Introduction (2006)
The following Note was written during my time in law school and was published, under my legal name, in the Wisconsin International Law Journal, vol 11, no. 2 (spring 1993). It seems not to have gone completely unnoticed; a few years ago someone wrote requesting permission to reprint part of it in an anthology, though I don't know if anything came of that.
In writing it, I was attempting to comply with the standard requirements of legal writing and reasoning, and hope not to have deviated too much from same. Nearing the conclusion, however, I found myself recurring to the global vision, derived from Celan's "Meridian" speech (see the article "Celan's Planetary Vision" on the "Homage to Paul Celan" page), that had also been reflected in The Consciousness of Earth.
The version below, due to technical difficulties, has lost most of the formatting which was painstakingly applied per the then latest handbook; and the Notes which appear at the end have lost their reference numbers in the text. However, I believe the ideas will still be clear, and anyone in search of scholarly accuracy can either look up the print version or obtain the WordPerfect file by emailing me at derondareview@att.net.
-- Esther Cameron
Beatrice A. Cameron
GLOBAL ASPIRATION, LOCAL ADJUDICATION:
A CONTEXT FOR THE EXTRATERRITORIAL APPLICATION OF ENVIRONMENTAL
LAW
The earth, that yielded us at last the metals,
the fuels, to thrust ourselves beyond its grip,
to where it now appears to us, so small,
as if it fit a thumb and finger's compass . . .
and at the same time here we are, caught up,
as ever, in the illimitable web
woven by life, sustaining us and all,
and if we tear this from the earth, we perish.
-- The Consciousness of Earth
Think globally, act locally.
-- Green Party slogan
TABLE OF CONTENTS
I. Introduction
II. Alternatives
III. The Framework of International Jurisdictional Principles
IV. Extraterritoriality in U.S. Courts
A. The Evolution of Extraterritoriality in Anti-Trust and Securities Litigation
B. Extraterritoriality in Labor Cases
C. Extraterritoriality in Environmental Cases
D. Substantive International Law As a Basis for Decisions
V. The Codemaking Process and its Discontents
A. Environmental Law in Restatement (Third) of Foreign Relations
B. The OECD Guidelines and the UN Draft Code
C. The Goal of an "Earth Charter"
VI. The "Ombudsmen for Future Generations": Bridge across the Information Gap?
VII. Summary and Conclusion
I. Introduction
In recent decades, a perception that human technology and demands pose a threat to the global
ecosystem has prompted a reexamination of basic values in various fields. In the field of law, this
situation has suggested the concept of "planetary obligations." In the view of Edith Brown Weiss,
these obligations are incumbent on the present generation of living humans as a whole, and derive
from the basic duty to pass on their environmental heritage in good condition to future generations.
In the view of Christopher Stone, the ecological crisis suggests that natural objects, no less than
human beings, should have rights. However, an extensive legal articulation of these concepts has
yet to occur.
One aspect of the crisis is a mismatch between the interrelatedness of the global ecology and the
parcelling-out of environmental regulation among nation-states whose authority for most purposes
ends at their borders. Various solutions to this problem have been advocated. Among other things,
it has been suggested that the courts of the several nations should use their extraterritorial authority
more extensively to enforce environmental law.
In order to assess the extraterritorial solution, this Note will look at extraterritoriality in context,
with the following four questions in mind:
How does this solution compare with the available
alternatives in potential for effectiveness in preserving the environment?
What assumptions andvalues are implied in the choice among these alternatives?
What is the likelihood that this solution will be adopted?
And finally, under what conditions could extraterritoriality be used effectively?
II. Global Regulation: The Alternatives
Three basic alternatives for global regulation may be distinguished: the creation of international
agencies with regulatory authority, the establishment of treaties and conventions among the several
nations, and the extraterritorial enforcement of environmental law by the courts of the several
nations.
Extraterritorial enforcement differs from the alternatives in that it creates no entities whose scope
of authority corresponds to the scope of the problem. Instead, it makes the individual state the
arbiter of global norms. In the words of one critic, it accords to the court of a nation state the role
of an "impartial tribunal." Arguably, this implies the danger that such a court might favor the
citizens of its own nation while burdening the citizens of other nations, with international friction
an inevitable result. In fact, attempts by the United States to enforce certain of its laws
extraterritorially have been decried as "imperialism" and have provoked retaliation abroad.
If despite this obvious difficulty extraterritoriality been advocated as a response to global
environmental problems, this may be partly due to the slowness of international process. As one
commentator puts it, the "grail of supranational authority" has proved elusive, due to states'
reluctance to give up their sovereignty. The International Court of Justice has heard only a handful
of environmental cases. Again and again, national governments have refused to ratify the product
of long and difficult treaty negotiations. On the international level, the warnings sounded by
scientists and environmental activists have often seemed to produce more negotiation, theorization,
and political posturing than effective regulation. Whether the legacy of the United Nations
Conference on Environment and Development (UNCED) which was held in Rio in June, 1992, will
change this perception, is still unclear.
As against attempts to create supranational authority, extraterritorial adjudication has the
advantage that its infrastructure is already in place. At least some nations have already passed far-
reaching environmental laws and have relatively effective mechanisms for enforcing them.
International law has long recognized the need for states to apply their laws beyond their own
borders, and in the twentieth century the scope of this permission has been expanding. In certain
areas law, notably securities and antitrust, the exercise of extraterritorial jurisdiction is already
standard practice, and despite the initial friction may be tending toward a universalization of norms
(see discussion infra).
It is true that a certain regime of international regulation is gradually being developed by such
regional groupings as the EEC, LAFTA, SEAN and the Andean Group. As the increasing
cohesiveness of the EEC inspires greater cohesiveness in other regions, these groupings, rather than
either world government or extraterritoriality, represent the wave of the future.
But this market-driven type of regional development may not be good news for the
environment. There is a growing perception that these groupings are bound to strengthen the hand
of the multinational enterprises which, along with governments, are the major actors in the global
environment. In September, 1991, a panel convened by the Council of the General Agreement on
Tariffs and Trade (GATT) set off widespread alarm among environmentalists by holding that United
States restrictions on tuna imports under its Marine Mammal Act violated the GATT treaty. Amid
the resulting furor, GATT in October, 1991, decided to "revive" its Working Group on Trade and
the Environment which, though formed twenty years ago, has never met; however, no date was set
for a meeting of the "revived" group. In recent months, too, the maquiladora plants south of the
U.S.-Mexico border have cast North American efforts at market unification into an ugly light from
the environmental as well as humanitarian standpoint.
It is conceivable that strengthened institutions of world government might strengthen the
hand of national governments vis-a-vis the regional economic groupings. At the UNCED
conference, the Secretary General of the International Court of Justice, Eduardo Valencia-Ospina,
pointed out that court has both the authority and the precedent to develop an expanded body of
international environmental law. Such a jurisprudence would, on the face of it, have a chance of
being driven by global concerns rather than regional rivalries. On the other hand, world government
arguably shares regional government's vulnerability to influence by multinational interests; as an
indicator, the World Bank's environmental record is ominous.
The ultimate motive for urging extraterritorial adjudication may be a mistrust of supranational
regulation, a sense that "small is beautiful," very relatively speaking. It is arguable that as
government goes multinational, its centers increasingly distant from the grass roots, it becomes more
vulnerable to the influence of the multinational corporations. Moreover, large and intrusive as the
United States government may be, the addition of a supranational layer of government threatens
further magnification of power and increased intrusiveness. As a response to these anxieties,
extraterritorial jurisdiction thus offers the nation a possible means of defending the public interests
it purportedly represents against large concatenations of private interests.
The nation thus occupies an ambiguous position in the field of the global environmental problem.
