Shipping News of the World

Whaddayaknow -- the Ghanaian commercial court upheld the detention of the Argentine tall ship at the request of the defaulted bond holders. The opinion says that there is insufficient consensus to support customary international law on military ship immunity, that sovereigns have virtually unlimited capacity to waive what immunity there is, and that Argentina waived any and all immunity in its broadly-worded Fiscal Agency Agreement (a reading the court supports by citing to subsequent narrower waivers). My sources on Ghanaian law say there are two more possible appeals; meanwhile, an Argentine foreign ministry team has ... ummm ... set sail for Ghana.

At first blush, this decision strikes me as phenomenally wrong-headed, but I want to give the custom angle a bit more thought. Meanwhile, whatever the law, the politics is not all bad for the Argentine leadership -- coming under attack by unscrupulous imperialists has its benefits, especially at home. And whatever the outcome, the biggest impact may be on borrowers other than Argentina, contemplating their contract drafting, payment, and litigation strategies. Even if the decision is overturned on appeal, who wants to take the risk of oddball magistrates in distant harbors? In that sense, the incident may already be a victory for Elliott. Worth ten years and umpteen zillion dollars?  Dunno.

Comments

[Knute Rife]

I don't have access to Exhibits KA02 and KA03, but I find it hard to believe NML actually proved Argentina waived immunity with regard to a naval vessel, which is what the court concludes on page 18. Waiver of immunity rendering the sovereign amenable to suit is not the same as waiving immunity for executing on specific property, but the court seems to conflate the two. It's possible, but I'd have to be specifically shown it.