¹ See Jeanette Greenfield, The Return of Cultural Treasures 282 – 86 (1989), for an account of this incident.

² Malraux was to become the celebrated French novelist and the author of such critical studies as Museum Without Walls (Stuart Gilbert & Francis Price trans., 1967) and The Twilight of The Absolute (Stuart Gilbert trans., 1950). Considered to be a leading art theoretician, Malraux was appointed by the French government as the French Minister of Cultural Affairs in the 1960's.

³ The court in Saigon did not accept Malraux's defense. As a result of a treaty entered into by France and Siam in 1907, France became the recognized owner of all historic monuments in the region. In 1908, the temple had been classified as a historic monument.

⁴ Interestingly, Malraux's argument in favor of a broader definition of cultural heritage was advanced by another French theoretician, Quartième de Quincy, more than a century earlier, for reasons exactly opposite to his. De Quincy believed that a broad conception of culture necessitated the return of cultural objects that Napoleon had taken from other European nations. He wrote:

It is as a member of this universal republic of arts and sciences and not as an inhabitant of this or that nation, that I shall discuss the concern of all parts and the preservation of the whole. What is this concern? It is a concern for civilization, for perfecting the means of attaining happiness and reason: in a word, for the improvement of the human race. Everything that can build toward this end belongs to all peoples; no one of them has the right to appropriate for itself, or to dispose of it arbitrarily …

Charles de Visscher, International Protection of Works of Art and Historic Monuments, 3590 U.S. Dep't St. Pub. 823, 824 (1949) (quoting Quartième de Quincy, Lettres au général Miranda sur le préjudice qu'occasionairaient aux arts et a la science le déplacement des monuments de l'art de l'Italie, le démembrement de ses collections et la spoilation de ses collections, galeries, musées, etc. (1796)), quoted in Graham, Gael M., Protection and Reversion of Cultural Property: Issues of Definition and Justification, 21 (3) Int'l Law. 755, 758 (1987).Google Scholar

⁵ The court sentenced Malraux to three years imprisonment and prohibited him from entering certain areas for five years. The charges were reduced on appeal to a suspended sentence of one year due to the testimony by leading French authors on his behalf.

⁶ See Bator, Paul M., An Essay on the International Trade in Art, 34 Stan. L. Rev. 275, 309 (1982)CrossRefGoogle Scholar, for the view that, despite the central importance of preservation, national patrimony should not be defined so as to encourage a nation to retain all of its art. See Merryman, John Henry, Two Ways of Thinking about Cultural Property, 80 Am. J. int'l L. 831, 846 (1986)CrossRefGoogle Scholar [hereinafter Merryman, Cultural Property], for a discussion of the distinction between “cultural internationalism” and “cultural nationalism” and the comment that cultural nationalism appears to be the attitude preferred by the majority of countries today. See also Merryman, John Henry, Text and Subtext in the International Art Trade, in 3 International Art Trade and Law 457, 462 (Martine Briat & Judith A. Freedberg eds., 1991)Google Scholar. Merryman is opposed to the cultural nationalist point of view, describing it as “romantic nationalism.” He writes: “The romantic nationalist subtext has outlived its utility and today serves the cause of blind retentionism … Together, preservation, truth and access offer an alternative and preferable basis for policy …”.

⁷ For instance, the ongoing debate over whether cultural treasures that have been removed in the past, sometimes centuries earlier, should be returned, will not be discussed. For a discussion of this topic see e.g. Greenfield, supra note 1, at 10–46, for a detailed discussion of the return by Denmark to Iceland in 1971 of two extremely valuable medieval manuscripts, the Flateyjarbok (the Book of Flat-Island) and the Codex Regius (the King's Volume), which Denmark had removed from its former colony 250 years earlier.

The most celebrated example of the ongoing debate as to whether objects removed centuries earlier should be returned involves the “Elgin Marbles.” Lord Elgin, while serving as the British Ambassador to Constantinople, removed them from Greece while it was part of the Ottoman Empire in the early nineteenth century. After much discussion, the British Parliament passed an Act in 1816 “To Vest the Elgin Collection of Ancient Marbles and Sculptures in the Trustees of the British Museum,” where they remain on display to this day. The notoriety of this example has led to the coining of the French word “Elginisme,” to describe generally the taking of a cultural object. A full account can be found in Greenfield, supra note 1, at 47–105.

The incident is further memorialized in a condemnation of the British action by Lord Byron in his poem “Childe Harold's Pilgrimage.” He wrote:

Cold as the crags upon his native coast,

His mind as barren as his heart is hard,

Is he whose head conceived, whose hand prepared,

Aught to displace Athena's poor remains.

…

Tell not the deed to blushing Europe's ears:

The ocean queen, the free Britannia, bears

The last poor plunder from a bleeding land.

Lord Byron, “Childe Harold's Pilgrimage,” Canto the Second, XII, XIII (1812), cited in Bator, supra note 6, at 277 n.2.

⁸ Marcus Tullius Cicero, The Verrine Orations, (In C. Verrem Actio II), Book IV (Harvard University Press, trans., L.H.G. Greenwood 1935), cited in Lyndel V. Prott & Patrick J. O'Keefe, 3 Law and the Cultural Heritage: Movement 803 (1989). See also Titus Livius, From The Founding of the City (Ab Urbe Condita), Book XXI (Harvard University Press, trans., B. O. Foster 1929), describing Hannibal's seizure of many valuable cultural objects in the war he waged with the Carthaginians against Rome, cited in Graham, supra note 4, at 756 n. 1.

⁹ See, UNIDROIT, Diplomatic Conference for the Adoption of the Draft UNIDROIT Convention on the International Return of Stolen or Illegally Exported Cultural Objects: Text of the Draft Convention with Explanatory Report, UNIDROIT 1994, Conf. 8/3, (Dec. 20, 1994) (Original: French) (hereinafter “UNIDROIT Explanatory Report 1994”), at 8. See also the Draft UNIDROIT Convention on the International Return of Stolen or Illegally Exported Cultural Objects, as resulted from the fourth session of the UNIDROIT Committee of governmental experts on the international protection of cultural property, Rome, Sept. 29 – Oct. 8,1993, UNIDROIT, Committee of Governmental Experts on the International Protection of Cultural Property, App. IV, UNIDROIT 1994, Study LXX – Doc. 48 (Original: French) [hereinafter “draft UNIDROIT Convention”] for the identical text of the draft UNIDROIT Convention.

The name UNIDROIT stands for the International Institute for the Unification of Private Law, an organization based in Rome, Italy. UNIDROIT was founded in 1926, at the instigation of the League of Nations, to serve as an independent body devoted to improving the harmonization of international laws.

It is frequently contended that there is a close link between traffic in cultural property and organized crime, see e.g. Church, Judith, Evolving United States Case Law on Cultural Property Disputes, 2 Int'l J. Cultural Prop. 47, 62 n.1 (1993))Google Scholar, citing. James Walsh, It's a Steal: The World's Cultural Heritage is Being Looted by Thieves Who Often Have Ties to Organized Crime and Even get Help From the Art World, Time, Nov. 25, 1991, at 86. Although this may be true, see e.g. Michael Janofsky, Fake Bank Set Up by U.S. Agents Snares Drug-Money Launderers, N.Y. Times, Dec. 17 1994, at Al, chronicling the recent sting operation conducted by U.S. agents of money laundering by Cali drug cartel and members of organized crime in Italy that resulted in the recovery of Picasso's “Head of the Beggar,” a 1904 watercolor. Rubens' “St. Paul” and painting by Sir Joshua Reynolds, it is perhaps the case that such instances, although newsworthy, do not represent a significant proportion of the cultural objects traded illicitly.

¹⁰ See Greenfield, Jeannette, The Return of Cultural Property, in 60 Antiquity, Mar. 1986, 29–35CrossRefGoogle Scholar for a list of examples of voluntary restitution by different nations. Among the more notable instances were the return to Ethiopia of the throne of Emperor Menelek II from Italy in 1982 and the return of a large collection of pre-Columbian ceramics to Ecuador after their illegal export to Italy was discovered in 1983.

The restitution of objects by museums is also prevalent, e.g., the return by the Brooklyn Museum of a stolen stela fragment to Guatemala in 1973; the return by the Newark Museum of a fifth century A.D. mosaic from the ancient city of Apamea to the Syrian Department of Antiquities in 1974; the return by the Kimbell Art Museum in Fort Worth, Texas, of the Siva Nataraja statue to India after its illegal provenance was discovered in 1979; the return by the M.H. de Young Memorial Museum in San Francisco, California, of a large collection of pre-Columbian murals dating from 400–700 A.D., to Mexico in 1986; and the return by the Voderasiatisches Museum in Berlin of more than 7,000 cuneiform tablets dating from the Hittite Empire, 1799 to 1200 B.C., to Turkey in 1987.

Also significant is the return of objects held by private individuals to their country of origin. In 1973, the Afo-A-Kom, a wooden carving sacred to the royal family of the Kom in Cameroon, was discovered in a Dartmouth College Art Exhibit on loan from a New York art dealer. It was returned to Cameroon shortly after this discovery.

¹¹ See Prott & O'Keefe, supra note 8, at 624–25, 616–20, respectively. The decisions in Attorney General of New Zealand v. Ortiz, [1982] 2 Q.B. 349; rev'd. [1982] 3 W.L.R. 571 (C.A.); [1983] 2 W.L.R. 809 (H.L) and Winkworth v. Christie, Manson & Woods, Ltd., [1980] 1 Ch. 496, serve to illustrate the unfortunate outcome that can result from the resolution of disputes under the current framework.

In Ortiz, the New Zealand government sought the return of five Maori carved panels. In 1972, a descendant of the Maori tribe, Manukonga, dug five panels out of a swamp which had been buried there by the Taranaki tribesmen in the 182O's-3O's when they had been forced off the land. He sold them to an English dealer who, in turn, took them to New York without an export permit, and sold them to a Swiss collector and resident, Ortiz. Ortiz kept the panels in Switzerland for five years (the requisite period under Swiss law in order for good title to pass), whereupon he attempted to auction them at Sotheby's in London. The panels were recognized by a New Zealander in a televised advertisement for the upcoming sale at Sotheby's. The New Zealand government then made an effort to stop the sale and have the panels returned.

Litigation commenced in London in 1982. The New Zealand government claimed that the panels should be returned to it on the basis of a provision (§ 12(2)) of the New Zealand Historic Articles Act of 1962. The Act required that “[a]n historic article knowingly exported … shall be forfeited to Her Majesty.” [New Zealand did not want to assert an ownership claim, as this would only have complicated the issue by engendering a controversy between Manukonga, the excavator of the Maori art, and the Taranaki tribe, which had originally buried the artifacts. Under New Zealand law, such a claim would need to be settled in a Maori land court.]