On the one hand, the nation stands for parochialism and pursuit of local interests that potentially
conflict with global welfare. On the other hand the nation stands for community, with its complexity
of motive and design, as against the unidimensional thrust of commercial purpose. The single nation
is envisioned as capable of representing all nations in asserting communal responsibility for the
common environment.
Could this reliance on the nation in a global context conceivably be justified? In the view of this
Note, a positive answer would depend on two factors: first, the existence of well-articulated
international aspirational norms which could serve as guidelines for the courts of each nation; and
second, their will and ability of each nation's citizens to impose on their representatives a mandate
of consideration for the world environment. In other words, the wise and effective use of
extraterritoriality would ultimately need to be predicated on a responsible political culture.
Regarding aspirational standards, one commentator wrote:
Absent the coercive power of a supranational authority, recommended standards may
in some cases be more effective than binding ones. Whereas the unanimity
requirement for the adoption of binding standards often leads to a lowest-common-
denominator result, recommended standards can be more stringent. Even if such
standards are not observed universally, the force of international opinion virtually
requires nonconforming states to put forth reasons -- even if based on notions of
sovereignty -- for their non-observance: they cannot merely hide behind their
formalistic lack of consent to the rule.
A well-codified set of such standards could be enforced extraterritorially by the courts of the several
nations, and such action would be perceived as fair in the light of the consensus represented by such
a code. In the words of Justice Cardozo, "International law . . . at times, like the common law . .
. has a twilight existence during which it is hardly distinguishable from morality or justice, till at
length the imprimatur of a court attests its jural quality." Such a process has played a part in the
international acceptance of human rights law.
The second factor -- a local political consciousness capable of giving global environmental
concerns greater weight in national government -- presents the greatest challenge, and is largely
outside the scope of this Note. However, it is a challenge which all attempts at advocacy of the
global public interest must eventually confront. A responsible political culture is both an end in
itself and an indispensable means to every other means that might further the common good. Thus
with every proposed means, its implications for this overarching means-and-end must be
considered. In part VI of this note, Edith Brown Weiss's suggested "ombudsmen for the unborn"
or "planetary rights commissioners" will be contemplated in the light of the same considerations.
In a preliminary summing-up, then, it appears that the extraterritorial application of
environmental law is not one simple project, but four interrelated projects: 1) the expansion of the
scope given to extraterritorial jurisdiction in international law; 2) the development of an
extraterritorial jurisprudence in the courts of the several nations 3) the international codification of
recommended substantive standards and 4) the inculcation of a political consciousness that would
make enforcement of global environmental law a national priority. The Note will explore these
aspects in that order.
III. The Framework of International Law
International law by definition recognizes one common interest of nations -- the need for a
common set of guidelines for avoiding or settling disputes. Through most of its history, however,
international law has been concerned more with avoiding conflicts among interests presumed to be
adverse, than with promoting cooperation toward common goals. Pre-twentieth century
international law was primarily a set of conventions for demarcating the interests of competing
states.
This history is reflected in the "five principles" -- nationality, territoriality, the protective
principle, passive personality, and universality -- that have crystallized as the grounds on which the
courts of a nation may assume jurisdiction over a defendant or the parties in a dispute. It is
appropriate to recur to these fundamentals in the light of their application to environmental issues.
The oldest of these principles is nationality, whereby a state may take jurisdiction if an offender
is one of its nationals, no matter where the offense was committed. This principle goes back to the
notion of the tribe as a coherent group, rather than to the state as an authority exercising control over
everything within a given territory. Today, according to one commentator,
there are striking differences in the extent to which (nationality) is used in the
different national systems. The United States rarely applies its laws extraterritorially
solely on the basis of the nationality principle.
The application of nationality is restricted by principles of comity and by the presumption against
extraterritoriality (see infra). However, nationality is still important in efforts to reach foreign
subsidiaries of corporations formed under the laws of a state.
Of more recent origin, but today most widely invoked, is the principle of territoriality, whereby
a state may assume jurisdiction over acts taking place within its territory. This principle, which arose
with the modern nation-state, is today everywhere accepted; disputes concern its scope. The
nineteenth-century American courts, in particular, often construed this principle strictly and held
that states had jurisdiction only over acts taking place within their borders. In the past century the
principle has been extended to include acts begun in the nation's territory but completed abroad (the
"subjective" territoriality principle) and acts begun outside the territory but completed, or having
an effect, inside it (the "objective" principle of territoriality).
Third, under the protective principle a state is entitled to exercise jurisdiction over conduct which
threatens its security or the operations of its government. Examples of such acts include
counterfeiting, espionage, perjury before consular officials abroad, and conspiracy to evade customs
or immigration laws.
Fourth, the passive personality principle entitles a state to assume jurisdiction where one of its
own nationals was the victim of a crime. This is traditionally the weakest of the five principles,
though in recent years it has occasionally been invoked as a rationale for dealing with acts of
terrorism.
Finally, the universality principle states that any nation that can obtain custody over the
perpetrators of certain crimes is entitled to exercise jurisdiction over them. This principle was
developed to deal with piracy: "a pirate," as one seventeenth-century judge put it, "is the enemy of
the human race." Here, then, the nation state acts as the representative of the international
community in punishing acts universally condemned. In recent years this principle has been
expanded to cover other crimes recognized as "of universal concern," such as hijacking, terrorism,
and the slave trade.
These principles may be divided into three groups, according to their underlying motives.
Nationality and passive personality seem based on an "affiliation" model of the state. The territorial
and protective principles might be said to rest on a "property" model of international relations. Only
universality assumes interests common to all nations, and it has historically been applied only in
certain limited situations. This confirms the historical reality noted at outset, that in international
law, universal considerations have been honored mainly by rules that limit the scope of
jurisdiction.From the standpoint of the
global environment, the "property" approach is philosophically deficient, since species and
ecosystems, if not indeed sacred in themselves, are part of a "common patrimony" and their
destruction is an injury not to one nation but to the planet and humankind as a whole. Of the
traditional principles, only universality considers the nation as representative of the entire human
community and authorizes it to use its judicial apparatus to suppress acts that are regarded as
generally harmful.
As stated, universality has hitherto been applied almost exclusively to a narrow range of criminal
actions -- piracy and, more recently, terrorism. However, some scholars have envisaged the
extension of this principle to the area of environmental law: [D]estruction of the environment and
depletion of resources have become as universal a concern as terrorism and piracy. Like
terrorism, degradation of the environment endangers every citizen of every country. Like
piracy, degradation of the environment will make the global commons unsafe.
Against such an expansion of the "universality" principle it might be argued (from the standpoint
of intergenerational equity, if not from a belief in the rights of nature) that, unlike piracy and related
offenses, the exploitation of the global environment is defensible in many cases as an inevitable
result of expanding human needs. The decision whether or not a given action is appropriate requires
a balancing of priorities and, as often as not, a difficult choice.
An alternative to expanding the traditional universality principle would be to elevate Weiss's
"intergenerational equity, or justice between generations" to a sixth jurisdictional principle. This
principle would be not only spatially encompassing but also "intertemporal"; it would regard the
"natural and cultural legacy" as a "trust" which each generation receives from its predecessors and
must pass on. The application of this principle would entail, each time, a complex balancing of
present and future needs. Possibly, as an alternative to expanding the "universality" principle, the
principle of "intergenerational equity" could be added to the list of grounds for jurisdiction. This
new principle would allow the courts of any nation to take jurisdiction where a given action would
unjustifiably impair assets of the "planetary trust" (but see further discussion infra).
In any event, the wider use of extraterritorial adjudication as a response to the global
environmental crisis implies a shift of the emphasis in environmental law from abstention principles
to a positive duty to invoke judicial authority. Revision of the list of jurisdictional principles to
reflect global environmental concerns would be one step in this direction. The application of the
new principles would depend, of course, on the courts of the several nations.
