. If the
Gécamines case is followed in future cases, there would be a strong
presumption that an S.O.E. is a separate entity. Extreme circumstances would
be required to displace such a presumption. When the S.O.E. is found as a

93
  See supra note 51, para. 91; cf supra note 3, para. 109.
94
   This paper does not focus on the situation where state-owned enterprises might be a claimant.
On this point see generally Mark Feldman, State-Owned Enterprises as Claimant in International
Investment Arbitration, 31 ICSID REVIEW, no. 1, 2016, at 24-35.



                                              363
                                                                    University of Bologna Law Review
                                                                                        [Vol.2:2 2017]
                                                                       https://doi.org/10.6092/issn.2531-6133/7666




separate entity and not a sham, its assets cannot be equated with those of the
state for the purposes of execution of arbitral awards by creditors. If,
considering the overall context, the S.O.E. is found to be an organ of the state,
its assets can be equated with those of the state and creditors can go after
them. It would then be up to the S.O.E. to raise the defence of immunity from
execution. The assets of the S.O.E. may or may not be immune from execution
depending on the intended purpose of the assets sought to be attached. If the
assets are intended for commercial use, no immunity is available and the
creditors can execute their awards against such assets under the doctrine of
restrictive immunity. If the assets are for a sovereign or public purpose, they
would be immune from execution.

           In Hong Kong courts, in the absence of clear waiver of immunity from
execution provisions or an unequivocal waiver by the state in the face of the
courts, creditors are unable to implead a State in the execution of an award
against the state because of the application of the doctrine of absolute
immunity.95 Even if an S.O.E. is found to be an organ of the state, its assets
would be absolutely immune from execution. Whether the S.O.E. is a separate
entity or an organ of state would produce the same result — one where the
creditor cannot pursue the S.O.E.’s assets. It would therefore be unnecessary
for a Hong Kong court to consider whether an S.O.E. is an organ of the state
where the creditor is seeking to execute an award against a state. Going into an
examination of the status of an S.O.E. would merely be academic. This leaves
little room for the application of the Gécamines case in this context.




      7.2. WHERE LIABILITY IS INCURRED BY THE S.O.E.

The converse of the scenario in the Gécamines case is where the state’s assets
are being targeted by a creditor of its S.O.E. This may occur where the S.O.E. is
considered insolvent, for example. It is likely that courts would apply the same
reasoning to this scenario. The starting point would again be to consider
whether        there     are   extreme      circumstances        which      displace          the      strong
presumption that the S.O.E. is a separate entity, or whether the S.O.E. was


95
     See supra note 51 and as confirmed in the interpretation of the Basic Law by the N.P.C.S.C.




                                                  364
                                                       University of Bologna Law Review
                                                                           [Vol.2:2 2017]
                                                          https://doi.org/10.6092/issn.2531-6133/7666




simply a sham. If the S.O.E. is found be a separate entity and not a sham, its
assets cannot be equated with those of the state. This would mean that the
creditors of the S.O.E. will not be able to look to the state’s assets for execution.
If, considering the overall context, the S.O.E. is found to be an organ of the
state, its assets can be equated with those of the state. Then, creditors can go
after state assets provided that they are intended for commercial purposes.

       Again, the situation in Hong Kong would be different as it follows the
doctrine of absolute immunity. Even if an S.O.E. is an organ of the state, both
its assets and those of the state are absolutely immune from execution, in the
absence of a clear waiver. This is regardless of what purpose the assets sought
to be attached serve. If the S.O.E. is a separate entity, a creditor can certainly
not seek execution against the assets of the state. The creditor can only seek to
execute the award against the assets of the S.O.E., which would have no
immunity from suit or execution if it is a separate entity. Again, it is argued
that the relevance of the Gécamines case with respect to the execution stage is
limited in Hong Kong courts. Whether or not a S.O.E. is an organ of the state
goes only so far as to determine whether it has immunity from suit or
execution against its own assets. Any examination by Hong Kong courts of the
S.O.E.’s status for the purposes of execution against state assets would only
serve an academic purpose.




       8. CONCLUSION

Increasingly, states are using their S.O.Es to enter into transactions with others
parties. With the precedent set by the Gécamines case, the separate legal
personality of S.O.Es is to be respected and they are likely to be considered
separate entities, unless there are exceptional circumstances to justify
assimilating between them and the state. What this would mean on the one
hand is that S.O.Es will be increasingly shielded from the creditors of the state,
and on the other, S.O.Es would face a high hurdle in raising the defence of
immunity. Conversely, if S.O.Es are presumed to be separate entities, states are
less likely to be held responsible for the liabilities of S.O.Es. Overall, this




                                        365
                                                               University of Bologna Law Review
                                                                                   [Vol.2:2 2017]
                                                                 https://doi.org/10.6092/issn.2531-6133/7666




provides a holder of an arbitral award with fewer targets for enforcement. The
impact of the Gécamines case on future similar Hong Kong cases remains to be
seen — but it is suggested that it would be limited and would not go beyond
determining whether an S.O.E. has immunity from suit.

        One might naturally ask whether the Privy Council had underlying
policy considerations due to the fact that a vulture fund was involved. After all,
F.G. Hemisphere was a vulture fund that spanned several jurisdictions and was
aggressively pursuing the full amount of a debt that it had bought at a huge
discount.96 Perhaps the Board had in mind wider equitable considerations,
especially since it seemed to have adopted a wholly novel approach to the issue
at hand. The interesting question is whether this case would have been decided
in the same way were the enforcement proceedings between the original
parties to the arbitral agreement.




96
  F.G. Hemisphere also won a case the New South Wales, Australia where the court allowed US$30
million to recover against D.R.C. See VANDA CARSON, Vulture Fund Wins Case Against Cash-strapped
Congo, SMH.COM.AU (Dec. 22, 2010), http://www.smh.com.au/business/vulture-fund-wins-case-
against-cashstrapped-congo-20101221-194fj.html. The decision of the court allowing this vulture
fund against poor country like D.R.C. was heavily criticized. See James Bai, Stop Them Circling:
Addressing Vulture Fund in Australian Law, 35 SYDNEY L. REV. 703-730 (2013).



                                             366
