The Case
Diplomatic Immunity

A decision made on August 10 2000 by the Paris Court of Appeal provides an interesting example of the scope of the sovereign immunity doctrine in a contractual relationship.


A Swiss company, NOGA, entered into a $1.5 billion loan contract with the government of the Russian Federation in 1991 and 1992. The contract stated that NOGA would provide consumer goods and foodstuffs in return for the right to sell petroleum from the Russian Federation.

In this agreement the Russian Federation waived its property immunity and recognized the jurisdiction of the Stockholm International Arbitration Court. Under the sovereign immunity doctrine, assets or properties of foreign states or their agencies are immune from execution.

In 1992 the relationship between the two parties deteriorated and the Russian Federation stopped giving petroleum to NOGA.

The Case

NOGA filed a suit before the Stockholm International Arbitration Court in order to seize agreement-related assets as compensation for funds that the company claimed it was owed by the Russian government.

An arbitration award was rendered on February 1997 which ordered the government of the Russian Federation to pay a total of $63 million. This award authorized NOGA to attach assets of the Russian Federation.

The government of the Russian Federation appealed for the annulment of the award. Both the Stockholm County Court and the Court of Appeal of Svea dismissed the appeal.

NOGA brought the award before various courts for enforcement.

A binding judgment made on March 15 2000 at the Paris County Court ordered the attachment of all Russian diplomatic assets in Paris. The Russian Federation claimed its right to appeal.

Since May 18 2000 NOGA has attached assets from the following (among others):

  • the Russian Embassy;

  • the Central Bank of Russia;

  • the Russian mission to the United Nations Educational, Scientific and Cultural Organization;

  • Vnechekonombank; and

  • Vneshtorgbank.

In July 2000 the sailing ship Sedov, owned by the University of Murmansk, was also attached in France.

The Russian Federation appealed the judgment in order to obtain the withdrawal of fixed assets. This was ruled illegal, with the exception of Russian diplomatic bank accounts located in France.

Diplomatic Immunity

In its decision of August 10 2000 the Paris Court of Appeal agreed with the Russian Embassy that the remaining attachments (related to the Parisian bank accounts of diplomatic missions) violated the Vienna Convention on Diplomatic Relations of April 18 1961. Articles 22 to 28 state that the efficient performance of diplomatic missions is ensured by the protection of all their properties and assets.

This privilege whereby "the premises of the mission, its furnishings, other property and means of transport shall be immune from search, requisition, attachment or execution" (Article 22 of the convention) is essential to the promotion of friendly relations between nations and is subject to specific rules. The court ruled that the waiver of immunity in a commercial agreement does not imply a waiver of immunity for diplomatic missions.

NOGA counterclaimed that embassy bank accounts are not covered by the Vienna Convention on Diplomatic Relations.

The Paris Court of Appeal stated that bank accounts are not expressly but implicitly included in the convention to ensure the protection of diplomatic functions. Therefore, a creditor cannot interfere with the efficient performance of diplomatic missions or embassies, even if it has a legally binding judgment.


Apart from the political aspect of this decision, its judicial significance complies with Court of Cassation case law.

On October 1 1985 the Court of Cassation ruled that "state goods shall be immune from attachment except when they are attached to private economic or commercial activities".

For further information on this topic please contact Philippe Blaquier-Cirelli at Jeantet et Associes by telephone (+33 1 45 05 81 85) or by fax (+33 1 45 05 82 28) or by e-mail ([email protected]).

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