The outcome of the case rested upon the court's interpretation of the term “forfeiture.” The defendant contended that the goods had not been “forfeited” but were merely “liable to forfeiture,” as “forfeiture,” according to the subsequently enacted Customs Act of 1966, required that the goods be seized by the New Zealand government. The New Zealand government contended that forfeiture was automatic upon the illegal export of the goods. The lower court granted a decision in favor of the New Zealand government. On appeal, however, both higher courts reversed, allowing the panels to be sold.

In Winkworth, a collection of netsuke, Japanese miniature ivory carvings, was stolen from a British citizen, Winkworth, and taken to Italy where it was purchased by the Marchese Paolo Da Pozzo. The goods were then delivered by the Marchese to Christie's in England to be auctioned on his behalf. Winkworth brought suit in London to attempt to recover his stolen property and to claim the proceeds of those items that had already been sold.

The Italian Civil Code, Art. 1153, provides that so long as the purchase is made “in good faith at the moment of consignment,” ownership is properly transferred. Thus, according to Italian law, the Marchese Da Pozzo was a bona fide purchaser. Under British law, it is not possible for a purchaser to obtain good title if the goods have previously been stolen. Therefore, if British law applied, Winkworth would have been able to reclaim his goods. The British courts ruled against Winkworth, however, because they determined that Italian law must govern according to the principle of lex situs (the law of the country where the property is situated at the time of the last transaction). Winkworth dropped the case following the determination that Italian law would govern.

¹² See Final Act of the Diplomatic Conference for the Adoption of the Draft UNIDROIT Convention on the International Return of Stolen or Illegally Exported Cultural Objects, Appendix: UNIDROIT Convention on Stolen or Illegally Exported Cultural Objects (hereinafter “UNIDROIT Convention”), June 24, 1995.

The full text of the UNIDROIT Convention is reprinted in 51 The Art Newspaper, Sept. 1995, at 28, and this Journal infra at 155.

¹³ These deliberations were recorded in the Summary Records of the Conference. UNIDROIT 1995, Conf. 8/S.R. 1–5 (June 10–24, 1995) (Original: English/French); the Summary Records of the Committee of the Whole, UNIDROIT 1995, Conf. 8/C.l/S.R. 1–19 (June 13–23, 1995) (Original: English/French); and the Report of the Final Clauses Committee, Conf. 8/C.2/Doc. 1 (June 23, 1995) (Original: English/French). These documents were provided to the author courtesy of UNIDROIT Secretariat prior to their final correction and official publication.

¹⁴ The responses given by local experts of various nationalities to a questionnaire addressing an early version of the draft UNIDROIT Convention, the preliminary draft Convention on Stolen or Illegally Exported Cultural Objects [hereinafter “the preliminary draft Convention”], provide a basis for these contentions. Their commentary offers valuable insights into the potential role arbitration could play in the settling of cultural property disputes. See Martine Briat & Judith A. Freedberg, Editors' Foreword to 4 International Art Trade and Law, at v (Martine Briat & Judith A. Freedberg eds., 1993) [hereinafter Briat & Freedberg]. The questionnaire was developed in 1991 by the Institute of International Business Law and Practice and by members of its Council. The National Reports, along with the General Reports, were written by local experts in response to the questionnaire asking them to express their opinion on the strengths and weaknesses of the preliminary draft Convention. These were presented at the Fourth International Symposium on International Sales of Works of Art, entitled “The Legal Aspects of International Trade in Art,” in Madrid, Feb. 12–14, 1992.

For the text of the preliminary draft Convention, see, UNIDROIT 1990, Study LXX – Doc. 19, reprinted in Lyndel V. Prott, The Preliminary Draft Convention on Stolen or Illegally Exported Cultural Objects, 41 I.C.L.Q. 160, 168–70(1992).

¹⁵ The 1965 Convention on the Settlement of Investment Disputes between States and Nationals of Other States, 17 U.S.T. 1270 (1966), 575 U.N.T.S. 159, reprinted in Doc. ICSID/15, ICSID Basic Documents 11 (Jan. 1985).

¹⁶ Arbitration between States, State Enterprises, or State Entities, and Foreign Enterprises, reprinted in 5 ICSID Rev. – For. Inv. L. J. 139 (1990), 16 Y.B. Comm. Arb. 236(1991).

¹⁷ See 19 Y.B. Comm. Arb. 338 (1994) for The Permanent Court of Arbitration Optional Rules for Arbitrating Disputes between two Parties of which only one is a State, July 6, 1993. They are also available from the Permanent Court of Arbitration, Peace Palace, Carnegieplein 2, 2517 KJ The Hague, The Netherlands.

Id. at 313 for The Permanent Court of Arbitration Optional Rules for Arbitrating Disputes between two States, Oct. 20, 1992, reprinted in 32 I.L.M. 572(1993).

¹⁸ Convention for the Protection of Cultural Property in the Event of Armed Conflict, May 14, 1954, 249 U.N.T.S. 215.

¹⁹ Convention on the Means of Prohibiting and Preventing the Illicit Import, Export and Transfer of Ownership of Cultural Property, Nov. 14, 1970, 823 U.N.T.S. 231, reprinted in 10 I.L.M. 289 (1971).

²⁰ Council Directive 93/7/EEC on the Return of Cultural Objects Unlawfully Removed from the Territory of a Member State, 1993 O.J. (L 74) 74; Council Regulation 3911/92/EEC on the Export of Cultural Goods, 1992 O.J. (L 395) 1. Both are reprinted in 3 Etudes en Droit de l'Art/ La Libre Circulation des Collections d'Objets d'Art (Studies in Art Law/ The Free Circulation of Art Collections) (Quentin Byme-Sutton & MarcAndré Renold eds., 1993) 217 [hereinafter Byme-Sutton & Renold].

²¹ See supra, note 18. The Preamble to the 1954 Hague Convention states, that “damage to cultural property belonging to any people whatsoever means damage to the cultural heritage of all mankind, since each people makes its contribution to the culture of the world.”

²² There was considerable discussion at the Diplomatic Conference, particularly by representatives from Croatia, Kuwait and the United States, as to whether the UNIDROIT Convention should address the issue of cultural objects acquired in periods of armed conflict. Ultimately, the decision was made not to introduce a separate provision on this subject in the Convention so late in the drafting process. However, it is still possible that such objects might be covered by the UNIDROIT Convention as drafted. See UNIDROIT 1995, Conf. 8/C.1/S.R. I, at 11–12 and Conf. 8/C.l/S.R. 12, at 8–9, supra note 13.

²³ See generally Graham, supra note 4, for a thorough discussion of the treatment of cultural property before the creation of UNESCO in 1947 and thereafter.

²⁴ See Prott & O'Keefe, supra note 8, at 726–801 for further discussion of the UNESCO Convention.

²⁵ See the UNESCO Convention, supra note 19, Art. 7, para, (b), cl. (i).

²⁶ Id. Art. 7, para, (b), cl. (ii).

²⁷ Id. Art. 6.

²⁸ See the Treaty on European Union, Feb. 7, 1992 O.J. (C 224) 1, [1992] 1 C.M.L.R. 719, reprinted in 31 I.L.M. 247 (1992) [hereinafter Maastricht Treaty]. The twelve Member States to sign the Treaty were Belgium, Denmark, France, the Federal Republic of Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain and the United Kingdom.

²⁹ See generally Byme-Sutton & Renold, supra note 20. See also Vitrano, Victoria J., Comments: Protecting Cultural Objects in an Internal Border-Free EC: The EC Directive and Regulation for the Protection and Return of Cultural Objects, 17 Fordham Intl. L.J. 1164 (1994)Google Scholar; see also Rigaux, François, The Protection of Cultural Heritage: Aspects of EEC Law, 109 Mededeungen van de Nederlandse Vereniging voor Internationaal Recht 69–97 (Nov. 1994).Google Scholar

³⁰ See Treaty Estabushing the European Economic Community, [hereinafter EEC TREATY] Mar. 25, 1957, 298 U.N.T.S. 3 (1958), as amended by Single European Act, 1987 O.J. (L 169) 1. The provisions regarding the free movement of goods are found in Arts. 30–34 of the EEC Treaty.

³¹ See EEC Treaty, Art. 36.

See Council Regulation 3911/92/EEC, supra note 20, Annex, “Categories of Cultural Objects covered by Article 1,” 1992 O.J. (L 395) 4 for the definition of cultural object; see Council Directive 93/7/EEC, supra note 20, Art. 1, para. (1), 1993 O.J. (L74) 75 for the definition of cultural object, and Annex, “Categories referred to in the second indent of Article 1(1) to which objects classified as ‘national treasures’ within the meaning of Article 36 of the Treaty must belong to in order to qualify for return under the Directive,” 1993 O.J. (L74) 78.

³² See Council Regulation 3911/92/EEC, supra note 20, Art. 2, para. (i), 1992 O.J. (L 395) I. It states, that “[t]he export of cultural goods outside of the customs territory of the Community shall be subject to the presentation of an export license.”

Id. Art. 2, para. (2), 1992 O.J. (L395) 1–2. It states “[t]he export license shall be issued at the request of the person concerned: – by a competent authority of the Member State in whose territory the cultural object in question … is located.”

Each Member State is responsible for establishing authorities competent to issue an export license. Id. Art. 3, para. (1), 1992 O.J. (L395) 2. It states “Member States shall furnish the Commission with a list of the authorities empowered to issue export licenses for cultural goods.” The Council Regulation has no retroactive application. Thus, cultural objects which were not “lawfully and definitively located” in a Member State prior to January 1, 1993 are not required to be accompanied by an export license. Id. Art. 2, para. (2), subpara. 1, first indent, 1992 O.J. (L395) 1.

³³ Id. Art. 2, para. (2), subpara. 4, 1992 O.J. (L395) 2.

³⁴ Id. Art. 2, para. (3), 1992 O.J. (L395) 2. It states “[t]he export license shall be valid throughout the Community.”

³⁵ Id. Art. 2, para. (2), subpara. 2, 1992 O.J. (L395) 2. However, if the object has previously been dispatched from a Member State and it is subsequently reimported from a country outside the Member States, the authorities of the country that reimports the goods are required to investigate the lawfulness of the prior dispatch from the Member State.

