May 7, 2012

An Interview with Nout van Woudenberg on Immunity

As museums are encountering stricter restrictions for acquiring art, and as budgets for new acquisitions are tighter, many museums are looking to temporary loan agreements to augment their permanent collections.

Immunizing this art from a potential suit has been an important step lenders have asked states to provide them. But this immunity is not without critics. I caught up with Nout van Woudenberg and asked him a little bit about his new book, 'State Immunity and Cultural Objects on Loan'. He is an external researcher at the University of Amsterdam and Legal Counsel at the International Law Division of the Ministry of Foreign Affairs of the Kingdom of the Netherlands.

Setting down to write, what was your aim with ‘State Immunity and Cultural Objects on Loan’? 

Some years ago, it occurred to me that it was not clear whether States actually knew what the current state of affairs was with regard to immunity from seizure of cultural objects belonging to foreign States while on loan abroad. In 2004 the convention on jurisdictional immunities of States and their property had been established under auspices of the United Nations, addressing, among other things, immunity for cultural State property on loan. But that convention has not yet entered into force. I thus considered it necessary to investigate whether another rule of international law was already applicable: a rule of customary international law. After all, that rule would be binding upon States, without necessarily becoming a party to a convention.
And so I did: I investigated whether a rule of customary international law exists, to the effect that cultural objects belonging to foreign States are immune from seizure while on loan to another State for a temporary exhibition. And if such a rule does not yet exist, is it emerging? And if such a rule does exist, what are its limitations? It is my aim that my study, and consequently this book, can provide more clarity and legal certainty in the field of lending and borrowing cultural State property. But there is more: the book describes the national legislation of States, reflects opinions of States, lists what kind of guarantees States are likely to give, provides academic views, and so on. I thus hope not only to bring clarity in the field of international law, but also hope that this book is considered to have a certain encyclopedic value in regard to relevant State practice. 

When did nations first start asking for immunity for their art? How have the reasons for granting this immunity changed, if at all? 

It is my impression that the very first request came from the former Soviet Union in the middle of the 1960s. The catalyst was an imminent exchange between a Soviet museum and the University of Richmond, US, in which the latter sought to import several cultural objects that had been expropriated by the Soviet Government from art collectors. The Soviet Union asked for a grant of immunity from seizure, as protection against former Soviet citizens claiming title to the cultural objects, a condition of the loan. As a result of the immunity from seizure request, the United States was the first country to introduce immunity from seizure legislation in 1965. 
Since then, the issue of immunity from seizure for travelling cultural objects has become more and more a concern for States and museums. This is mainly due to an increasing number of legal disputes over the ownership of cultural objects, particularly as a result of claims made by heirs to those objects expropriated by Communist regimes in Eastern Europe as well as Holocaust-related claims. But there may be disputes other than ownership disputes which result in attempts to seize a cultural object, and that phenomenon is more recent: for instance when an individual or a company is of the opinion that the owner of the cultural object on loan owes a debt (not necessarily related to the cultural object) to the claimant, and this claimant has concerns regarding the enforcement of a judgment or arbitration award in the State of residence of the owner. An example is the 2005 Noga case in Switzerland, where the company Noga asserted that it was a creditor of the Russian Federation, and the 2011 Diag Human case in Austria, where the company Diag Human argued that it was a creditor of the Czech Republic. One last remark in regard to your question: one might wonder whether we need to speak about granting immunity. After all, in the Swiss Noga case, and the Austrian Diag Human case, the Swiss federal authorities and the Viennese court respectively, have ordered that on the basis of customary international law, the cultural State property on loan was immune from seizure. Many other States are of this opinion as well, as I show in my book. They sometimes count on the general rule of customary international law that State property in use or intended for use for government non-commercial purposes is immune from measures of constraint, but a considerable number of States also count on the existence of a specific rule of international law immunizing cultural State property on loan. If this line is to be followed, there is no situation of granting immunity (actively doing something), but the immunity from seizure merely applies. 

The cover of your book uses Portrait of Wally a painting which was granted immunity in New York State court but was eventually seized in Federal Court by US Attorneys. What is your reaction to the result in that case? 