IV. Extraterritoriality in the Courts of the United States
Since the early years of the nation, United States courts have exercised extraterritorial
jurisdiction. As might be expected, the early cases are mostly maritime cases, involving natural
persons, with the United States applied substantive international law under the universality
principle. These cases will be discussed infra, at the end of this part of the Note.
Only at the end of the nineteenth century, when the expansion of commercial enterprise
created a demand for market regulation abroad, were U.S. courts called upon to enforce this country's
own legislation abroad. The courts responded, at first reluctantly, then with a greater willingness.
In so doing, the courts have repeatedly had to confront the question of which statutes should be
applied extraterritorially.
In United States v. Bowman, decided in 1922, the Supreme Court formulated a general
criterion for extraterritorial applicability. In this case, the Court decided that a statute providing
criminal penalties for acts directly injuring the government was applicable to a fraud against the
government which had been perpetrated on foreign soil. In reaching this conclusion, the Court drew
a basic distinction between statutes aimed at protecting the domestic community, and statutes aimed
at preventing harms that reach beyond the domestic community. For the first type of statute, the
court would apply a presumption of extraterritoriality, which could be rebutted if the Court finds an
implied or explicit Congressional intent to make the statute applicable abroad. The second type
of statute, however, can be applied extraterritorially without the expression of Congressional intent,
because to limit such a statute to a strictly domestic application would undermine its effectiveness.
The principle enunciated in Bowman would seem applicable to all kinds of cases -- criminal,
market, labor, and environmental. However, the principle has not in fact been applied evenhandedly.
As Jonathan Turley and others have pointed out, courts have often been more than willing to
construe an extraterritorial mandate in market cases; but in labor and environmental cases, courts
have tended to apply the presumption against extraterritoriality, without first inquiring whether the
statute aimed at preventing harms that reach beyond the domestic community. Discouraging as this
discrepancy is, the market cases can still suggest what might be possible if courts did apply the
Bowman rule evenhandedly.
A. The Evolution of Extraterritoriality in Anti-Trust and Securities Litigation
The question of extraterritorial jurisdiction in a modern corporate context first surfaced in
connection with the Sherman Act, which Congress passed in 1890. Sec. 1 of the Act forbids
"(e)very contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade
or commerce among the several States, or with foreign nations." The question soon arose whether
the Act applied to conduct outside the United States.
The first major case addressing this question was American Banana Co. v. United Fruit Co.,
which the United States Supreme Court decided in 1908. The defendant in this case, a New Jersey
corporation, had "monopolized and restrain(ed)" the banana trade for some years. The plaintiff,
McConnell, had started a banana plantation in Panama, but was dispossessed by Costa Rican troops
entering Panamanian territory at the defendant's instigation. The Supreme Court refused
jurisdiction. In an opinion written by Justice Holmes, the Court found "startling" the notion that an
act of Congress could apply to acts done "outside the jurisdiction of the United States and in that of
other states." The Court held that "the character of an act as lawful or unlawful must be determined
wholly by the law of the country where the act is done." The "laws" of Costa Rica, which had
proved singularly pliant before the power of United Fruit, stood as a rigid barrier to shield United
Fruit from the United States Supreme Court.
American Banana has never been specifically overruled; it is still invoked by parties
wishing to avoid extraterritorial jurisdiction, and sometimes its reasoning prevails.
However, subsequent cases have strongly qualified its authority. In 1945, the Second Circuit, with
Judge Learned Hand presiding, decided United States v. Aluminum Co. of America ("Alcoa"). The
case concerned a number of companies, all of them foreign except Alcoa, which had allegedly
conspired to impose quotas on imports of aluminum ingots into the United States. Judge Hand
determined that Alcoa had not participated in the conspiracy, but he refused to dismiss the
indictment against the Canadian company which was allegedly involved, and held that the Sherman
Act applied.
Judge Hand did not read the Sherman Act itself as containing a blanket mandate for its
extraterritorial application, even though the act prohibits conspiracies "in restraint of trade or
commerce among the several States, or with foreign nations." In a pungently alliterative line, he
refused to "impute to Congress an intent to punish all whom its courts can catch, for conduct which
has no consequences within the United States." But as the converse of this common-sense
observation, Judge Hand concluded that where conduct does have an effect within the United States,
an intent to regulate extraterritorially can be inferred even absent an unequivocal mandate. Judge
Hand found it to be "settled law . . . that any state may impose liabilities, even upon persons not
within its allegiance, for conduct outside its borders that has consequences within its borders which
the state reprehends." The Sherman Act could therefore apply to conduct of aliens outside the
United States if 1) the conduct was intended to have an adverse effect on United States commerce
and 2) if it did have such an effect. While it was up to the plaintiff to prove the existence of intent,
once this was proved the burden would shift to the defendants to show that the adverse effect had
not actually occurred.
This "effects doctrine," as it came to be called, was fortified by the Ninth Circuit in Timberlane
Lumber Co. v. Bank of America. Timberlane charged that Bank of America had conspired to
monopolize logging in Honduras. Here the conduct, which took place on foreign soil and involved
foreign nationals, had its "most direct effect" in Honduras rather than in the United States. The test
enunciated by the court had three parts:
1. Does the alleged restraint affect, or was it intended to affect, the foreign commerce
of the United States?
2. Is it of such a type and magnitude so as to be cognizable as a violation of the
Sherman Act?
3. As a matter of international comity and fairness, should the extraterritorial
jurisdiction of the United States be asserted to cover it?
In this test, Judge Hand's requirement of both intent and effect is converted into a requirement of
either intent or effect. Furthermore, this "balancing" of various international interests tends to
replace inquiry into congressional intent, giving rise to the objection that it "ignores the question
whether the defendant had any reason to believe that its conduct would subject it to the jurisdiction
of the United States."
United States courts have not hesitated to assert "personal" jurisdiction in antitrust cases, or to
enforce judgments on the property of foreign corporations found in their jurisdictions. in United
States v. Scophony Corp., a British corporation that had opened a branch in the Southern District
of New York argued that it could not be sued in the District for antitrust violations because as a
foreign corporation it was not "found" there within the meaning of sec. 12 of the Clayton Act. The
Court refused to distinguish between Scophony and its U.S. subsidiary. In an early "piercing" of the
"transnational corporate veil," it stated: "(T)he determination is (not) to be made for such an
enterprise by atomizing it into minute parts or events, in disregard of the actual unity and continuity
of the whole course of conduct." And in In Re Uranium Antitrust Litigation, decided by the
Seventh Circuit in 1980, the court upheld an injunction issued by the district court to prevent nine
foreign corporations against whom a default judgment had been rendered in an antitrust suit from
transferring their assets out of the country to avoid payment of the judgment.
United States courts have been similarly vigorous in enforcing the anti-fraud provisions of the
Securities Act of 1933 and the Securities Exchange Act of 1934. Passed in the hope of preventing
future stock-market crashes by discouraging irresponsible speculation, these acts require registration
of securities with the Securities Exchange Commission (SEC) and set minimum informational
requirements for advertising of shares. The securities laws are still less explicit than the Sherman
Act about their extraterritorial reach. Indeed, the Securities Exchange Act explicitly states that it
shall not apply to any person insofar as he transacts a business in securities without
the jurisdiction of the United States, unless he transacts such business in
contravention of such rules and regulations as the Commission may prescribe as
necessary or appropriate to prevent the evasion of this chapter.
Moreover, the Securities Exchange Commission itself has never prescribed such "rules and
regulations." The courts have based the extraterritorial application of the act upon a Congressional
mandate which from the text of the statute appears dubious at best.