³⁶ See Council Directive, 93/7/EEC supra note 20, Arts. 2, 4–6, 1993 O.J. (L74) 75–76. Art. 4 indicates the procedure to be followed in a restitution proceeding. First, the national authorities of the requested Member State, upon the application of the requesting Member State, must try to find the specified object. (Art. 4, para. (1)). Second, it is incumbent upon the Member State to notify another Member State if it finds what it believes to be an unlawfully removed object within its territory (Art. 4, para. (2)). Third, it must enable the competent authorities of the requesting Member State to conduct an inquiry (Art. 4, para. (3)) and it must protect the object in the interim (Art. 4, paras. (4) and (5)). Lastly, the competent authorities of the requested Member State may, upon the approval of the requesting Member State and the possessor or holder, submit the dispute to an arbitration proceeding (Art. 4, para. (6)).

The Directive further provides that if the dispute is resolved in a court proceeding as opposed to an arbitral forum, the requesting Member State shall initiate proceedings in the court of the requested Member State (Art. 5) and shall notify other Member States of the proceeding (Art. 6).

³⁷ Id. Art. 7, para. (1), 1993 O.J. (L74) 76. It provides, that the “return proceedings … may not be brought more than one year after the requesting Member State became aware of the location of the cultural object and of the identity of its possessor or holder.”

Furthermore, it states that “[s]uch proceedings may, at all events, not be brought more than 30 years after the object was unlawfully removed …” Id. This time limit is extended to 75 years in the case of objects forming part of public collections and in the case of certain ecclesiastical goods. Id.

³⁸ Id. Art. 9, 1993 O.J. (L74) 76. It provides that the competent court of the requested Member State shall award the possessor fair compensation if it is satisfied that the possessor exercised “due care and attention in acquiring the object.” Although the Directive provides that compensation is to be paid by the requesting Member State, the burden of proof to determine whether the requisite due care was exercised shall be governed by the legislation of the requested Member State.

³⁹ See Rigaux, supra note 29, at 70. Prior to the Maastricht Treaty, this area was regulated by The European Convention on offenses relating to Cultural Property, June 23, 1985, European Treaty Series No. 119, Council of Europe, Strasbourg, 1985.

⁴⁰ Id. at 79. The scope of the Council Directive does not coincide exactly with the coverage of the Council Regulation – some objects falling within the parameters of one and not the other. See supra note 31, for the relevant provisions governing the definition of “cultural object.”

The Council Directive's definition of “cultural object” differs from that of the Council Regulation (the “Annex”). Article 1, para. (1) of the Council Directive states:

(a) an object which is classified, before or after its unlawful removal from the territory of a Member State, among the national treasures possessing artistic, historic or archeological value, under national legislation or administrative procedures within the meaning of Article 36 of the Treaty

and

(b) belongs to one of the categories listed in the Annex or does not belong to one of those categories but forms an integral part of – public collections listed in the inventories of museums, archives or libraries' conservation collections … [or] the inventories of ecclesiastical institutions (emphasis added).

Thus, four categories of cultural goods arise as a result of the interplay between the definition of “cultural object” in these two documents. First, those objects which are only subject to restitution proceedings because they fall within the definition of “national treasures” and otherwise satisfy Art. 1, para. (1), cl. (b) but which are not listed as belonging to one of the categories in the Annex and therefore fall outside the scope of the Council Regulation. Second, those to which both the Council Regulation and the Directive apply as they are listed in the Annex and are encompassed within the definition of “national treasures.” Third, those to which only the Council Regulation applies as they are listed in the Annex but fail to satisfy Art. 1, para. (1), cl. (a) of the Council Directive; and lastly, those objects to which neither provision applies as they do not fall within the categories listed in the Annex and do not otherwise satisfy Art. 1, para. (1) of the Council Directive.

⁴¹ See Byrne-Sutton & Renold, supra note 20, at 13–14. See also Rigaux, supra note 29, at 83–85. To illustrate the difficulty of characterizing a “treasure” as a “national” one, Rigaux offers as examples “a Chinese jar, epoch Yuan, deemed a national treasure by the French, and a Velasquez picture presented by the King of Spain to the Duke of Wellington, deemed a national treasure by the United Kingdom.”

Rigaux also raises the issue of the difficulty surrounding efforts to determine an artist's nationality. He queries: “Has one to separate in Van Gogh's career a Dutch from a French period or in Picasso's, a Catalonian from a French one?” Although not specifically addressing the export authorities' discretion or lack thereof, Rigaux notes the complexities involved in making such determinations, citing Jeanneret v. Vichy, 693 F.2d 259 (2d Cir. 1982) (Matisse painting illegally exported from Italy was deemed to be not an Italian “national” treasure and furthermore, was not even a “treasure”). Id.

⁴² Whether this concern is justifiable is questionable as it is unclear what countries would be able to fill the positions previously held by the members of the European market.

⁴³ See Byrne-Sutton & Renold, supra note 20, at 12.

⁴⁴ Also of relevance on a regional level is the Scheme for the Protection of Cultural Heritage within the Commonwealth, Commonwealth Secretariat, London, adopted in Mauritius, Nov. 1993. It provides for the protection of cultural property within the countries of the Commonwealth against exports in contravention of their national laws. See UNIDROIT Explanatory Report 1994, supra note 9, at 10.

⁴⁵ See UNIDROIT Convention, supra note 12, Ch. IV, Art. 9, para. (1) and discussion thereof, infra (previous Ch. V, Art 10 of the draft UNIDROIT Convention). Art. 9 states:

(1) Nothing in this Convention shall prevent a Contracting State from applying ant rules more favourable to the restitution or the return of stolen or illegally exported cultural objects than provided for by this Convention.

See also UNIDROIT Convention, supra note 12, Ch. V, Art. 13. It states:

(1) This Convention does not affect any international instrument by which any Contracting State is legally bound and which contains provisions on matters governed by this Convention, unless a contrary declaration is made by the States bound to such instrument.

(2) Any Contracting State may enter into agreements with one or more Contracting States, with a view to improving the application of this Convention in their mutual relations. The State which have concluded such an agreement shall transmit a copy to the depositary.

(3) In their relations with each other. Contracting State which are Members of organisations of economic integration or regional bodies may declare that they will apply the internal rules of these organisations or bodies and will not therefore apply as between these States the provisions of this Convention the scope of application of which coincides with that of those rules.

⁴⁶ See Pierre A. Lalive, Comment, in Byrne-Sutton & Renold, supra note 20, at 128. Lalive questions specifically the need for the Council Directive in light of the draft UNIDROIT Convention.

⁴⁷ See UNIDROIT Explanatory Report 1994, supra note 9, at 10. It states:

While fully aware of the purely regional scope of these instruments, the committee of governmental experts sought to draw on those initiatives as the solutions adopted in them represented a compromise between different interests which, on a narrower scale, were the same as those of the States participating in the work of UNIDROIT.

⁴⁸ Draft Convention providing a Uniform Law on the acquisition of Corporeal Movables, (LUAB 1974) UNIDROIT 1975, Study XLV – Doc. 48.

⁴⁹ UNIDROIT Explanatory Report 1994, supra note 9, at 6, citing the Report on the 65th session of the Governing Council of UNIDROIT, UNIDROIT 1986, CD. 65 – Doc. 18, at 24.

⁵⁰ An art market nation, as opposed to a source nation, is one in which the demand for art exceeds the supply. See Merryman, Cultural Property, supra note 6, at 832. The major art market nations include the countries that actively encourage the movement of cultural goods through their countries by offering expertise in evaluating and selling such goods. The art market nations include: Australia, Canada, France, Germany, Japan, Switzerland, the United Kingdom and the United States.

⁵¹ To date, the only art market nations to adopt the UNESCO Convention are Australia, Canada, and the United States. The United States, however, is the only one of these which plays a major role in the art market.

In order to give effect to the UNESCO Convention in the United States, it was considered necessary to adopt detailed legislation. Thirteen years after the UNESCO Convention was drafted in its final form, the United States enacted the Cultural Property Implementation Act, 19 U.S.C.S. §2601 (1983). It allows for the return of a cultural object if the item concerned has previously been specifically identified in the inventory of the institution claiming its restitution. The United States will also enter into a bilateral or multilateral agreement with a state that seeks its aid, upon a showing that United States action is required to deter a serious situation of pillage. (19 U.S.C. § 2606(c)(2)) The state requesting assistance must take steps of its own to protect its cultural patrimony and the United States must be satisfied that the restrictions, if implemented, would be of “substantial benefit.” To date, the United States Information Agency has issued restrictions on the importation of certain goods from El Salvador, Guatemala, Bolivia, Peru and Mali.

An alternative avenue for the recovery of stolen property is available in the United States through the National Stolen Property Act, 18 U.S.C. §§ 2311–18 (1978) (hereinafter NSPA). The NSPA was used to recover preColumbian artifacts stolen and transported through interstate commerce in the United States in United States v. McLain, 545 F.2d 988 (5th Cir. 1977) and in United States v. Hollinshead, 495 F.2d 1154 (9th Cir. 1974).

⁵² See Ortiz, [1984] A.C.I at 20 d-e, cited in Percoraro, Thomas W., Choice of Law in Litigation to Recover National Cultural Property: Efforts at Harmonization in Private International Law, 31 Va. J. Int'l L. 1, 11 n.45 (1990)Google Scholar, for the proposition that courts will more readily enforce contract or tort claims brought by private parties than they will those brought by state parties. The court in Ortiz states:

This suit by a foreign state to enforce its laws is to be distinguished altogether from a suit between private firms or individuals which raises a question as to whether a contract has been broken by one or the other or whether a wrong has been done by one to the other. In such a suit our courts will recognize the existence of the laws of a foreign state.

⁵³ See UNIDROIT Explanatory Report 1994, supra note 9, at 6; See also Lyndel V. Prott, Chief, UNESCO International Standards Section, Explanatory Note, UNIDROIT Draft Convention of Stolen and Illegally Exported Cultural Objects, Oct. 18, 1993. She offers three principal motivations for UNESCO's request of UNIDROIT:

(1) The 1970 UNESCO Convention raised several private law issues (the predominant one concerning the protection of the bona fide purchaser according to different national legal systems) which UNESCO felt UNIDROIT was better able to resolve;

(2) some States criticized the drafting of the UNESCO Convention as ambiguous and hence unclear as to what obligations were required of countries and when they applied; and

(3) some States felt that the scope of the application of the Convention was unclear and if given too broad a reading would interfere too much in the legal trade in cultural objects.

⁵⁴ See Gerte Reichelt, International Protection of Cultural Property, UNIDROIT 1986, Study LXX – Doc. 1, reprinted in. Uniform Law Review 43 (1985). Gerte Reichelt, Second Study Requested from UNIDROIT by UNESCO on the International Protection of Cultural Property with Particular Reference to Private Law Affecting the Transfer of Title to Cultural Property in the Light also of the Comments Received on the First Study, UNIDROIT 1988, Study LXX – Doc. 4.