First of all, I would like to thank the Leopold Museum in Vienna to allow me to use this image for the cover of my book. Now in regard to the case: the fact that the case lasted approximately twelve years, in combination with the fact that the case and the judgment went back and forth several times, gives sufficient indication for stating that it regarded a complex and not very clear-cut case. Although it regarded a painting seemingly forcibly sold by Lea Bondi at the beginning of WW II, the US court case focused very much on the question of what Dr. Leopold knew or ought to know when he acquired the painting in 1954. In the end, it came to an amicable settlement, and that should be applauded and respected. We now may be able to say that both the Museum and the Bondi Estate are “winners” as they came to terms with each other. However, the fact that the case lasted that long, and that the outcome went back and forth repeatedly, is not very helpful in promoting the certainty which is necessary in the field of international art loans. Also the Museum as well as the Bondi Estate had to go through a lot during these years of litigation. 

What are your thoughts on immunity generally? Is it a useful tool to allow for the movement of art? 

Absolutely. But let me limit myself to immunity for cultural State property on loan. Basically, the reason for providing cultural objects with immunity from seizure is to prevent cultural objects on loan from being used as ‘hostages’ in trade and/or ownership disputes. Immunity from seizure can serve as a means to overcome the reluctance of lenders to send their cultural objects temporarily abroad. We also have to keep in mind that many States have committed themselves through international legal instruments to supporting the exchange of cultural objects. It can be said that nowadays there is a well-established and universally shared interest to protect and enhance the international cooperation of museums and other cultural institutions. Moreover, in the literature, links have been made between cultural objects and diplomatic relations: international art loans can symbolize and foster these diplomatic relations.
Cultural objects can break the ice of misunderstandings and can be the first steps in new bilateral ties. They are sometimes referred to as ‘good will ambassadors’. Immunity from seizure facilitates inter-State art loans. That background may serve as a proper explanation why immunity from seizure for cultural State property on loan is understandable. In relation to this, I would also like to refer to the UN Convention on Jurisdictional Immunities of States and Their Property. On 2 December 2004, the UN General Assembly adopted the convention by consensus. It has not entered into force yet, but a considerable number of States consider the convention as a reflection of customary international law. Part IV of the 2004 UN Convention regards State immunity from seizure. It provides in general, but subject to certain limitations, for the immunity of a State from all forms of seizure in respect of its property or property in its possession or control. This part of the convention also contains an article where State property is listed which shall not be considered as commercial property. Consequently, this property is immune from seizure (unless the State to which the property belongs has explicitly consented to seizure or has allocated the property for the satisfaction of the connected claim). The relevant article, Article 21, aims to secure the protection for certain specific categories of property. One of the five categories of property reads “property forming part of an exhibition of objects of scientific, cultural or historical interest and not placed or intended to be placed on sale.” State-owned exhibits for industrial or commercial purposes are not covered by this category. It should be borne in mind that the gist of Article 21, and especially the cultural category, has neither been disputed during the negotiations. In my view, the fact that cultural objects can be important for the identity of a State, the fact that cultural objects may help to understand the culture, history and development of a State, as well as the fact that cultural objects can be used as a means in the promotion of international cultural exchanges (codified in several international agreements) and the strengthening of bilateral or multilateral diplomatic relations, makes it fair to consider these cultural objects on loan as a category of protected State property. Consequently, I do not consider it awkward to mention cultural State property on loan in one breath with one of those ‘classical’ categories of protected objects, such as military property, diplomatic property or property of the central bank of a State (and that is exactly what the 2004 UN Convention did). 

What are the biggest problems you have found with respect to immunized art? Are there reforms you can suggest? 

In regard to immunity from seizure for cultural State property on loan, important questions are: “what is a State?” and “what is to be considered as State property?” Answering these questions is not always easy. Different national and international legal instruments each follow their own approach in regard to the definition of a State. It can also depend on the acts performed by an agency or instrumentality of a State whether or not it falls under the definition of a State (or whether or not it enjoys the same immunity as the State). In practice, this can mean that it is up to national courts to consider whether in an actual situation an organ or entity can be identified as falling under the definition of a State. In most jurisdictions, a State museum will not fall under the definition of a State. However, that does not mean that the cultural objects housed in that State museum are subject to seizure by definition. Immunized State property would be broader than solely property that is owned by a State. Under the aforementioned 2004 UN Convention, property owned by the State and property in its possession or control would most likely be covered by the immunity provisions, although the exact scope has not yet been determined in practice. Although there is no specific definition of State property in the 2004 UN Convention, I come to this conclusion based on the history of negotiations and the reports of the International Law Commission. Generally speaking, based on my investigation, it would be fair to say that in any case property that is State-owned or of which the State serves as a custodian or has a right of disposal would fall under the immunity. And here we come to the second part of your question: the fact that immunity from seizure does not only apply to cultural objects on loan owned by a State, but also to objects possessed or controlled by a State, can make the application of the rule in practice somewhat complicated; it may be necessary to determine on a case by case basis whether a cultural institution should be considered as falling under the notion of a State (which will mostly not be the case), and whether in the actual situation it is the State which either owns, possesses or controls the objects concerned. As a result, it may be possible that loans between lending and borrowing institutions have to be considered differently, with regard to possible immunity. After all, a cultural institution can house objects which are owned by a State, a State may be able to exercise control over other objects, and some objects may not have a link with the State at all. A future global convention on immunity from seizure for all kinds of cultural property on loan, regardless whether it regards State property or private property, may solve such a situation. The International Law Association is currently assessing whether such a convention may possibly be viable, however, the assessment is still in its embryonic stage (the underlying discussion paper has been prepared by Prof. Th. M. de Boer and me). A convention like that may provide more legal security, but also raises new questions such as a possible overlap or discrepancy with the 2004 UN Convention. 