In Schoenbaum v. Firstbrook, decided in 1968, the court applies an "effects" test, resembling
the "objective territoriality principle," to a problem in securities law. In that case, a Canadian
corporation, registered on the American Stock Exchange, had sold some of its shares in Canada to
controlling Canadian shareholders. The plaintiff, an United States citizen and shareholder in the
corporation, alleged that the price of the shares in this transaction had been artificially low. The
Second Circuit found a violation of securities law, because the sale had an adverse effect on the
American securities market.
In Leasco Data Processing Equip. Corp. v. Maxwell, decided in 1972, the Second Circuit
developed a "conduct" test, similar to the "subjective territoriality principle," where the connection
with a United States stock exchange was too tenuous to warrant application of an "effects" test.
Maxwell, a British citizen, had traveled to the United States to persuade the officers of Leasco, a
corporation registered on the American Stock Exchange, to purchase a company owned by the
defendant. In these contacts Maxwell knowingly misrepresented the assets and prospects of the
company in question, which was not registered on a United States stock exchange. The contacts
were renewed, and further fraudulent representations made, in London. Finally, Leasco agreed to
purchase the company through a foreign subsidiary which was not registered on a U.S. stock
exchange. After purchasing $22,000,000 of stock, Leasco discovered the deception, stopped the
stock purchases, and sued. In taking jurisdiction, the Second Circuit indicated that the fact that the
parent corporation of the defrauded purchaser was registered on a U.S. stock exchange would not
have been sufficient grounds for jurisdiction if all the misrepresentations had occurred in England.
On the other hand, contacts between foreign nationals in the United States leading to fraudulent sales
of securities not registered on a U.S. stock exchange would not have triggered the Securities
Exchange Act either. However, given that a United States company was involved, the
jurisdictional requirement was satisfied by the fact that the misrepresentations in the United States
had constituted an "essential link" or a "substantial" part of the fraudulent transaction. If the
tenuousness of the connection in Leasco between the transaction and United States markets is added
to the tenuousness of the Congressional mandate for enforcement of the Securities Exchange Act,
the willingness of courts to construe or construct an extraterritorial mandate in market cases is very
striking.
By the holdings of Schoenbaum and Leasco, liability under United States securities legislation
can be found either on grounds that some part of the conduct took place in the United States, or on
grounds that it had an effect in the United States. This extraterritorial reach of securities legislation
appears comparable to the reach of antitrust legislation under the Timberlane test.
This extraterritorial jurisprudence has frequently elicited accusations of legal "imperialism"
from the international community, and has sometimes provoked legal retaliation. A particular sore
point is the application of section 4 of the Clayton Act, which was first passed in 1914, and which
provides treble damages to a plaintiff injured by a violation of antitrust law. In 1980 the United
Kingdom reacted to the extraterritorial enforcement of this provision by passing the Protection of
Trading Interests Act, with its "clawback" provision which gives a British loser in an antitrust suit
the right to sue in British court for the noncompensatory two-thirds of the treble damages award.
Yet despite the resentment and retaliation, U.S. efforts to impose international regulation in this
field appear to have been partially successful. The United States is no longer as isolated as it once
was in attempting to regulate international markets. Articles 85 and 86 of the Treaty of Rome, which
was signed in 1957 and forms the basis for the European Economic Community, consist of
"competition" (i.e. anti-trust) law. These articles list prohibited practices in restraint of trade, and
their provisions have been expanded by decisions of the ECC governing bodies. The penalties for
violation are less severe than the felony criminal sanctions or the private treble damages which may
be imposed under United States law. However, the offending business agreement is rendered null
and void, and fines may be levied; in recent years a tendency to impose heavier fines has been
noted. These provisions are now being enforced, not only against corporations based in the EEC
nations, but also extraterritorially, against United States-based corporations among others.
Thus, U.S. extraterritorial regulation may have aroused not only resentment but also
emulation. According to Restatement (Third) of Foreign Relations, sec. 416, Reporters Note 9:
"increasingly, there have been efforts by antitrust authorities of various countries to harmonize their
activities."
The principles of extraterritorial jurisdiction developed in the anticompetitive activities and
securities transactions have been codified, in moderated form, in Chapter IV of the Restatement
(Third) of Foreign Relations IV. Section 415 of that chapter states that anticompetitive activities are
subject to United States jurisdiction if they take place in the United States, regardless of the
nationality of the parties (subsec. 1), if "the principal purpose" of the activities is to interfere with
United States commerce, and the activities do have "some effect on that commerce" (subsec. 2); or
if the activities "have substantial effect on the commerce of the United States and the exercise of
jurisdiction is not unreasonable" (subsec. 3). This section, then, incorporates a modified Timberlane
test: either intent or effects will trigger jurisdiction, but the intent must be "the principal purpose,"
and the effects must be "substantial." The more elaborately spelled-out provisions on securities
transactions in sec. 416 are comparable in scope.
These results may well be contemplated by environmentalists with some wistfulness. The
"effects" test is particularly appealing, given that significant action at any point in the ecosphere may
have some effect at every other point. Should an "effects" test be adopted, a requirement of
"substantial" effect would doubtless have to be litigated. The application of an "effects" test
would carry the risk that national courts would be more sensitive to their neighbors' environmental
sins than to their own; but as in market cases, a "harmonization" of regulation might eventually come
about.
If courts were to apply an irrebuttable presumption that an action with a major environmental
impact anywhere in the world will eventually have an effect within the territory of any given nation,
such a presumption would be virtually indistinguishable in practice from a principle of
"intergenerational equity." Each nation would be authorized to act on behalf of the human
community; and the inquiry might then focus on two questions: 1) whether the action had a major
environmental effect and 2) whether this effect was justified in the light of all the factors.
This suggestion admittedly raises the specter of five billion claimants for any given
environmental injury. Here the "ombudsmen for future generations" or "planetary commissioners"
(see discussion infra, part VI) might offer assistance, by receiving and sifting complaints and
bringing those which appear to have merit in whichever jurisdiction seems likely to provide a fair
and adequate remedy.
Given the present trend of U.S. jurisprudence, these possibilities are likely to remain theoretical
for some time to come. However, theoretical possibilities are still worth contemplating for the
inspiration they may give to advocacy and constructive legal and social thought.
B. Extraterritoriality in Labor Cases
United States courts have shown greater reluctance to extend protection to citizens working
abroad, than to corporations in international markets. The leading extraterritorial labor case is Foley
Bros. v. Filardo, decided by the Supreme Court in 1949. The plaintiff in that case worked abroad
for a United States-based employer at a task that often demanded more than eight hours per day, but
his employer denied him overtime pay, which in the United States would have been contrary to the
Eight Hour Law. Despite the U.S. citizenship of both plaintiff and defendant, the Court refused
to give the Eight Hour Act extraterritorial application. Instead, the Court applied the presumption
against extraterritoriality, that "canon of construction which teaches that legislation of Congress,
unless a contrary intent appears, is meant to apply only within the territorial jurisdiction of the United
States." The Court also based its holding on the view that to regulate United States-based
employers abroad would mean regulating alien workers, as well as citizens working abroad.
Justice Frankfurter's concurrence incorporated a letter from the Department of Labor which
supported the Court's view.
This decision represents a withdrawal from the historically sanctioned principle of nationality,
whereby the members of a nation wherever situated were entitled to the protection of its laws. It also
contrasts with the holding in Alcoa, decided four years earlier, that conduct having an "effect" within
the United States is subject to United States jurisdiction. Significantly absent from Foley is any
consideration of the possible effect of the employer's conduct on the labor market within the United
States.