⁵⁵ See UNIDROIT 1988, Study LXX – Doc. 3. This contains the initial preliminary draft Convention, as submitted by the Austrian member of the UNIDROIT Governing Council, Mr. Roland Loewe.

See UNIDROIT 1989, Study LXX – Doc. 10, UNIDROIT 1989, Study LXX – Doc. 14, and UNIDROIT 1990, Study LXX – Doc. 18, for a report on these three meetings.

⁵⁶ See supra note 14.

⁵⁷ See supra note 9.

⁵⁸ Representatives from the following countries participated: the Republic of Albania; the People's Democratic Republic of Algeria; the Republic of Angola; the Argentine Republic; Australia; the Republic of Austria; the Republic of Belarus; the Kingdom of Belgium; the Republic of Bolivia; the Federative Republic of Brazil; the Republic of Bulgaria; Burkina Faso; the Kingdom of Cambodia; the Republic of Cameroon; Canada; the People's Republic of China; the Republic of Colombia; the Republic of Côte d'lvoire; the Republic of Croatia; the Republic of Cyprus; the Czech Republic; the Kingdom of Denmark; the Republic of Ecuador; the Arab Republic of Egypt; the Republic of Finland; the French Republic; the Republic of Georgia; the Federal Republic of Germany; the Republic of Guinea; the Hellenic Republic; the Holy See; the Republic of Hungary; the Republic of India; the Islamic Republic of Iran; Ireland; the State of Israel; the Italian Republic; Japan; the State of Kuwait; the Socialist People's Libyan Arab Jamahiriya; the Republic of Lithuania; the Grand Duchy of Luxembourg; the Republic of Malta; the United Mexican States; the Kingdom of Morocco; the Union of Myanmar; the Kingdom of the Netherlands; the Federal Republic of Nigeria; the Kingdom of Norway; the Islamic Republic of Pakistan; the Republic of Paraguay; the Republic of Peru; the Republic of Poland; the Portugese Republic; the Republic of Korea; Romania; the Russian Federation; the Republic of Slovenia; the Republic of South Africa; the Kingdom of Spain; the Kingdom of Sweden; the Swiss Confederation; the Kingdom of Thailand; the Republic of Tunisia; the Republic of Turkey; Ukraine; the United Kingdom of Britain and Northern Ireland; the United States of America; the Republic of Yemen; and the Republic of Zambia.

Observers included representatives from the following States: the Republic of Bosnia-Herzegovina; the Republic of Ghana; the Republic of Guatemala; the Republic of Honduras; the Hashemite Kingdom of Jordan; the Kingdom of Saudi Arabia; the Syrian Arab Republic; the Republic of Venezuela.

The following intergovernmental organizations sent observers: the Commission of the European Communities; the Council of Europe; the Council of the European Union; the Hague Conference on Private International Law; the International Centre for the Study of the Preservation and the Restoration of Cultural Property; the International Criminal Police Organisation; and the United Nations Educational, Scientific and Cultural Organization.

The following non-governmental organizations sent observers: the International Association of Lawyers; the International Bar Association; the International Council on Archives; the International Law Association; and the International Union of Latin Notariat.

The International Association of Dealers in Ancient Art and the Sovereign Military Order of Malta also sent observers to the Conference.

⁵⁹ See UNIDROIT Convention, supra note 12, Ch. I, Art. 1.

⁶⁰ Draft UNIDROIT Convention, supra note 9, Ch. I, Art. 1, para. (a). See UNIDROIT 1995, Conf. 8/C.1/S.R. 1, supra note 13, at 7.

⁶¹ UNIDROIT Convention, supra note 12, Ch. I, Art. 1, para. (b).

⁶² The definition of “cultural object” is less expansive than in the draft UNIDROIT Convention. Various representatives were eager to tighten the definition out of fears that an overly broad definition might inhibit states from ratifying the Convention.

Previously, the definition had referred to cultural objects “such as” those listed in Article 1 of the 1970 UNESCO Convention definition. See, UNESCO, U.N. Doc. 16C/Res./38 (1970). The words “such as” were eliminated from the final text to make clear that the the definition contained in the UNIDROIT Convention is intended to be exclusive. All specific references to the 1970 UNESCO Convention have been eliminated. However, the UNESCO definition is incorporated into the Annex of the UNIDROIT Convention. The Annex lists the following categories:

(a) Rare collections and specimens of fauna, minerals and anatomy, and objects of paleontological interest;

(b) Property relating to history, including the history of science and technology and military and social history, to the life of national leaders, thinkers, scientists and artists and to events of national importance;

(c) Products of archeological excavations (including regular and clandestine) or of archeological discoveries;

(d) Elements of artistic or historical monuments or archeological sites which have been dismembered;

(e) Antiquities more than one hundred years old, such as inscriptions, coins and engraved seals;

(f) Objects of ethnological interest;

(g) Property of artistic interest, such as:

(i) pictures, paintings and drawings produced entirely by hand on any support and in any materials (excluding industrial designs and manufactured articles decorated by hand);

(ii) original works of statuary art and sculpture in any material;

(iii) original engravings, prints and lithographs;

(iv) original artistic assemblages and montages in any material;

(h) Rare manuscripts and incunabula, old books, documents and publications of special interest (historical, artistic, scientific, literary, etc.) singly or in collections;

(i) Postage, revenue and similar stamps, singly or in collections;

(j) Archives, including sound, photographic and cinematographic archives;

(k) Articles of furniture more than one hundred years old and musical instruments.

⁶³ UNIDROIT Convention, supra note 12, Ch. II, Art. 3, para. (1).

⁶⁴ See, e.g., in France, the purchaser is protected (i. e. is deemed bona fide) after a period of three years (C. Civ. Art. 2279 (Fr.)); in Switzerland, the purchaser is protected after a five year period (Schweizerisches Zivilgesetzbuch, Title 24, Art. 934 (Switz.)); and in Italy, the purchaser has good title to the object immediately (Codice Civile, Art. 1153. (It.)).

⁶⁵ See UNIDROIT 1995, Conf. 8/C.1/S.R.2, supra note 13, at 6–10.

⁶⁶ Id. at 7–8.

⁶⁷ See UNIDROIT 1995, Conf. 8/C.1/S.R. 16, supra note 13, at 4.

⁶⁸ See UNIDROIT 1995, Conf. 8/C.l/S.R. 2, supra note 13, at 10–14. See also UNIDROIT Explanatory Report 1994, supra note 9, at 17–18.

⁶⁹ Earlier suggestions of one year and 30 years, respectively, were rejected. The shorter one-year time period in instances where the claimant has the requisite knowledge was rejected despite arguments that it would reduce the likelihood of stale claims being brought and lead to greater legal certainty. See UNIDROIT 1995, Conf. 8/C.1/S.R. 2, supra note 13, at 10–14. See also UNIDROIT Explanatory Report 1994 supra note 9, at 18.

One of the arguments in favor of having a longer period in excess of 30 years is that in many of the recently litigated cases, the period that elapsed between the object's disappearance and the claimant's filing of his or her claim has exceeded 30 years. See, e.g., Stiftskirche-Domgemeinde of Quedlinburg v. Meador, No. CA3–90–1440–D (N.D. Texas, filed June 18, 1990) (45 years); DeWeerth v. Baldinger, 836 F.2d 103 (2d Cir. 1987), cert, denied, 486 U.S. 1056 (1988), 38 F.3d 1266 (2d Cir. 1994) (38 years); United States v. Herce, 334 F.Supp. 111 (S.D.N.Y. 1971) (35 years).

Another change from the draft UNIDROIT Convention is the deletion of the term calling for the commencement of the statute of limitations period from the time the possessor “ought reasonably to have known the location of the object and the identity of its possessor.” Draft UNIDRO1T Convention, supra note 9, Art. 3, para. (3). Various representatives expressed reservations about the inclusion of this phrase at the Diplomatic Conference. They argued that it was too broad in scope and created the difficulty of defining “reasonable knowledge.” See UNIDROIT Conf. 8/C.1/S.R. 2, supra note 13, at 10. The decision to delete this phrase in the final text of the UNIDROIT Convention potentially makes this provision more favorable to the claimant as the clock does not begin to run until the claimant “knew,” rather then when it “ought to have known.”

⁷⁰ UNIDROIT Convention, supra note 12, Ch. II, Art. 3, para. 4.

⁷¹ Id. See also UNIDROIT 1995, Conf. 8/C.1/S.R. 3, supra note 13, at 2–8. Some representatives voiced a concern that by providing that there were to be no time limitations for asserting claims concerning cultural objects in “public collections,” the UNIDROIT Convention went beyond the situation currently existing in many countries' national legal systems. Therefore, there might be a reluctance on the part of such countries to ratify the Convention. The draft UNIDROIT Convention stated that “an object belonging to a public collection of a Contracting State [shall not be subject to prescription] [shall be brought within a time limit of [75] years].” Draft UNIDROIT Convention, supra note 9, Art. 3, para. 4. The brackets reflected the indecision surrounding portions of this provision. See also UNIDROIT Explanatory Report 1994, supra note 9, at 18–19.

⁷² UNIDROIT Convention, supra note 12, Ch. II, Art, 3, paras. 5 and 6.

⁷³ See, UNIDROIT 1995, Conf. 8/C.1/S.R. 3, supra note 13, at 7.

⁷⁴ Id at 5.

⁷⁵ See UNIDROIT 1995, Conf. 8/C.1/S.R. 3, supra note 13, at 8. UNIDROIT Convention, supra note 12, Ch. II, Art. 3, para. 7. It provides: a ‘public collection’ consists of a group of inventoried or otherwise identified cultural objects owned by:

(a) a Contracting State;

(b) a regional or local authority of a Contracting State: (c) a religious institution in a Contracting State; or (d) an institution that is established for an essentially cultural, education or scientific purpose in a Contracting State and is recognized in that State as serving the public interest.

A separate paragraph, Art. 3, para. (8), indicates that a “sacred or communally important cultural object belonging to and used by a tribal or indigenous community in a Contracting State as part of that community tradition or ritual use shall be subject to the same time limitation as those applicable to public collections.”

See draft UNIDROIT Convention, supra note 12, Ch. II, art. 3, para. (4), for the earlier definition of “public collection.”

⁷⁶ UNIDROIT Convention, supra note 12, Ch. II, Art. 4, para. (1). It states:

(1) The possessor of a stolen cultural object required to return it shall be entitled, at the time of its restitution, to payment of fair and reasonable compensation provided that the possessor neither knew nor ought reasonably to have known that the object was stolen and can prove that it exercised due diligence when acquiring the object.

