1 Argentina had declared a public emergency by Emergency Law No. 25561 of January 6, 2002, which has been repeatedly extended—most recently until December 31, 2007. For background information on proceedings in other countries, see Jayson, J. Falcone, Argentina’s Debt Crisis, 27 Suffolk Transnat’l L. Rev. 357 (2004).Google Scholar Argentina also abolished the convertibility of the peso to the U.S. dollar and abrogated tariff adjustment clauses, which gave rise to investment disputes between Argentina and foreign investors, mainly in arbitrations under the aegis of the International Centre for Settlement of Investment Dispute. For details see Paolo Di, Rosa, The Recent Waive of Arbitrations Against Argentina Under Bilateral Investment Treaties: Background and Principal Legal Issues, 36 U. Miami Inter-Am. L. Rev 41 (2004).Google Scholar The article in this issue by Michael Waibel, “Opening Pandora’s Box: Sovereign Bonds in International Arbitration,” is largely concerned with the fallout from the Argentinean debt crisis.

2 The Court cites in this context its long-standing, established case law, beginning with 15 BVerfGE 25, 32, Case No. 2 BvM 1/60, Oct. 30, 1962.

3 60 Neue Juristische Wochenschrift 2610 (2007) (Fed. Const. Ct. May 8, 2007), available at <http://www.bundesverfassungsgericht.de>.

4 International Law Commission, Articles on Responsibility of States for Internationally Wrongful Acts, in Report of the International Law Commission on the Work of Its Fifty-third Session, UN GAOR, 56th Sess., Supp. No. 10, at 43, UN Doc. A/56/10 (2001), reprinted in James, Crawford, The International Law Commission’s Articles on State Responsibility: Introduction, Text and Commentaries (2002).Google Scholar

5 Payment of Various Serbian Loans Issued in France, 1929 PCIJ (ser. A) No. 20/21, at 5 (July 12).

6 French Co. of Venezuelan R.R. (Fr. v. Venez.), 10 R.I.A.A. 285 (Fr.-Venez. Mixed CI. Comm’n 1905).

7 Russia v.Turkey (Russian Indemnity), Hague Ct. Rep. (Scott) 298 (Perm. Ct.Arb. 1912), 7 AJIL 178, 188(1913).

8 ICSID No. ARB/01/08, Award (May 12, 2005).

9 ICSID Case No. ARB/02/1, Liability (Oct. 3, 2006). The award recognized that Argentina was justified in invoking necessity in order to refuse payment for a limited period of time between 2001 and 2003.

10 In reaching this conclusion, the Court did not cite case law but relied on an (as yet unpublished) expert opinion that it had requested from Austrian scholar August Reinisch.

11 These functions include, in particular, the protection of life and health of its citizens (para. 85).

12 Justice Lübbe-Wolff did not address, however, whether this Italian judgment contradicts her finding concerning judicial review of a state’s defense of necessity (paras. 72, 73).

13 In this context Justice Lübbe-Wolff referred to Pravin Banker Assocs. v. Banco Popular del Peru, 109 F.3d 850 (2d Cir. 1997), and EM Ltd. v. Republic of Argentina, 473 F .3d 463 (2nd Cir. 2005), as well as to sections 1610(a) (1) and 1611 (b) (1) of the Foreign Sovereign Immunities Act, 28 U.S.C. §§ 160 2–1611 (2000) and corresponding decisions. In discussing these U.S. materials, she considered it irrelevant that these courts did not recognize a state of emergency declared by a foreign state without further enquiries.

14 Thomas, Kleinlein, Rechtsfragen staatlicher Auslandsanleihen: Odious Debts, Staatsnotstand und Immunität, 44 Archiv des Völkerrechts 405, 405 (2006)Google Scholar; Thomas, Pfeiffer, Zahlungskrisen ausldndiscber Staaten im deutschen und internationalen Rechtsverkehr, 102 Zeitschrift Für Vergleichende Rechtswissenschaft 141, 144 (2003).Google Scholar

15 According to some authors, the share of creditor states and creditor banks in the total indebtedness of Argentina amounts to only 7 percent. See Alf, Baars & Margret, Böckel, Argentinische Auslandsanleihen vordeutschen undargentinischen Gerichten, 16 Zeitschrift für Bankrecht und Bankwirtschaft 445, 446 (2004)Google Scholar; Pfeiffer, supra note 14, at 144.