Title VII of the Civil Rights Act, which applies to employment discrimination, contains language
arguably calculated to avoid the result reached in Foley. The Foley court had reasoned that because
the extraterritorial application of the Eight Hour Act would have resulted in the regulation of aliens
as well as of United States citizens abroad, Congress must have intended to apply it only
domestically. Title VII states that the act does not apply "with respect to the employment of aliens
outside any state." In Bryant & Lillibridge v. International School Servs., Inc., the District Court
of New Jersey interpreted this to mean that since aliens outside any state were explicitly excluded,
United States citizens outside any state must be implicitly included. In Boureslan v. Aramco,
legislative history and the interpretation of the EEOC were adduced in support of this view;
nevertheless, the Fifth Circuit was unable to find an extraterritorial mandate in Title VII, thus
prompting Jonathan Turley's bitter observation that the principle "out of sight, out of mind" controls
the fate of American workers on foreign soil.
In January, 1991, the Supreme Court affirmed this decision in EEOC v. Aramco. Chief Justice
Rehnquist's opinion rejects an interpretation of the alien exemption similar to that in Bryant,
denies deference to the EEOC interpretation, and cites Foley in applying the presumption against
extraterritoriality. Not content with applying the Foley presumption, Rehnquist reinforces it by
"assum[ing] that Congress legislates against the backdrop of the presumption against
extraterritoriality." With this additional assumption, Rehnquist rejects extraterritoriality except
where Congress has made "a clear statement that a statute applies overseas."
But in Foley, the Court had stated that the inquiry was whether "language in the [relevant act]
gives any indication of a congressional purpose to extend its coverage beyond places over which the
United States has sovereignty or has some measure of legislative control." By this standard, the
evidence for extraterritorial intent, which Rehnquist concedes is "not totally lacking in probative
value," must have sufficed.
Justice Marshall attacked Rehnquist's reasoning in a long, indignant and persuasive dissent.
Besides reciting the weighty evidence for the statute's extraterritorial intent, Marshall tellingly
observed:
The range of factors that the Court considered in Foley Brothers demonstrates that
the presumption against extraterritoriality is not a "clear statement" rule. Clear-
statement rules operate less to reveal actual congressional intent than to shield
important values from an insufficiently strong legislative intent to displace them . .
. When they apply, such rules foreclose inquiry into extrinsic guides to interpretation
. . . and even compel courts to select less plausible candidates from within the range
of permissible constructions . . . The Court's analysis in Foley was by no means so
narrowly constrained.
The decision in Aramco is the more difficult to justify as the refusal of extraterritorial application
arguably defeats Title VII's domestic purpose. In an article published between the Fifth Circuit and
Supreme Court decisions in Aramco, Jonathan Turley pointed out that a ruling that Title VII does
not apply extraterritorially creates a major loophole in Title VII's protection of U.S. workers, since
under such a ruling a multinational employer wishing to discriminate can simply transfer the
employee abroad. Such a rule also creates an incentive for companies to move their operations
outside the United States. Thus, the assumption that in enacting Title VII Congress could be
presumed to be concerned only with domestic matters is still less valid than it was when Foley was
decided.
Justice Marshall's arguments against the overuse of "clear statement" rules are also supported by
an understanding of the legislative process. In an exhaustive review of research and theory, Turley
explains that the traditional canon that statutes in the public interest should be construed liberally
has its justification in the dynamics of legislation. Due to "the comparative success of small interest
groups in furthering their interests relative to larger groups," the legislative process actually
disfavors statutes that will benefit or prevent harm to a large number of citizens. Statutes in the
public interest tend to be vague in their provisions and to be full of loopholes which represent
concessions to private interest groups. Thus liberal rather than strict construction of such statutes
is essential if the public interest is to be served; and there is more than a degree of cynicism in the
Supreme Court's statement that "when it desires to do so, Congress knows how" to mandate
extraterritorial enforcement of a statute. Indeed, there is a growing perception that Congress
"knows how" to pass laws that ring loud with public purposes which cannot be carried out due to the
weakness of their specific provisions.
Theoretically it might have been possible to hope that environmental legislation, even under the
school of jurisprudence which Turley criticizes, could escape the extraterritorial fate of labor laws.
The rule that statutes in the public interest are to be construed liberally is recognized even by Judge
Easterbrook. Judge Posner has included environmental regulations in the category of "public
interest" legislation, while relegating "laws against discrimination" to an intermediate category that
is neither "interest-group [nor] public good legislation" but instead legislation "actuated by widely
held concepts of distributive justice." But this nuance of difference, conjecturably due to the fact
that not only workers but also judges must breathe the federal air, has not often been reflected in the
outcomes of cases, as the following analysis will show. The maquiladora plants south of the U.S.-
Mexico border stand as concrete proof that the causes of social equity and environmental health
cannot be severed.
The "strict constructionist" school of statutory interpretation is, as Turley's citations show,
tantamount to a market theory of legislation. In the words of Judge Easterbrook, "legislative
protection flows to those groups that derive the greatest value from it regardless of the overall social
welfare." Therefore, judicial attempts at finding the true "intent" of a statute are "not only doomed
to fail but will often succeed only in giving one side a potential benefit that it did not pay for
[emphasis added] in Congress."
From another perspective, it is possible to characterize the identification of the legislature with
a marketplace as a refusal of that search for meaning which Victor Frankl identifies as the essential
human quest. Frankl writes that "Man's search for meaning is a primary force in his life and not
a 'secondary rationalization' of instinctual drives." The reduction of a statue to the "deals" it
incorporates may be likened to the reduction of the search for meaning to instinctual "drives." In
both cases, a higher level of meaning is denied, and incoherency results.
This disintegrative process has a direct relation to the problem of global regulation, since
global regulation can come about through the creation of coherency, as well as through the
imposition of new layers of command. If the creation of coherency is frustrated, only the second
method remains. If the dubious implications of the second method are admitted, then the search for
meaning may well be inseparable from the search for social justice -- and for environmental health.
C. Extraterritoriality in Environmental Cases
From the early cases on, United States court decisions in environmental cases have tended to
apply a strong presumption against extraterritoriality. This appears in United States v. Mitchell,
decided by the Fifth Circuit in 1972 on the basis of the Marine Mammal Protection Act.
In the Mitchell opinion, the Marine Mammal Protection Act appears as an all-too-typical "public
interest" statute, with significant gaps in its drafting. The Act contained two provisions designed to
protect the dolphin, and the relation between the two provisions was unclear. On the one hand, the
act forbade the taking of dolphins without a permit; on the other hand, the act imposed a "general
moratorium" on the taking of dolphins. The prohibition on taking without a permit applied only
to United States territorial waters and to the high seas; the territorial scope of the "moratorium" was
left unspecified. Mitchell, a United States citizen, had captured dolphins for export to Britain
within the three-mile coastal limit of the Bahamas, pursuant to a Bahaman work permit.
The Fifth Circuit reversed the jury verdict against Mitchell. Citing Bowman, the court stated that
the presumption against extraterritoriality applied unless either 1) the "nature of the law" mandated
its extraterritorial application or 2) there was a "clear expression of congressional intent." The
Marine Mammal Act did not pass the first test. As in Foley, "all-inclusive" language was held
insufficient to confer extraterritorial scope, although unlike the Eight Hour Law the Marine Mammal
act had explicitly stated a public purpose -- to protect dolphin species from extinction -- in terms
of which it arguably makes little sense to restrict the application of the act to United States territorial
waters. In stating the requirement of congressional intent, the court cited Foley, although Foley itself
does not require a "clear expression" but states only that legislation does not apply extraterritorially
"unless a contrary intent appears." However, as in Foley, the court examined the statutory
language and the legislative history, before concluding that the presumption against extraterritoriality
must be applied.
