Immunity of International Organizations: U.S. Supreme Court Rejects Absolute Immunity for International Organizations Under International Organizations Immunity Act

Sullivan & Cromwell LLP - March 11, 2019

In Jam v. International Finance Corporation, the Supreme Court held that the immunity granted to international organizations under the International Organizations Immunity Act (the “IOIA”) is the same as the immunity granted to foreign governments under the Foreign Sovereign Immunities Act (the “FSIA”). In reaching this conclusion, the Supreme Court rejected prior D.C. Circuit case law that held that immunity under the IOIA is “absolute.” As a result, absent more expansive immunity provisions in their charters, international organizations granted immunity under the IOIA may be subject to suit in a U.S. court to the same extent as a foreign sovereign would be under the FSIA, including as a result of the so-called “commercial activities” exception. In addition to noting that an organization’s charter may provide an independent source of immunity, the Chief Justice’s majority opinion offered helpful dictum regarding the scope of the commercial activities exception. While the opinion did not decide whether the international organization benefitted from immunity in the case, and suggested in dictum that it might, the Jam decision and its rejection of absolute immunity for international organizations may heighten the litigation exposure of international organizations in the United States.