16 Kleinlein, supra note 14, at 417; Thomas, Pfeiffer & Thomas, Kopp, Der Immunitätsverzicht in Staatsanleihen und seine Reichweite, 102 Zeitschrift für Vergleichende Rechtswissenschaft 563, 563 (2003)Google Scholar; International Monetary Fund, Proposals for a Sovereign Debt Restructuring Mechanism (SDRM), at <http://www.imf.org/external/np/exr/facts/sdrm.htm>>Google Scholar; Anne, Krueger, A New Approach to Sovereign Debt Restructuring, Address Before the Conference on Sovereign Debt Workouts: Hopes and Hazards, Washington, D.C. (Apr. 1, 2002), at <http://www.imf.org/external/np/speeches/2002/040102.htm>>Google Scholar; Christoph, Paulus, Rechtlich geordnetes Insolvenzverfahren für Staaten, 35 Zeitschrift für Rechtspolitik 383 (2002).Google Scholar

17 Stephan, W. Schill, German Constitutional Court Rules on Necessity in Argentine Bondholder Case, ASIL Insight (July 31, 2007).Google Scholar

18 For Argentina’s waiver of immunity, see supra note 1 and accompanying text. According to Baars and Böckel, see supra note 15, at 446, the importance of the case was evident in the number of referrals: in 2004, ten referrals under Article 100(2) of the Basic Law were pending before the Constititional Court, versus the fifteen cases previously brought to the Court since 1949.

19 Bundesverfassungsgericht, Case No. 2BvQ3/03, Feb. 13, 2003, 118 Deutsches Verwaltungsblatt 661 (2003).

20 Landgericht [Regional Court] Frankfurt a. M., Case No. 2/21 O 294/02, Mar. 14, 2003, 57 Wertpapier-mitteilungen 783, 786 (2003), holding that an “imminent peril” to the state’s essential interests, which is one of the elements of the state of necessity as set out in Article 25 of the International Law Commission’s Articles on State Responsibility, see supra note 4, had not been established at this stage of the proceedings since the creditor’s title had to be executed in separate proceedings. See Landgericht Frankfurt a.M., Press Release Z06/03 (Mar. 18, 2003).

21 BVerfG, Case No. 2 BvM 9/03, Dec. 6, 2006, 122 Deutsches Verwaltungsblatt 242 (2007); see Amtsgericht Berlin-Mitte, Case No. 32 M 4833/03, Sept. 10, 2003, 18 Neue Juristische Wochenschrift—Rechtsprechungs-Report 1713 (2003); Kammergericht [Court of Appeals] Berlin, Case No. 25 W 100/03, Nov. 11, 2003, 4 Neue Juristische Online Zeitschrift 3382 (2004); Oberlandesgericht Köln, Case No. Wx 34/03, Mar. 24, 2004, 4 Neue Juristische Online Zeitschrift 2064 (2004); BVerfG, Case No. 2 BvR 120/03, May 4, 2006, 59 Neue Juristische Wochenschrift 2909 (2006) (finding no jurisdiction to review decisions of the International Monetary Fund that allegedly had contributed to Argentina’s financial crisis).

22 Oberlandesgericht Frankfurt a. M., Case No. 8 U 109/03, Feb. 16, 2006, 6 Neue Juristische Online Zeitschrift 3184 (2006); see Oberlandesgericht Frankfurt a.M., Case No. 8 U 107/03, June 13, 2006, 59 Neue Juristische Wochenschrift 293 (2006) (comments by Ulrich Schroeter, 22 Entscheidungen Zum Wirtschaftsrecht 557 (2006), and by Peter Schantz, 21 Verbraucher und Recht 310 (2006)); Peter, Seester, Argentinische Staatsanleihen: Schicksal der “Hold Outs” nach Wegfall des Staatsnotstands, 59 Neue Juristische Wochenschrift 2891 (2006).Google Scholar

23 See, e.g., AG Frankfurt a.M., Case No. 30 C 1595/05, May 16, 2006, 6 Neue Juristische Online Zeitschrift 3183 (2006).

24 See Oberlandesgericht Frankfurt, Case No. 26 W 37/07, Aug. 9, 2007, with reference to the decision of the Constitutional Court. The court’s press release of August 10, 2007, is available at <http://www.olg-frankfurt.justiz.hessen.de>.