Id Ch. V, Art. 9, para. (1). This clause provides that the Convention does not “prevent a Contracting State from applying any rules more favourable to the restitution or the return of stolen or illegally exported objects than provided for by th[e] Convention.” Thus, there is no obligation on the part of a country that has a common law system, which traditionally does not require the payment of compensation to a purchaser of a stolen object, even a bona fide one, to modify its existing system. See UNIDROIT Explanatory Report 1994, supra note 9, at 20.

⁷⁷ See UNIDROIT 1995, Conf. 8/C.1/S.R. 5, supra note 13, at 2. Some representatives at the Diplomatic Conference questioned the wisdom of providing for this shift in the burden of proof in Art. 4, para. (1) with respect to stolen cultural objects.

⁷⁸ UNIDROIT Convention, supra note 12, Ch. II, Art. 4, para. (4).

⁷⁹ See UNIDROIT 1995, Conf. 8/C.1/S.R. 5, supra note 13, at 2–3. Some representatives at the Diplomatic Conference were in favor of amending the text of Art. 4(1) to make it clear that the compensation to be paid should be either the value of the object or the price actually paid, whichever was the lower. Others disagreed with this idea, arguing that it deprived art dealers involved in legitimate transactions the value of their bargains. Other representatives suggested that the full market value should be the only standard used. Still others disagreed with the entire principle of compensation, on the ground that this requirement would make it more difficult for members of third world countires to reclaim their cultural objects.

⁸⁰ UNIDROIT Convention, supra note 12, Ch. III, Art. 5, paras. (1) and (2). It provides:

(1) A Contracting State may request the court or other competent authority of another Contracting State to order the return of a cultural object illegally exported from the territory of the requesting State.

(2) A cultural object which has been temporarily exported from the territory of the requesting State, for purposes such as exhibition, research or restoration, under a permit issued according to its law regulating its export for the purpose of protecting its cultural heritage and not returned in accordance with the terms of that permit shall be deemed to have been illegally exported.

Art. 5, para. (1) of the draft UNIDROIT Convention had listed three separate categories ((a) through (c)) of situations in which the return of illegally exported cultural objects would be appropriate. The decision of whether or not clause (c), relating to the excavation of cultural objects, should be retained, or whether or not it properly belonged in Chapter III of the Convention, generated a considerable amount of discussion at the Diplomatic Conference. See, UNIDROIT 1995, Conf. 8/C.1/S.R. 5, supra note 13, at 7–12. Ultimately, a majority of the representatives voted in favor of retaining the substance of draft UNIDROIT Convention, Art. 5(1)(c). See UNIDROIT 1995, Conf. 8/C.1/S.R. 17, supra note 13, at 8.

⁸¹ But see UNIDROIT Explanatory Report 1994, supra note 9, at 23, citing Switzerland's Private International Law Statute, Dec. 18, 1987, Art. 19, [reprinted in 29 I.L.M. 1244 (1990)], as an example of the increasing trend in both the statutes and case law of some countries “to be more generous in taking into consideration the mandatory rules of law of another State.”

⁸² UNIDROIT Convention, supra note 12, Ch. III, Art. 5, para. (3). It states:

(3) The court or other competent authority of the State addressed shall order the return of an illegally exported cultural object if the requesting State establishes that the removal of the object from its territory significantly impairs one or more of the following interests:

(a) the physical preservation of the object or its context;

(b) the integrity of a complex object;

(c) the preservation or information of, for example, a scientific or historical character;

(d) the traditional or ritual use of the object by a tribal or indigenous community;

or establishes that the object is of significant cultural importance for the requesting State.

The inclusion of these criteria was also a response to the fact that the legislation in many states does not reflect a concern with the question of the illicit traffic of exported cultural objects to the same degree as it does with respect to stolen objects. See UNIDROIT 1995, Conf. 8/C.1/ S.R. 5, supra note 13, at 13.

⁸³ See UNIDROIT Explanatory Report 1994, supra note 9, at 25.

⁸⁴ Id. at 25–26. See also UNIDROIT Convention, supra note 12, Ch. V, Art. 9, para. (1) of the UNIDROIT Convention. It allows a state to apply any rules in its national legislation more favorable to the return of illegally exported cultural objects than provided for by the Convention.

⁸⁵ The draft UNIDROIT Convention had referred to objects of “outstanding cultural importance” as opposed to the present language of objects of “significant cultural importance.” Draft UNIDROIT Convention, supra note 9, Art. 5, para. (2). The exact terminology to be used in this provision was the source of considerable discussion among the representatives at the Diplomatic Conference. Some representatives indicated that it would be crucial to their countries' decision whether or not to ratify the Convention that such adjectives be retained as they serve to limit the scope of the Convention. See UNIDROIT 1995, Conf. 8/C.1/S.R. 6, supra note 13, at 5.

The draft UNIDROIT Convention, like the present Convention, did not specify the factors to be considered by an adjudicator in determining whether or not an object was “outstanding.” The suggestion was made, however, that “the outstanding cultural importance of the object for the requesting State should be measured against the extent and wealth of its heritage, be it in public or private hands, and the rarity of the object.” UNIDROIT Explanatory Report 1994, supra note 9, at 26.

⁸⁶ UNIDROIT Convention, supra note 12, Ch. III, Art. 5, para. (4).

⁸⁷ Id. Ch. III, Art. 5, para. (5).

⁸⁸ Draft UNIDROIT Convention, supra note 9, Art. 6, para. (1).

⁸⁹ See UNIDROIT 1995, Conf. 8/C.1/S.R. 7, supra note 13, at 9–12.

⁹⁰ See UNIDROIT Explanatory Report 1994, supra note 9, at 27.

⁹¹ UNIDROIT Convention, supra note 12, Ch. III, Art. 6, para. (1).

⁹² UNIDROIT Explanatory Report 1994, supra note 9, at 30 notes that this difference is due to the fact that a large number of delegations thought that “the stigma attaching to theft ought not to be transposed to illegally exported cultural objects.”

⁹³ UNIDROIT Convention, supra note 12, Ch. III, Art. 6, para. (2).

⁹⁴ Id. Ch. III, Art. 6, para. (3).

⁹⁵ Id. Ch. III, Art. 6, para. (4).

⁹⁶ Id. Ch. III, Art. 7, para. (1), cl. (a).

⁹⁷ Id. Ch. III, Art. 7, para. (1), cl. (b).

⁹⁸ Id. Ch. III, Art. 7, para. (2).

⁹⁹ Id. Ch. IV, Art. 8, para. (1). The preliminary draft Convention, supra note 14, Art. 9, para. (1), [current Art. 8, para. (1)], provided an additional alternative forum for a claim to be brought where the possessor of the cultural object had his habitual residence. This alternative was deleted in the draft UNIDROIT Convention text. See UNIDROIT 1994, Study LXX – Doc. 48, supra note 9, at 53.

¹⁰⁰ Georges A.L. Droz, Memoire sur le Projel de Convention d'Unidroit sur le Retour International des Biens Culturels Volés ou Illicitement Exportes, 109 Mededelingen van de Nederlandse Verendiging voor Internationaal Recht 47, 56 (Nov. 1994). Droz refers to the EEC Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters, Sept. 27, 1968, 1262 U.N.T.S. 153 (hereinafter the “Brussels Convention”) and the EEC Convention on Jurisdiction and the Enforcement of Judgments in Civil and Commercial Matters, Sept. 16, 1988, 1988 O.J. (L 319) 9 (hereinafter the “Lugano Convention”) as examples of Conventions which do not consider the location of the movable property to warrant the grant of jurisdiction, but instead apply general principles regarding the conflict of laws.

¹⁰¹ See UNIDROIT 1995, Conf. 8/C.1/S.R. 9, supra note 13, at 3. It was considered inappropriate to introduce a conflict of law rule on the law applicable in light of the substantive nature of the UNIDROIT Convention.

See also UNIDROIT Explanatory Report 1994, supra note 9, at 31. Some representatives noted that provisions governing enforcement and recognition of judgments are rarely found in private law instruments with a global reach and therefore felt the inclusion of such provisions might render the draft UNIDROIT Convention unacceptable to many countries unaccustomed to such provisions.

¹⁰² See UNIDROIT 1995, Conf. 8/C.1/S.R. 9, supra note 13, at 3.

¹⁰³ UNIDROIT Convention, supra note 9, Ch. IV, Art. 8, para. 2. See UNIDROIT Explanatory Report 1994, supra note 9, at 53 noting the “quasiunanimity in favor of arbitration.” See also Droz, supra note 100, at 56. He notes that this provision complies with the spirit of the Brussels and Lugano Conventions.

¹⁰⁴ UNIDROIT Convention, supra note 12, Ch. IV, Art. 8, para. (3). This provision is based on Art. 24 of the Brussels Convention. See UNIDROIT Explanatory Report 1994, supra note 9, at 32.

¹⁰⁵ UNIDROIT Convention, supra note 12, Ch. IV, Art. 9, para. (2). It states: This article [referring to Art. 9, para. (1)] shall not be interpreted as creating an obligation to recognise or enforce a decision of a court or other competent authority of another Contracting State that departs from the provisions of this Convention.

¹⁰⁶ UNIDROIT Convention, supra note 12, Ch. IV, Art. 9, para. (1).

¹⁰⁷ See UNIDROIT 1995, Conf. 8/C.1/S.R. 12, supra note 13. at 2–7.

¹⁰⁸ Preliminary draft Convention, supra note 14, Ch. V, Art. 10. It states:

This Convention shall apply only when a cultural object has been stolen, or removed from the territory of a Contracting State contrary to its export legislation, after the entry into force of the Convention…

¹⁰⁹ Vienna Convention on the Law of Treaties, May 23, 1969, 1155 U.N.T.S. 331, Art. 100. See UNIDROIT Explanatory Report 1994. supra note 9, at 33. Some representatives indicated that it would be impossible for their countries to accept the draft UNIDROIT Convention if it were to have retroactive application out of fear that this would expose the museum collections in their countries to challenge.

¹¹⁰ UNIDROIT Convention, supra note 12, Art. 10. It states:

(1) The provisions of Chapter II shall apply only in rspect of a cultural object that is stolen after this Convention enters into force in respect of the State where the claim is brought, provided that:

(a) the object was stolen from the territory of a Contracting State after the entry into force of the Convention for that State; or

(b) the object is located in a Contracting State after the entry into force of the Convention for that State.

(2) The provisions of Chapter III shall apply only in respect of a cultural object that is illegally exported after this Convention enters into force for the requesting State as well as the State where the request is brought.