Many in the United States are hesitant to offer an opinion on immunity, particularly with respect to a proposed clarification to current U.S. practice moving through the U.S. Congress. I think this may be because immunity has increasingly been conflated with preventing justice. Do you think immunity prevents claimants from achieving a just result for their claim to a work of art? 

It occurred to me that several pending cases before a US court regard cultural property which is not on loan in the US, but is, and has been, in the ‘State of origin’. To name a few cases of past and present: the Altmann case, the Cassirer case, the Herzog case and the Popper case. Here we are not talking about immunity from seizure, but immunity from jurisdiction. And also in the Malewicz case, plaintiffs did not try to seize the cultural objects which were on loan to two US museums. 
The question what a ‘just result’ may be, will be answered differently by different people. But I have to sympathize with a Statement of Interest of the US in the Malewicz case. The heirs were there, in the view of the US authorities, “using the window of opportunity afforded by the Malewicz exhibition[s] as the jurisdictional hook for their claims”.
The Executive Branch stated: “if jurisdiction over a sovereign lender could be established solely by virtue of introduction into the United States of an exhibit immunized under section 2459, foreign States would be far less likely to agree to share their artwork with the American public, undermining the principal objective of section 2459” and “a finding of no jurisdiction in this case would merely prevent claimants from transforming into a sword what was intended to be only a shield.” From the perspective of international art loans, I have to admit that, in general, I have difficulties to agree with the idea that the presence of the objects (for the purpose of exhibition) in the jurisdiction of the borrowing State might provide a jurisdictional hook enabling the court in the borrowing State to exercise jurisdiction over the acts of a lending State. Even more, as domestic remedies often have not been exhausted. 
In regard to immunity from seizure, I have to recall that on February 3rd, 2012, the International Court of Justice was not at all hesitant to offer an opinion on immunity; it confirmed in the case Germany v. Italy that State property with a government non-commercial purpose, is immune from immunity from seizure unless the State which owns the property has expressly consented to the taking of the seizure or that that State has allocated the property in question for the satisfaction of a judicial claim. 
Finally with regard to the current US draft legislation, which aims to make the relationship between the FSIA and the IFSA clearer: I do think that the content of this legislation confirms the main conclusions of my study: I come to the conclusion that indeed a relatively young rule of customary international law exists, although not yet firmly established or well defined in all its aspects, stating that cultural objects belonging to foreign States and on temporary loan for an exhibition are immune from seizure. However, an important remark needs to be made in that regard: in order to be considered as a rule of customary law, a rule needs to be based, among other things, on a widespread, representative and virtually uniform practice of States (as well as opinio juris). With regard to some categories of cultural State property, this wide, virtually uniform acceptance is absent. The most important category regards cultural objects plundered during armed conflict. Based on my study, I would say that, generally speaking, the main sentiment among States is that such objects should not deserve protection. Although not legally but certainly morally binding, many States subscribed to the 1998 Washington Principles on Holocaust Era Assets, the 2000 Vilnius Declaration on Holocaust Era Looted Cultural Assets and the 2009 Terezin Declaration on Holocaust Era Assets and Related Issues. Moreover, several States established Restitution or Spoliation Committees in order to restitute cultural objects to heirs of World War II victims. Also the draft legislation which is currently under assessment of the US Senate confirms the immunity for cultural property on loan, unless it regards cultural property illicitly taken during the Holocaust.
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