Besides applying a stringent presumption against extraterritoriality, the court invoked the principle
of comity ("the control of sovereigns over the natural resources within their territories") and added
that the traditional method of resolving differences in policy among nations was "through negotiation
and agreement rather than through the imposition of one particular choice by a state imposing its law
extraterritorially." The court did not take judicial notice of a number of international treaties
aimed protecting marine mammals which were already in existence. Nor did it pose the question
whether the interest of the Bahamas in exempting Mitchell's acts from the jurisdiction of United
States courts was substantial enough to warrant the application of the comity principle. Without
citing American Banana, the court manifests a reluctance to interfere which is strongly reminiscent
of that case.
A major testing-ground for this reluctance has been the National Environmental Policy Act of
1969. NEPA, hailed by some commentators as an "environmental bill of rights," has proved to
be something less than that. Rather, NEPA is mainly an intragovernmental directive, requiring
federal agencies to prepare an environmental impact statement (EIS) whenever a proposed major
Federal action seems likely to have significant environmental effects. The Act creates an advisory
body, the Council on Environmental Quality (CEQ). Although the Act does not specifically create
a cause of action, the requirement of an EIS has been interpreted by courts in this sense. The
requirement of an EIS does not guarantee that projects found to be environmentally harmful will not
be carried out nevertheless.
It has been argued that application of the EIS requirement to projects destined to be carried out
on foreign soil would not actually be "extraterritorial," since the requirement does not entail
interference with the decisions of another state, but is simply "a procedural tool for American
decisionmaking." On the other hand, where preparation of an EIS entails information-gathering
in foreign territory, considerations of foreign policy may be invoked. Accordingly, a dispute arose
soon after NEPA's passage between the CEQ and the State Department as to the intended
"extraterritorial" scope of the Act. The CEQ contended that the Act applied to Federal actions
everywhere in the world; the State Department contended that it did not apply to proposed actions
within the jurisdiction of any other state.
Again, the dispute was fueled by a significant ambiguity in the language of the Act. The CEQ
could rely on such global rhetoric as the references to the "critical importance of restoring and
maintaining environmental quality to the overall welfare and development of man," the "world-
wide and long-range character of environmental problems," and the "biosphere." The State
Department could point to the Act's references to "the ecological systems and natural resources
important to the Nation," "the social, economic and other requirements of present and future
generations of Americans." At this writing, a bill is pending in Congress which would resolve the
alleged ambiguity and explicitly mandate the application of NEPA to projects carried out on foreign
soil.
In the first circuit court case under NEPA, Sierra Club v. Adams, the D.C. Circuit "assume[d],
without deciding, that NEPA is fully applicable" to construction beyond the borders of the United
States. The court considered chiefly issues of standing and the adequacy of a final environmental
impact statement (FEIS) which the Federal Highway Administration had prepared for the
construction of 250 miles of highway across the Darien Gap in Panama and Colombia. As the last
connecting link in the Pan American Highway that stretches from Alaska to Chile, the projected
stretch of road represented the removal of a natural barrier between ecosystems. The District
Court had accepted the Sierra Club's argument that in the FEIS insufficient attention had been
devoted to two problems: the possibility of an epidemic of hoof-and-mouth disease brought on by
the unimpeded movement of cattle from south to north, and the impact of the highway's construction
on the Cuna and Choco tribes. On appeal, the FHA argued that the Sierra Club did not have standing
to challenge the FEIS, and also suggested that NEPA might not cover "purely local" environmental
impacts, such as the effect on the Cuna and Choco peoples.
In its opinion the D.C. Circuit took a liberal approach to a jurisdictional issues. It held that Sierra
Club members as members of the public had standing based on personal "injury" and thence could
also raise other inadequacies in the FEIS based on the "public interest." Moreover, the court stated
that "because of the statutory and regulatory requirements that the FEIS reflect an 'inter-disciplinary'
and 'integrated' approach, the issues discussed in the statement will be necessarily interrelated and
interdependent." Thus it was possible to litigate the question whether the impact of the project on
the Cuna and Choco peoples had been adequately addressed. However, the court found the FEIS
adequate and vacated a preliminary injunction against construction of the highway.
In Adams the question of impingement on foreign policy was not raised; this question was
litigated in Babcock & Wilcox (1977), in which the Nuclear Regulatory Commission decided that
NEPA does not require the preparation of environmental impact statements where the project is to
be carried out within the jurisdiction of a foreign government. The dispute concerned an American
corporation's application for a license to export reactor components for use in a power station to be
constructed in the then Federal Republic of Germany. Pursuant to an Executive Order, the NRC
transmitted the application to the State Department, which approved the project. A German
antinuclear group requested leave to intervene, arguing that the NRC could not lawfully act on the
application without preparing an EIS under NEPA. In holding that NEPA has no extraterritorial
applicability, the NRC referred to the "patriotic" language in the Act; it acknowledged the "global"
language relied on by the CEQ but minimized the important of that language and stated that the
CEQ's views were not binding on other agencies. Pointing out that NEPA's one explicit reference
to foreign objectives is qualified by the clause "where consistent with the foreign policy of the
United States," the NRC found that foreign policy considerations precluded second-guessing the
West German government on its own environmental needs. The NRC distinguished Sierra Club v.
Coleman (the name of Adams in the district court) by pointing out that whereas the United States
retained substantial control over the Darien Gap construction project, the reactor was to be
constructed under the sole supervision of the German government.
In 1979 President Jimmy Carter attempted to settle the "extraterritoriality" of NEPA by issuing
Executive Order No. 12,114, which prescribed procedures for the preparation of an EIS on federal
actions abroad. However, this directive left many loopholes for agencies to avoid preparing an
EIS. Moreover, the Executive Order specifically stated that it created no right of action against
noncomplying agencies. In effect, this directive, while professing concern for the global
environment, resolved the question of NEPA's applicability overseas in the negative.
Nonetheless, the question of NEPA's "extraterritoriality" continued to be argued in court. In 1981
the District of Columbia Circuit gave a negative answer to this question in Natural Resources
Defense Council, Inc., v. Nuclear Regulatory Commission. This case concerned a permit which
the Nuclear Regulatory Commission had issued to Westinghouse Electric Corporation for the export
of a nuclear reactor to the Philippines. The project was controversial, both in the United States
and abroad. Critics pointed out that the proposed site a) lay over an earthquake fault line which in
1976 had moved, killing some 4,000 people; b) was overlooked by an active volcano, Mt. Natib,
five miles away; and c) was only twelve miles away from a naval base where over 12,000 United
States citizens were in residence. Nevertheless, the Philippine government under President
Marcos declared itself in favor of the project; it was alleged that Westinghouse had engaged in
extensive bribery to produce this result. Natural Resources Defense Council sued to compel the
NRC to prepare an EIS.
In deciding the case, the court admitted that the issue was not extraterritoriality in the strict sense,
because NEPA does not "proscribe[] or prescribe[] activity in the sovereign territory of a foreign
country." Nevertheless, the court considered that an "extraterritorial effect" was involved because
Conditioning an export licence on the health, safety and environmental standards we think
sound for the foreign nation's regulation directs that nation's choices just about as effectively
as a law whose explicit purpose is to compel foreign behavior.
In an unprecedented inversion of the "effects" test, the court appears to suggest that a government
agency could not be compelled to take an otherwise mandated action within its own territory, if that
action would have an effect outside its territory.
Upon this basis, the court proceeded to apply an extremely stringent version of the presumption
against extraterritoriality, requiring not simply a clear indication of extraterritorial intent, but "an
unequivocal mandate from Congress" to overcome it. This amounts to the "clear statement" rule
which the Supreme Court was later to impose in EEOC v. Aramco (see discussion supra).
Moreover, the court stated that even had an "unequivocal" Congressional mandate existed, a court
could still have refused to carry it out if the conduct "occurred outside the territory of the United
States, had -- or was intended to have -- no effects within the United States, or involved no conduct
of nationals of the United States [emphasis added]." The court thus relied on a principle of strict
"territoriality" and deference to a foreign sovereign's decision where, as in American Banana, the
decision may have resulted from bribery by United States citizens.