¹¹¹ Id. Ch. IV, Art. 10, para. (3). It states:

(3) This Convention does not in any way legitimise any illegal transaction of whatever nature which has taken place before the entry into force of this Convention or which is excluded under paragraphs (1) or (2) of this article, nor limit any right of a State or other person to make a claim under remedies available outside the framework of this Convention for the restitution or return of a cultural object stolen or illegally exported before the entry into force of this Convention.

¹¹² Id. Ch. V, Art. 11, Art. 12, and Art. 21.

¹¹³ Id. Ch. V, Art. 13.

¹¹⁴ Id. Ch. V, Art. 14.

¹¹⁵ Id. Ch. V, Art. 18.

¹¹⁶ Id. Ch. V, Art. 19. All of the provisions in Chapter V are adoptions of the text of the draft Final Provisions (with the exceptions of draft Final Provisions Arts. C and F) of the draft UNIDROIT Convention. They were renumbered at the Diplomatic Conference and now form part of the text of the UNIDROIT Convention.

¹¹⁷ See Droz, supra note 100, at 47 (Fr.) and at 58 (Engl. summ.).

¹¹⁸ See Harold S. Burman, Executive Director, Office of the Legal Adviser, United States Department of State, Memorandum, Dec. 5, 1991, Issues raised by the draft UNIDROIT Convention on International Protection of Cultural Property; Report of the first meeting of government delegations; Preparation of U.S. positions for the second UNIDROIT meeting January 20. 1992. at 16. Burman discusses the differences between public and private law conventions.

¹¹⁹ See Droz, supra note 100. at 48–49 (Fr.) and at 58 (Engl. summ.). See also UNIDROIT Explanatory Report 1994, supra note 9, at 15. In discussing the draft UNIDROIT Convention, some representatives were in favor of adopting two separate definitions of the term because of the different regard in which these two offenses are held. It was decided that this would introduce an unnecessary level of complication. Another suggestion was to establish a minimum value on the cultural objects to which the Convention would apply and establish differing minimum levels depending on the category of the object. A further proposal was to leave the decision of whether the cultural object fell within the scope of the Convention to the national law of each Contracting State. This idea was rejected on the ground that it would undermine the UNIDROIT Convention's objective to be as uniform as possible.

¹²⁰ See UNIDROIT 1995, Conf. 8/C.1/S.R. 9, supra note 13, at 7. One of the representatives at the Diplomatic Conference observed that the UNIDROIT Convention is not designed to make changes in national legal systems that already provide for the return of stolen cultural objects without payment of compensation to the possessor. The Convention provisions are intended to be understood as establishing a floor.

¹²¹ See UNIDROIT Explanatory Report 1994, supra note 9, at 20, indicating that the representatives preferred to leave the determination of “fair and reasonable compensation” to the discretion of the judge hearing the claim, indicating that it has been standard in public international law for judges to make such determinations of commercial value. This interpretation was subject to criticism, however, at the Diplomatic Conference. See UNIDROIT 1995, Conf. 8/C.1/S.R. 4, supra note 13, at 3, 4.

¹²² See UNIDROIT 1995, Conf. 8/C.1/S.R. 3, supra note 13, at 3. A representative at the Diplomatic Conference criticized the definition of “public collection” as being “far too broad.” Another remarked that “the definition of public collection as it appeared in the draft was too vague to justify special protection for cultural objects belonging to this category under the future Convention, as it contained terms that were far too ambiguous.”

¹²³ See UNIDROIT 1995, Conf. 8/C.1/S.R. 2, supra note 13, at 4, for the suggestion that the word “possessor” should be replaced with the word “holder.” Another representative recommended replacing the term “possessor” with the term “owner,” while others favored a more precise definition of the term. See also UNIDROIT Explanatory Report 1994, supra note 9, at 16–17.

But see UNIDROIT 1995 Conf. 8/C.1/S.R. 4, supra note 13, at 5. A representative at the Diplomatic Conference made the following comment:

a self-contained definition of the idea of possessor in this draft Convention should be abandoned … [as] one of the fundamental ideas in the elaboration of this draft Convention was to minimise as much as possible self-contained definitions because of the diversity of the legal systems of the States participating in this conference.

¹²⁴ See, UNIDROIT Explanatory Report 1994, supra note 9, at 15. It reports that a number of delegations requested definitions of these terms, “fears being expressed … that there would in their absence be a risk of each Contracting State applying its national definition of such terms which would run counter to the aim of uniformity.”

But see UNIDROIT 1995, Conf. 8/C.1/S.R. 2, supra note 13, at 5. One representative at the Diplomatic Conference commented that, “the study group quickly realised that it was impossible for its members to agree on an overall set of uniform regulations, in conformity with legal systems of all the States, and also on such terminology as ‘thief,’ ‘possessor,’ ‘owner,’ ‘quality,’ [and] ‘recourse.’… it was an illusion to believe that reaching an agreement was possible with regard to defining the notions of ‘possessor’ or ‘theft’ or ‘claimant.’”

¹²⁵ See UNIDROIT Explanatory Report 1994, supra note 9, at 26. The text of the UNIDROIT Convention substituted the word “significant” in place of the previous term “outstanding.” The comment expressed in the UNIDROIT Explanatory Report 1994 with respect to the term “outstanding cultural importance” could seemingly apply equally to the term “significant cultural importance.” It states:

[s]o as to ensure consistency in drafting with other provisions of the draft and so as to leave to the judge a certain degree of discretion, the text lays down no criteria to determine the importance of the object.

¹²⁶ See Alexandra Peers, Gates Purchase Tops a Tepid Art Year, Wall St. J., Jan. 3, 1995, at R35, forecasting that “[r]epatriation promises to be the hot issue of the decade in the art world …” Other recent events, such as the discovery of a “major trove” of Impressionist paintings held in the Hermitage Museum since the end of World War II, have generated a great deal of controversy, See John Russell, Hermitage Reveals It Hid Trove of Impressionist Art, N.Y. Times, Oct. 4, 1994, at Al; Alexandra Peers, Art World is Unnerved by Cries for Return of War Booty, Wall St. J., Feb. 16, 1995, at Cl; Steven Erlanger, Russia Reveals More Art Taken from Nazis, N.Y. Times, Feb. 28, 1995, at Al (Pushkin Museum of Fine Art trove); Rod MacLeish, The Art and the Glory: The Lost Masterpieces of the Hermitage, Vanity Fair, Mar. 1995, at 125.

See also 51 The Art Newspaper, supra note 13, at 26–29 for a collection of articles on the UNIDROIT Convention. Some of the articles are in favor of the ratification of the Convention, others are against.

¹²⁷ Council Directive 93/7/EEC, supra note 20, 1993 O.J. (L74) 75–76 Art. 4, para. 6. It provides:

Member States' central authorities shall cooperate and promote consultation between the Member States’ competent national authorities. The latter shall in particular:

***

6. act as intermediary between the possessor and/or holder and the requesting Member State with regard to return. To this end, the competent authorities … may … first facilitate the implementation of an arbitration procedure, in accordance with the national legislation of the requested State and provided that the requesting State and the possessor or holder give their formal approval.

The UNIDROIT Convention, supra note 12, Art. 8, para. (2) provides Contracting States the option of using arbitration. It states that, “[t]he parties may also agree to submit the dispute to … arbitration.”

Thus, the potential for arbitration is not limited to the UNIDROIT Convention but is relevant to other regulatory frameworks as well.

¹²⁸ See UNIDROIT Explanatory Report 1994, supra note 9, at 32.

¹²⁹ See UNIDROIT 1994, Study LXX-Doc. 48, supra note 9, at 53.

¹³⁰ See Lyndel V. Prott, Principles for the settlement of contemporary claims to cultural property displaced during World War II, Symposium, The Spoils of War, New York, Jan. 19–21, 1995, sponsored by the Bard Graduate Center for Studies in the Decorative Arts. Prott, offering suggestions to resolve the impasse between Russia and Germany over the fate of cultural property displaced during and after World War II, proposed that states should first attempt to settle their disputes by resorting to bilateral or multilateral agreements. Failing the success of these agreements, she proposed resort to arbitration. Lastly, she suggested the possibility of submitting the dispute to mediation, which she said could be performed by a UNESCO committee. See also Laura Leivick, Return Art Stolen During Wars, Now, Wall St. J. Feb. 16. 1995, at A12.

See also Stephen K. Urice, Claims to ownership of the “treasures,” id. He stated that the German government had indicated its willingness to submit the dispute surrounding the fate of the “Treasure of Priam,” a renowned collection of archeological artifacts originally excavated by Heinrich Schliemann from the second city of Troy, which was subsequently removed from Germany by Russia during World War II, to an international court of arbitration or before the International Court of Justice.

¹³¹ See UNIDROIT 1995, Conf. 8/C.1/S.R. 9, supra note 13, at 3–4.

¹³² Id. at 4. One representative suggested the International Court of Justice as a potential forum for the settlement of disputes involving state parties under Chapter III.

¹³³ Id. at 4.

¹³⁴ Id. at 4.

¹³⁵ See Reinhard Mußgnug, Germany National Report on Topic 1. The Regulatory Framework for the Free International Circulation of Objects of Art, in Briat & Freedberg, supra note 14, at 68, for the view that “[t]he wide margins that Arts. 5(3) [current Art. 5(2)] and 6 of the Draft leave open for interpretation could be more easily accepted if these articles were to be applied by an independent and impartial court of arbitration.” See also Quentin Byrne-Sutton & Marc-André Renold, Switzerland National Report, id. at 103 for the following comment:

It is preferable that a sole specialized authority makes the decisions on the demands for restitution. This would perhaps be an ideal terrain for international arbitration which permits the parties to choose arbitrators who are specialized and ‘detached’ from the national judicial order. One can well imagine the creation of a specialized arbitration procedure as is the case, for example, in the field of maritime law. (trans, by author).

¹³⁶ The burden is on the requesting State to prove that the removal of the object from its territory significantly impairs one or more of the enumerated criteria in Art. 5(3) before the requested State must order its return.

See Mußgnug, supra note 135, at 68. He raises the contention that this system places too much of the burden on the requesting State. He argues for reversing the burden of proof so that there is a presumption that the good would be returned absent a showing by the requested State that it had a superior interest in the object in dispute. Even with this modification, however, he believes that arbitration offers the only suitable means to achieve an absolutely fair balance between the interests of the requesting State and the requested State.

¹³⁷ For example, if an object were located in Country A but the defendant were in Country B and the rules concerning jurisdiction in force in the Contracting States provided that the location of the defendant was a suitable ground for the assertion of jurisdiction, the claimant could bring his claim in Country B rather than where the object were located.

The reason that the courts of the state where the object was located is likely to be selected by the claimant is that it means that a “successful claim for the restitution or return of a stolen or illegally exported objects would be directly enforceable without the need to have recourse to the courts of a second State” for enforcement. This is regarded as a significant innovation in the area of cultural property. See UNIDROIT Explanatory Report 1994, supra note 9, at 32.