25 Stefan, Kadelbach & Thomas, Kleinlein, Überstaatliches Verfassungsrecht, 44 archiv des Völkerrechts 235, 255 (2006)Google Scholar; Hermann, Mosler, General Principles of Law, in 2 Encyclopedia Of Public International Law 511 (1995).Google Scholar

26 Ian, Brownlie, Principles of Public International Law 16 (6th ed. 2003)Google Scholar (referring to Oppenheim’s International Law 29); Malcolm, N. Shaw, International Law 92–94 (5th ed. 2003).Google Scholar

27 See Pfeiffer, supra note 14, at 160 (discussing ability of states to regain their capacity for economic development); Rudolf, Dolzer, Staatliche Zahlungsunjuhigkeit: Zum Begriffundzu den Rechtsfolgen im Völkerrecht, in Des Menschen Recht Zwischen Freiheit und Verantwortung: Festschrift für K. J. Partsch 531, 546–47 (Jürgen, Jekewitz et al. eds., 1989).Google Scholar For similar treatment of of splitting up remaining assets for creditors in a fair manner, see Christian, Tietje, DieArgentinien-Krise aus rechtlicher Sicht: Staatsanleihen undStaateninsolvenz, in 37 Beiträge zum transnationalen wlrtschaftsrecht 5, 18 (Christian, Tietje, Gerhard, Kraft, & Rolf, Sethe eds., 2005).Google Scholar

28 See International Law Commission, Report on the Work of Its 32nd Session, [1980] 2 Y.B. Int’l L. Comm’n, pt. 2, at 36 (1980).

29 Kleinlein, supra note 14, at 41 4–15; Baars & Bockel, supra note 15, at 461.

30 Kleinlein, supra note 14; Baars & Bockel, supra note 15. To similar effect, see Christoph, Ohler, Der Staatsbankrott, 60 Juristenzeitung 590, 595 (2005).Google Scholar

31 Human Rights Committee, General Comment No. 3, The Nature of States Parties Obligations, para. 12, UN Doc. E/1991/23, Annex III (1990).

32 See Pfeiffer, supra note 14, at 16 0–61; Kleinlein, supra note 14, at 412; Dolzer, supra note 27, at 547; Jörn Axel, Kämmerer, Der Staatsbankrottaus völkerrechdicher Sicht, 65 Zeitschrift für ausländisches Öffentliches Recht und Völkerrecht 651, 657 (2005)Google Scholar; Anne van, Aaken, Zwischen Scylla und Charybdis: Völkerrechtlicher Staatsnotstand und Internationaler Investitionsschutz, 105 Zeitschrift für Vergleichende Rechtswissenschaft 544, 559–60 (2006)Google Scholar (all arguing that these minimum standards should be assessed in relation to the degree of economic development of the state invoking necessity).

33 See, e.g., Human Rights Committee, General Comment No. 31, Nature of the Legal Obligation on States Parties to the Covenant, para. 8, UN Doc. CCPR/C/21/Rev.1/Add.13 (2004); Human Rights Council, Report of the Special Representative of the Secretary-General on the Issue of Human Rights and Transnational Corporations and Other Business Enterprises, UN Doc. A/HRC/4/035 (2007).

34 Human Rights Committee, General Comment No. 29, States of Emergency, para. 6, UN Doc. CCPR/C/21/Rev. 1/Add. 11 (2001).

35 Also advocated by Dolzer, supra note 27, at 542, with reference to Hermann Mosler, The International Society as a Legal Community 122 (1980), and Stephan, Hobe, Völkerrecht im Zeitalter der Globalisierung, 37 Archiv des Völkerrechts 253, 267–68 (1999).Google Scholar