By implying that the comity principle of international law may trump even an "unequivocal
mandate" by Congress, the court inverted the usual relation between congressional mandate and
international law (see discussion infra), whereby a domestic court has no authority to void a
congressional mandate merely because it conflicts with international law. In a striking twist,
international law was given precedence over national law in order to defeat the interests of the global
community.
In a more recent case, Greenpeace U.S.A. v. Stone, the District Court of Hawaii attempted to
strike a balance on the question of NEPA's "extraterritorial" reach. In that case, Greenpeace sued
to compel the U.S. Army to prepare an EIS, pursuant to NEPA, on the removal of chemical weapons
from Germany and the destruction of these weapons at a disposal site on a Pacific atoll. The German
government was participating in the project, and a German court had reviewed and approved the
safety measures. Regarding the actions at the Pacific site, the Army had already prepared three
EIS; regarding the transportation phase, the Army had prepared a Global Commons Environmental
Assessment, pursuant to Executive Order No. 12,114. But the Army refused to prepare an EIS on
the movement of the weapons within Germany, pointing out that the Executive Order required
agencies to evaluate only the impact on "a foreign nation not participating with the United States and
not otherwise involved in the action." The army urged application of the presumption against
extraterritoriality and also argued that the preparation of an EIS would both infringe on Germany's
sovereignty and encroach upon the President's discretion in foreign policy matters. The court agreed
with the Army that NEPA was not applicable to the movement of the weapons within Germany;
however, it limited its findings to the facts of the case and stated that under some circumstances the
EIS requirement of NEPA might apply to some projects carried out on foreign soil. In the court's
view, Congress, realizing the potential conflict between environmental and foreign policy
considerations, had deliberately left the "extraterritoriality" of NEPA open, to be decided case by
case. An EIS would be required, the court stated, where the "United States agency's action abroad
has direct environmental impacts within this country, or where there has been a total lack of
environmental assessment by the federal agency or foreign country involved." Thus the Hawaii
District Court would presumably have agreed with the NRDC that an EIS was required for the
Philippine reactor site.
In contrast, a recent holding by the District of Columbia District Court applies the Aramco
holding so as to eliminate such nuances. In Environmental Defense Fund, Inc. v. Massey,
the Environmental Defense Fund sought to enjoin the National Science Foundation from
incinerating "food related waste and selected domestic waste" at NSF's McMurdo Station in the
Antarctica, on grounds NSF had not complied with the environmental analysis requirements of
NEPA. In urging that NEPA applied to actions taken in the Antarctic, EDF pointed to "NEPA's
statutory language, legislative history, the interpretation of NEPA's implementing agency, CEQ, and
the applicable case law," as well as to the fact that application of NEPA in Antarctica, which is part
of the "global commons," would not entail interference with the sovereignty of any foreign nation.
Applying Aramco, the court stated:
The Court cannot ferret out a clear expression of Congress' intention that NEPA
should apply beyond the territorial jurisdiction of the United States. Rather, NEPA contends
language such as "the human environment" see 42 U.S.C. sec. 4332(2)(C), "the worldwide
and long-range character of environmental problems" see id. at sec, 4332(2)(F), and the
purpose of NEPA is to "encourage productive and enjoyable harmony between man and his
environment [and] to promote efforts which will prevent or eliminate damage to the
environment and biosphere." See id. at sec. 4321.
While Congress may have selected broad language to describe NEPA's purpose,
Congress failed to provide a clear expression of legislative intent through a plain statement
of extraterritorial statutory effect.
Therefore, the court felt compelled to conclude that NEPA does not apply in Antarctica, even while
professing itself "concerned with the manner in which NSF undertook the Environmental Impact
Assessment."
In Massey, the Aramco rule is applied in the absence of the sovereignty considerations which
may possibly have been present in the Aramco case itself, in a situation where no foreign powers
were involved and where the United States government was acting alone. In such a situation it
would seem appropriate to invoke the arguments, cited supra, that the question of NEPA's
applicability to projects undertaken abroad is not even a question of extraterritoriality. Thus the
Massey decision demonstrates not only the eviscerating effect of Aramco, but also a judicial mood
in which courts, with increasing frequency, see themselves "compelled" to construe statutes in the
public interest strictly, without looking very far for ways around this necessity.
Aramco was also applied by the Southern District of New York in Amlon Metals, Inc., v.
FMC Corporation, where the plaintiff had sought sought redress under the Resource Conservation
and Recovery Act (RCRA). Amlon, as representative of a British recycling firm, contracted with
FMC to acquire copper residue for processing in England. The residue was to be free from harmful
impurities. In due time, FMC filled a number of containers with residue for shipping. Without
Amlon's knowledge, the drivers of the trucks that took the containers from FMC's plant to the cargo
ship were told to wear respirators, and the containers were marked "corrosive." Upon arrival in
England, the containers gave forth a noticeable odor, and it eventually transpired that they contained
toxic and hazardous substances. The Health and Safety Executive of the United Kingdom, on
being notified of the problem, required the British company to store the residue in steel drums.
The British company brought suit in England, but the British court dismissed the case on grounds
the alleged conduct took place in the United States and United States law would apply. The British
firm, through Amlon, then sued FMC in the Southern District Court of New York. Besides RCRA,
Amlon invoked the Alien Tort Statute. The Alien Tort Statute claim involves the applicability of
substantive international law in United States courts, and will be considered infra.
The RCRA claim was based on RCRA's citizen suit provision, which provides that
any person may commence a civil action against any person . . . including any past
or present generator, past or present transporter, or past or present owner or operator
of a treatment, storage, or disposal facility, who has contributed or who is
contributing to the past or present handling, storage, treatment, transportation, or
disposal of any solid or hazardous waste which may present an imminent and
substantial endangerment to health or to the environment.
Arguing that this provision did not apply to waste located within the territory of another sovereign
nation, the defendant invoked the presumption against extraterritoriality as in Foley and EEOC v.
Aramco. Amlon countered by invoking the "conduct test" developed in Leasco, urging that RCRA
applied because the actions that created an environmental hazard had occurred in the United
States. Amlon argued that the principle of comity behind Foley and Aramco did not apply because
there was no interest, such as a foreign nation's interest in a uniform system of labor regulation
within its borders, that would be encroached on by the application of RCRA against FMC.
Moreover, Amlon pointed out, under sec. 602(2) of Restatement (Third) of Foreign Relations, a state
where pollution originated must give private parties who have suffered "significant" injury "access
to the same judicial or administrative remedies as are available in similar circumstances to persons
within the state."
The court did not reach the issue of whether the conduct test was applicable, but based its holding
on a finding that Congress did not intend RCRA to apply extraterritorially. After pointing out the
domestic focus of the Act's language, the court declined to read "any person" in the citizen suit
provision as establishing RCRA's extraterritorial applicability. The court pointed out a venue
provision which states that a citizen suit "shall be brought in the district court for the district in
which the alleged endangerment may occur." Again, the court cited Aramco as precedent for the
use of an ill-fitting venue provision to rule out extraterritorial application. Finally, the court
referred to four law review articles dealing with the problem of hazardous waste exports (one
subtitled "Burying Our Neighbors in Garbage") as authority for the proposition that RCRA does not
apply extraterritorially.
It is possible to admit the weakness of the evidence for extraterritorial intent in RCRA, and at the
same time to recall that the evidence for the extraterritorial mandate of the Securities Exchange Act,
which the court found persuasive in Leasco, was not much stronger. More disturbing still is the
court's citation of scholarship concerned with the problem of hazardous waste export, as evidence
for the proposition that RCRA affords no remedy for the problem. Indeed, this separate opinion
issued on two claims in a case that apparently raised other claims as well, could be read as an explicit
message that it is legal to export hazardous waste, thus removing whatever deterrent effect RCRA's
uncertain applicability might have exerted. As in Aramco, it is difficult to avoid receiving an
impression of cynicism.