¹³⁸ See Mußgnug, supra note 135, at 69. He raises the following contention:

[A]ccording to Art. 9, [current Art. 8] claims addressed against a German possessor are to be pursued before the German courts. But the German government will have to take into consideration that the vague uncertainty of Arts. 5(2) [current Art. 5(3)] and 6 [deleted in the current text] of the Draft does not appear too encouraging in regard to the situation of Germany as a requesting State which has to pursue its return claims before foreign courts or even before the authorities of a foreign State. Therefore, if asked, I would warn against the ratification unless the Convention provides for an impartial arbitration …

¹³⁹ Id. at 68 for the argument that although the restitution claim in the case of stolen goods (Ch. II) could be handled by the national courts, (“Legal objections might be put aside with the consideration that the Convention does not aim at a return of any illegally exported object, but only those of ‘outstanding cultural importance’. On the whole, objects illegally exported in Germany, therefore, will only have to be returned to the State of their origin if in Germany they would be subject to an export prohibition as well.”), in the case of illegally exported objects (Ch. III), he notes that there is a “concern that the national courts and authorities might overvalue their own nation's interests. Therefore, Chapter III needs an international court of arbitration.”

¹⁴⁰ Id. at 68. He believes that the qualification that the object be of “outstanding cultural significance” [draft UNIDROIT Convention, Art. 5(2)] should be moved forward to Ch. I, Art. 2, where it would apply in the stolen good context as well, so that it “corrects the excessively broad definition of the term ‘cultural object.’”

¹⁴¹ See Prott & O'Keefe, supra note 8, at 196. Both the United States and the United Kingdom have arbitration systems for making this determination as to valuation. This is particularly relevant in the context of valuing items where the good is loaned as part of a travelling exhibition. In the United States, the Arts and Artifacts Indemnity Act of 1975, 20 U.S.C.S. §§ 971 et seq. (1975), provides for an arbitration proceeding which is conducted by two appraisers and an umpire. Each party appoints its own appraiser, and the appraisers in turn appoint the umpire. If the appraisers can not agree on the value to be awarded, the umpire makes a final and binding determination. See Indemnity Under the Arts and Artifacts Indemnity Act, 41 Fed. Reg. 29, 386 (1976). The Federal Council on the Arts and the Humanities issues a Certificate for Indemnity that provides for arbitration if agreed to by all the parties. The Arts and Artifacts Indemnity Act stipulates that the cost of each appraiser is to be paid by the party who hires him or her and that all other costs of the proceeding should be shared equally by the parties.

The United Kingdom system is governed by the Indemnity Agreements for Bodies Funded by the Office of Arts and Libraries, the Scottish Education Department and the Welsh Office Education Department (1985). According to this system, the costs of the entire proceeding are paid by the owner if he or she is unsuccessful or by public funds if the owner's appeal as to the proper valuation of the damaged or lost item is successful.

¹⁴² Two recent high profile cases are Republic of Lebanon v. Sotheby's, No. 3790/90 (N.Y. Sup. Ct. Nov. 4, 1993) and Republic of Turkey v. The Metropolitan Museum of Art, 762 F. Supp. 44 (S.D.N.Y. 1990).

Republic of Lebanon involved the claim of ownership by the Marquess of Northampton (a U.K. citizen) to a collection of 14 pieces of late Roman silver, known as the Sevso Treasure, which he purchased on advice of Sotheby's from a Lebanese dealer and a Yugoslavian-born coin merchant. Lebanon, Yugoslavia (now Croatia) and Hungary filed suit claiming ownership of the objects. Lebanon subsequently withdrew from the case and the New York State Supreme Court recently ruled that neither Croatia or Hungary had proved to the court's satisfaction its claim to ownership. Thus, despite doubts as to its provenance, Northampton's claim to the Treasure and his right to sell it were upheld. See David D'Arcy, Lord Northampton Wins by Default – For the Moment, 4 The Art Newspaper, Dec. 1993, at 4. He points out that the value of the Sevso Treasure has declined because of the uncertainty surrounding its provenance and the threat of ongoing litigation facing a potential buyer of the Treasure. See also Republic of Croatia v. Trustee of the Marquess of Northampton 1987 Settlement, No. 50810–50816 (N.Y. App. Div., April 21, 1994), reported in N.Y.L.J., April 25, 1994, at 26.

In Republic of Turkey, Turkey sought to recover artifacts in the possession of the Metropolitan Museum of Art. Turkey asserted that the artifacts were excavated from burial mounds in the Ushak region of Turkey in 1966 and exported to the United States in contravention of Turkish law. Turkey claimed that under Turkish law it owns all artifacts found in Turkey. Subsequently, The Metropolitan Museum returned the artifacts to Turkey. See Alexandra A. Montagu, Recent Cases on the Recovery of Stolen Art – The Tug of War Between Owners and Good Faith Purchasers Continues, 18:1–2 Colum.-VLA J.L & Arts 75, 86–87 (1994).

¹⁴³ See Mußgnug, supra note 135, at 68. The reasons he offers for the establishment of an international court of arbitration in this context are speed and the reduced cost of the proceedings as compared with litigation.

See also Prott and O'Keefe, supra note 8, at 196. They offer the following comment on the use of arbitration where a state party is involved:

Arbitration is used as a dispute settlement mechanism in many … matters involving States and, although it has defects, in general it works very well. It is important that provision be made for some method of settling disputes and arbitration is particularly suitable for those with international elements.

¹⁴⁴ Arbitration Center, World Intellectual Property Organization, Geneva, Switzerland.

¹⁴⁵ Removing the cases from the national court system to an arbitration center may also offer advantages from a foreign relations standpoint. Cultural property disputes often raise issues sensitive to governments and they may prefer that such claims are removed to a neutral location.

¹⁴⁶ The ICSID Convention was formulated in 1965 by the Executive Directors of the World Bank in Washington, D.C.

¹⁴⁷ As of March 1, 1995, 115 countries had become Contracting States and an additional 16 had signed the Convention but not yet ratified it; See List of Contracting State and Signatories of the Washington Convention 1965, 20 Y.B. Comm. Arb. 1077 (1995).

Also worth noting are the Rules Governing the Additional Facility for the Administration of Proceedings by the Secretariat of ICSID, Sept. 1978 (hereinafter “the Additional Facility Rules”), Document ICSID/11 Additional Facility for the Administration of Conciliation, Arbitration and Fact-Finding Proceedings, June 1979, which can be used for certain types of proceedings between foreign nationals and states that fall outside the scope of the ICSID Convention.

¹⁴⁸ See John T. Schmidt, Arbitration Under the Auspices of the International Centre for Settlement of Investment Disputes (ICSID): Implications of the Decision on Jurisdiction in Alcoa Minerals of Jamaica, Inc. v. Government of Jamaica, 17 Harv. Int'l. L.J. 90, 104 (1976) as cited in Stephen J. Toope, Mixed International Arbitration 221 n. 10 (1990) for the idea that a neutral forum will increase the likelihood of the investor achieving “easy access to the decisional forum, [and the] opportunity to air the merits of a claim” by divorcing the forum from the control of the host state. This will in turn increase investor activity.

¹⁴⁹ See Toope, supra note 148, at 200.

¹⁵⁰ For a thorough analysis of the Santiago de Compostela Resolution, See generally Arthur T. von Mehren, Arbitration Between States and Foreign Enterprises: The Significance of the Institute of International Law's Santiago de Compostela Resolution, 5 ICSID Rev.-For. Inv. L. J. at 54. See also Arthur T. von Mehren, Institute of International Law – Resolution on Arbitration between States. State Enterprises or State Entities and Foreign Enterprises. Explanatory Note, (hereinafter “Von Mehren Explanatory Note”) 16 Y.B. Comm. Arb. 233 (1991).

¹⁵¹ The language of Article 6 of the Santiago de Compostela Resolution which follows describes the complete fireedom of contract afforded to the parties in selecting the law to govern their arbitrable disputes. It states:

In particular, (1) a different source may be chosen for the rules and principles applicable to each issue that arises and (2) these rules and principles may be derived from different national legal systems as well as from non-national sources such as principles of international law, general principles of law, and the usages of international commerce.

¹⁵² A major distinction of the Santiago de Compostela Resolution from the Amsterdam Resolution on Arbitration in Private International Law (Resolution on “L ‘Arbitrage en droit international prive” adopted at the Institute's Forty-Eighth Session, Amsterdam, 1957) is the delocalization of the arbitral proceeding from the seat of its proceeding. Under the Amsterdam Resolution, although the parties had the discretion to choose where the arbitration tribunal would sit, the law of the seat that was selected governed the proceeding. Under the Santiago de Compostela Resolution, by contrast, it is the arbitration agreement which controls.

¹⁵³ The “general principles” that apply in Article 3, “[ujnless the arbitration agreement provides otherwise,” include the following: the separability of the arbitration agreement from the legal relationship to which it refers; Kompetenz-Kompetenz; rules allowing for the continuation of the proceeding despite a party's obstructionist measures; the ability to remove the arbitration proceeding to a different venue; and the ability to continue the proceeding should an arbitrator engage in obstructionist tactics.

¹⁵⁴ Santiago de Compostela Resolution, Article 4.

¹⁵⁵ Id.

¹⁵⁶ See Stephen M. Schwebel, International Arbitration: Three Salient Problems 122–25 (1987) for a discussion of the inadmissibility of a plea of sovereign immunity as a bar to the jurisdiction of arbitrators in international arbitral tribunals; See also, Georges Delaume, State Contracts and Transnational Arbitration 75 Am. J. Int'l L. 784, 786 (1981), as cited in Schwebel, id. at 125 n.140. Schwebel also refers to the discussion by Dr. J. Gillis Wetter of Solel Boneh International Ltd. (Israel) and Water Resources Development International (Israel) v. the Republic of Uganda and National Housing and Construction Corporation of Uganda (ICC) (1974) in support of this proposition, and to J. Gillis Wetter, Pleas of Sovereign Immunity and Act of Sovereignty before International Arbitral Tribunals 2 J. Int'l. Arb. 7, 9–10 (1985); See also Toope, supra note 148, at 139–40. He states that “the submission of a state to arbitration is treated as an implicit waiver of jurisdictional immunity.”

