(International Liability for Injurious Consequences arising out of Acts not Prohibited by International Law, Reservations to Treaties & Unilateral Acts of States)

New York, 30 October 2003

Mr. Chairman,

The ILC, at its 55th session, discussed the topic of international liability for injurious consequences arising out of acts not prohibited by international law. We would like to express our appreciation to the Special Rapporteur for his excellent report. Here, I'd like to make some brief comments on this topic.

Let me proceed with two general observations.

First, we support the study by the ILC on the question of allocation of loss with a view to formulating a uniform scheme as soon as possible. The report by the Special Rapporteur reveals some common features in the existing liability regimes in relation to allocation of loss from transboundary harm. For instance, the party that should assume primary liability is normally the operator or the one that can exercise the most effective control over the hazard. There are limitations on liability, and in most schemes, a state's liability is generally of supplementary nature, and they contain waiver clauses or procedures for claims, etc. Therefore conditions are in place for the ILC to pursue an in-depth study on this topic. The Commission should, along these lines, carry out more studies on national legislations and domestic and international practices in order to find common denominators which will solidly lay the groundwork for a uniform regime. The proposed allocation of loss regime should combine principles with flexibility. On the one hand, it should provide a framework of principles for the allocation of loss among participants of a high- risk activity, so that countries can be guided by it when a case arises. On the other hand, it should be a relatively flexible regime with enough latitude to allow countries sufficient freedom to resolve their disputes.

Second, the Special Rapporteur proposed in his report that:

· the proposed allocation of loss regime should be without prejudice to any existing treaty regimes, or to any future regime governing the allocation of loss;

· a state's liability should be of supplementary nature;

· the scope of the topic should be the same as the one for the draft articles on prevention;

· the same threshold of significant harm should be applied for triggering allocation;

· parties that share major responsibilities should hold the joint and several liability;

· limited liability should be supplemented by additional funding mechanisms;

· the state should be responsible for designing schemes specific to addressing problems concerning transboundary harm;

· damage to persons and property should be compensable;

· compensation to damage to environment or natural resources within the jurisdiction or in areas under the control of a state should be limited to reasonable costs actually incurred on account of response measures as well as measures of restoration.

We endorse these proposals in principle and believe they should be fleshed out and adjusted by the Commission on the basis of a further survey of practices in this respect.

Now I'd like to offer some general comments on a few specific issues.

First, the supplementary liability of the state should, in our view, mainly consist of taking preventive measures and setting up funds for the equitable allocation of loss, rather than its assuming residual liability when the responsible party is financially incapable of compensation.

Second, on the question of whether there should be mandatory insurance for high-risk activities, we believe flexibility is called for here, as the diversity of national legal systems and economic conditions is not amenable to the implementation of a rigid rule in this regard. In addition, the commission has reached an agreement on the residuary nature of the proposed regime for allocation of loss, which means it should be without prejudice to the existing national practices in liability.

Third, on the issue of who should assume primary liability, in our view, in any allocation of loss, primary liability should be placed at the doorstep of the person who directly commands and controls the hazardous activity. There should be presumption of a reasonable causal link between the actions of this party and the injurious consequences, unless there is a waiver clause. Whether this person should be called “operator” or “the person in control” is not a major issue.

Now I'd like to offer some comments on the topic of reservations to treaties.

I'd start by congratulating the Commission on the results it has achieved so far and expressing our appreciation to the Special Rapporteur for his efforts on this topic. The Special Rapporteur has submitted an excellent report on the enlargement of the scope of reservations and the definition of objections to reservations.

Regarding the enlargement of the scope of reservations, we agree that this should be treated as the late formulation of a reservation, for it is equivalent to a new reservation on a larger scope. It is only proper that the provisions contained in the draft guidelines on the late formulation of reservations apply, i.e. as long as other states parties have no objections, a state party can resort to a late formulation of reservations or enlarge the scope of its reservations. This seemingly contradicts the relevant provisions of the Vienna Convention on the Law of Treaties, which allows a state to submit its reservations only at the time of signing, ratifying, accepting, approving and acceding to a treaty. However, the freedom to enter into a treaty is one of the fundamental principles of the law on treaties. After all, a treaty is the result of the agreement among its parties. The absence of objections from other parties to an enlargement of the scope of reservation signifies its acceptance. As any enlargement of reservations is subject to the agreement by other states parties, it will not have the effect of encouraging enlargements of reservations either.

There can be two kinds of objections to reservations. In one, a state party can claim the inadmissibility of the reservation by invoking article 19 of the Vienna Convention on the Law of Treaties. In the other, a state party may deem a reservation admissible but nonetheless formulates an objection on other grounds. Although the Vienna Convention on the Law of Treaties does not contain a definition of “objections to reservations”, one can infer from the relevant provisions contained therein that the above two possibilities fall into the category of objections to reservations. In practice, an objecting state party wouldn’t normally specify the grounds of their objections. Such general objections to reservations should therefore be governed by the provisions in the Vienna Convention on the Law of Treaties on the legal effects of objections, namely, the whole treaty, or the provision to which the reservation relates, will not apply in the relations between the reserving state and the objecting state. However, when a state raises an objection to a reservation under article 19 of the Vienna Convention, it might lead to a unilateral judgment that the reservation is inadmissible and absent such reservation the treaty in question would apply in the relations between it and the reserving state. The “reservations dialogue” cited by the Special Rapporteur involves such a scenario. In case of a dispute about the admissibility of a reservation, the legal effects of the objection to the reservation under the Vienna Convention will not be immediately brought about. The parties should in this case first endeavor to resolve their dispute. If the dispute defies solution or a party simply ignores such controversy, the objections to reservations should continue to be governed by the provisions on the legal effects of objections to reservations under the Vienna Convention. An objecting state's unilateral claim based on its judgment of the inadmissibility of the reservation that the whole treaty shall enter into force in its relations with the reserving state will have no legal effect and will not be accepted in practice. The silence of the reserving state should not be interpreted as acceptance of the objections either. In view of the above, we believe that the definition of objections should clearly provide that objections to reservations can merely produce the legal effects defined in the Vienna Convention directly or indirectly.

Lastly, on the topic of unilateral acts of states. During this session of ILC, a report submitted by the working group on the scope of the topic was adopted, in which the working group expressed the view that the Commission should begin with a study of unilateral acts stricto sensu. This category of unilateral acts of states consists of declarations expressing the will or consent by which states purport to create obligations or other legal effects under international law. In addition, the study will also deal with unilateral acts of states that are not stricto sensu.

We are in favor of the above scope as defined by the Commission and hope that on the basis of extensive efforts to gather relevant state practices, the study will proceed expeditiously so that draft articles or guidelines on unilateral acts of states can be prepared at an early date with a view to clarifying the legal implications and effects of such acts. This will not only contribute positively to the development of international law but also greatly help efforts to regulate international practices and minimize international disputes.

That concludes my statement.

Thank you, Mr. Chairman.