The sense of wrongness which this holding inspires is only reinforced by the court's recitation of
language in the statute tending to show that "Congress was concerned with hazardous waste
problems in the United States, not in foreign countries." Thus, the statute characterizes the
problem of waste disposal as "a matter of national scope and concern," and finds that "alternatives
to existing methods of land disposal must be developed since many of the cities in the United States
will be running out of suitable solid disposal sites within five years unless immediate action is
taken." Perhaps indeed the shipping of hazardous waste to one's neighbors represents an
"alternative"; but such an alternative is surely calculated to bring the United States into bad odor with
its neighbors, literally and figuratively. One feels that between nations as between individuals, the
rule "what is hateful to you, do not do to your neighbor" should apply.
In terms of the jurisdictional principles discussed supra, perhaps one could say that the
worldwide environmental crisis should prompt not only a wider use of the universality principle (or
introduction of an "intergenerational equity principle"), but also a greater reliance on the nationality
principle, as an expression of each state's responsibility for the environmental conduct of its own
nationals.
Such an approach would not be wholly without precedent, as Justice Cardozo's above-cited
dictum that international law is at some points indistinguishable from morality, may suggest.
International environmental action ultimately depends upon a global morality; and as the following
analysis will show, such a morality has now and then formed the basis for a judicial decision.
D. International Law as a Basis for Decision
The discussion of the "effects doctrine" and the "conduct test" demonstrates that a nation's
separate exercise of jurisdiction can affect international law. The converse is also true: the
framework of international legal expectations can influence the jurisprudence of the several nations.
In the cases so far discussed, international law has been applied largely in a restrictive sense. The
principle of comity, or its variant the act-of-state doctrine, has been invoked to shield conduct
outside the United States which a foreign sovereign could conceivably have an interest in regulating.
The Amlon opinion, however, contains a reminder that international law can also invoked
expansively, for the protection of global interests. In that case, the agent for the defrauded British
corporation sued not only under RCRA but also under the Alien Tort Statute, which provides: "The
district courts shall have original jurisdiction of any civil action by an alien for a tort only committed
in violation of the law of nations or a treaty of the United States." Since Amlon did not allege the
violation of a specific treaty, the issue was whether FMC's actions had constituted a violation of the
law of nations.
In support of this claim Amlon relied on relied on Principle 21 of the Stockholm Declaration of
1972, to which the United States is a signatory. This principle states that nations have "the
responsibility to ensure that activities within their jurisdiction or control do not cause damage to the
environment of other States or of areas beyond the limits of national jurisdiction." Amlon also
referred to a black-letter provision of Restatement (Third) of Foreign Relations, which states that
where pollution originating in a state has caused significant injury to persons outside that
state, or has created a significant risk of such injury, the state of origin is obligated to accord
to the person injured or exposed to such risk access to the same judicial or administrative
remedies as are available in similar circumstances to persons within the state.
But, said the court, "these invocations of international law do not establish a violation of such law
under the Alien Tort Statute." The court cited Filartiga v. Pena-Irala for the proposition that
only where the nations of the world have demonstrated that the wrong is of mutual and not
merely several, concern, by means of express international accords, that a wrong generally
recognized becomes an international law violation within the meaning of the statute.
The court then cited a later decision, Zapata v. Quinn, which distinguishes Filartiga, for the
holding that the Alien Tort Statute "applies only to shockingly egregious violations of universally
recognized principles of international law." In the court's view, neither the Stockholm Declaration
nor the Restatement (Third) of Foreign Relations states "universally recognized principles"; the
Stockholm Principles "do not set forth any specific proscriptions, but rather refer only in a general
sense" to extraterritorial environmental responsibilities; the Restatement represents "[a]t most . . .
the existing U.S. view of the law of nations regarding global environmental protection."
Once again a strong redolence of disingenuousness arises. "Universally recognized principles"
are, almost by definition, not specific; they are general rules, to be applied as circumstances which
are often unforeseen may dictate. An "existing U.S. view of the law of nations" would be one on
which U.S. courts, at least, would be entitled to rely. Similarly, on comparison of the facts of
Filartiga and Zapata, it is outrageous to read one as qualifying the other. In Filartiga, the Second
Circuit accepted jurisdiction in a wrongful death suit brought by a Paraguayan father and daughter
against another Paraguayan citizen for the torture and death of a son and brother; in Zapata, a
Mexican citizen and resident who had won a lottery prize in New York sued to have the prize paid
to her in a lump sum instead of in installments. The holding in Zapata was based not on the
inapplicability of the Alien Tort Statute, but on the frivolousness of the claim. The facts as stated
in Amlon lie somewhere on a continuum between the utter tragedy of Filartiga and the utter frivolity
of Zapata; and the court's recitation of language abdicates the judicial task of fixing the point on that
continuum at which a violation of international law may be held to exist.
Admittedly, the Filartiga court itself emphasized that "[t]he requirement that a rule command the
'general assent of civilized nations' is a stringent one." The court referred to Cuba v. Sabbatino,
in which the Supreme Court declined to apply international law to Cuban expropriation of the assets
of a foreign corporation, noting that real differences existed among nations as to the rightfulness of
such expropriations. In contrast, the Filartiga court could cite numerous treaties and accords to
demonstrate that the prohibition of torture today is unanimous in principle though often violated in
practice. The fact that the prohibition is often violated does not affect its universality.
The judicial inquiry in Amlon might, then, have focused on the question of the degree to which
the condemnation of environmental offenses is universal. Such an inquiry would have had to take
into account the well-known friction between "North" and "South" on environmental matters, but
also the existence of numerous accords aimed at regulating transboundary pollution. Once the
universality of the concern inspired by environmental pollution is demonstrated, the fact that
pollution often occurs would not be a bar to the enforcement of basic environmental principles where
egregious facts can be stated, as in Amlon they arguably were.
The Filartiga court makes clear that the application of international law in the courts of the
several nations is not a novelty. Indeed, such application may have been more accepted at the time
of the signing of the Constitution than it is at present.
The Alien Tort Statute itself, though its present form dates from 1948, goes back in substance to an
enactment of the First Congress. Early Supreme Court cases cited a British decision, Mostyn v.
Fabrigas, for the proposition that
[If] A becomes indebted to B, or commits a tort upon his person or upon his personal
property in Paris, an action in either case may be maintained against A in England,
if he is there found.
Recalling that Mostyn was freshly decided when the Constitution was signed, the Filartiga court
went on to consider the constitutionality of the Alien Tort Statute:
The law of nations forms an integral part of the common law, and a review of the
history surrounding the adoption of the Constitution demonstrates that it became a
part of the common law of the United States upon the adoption of the Constitution.
Therefore, the enactment of the Alien Tort Statute was authorized by Article III.
The Filartiga court also cited two cases which the Supreme Court decided directly on the basis
of international law, and which it is worthwhile to examine here. In United States v. Smith, a man
who had been sentenced to death for piracy appealed his conviction, arguing that the statute which
authorized the death penalty for any person who "shall, upon the high seas, commit the crime of
piracy, as defined by the law of nations" was unconstitutional because it did not "define" the crime
of piracy. The Supreme Court held that international law, "which is part of the common law,"
defines piracy "with reasonable certainty." The Court went on to state:
(T)he general practice of all nations in punishing all persons, whether natives or foreigners,
who have committed this offence against any persons whatsoever, with whom they are in
amity, is a conclusive proof that the offence is supposed to depend, not upon the particular
provisions of any municipal code, but upon the law of nations, both for its definition and