Problems of recognition and enforcement of the arbitral award remain in certain legal systems. Id. at 144–45. But see The United States Foreign Sovereign Immunities Act (1976), 28 U.S.C. § 1610(1) (Supp. 1982), 28 U.S.C. § 1605(a)(6) (amended 1988) (hereinafter “FSIA”), for the principle, adopted by other countries as well, that a state may not assert a claim of sovereign immunity to frustrate an arbitration agreement which it has entered into with a private party. It provides that there is no immunity available to a state in any action:

to enforce an agreement made by the foreign state with or for the benefit of a private party to submit to arbitration all or any differences which have arisen between the parties with respect to a defined legal relationship, whether contractual or not, concerning a subject matter capable of settlement by arbitration under the laws of the United States, or to confirm an award made pursuant to such an agreement … (emphasis added).

See also Switzerland International Private Law Statute, supra note 81, Ch. 12.

¹⁵⁷ The Preamble of the Santiago de Compostela Resolution specifically states:

[W]hile there are many principles that apply to international arbitrations in general, this Resolution also draws attention to other principles which are of special importance to arbitrations between States, state enterprises, or state entities, on the one hand, and foreign enterprises, on the other … [and notes] further that this Resolution has in view only the authority and duties of arbitrators in arbitrations between States, state enterprises, or state entities, on the one hand, and foreign enterprises, on the other… (emphasis added).

¹⁵⁸ See Von Mehren Explanatory Note, supra note 150, at 235–36. He notes that of special importance in this regard is the principle that arbitrators are “not free to invoke l'ordre public or lois imperatives in disregard of the arbitration agreement.” This had relevance in the draft UNIDROIT Convention context as some delegations to the Convention perceived the possibility of a country invoking l'ordre public as the rationale for the inclusion of Article 6(1). See UNIDROIT Explanatory Report 1994, supra note 9, at 27. However, Article 6(1) was deleted from the final text of the Convention.

¹⁵⁹ Santiago de Compostela Resolution, Art. 2.

¹⁶⁰ See TOOPE, supra note 148, at 146–50. He cites the leading American case in support of this proposition, Ipitrade International S.A. v. Federal Republic of Nigeria, 465 F.Supp. 824 (D.D.C. 1978) (State's agreement to arbitrate under ICC Rules constitutes a waiver of sovereign immunity under United States legislation). Although there are cases which have held to the contrary, the predominant position of cases in Australia, France, Holland, Sweden and Switzerland is to recognize an implicit waiver of sovereign immunity as extending to the enforcement and execution of the arbitral award. The Australian Foreign States Immunities Act 1985, reprinted in 25 I.L.M. 715 (1986), § 17(2), makes this waiver of immunity explicit. It provides that where the state has submitted to arbitration, “the foreign State is not immune in a proceeding concerning the recognition as binding for any purpose, or for the enforcement, of an award made pursuant to the arbitration, wherever the award was made.” Furthermore, the Act (§ 30) authorizes the Australian courts to order enforcement of the award. See also D. W. Bowett, Contemporary Developments in Legal Techniques in the Settlement of Disputes, Hague Recueil 169, 220 (1983), as cited in. TOOPE, supra note 148, at 148 n.206. See also Schwebel supra note 156, at 124. He cites Georges R. Delaume, State Contracts and Transnational Arbitration, 75 AM. J. INT'L L. 784, 786–87 (1981) in support of this same proposition.

¹⁶¹ The recently enacted Rules supersede an earlier set of rules which were designed to handle disputes of this type, the “1962 Rules of Arbitration and Conciliation for Settlement of International Disputes Between Two Parties of Which Only One is a State.”

¹⁶² See TOOPE, supra note 148, at 204 n. 15. Toope contends that states have a tendency to distrust institutional frameworks, preferring ad hoc arbitration instead. He cites Benteler v. Belgian State (Nov. 18, 1983), reprinted in I J.INT'L. ARB. 184 (1984); and Hellas International Co. for Garments S.A. v. The Greek State (Jan. 18, 1982), reprinted in 10 Y.B. COMM. ARB. 34 (1985), in support of this proposition.

¹⁶³ See Rules, Art. 1, para. (2) and the Model Arbitration Clauses for use in connection with the Permanent Court of Arbitration Optional Rules for Arbitrating Disputes Between Two Parties of Which Only One is a State, para. 5 (hereinafter “Future Disputes clause”).

¹⁶⁴ But see The Additional Facility Rules of the ICSID Convention, supra note 147, which expand the situations in which resort to the ICSID regime might be available to interested parties. The Additional Facility Rules authorize the ICSID Center to administer proceedings which fall outside the scope of the ICSID Convention in the following situations:

(a) … for the settlement of investment disputes between parties one of which is not a Contracting State or a national of a Contracting State;

(b) (b) … between parties at least one of which is a Contracting State or a national of a Contracting State for the settlement of disputes that do not directly arise out of an investment; and

(c) fact-finding proceedings.

¹⁶⁵ Rules, Art. 8, para. (3) provides that, “[i]n appointing arbitrators pursuant to these Rules, the parties and the appointing authority are free to designate persons who are not members of the Permanent Court of Arbitration at The Hague.”

A possible disadvantage of this method of selecting arbitrators as a possible model for the UNIDROIT Convention is that it would not provide a pool of specialized arbitrators with an expertise in the cultural property area.

¹⁶⁶ Rules, Art. 5. It provides that if the parties have not agreed that there shall be a sole arbitrator, then three arbitrators shall be appointed. The appointment of arbitrators is discussed in Arts. 6–8. The sole arbitrator is appointed either by agreement of the parties, or by the appointing authority agreed to by the parties, or failing that, by request of either party, by the Secretary-General of the Permanent Court of Arbitration in the Hague (Art. 6, para. (2)). Thus, although there is flexibility, the services of the Secretary- General of the Permanent Court of Arbitration are available to prevent the breakdown of the proceedings. Art. 6, para. (4) specifically alludes to the necessity of appointing as independent and impartial an arbitrator as possible. It provides:

In making the appointment [of the sole arbitrator], the appointing authority shall have regard to such considerations as are likely to secure the appointment of an independent and impartial arbitrator and shall take into account as well the advisability of appointing an arbitrator of a nationality other than the nationalities of the parties.

¹⁶⁷ See TOOPE supra note 148, at 202–203. Toope makes the point that a difficulty with institutional arbitration is that its codified procedures contribute to the inflexibility of the dispute resolution process. This tends to alienate non-western countries from resorting to arbitration. He writes:

The increasing formalism of arbitral procedure that seems to follow the creation of institutions may in fact hamper the resolution of disputes where developing state are involved because the emphasis upon rigorous procedural rules may not allow for sufficient sensitivity to political concerns and cultural discontinuities.

But see 4 ICC INTapos;L CT. ARB. Bulletin 1, at 4 (May 1993). Statistics compiled by the ICC indicate that in the ten year period from 1983–92, parties from 93 different countries participated in ICC arbitrations. Parties from Western Europe accounted for 57% of this pool but the remainder was composed of parties from the Asia-Pacific region and from Central and Eastern Europe.

¹⁶⁸ Rules, Art. 1.para. (4).

¹⁶⁹ Rules, Art. 16, para. (1) provides the following rules as to the place of arbitration:

Unless the parties have agreed upon the place where the arbitration is to be held, such place shall be The Hague, The Netherlands. If the parties agree that the arbitration shall be held at a place other than The Hague, the International Bureau shall inform the parties and the arbitral tribunal whether it is willing to provide the secretariat and registrar services…

¹⁷⁰ Rules, Art. 23.

¹⁷¹ See Alan Redfern & Martin Hunter, Law and Practice of International Commercial Arbitration at 39 (1986), for the premise that, “[t]he time limits laid down by institutional rules usually fail to take account of the time which a state or state entity needs to obtain approval of important decisions, through its own official channels.”

¹⁷² Rules, Art. 1, para. (2) provides:

Agreement by a party to arbitration under these Rules constitutes a waiver of any right of sovereign immunity from jurisdiction, in respect of the dispute in question, to which such party might otherwise be entitled. A waiver of immunity relating to the execution of an arbitral award must be explicitly expressed.

¹⁷³ See Future Disputes clause, supra note 163. It provides:

This agreement to arbitrate constitutes a waiver of any right to sovereign immunity to which a party might otherwise be entitled with respect to the enforcement of any award rendered by an arbitral tribunal constituted pursuant to this agreement.

¹⁷⁴ See supra note 156.

¹⁷⁵ See The Report of the Executive Directors of the World Bank, Comment on Art. 55, Doc. ICS1D/2, para. 43, as cited in Aron Broches, Convention on the Settlement of Investment Disputes Between States and Nationals of Other States of 1965, Explanatory Notes and Survey of its Application. 18 Y.B. COMM. ARB. 627, 704 (1993).

It states:

The doctrine of sovereign immunity may prevent the forced execution in a State of judgments obtained against foreign States or against the state in which execution is sought. Article 54 requires Contracting States to equate an award rendered pursuant to the Convention with a final judgment of its own courts. It does not require them to go beyond that and to undertake forced execution of awards rendered pursuant to the Convention in cases in which final judgments could not be executed.

Broches cites LETCO v. Liberia, 650 F.Supp. 73 (1986) as an example of an instance where the jurisdiction of the U.S. court over the foreign State was upheld but the execution of the ICSID award was not enforced. The assets were deemed by the court to be sovereign and not commercial assets and therefore not covered by the Foreign Sovereign Immunities Act exception from immunity of execution of assets used for commercial activities. Id. at 704–05.

See also TOOPE supra note 148, at 246–49 for a discussion of this subject. The author cites Judgement of June 6, 1981 (Benvenuti & Bonfant Co. v. Government of the People's Republic of Congo), Cour d'appel (Fr), reprinted in 20 I.L.M. 878 (1981), as an example of a situation where a sovereign immunity defense was upheld against execution of the award.

¹⁷⁶ See TOOPK, supra note 148, at 190–96, and at 237–238 for a discussion of the issue of interim measures of protection in the context of the ICSID system as well as in that of other arbitral systems.

¹⁷⁷ Rules, Art. 26, para. (3).

¹⁷⁸ See TOOPE, supra note 148, at 192–95. Although there is a body of U.S. case law which holds that if a dispute is to go to arbitration, the courts are precluded from granting any provisional measures, including ordering attachment of the goods, the tendency in both the U.S. and in Europe is to allow courts to pre-arbitration attachments.

¹⁷⁹ Rules, Art. 26, para. (1) provides:

Unless the parties agree otherwise, the arbitral tribunal may, at the request of either party, take any interim measures it deems necessary to preserve the respective rights of either party or in respect of the subject-matter of the dispute, including measures for conservation of the goods forming the subject-matter in dispute such as ordering their deposit with a third person or the sale of perishable goods.

Art. 26, para. (2) provides, that “[s]uch interim measure maybe established in the form of an interim award. The arbitral tribunal shall be entitled to require security for the costs of such measures.”