US SUPREME COURT HOLDS IN HALKBANK PETITION THAT FSIA DOES NOT APPLY IN CRIMINAL CASES

The United States Supreme Court today held that the bank is not immune from criminal proceedings under the Foreign Sovereign immunities Act, which bars civil suits against foreign government-owned entities. The Court which also held that the US District Court properly had jurisdiction over the bank in a criminal case, also ruled that the Commercial Activities Exception to the FSIA was applicable.

After a lengthy sixteen-page discussion on the applicable law, and after concluding that Halkbank's legal arguments on FSIA has no merit, the Court Affirmed the lower court decision on the inapplicability of the FSIA, but Reversed and Remanded on the sole issue of whether there is a common law immunity, noting that the Court of Appeals did not fully consider that issue. The case now goes back to the Second Circuit for further proceedings on that sole issue, but the Court ruled against the bank on the critical FSIA issue.