of a foreign government done within its own territory, the district court found that the seizure of the bills of lading had not come to complete fruition within Bangladesh such as to amount to a "fait accompli", since both the jute and the proceeds from the sale of the jute were outside of the dominion of the Bangladeshi Government. Hence, the Court ruled, it cannot be said that the mere seizure of the bills, without more, was an "act of state" within the meaning of the doctrine.

*

Dept. of State File No. P78 0005-1850.

The portion of Mr. Mark's letter of December 8, 1977, responding to the act of state inquiry appears below:

* * *

In the Department's view, the Hickenlooper amendment is inapplicable in this case because it does not apply to expropriation of property not owned by Americans. Menendez v. Saks & Co., 485 F. 2d 1355, 1372 (2d Cir. 1973); Occidental of Umm Al Qay, Inc. v. Cities Service Oil Co., 396 F. Supp. 461, 472 (D.C. La. 1975). In general, the Department takes the view that foreign policy interests do not require U.S. courts to refrain from reviewing acts of foreign states on the merits. See, the Legal Adviser's letter to the United States Solicitor General in Alfred Dunhill of London, Inc. v. The Republic of Cuba, 425 U.S. 682, 706 (1976), app. 1. Similarly, in this case, the Department does not believe that United States foreign policy interests would be adversely affected were the Court to recognize or refuse to recognize the expropriation decrees at issue. However, the Department has not made a "determination" to this effect, as that term is used in the Hickenlooper amendment. Dept. of State File No. P78 0005-1857.

The nine questions posed by Clerk Fusaro appear below:

(1) Does the appellee dispute that endorsement of the bills of lading by Adamjee to NBP (Rule 9(g) Statement, paragraph 19, at A-14) transferred title to the jute to NBP to the extent of the Bank's security interest? If so, on what grounds?

(2) In light of NBP's holding of the bills of lading, did the delivery of the iute to the consignee in the Dominican Republic on December 17 and 21, 1971 (Stipulation of Facts, items 11, 13, 15(b) and 16, at A-38-39), affect the legal position of NBP?

(3) Is the armed clash in East Pakistan described in items 19 and 20 of the Stipulation of Facts, at A-39-40, properly characterized as a rebellion or as a war? Does such characterization make any difference with respect to the question whether the Administration Order or the Abandoned Property Order or the Nationalization Order (Stipulation of Facts, items 1, 21, 22, 23 and related exhibits) constituted violations of international law?

(4) If Pakistan and Bangladesh were at war, how long-given the cessation of combat on December 16, 1971,-did the state of war continue?

(5) What action, if any, has been taken by Pakistan with respect to property in Pakistan owned by citizens of what has become Bangladesh?

(6) Does the United States' recognition of Bangladesh on April 4, 1972, or Pakistan's recognition of Bangladesh (Stipulation of Facts, items 24 and 25. at A-41) have any bearing on the rights of the parties? Cf. Oetjen v. Central Leather Co., 246 U.S. 297, 302-03 (1918); Ricaud v. American Metal Co., 246

U.S. 304, 308-09 (1918), where the beneficiary of the expropriation did not seek affirmative relief in a United States court.

(7) What is the effect of article 8 of the Nationalization Order quoted in item 23 of the stipulation of facts on the issue of confiscation? Have there been any developments with respect to compensation since the date of the stipulation and the statement under Rule 9 (g) (item 26)?

(8) Are there any pending negotiations between Pakistan and Bangladesh for the settlement of claims such as those here in suit or arising out of such acts of Pakistan as are described in item (5) above?

(9) Would it be proper and, if so, appropriate for the court of appeals to vacate the order of the district court without prejudice and direct the district court to suspend judgment for a reasonable time to allow for negotiations such as are described in item (8) above?

In Linseman v. World Hockey Ass'n, 439 F. Supp. 1315 (1977), a case involving an action by a nineteen-year-old Canadian hockey player challenging the validity of a minimum age limitation imposed by the World Hockey Association as a violation of section 1 of the Sherman Antitrust Act, the U.S. District Court for the District of Connecticut rejected a defense based upon the act of state doctrine. The plaintiff requested a preliminary injunction to restrain the defendant from applying its minimum age limitation of twenty years to prevent him from playing for the Birmingham Bulls, a member team of the defendant association. The Bulls had drafted the plaintiff and signed him to a lucrative contract. The Association subsequently informed the Bulls that the selection of the plaintiff in the draft was null and void because of the "twenty-year-old rule" and alleged that if the plaintiff were permitted to play in violation of the rule, which resulted from an agreement between the World Hockey Association and the Canadian Amateur Hockey Association, the latter would refuse to approve professional hockey games in Canada between members of the World Hockey Association and foreign teams.

On October 28, 1977, the Court held, inter alia, that the plaintiff was entitled to the issuance of a preliminary injunction because the regulation would very likely be found at a trial to be in violation of section 1 of the Sherman Antitrust Act and because the defendant's reliance upon the act of state doctrine would in all probability fail for two reasons. First, it appeared that the Canadian Government had not in fact ordered the use of the twenty-year-old rule. Second, the doctrine would not excuse the illegal boycott activities of the defendant association in the United States.

Excerpts from the district court opinion, issued by Chief Judge T. Emmet Clarie, follow:

First, defendant has offered no proof that the twenty-year-old rule was in fact ordered by the Canadian Government. The affidavit of William MacFarland states merely that the rule was "endorsed" by the Minister of Health who wished to "discourage" the drafting of teenagers from the Canadian amateur leagues. The defendant also points to Judge Higginbotham's decision

in Philadephia World Hockey Club v. Philadelphia Hockey Club, 351 F. Supp. 462 (E.D.Pa.1972) where the judge found:

While there is apparently no legal bar which precludes the WHA's contracting with amateur players of any age, the Canadian Government in regulating its sponsored amateur leagues would prefer that the professional leagues draft only amateurs who are over 20 years of age. Id. at 472 (emphasis added).

Neither one of these statements can be construed to imply that the complained of practice was "compelled" by the Canadian Government, and a showing of compulsion is what is required in order to invoke the act of state doctrine.

The Court has already decided that state authorization, approval, encouragement or participation in restrictive private conduct confers no antitrust immunity. Cantor v. Detroit Edison Co., 428 U.S. 579, 592-593, 96 S.Ct. 3110, 3118. 49 L.Ed.2d 1141 (footnotes omitted). .

Second, even if defendant were able to prove at trial that the twentyyear-old rule was the result of compulsion by the Canadian Government, the act of state doctrine shields only conduct which is perpetrated within the territorial boundaries of the foreign country. The doctrine cannot be used to excuse the commission of illegal acts within the territorial boundaries of the United States. See United States v. Sisal Sales Corp., 274 U.S. 268, 276, 47 S.Ct. 592. 71 L.Ed. 1042 (1927); Republic of Iraq v. First National City Bank, 353 F.2d 47, 51 (2d Cir. 1965), cert. den. 382 U.S. 1027, 86 S.Ct. 648, 15 L.Ed.2d 540 (1966). . . . Indeed, given the fact that the rationale for the doctrine is to foreclose judicial review of acts of foreign governments which occur "on their own soil,” Alfred Dunhill of London, Inc. v. Cuba, 425 U.S. 682, 697, 96 S.Ct. 1854, 48 L.Ed.2d 301 (1976), it would be startling to find that it has application to acts occurring on United States soii. In the present case, the restriction would prevent Linseman from playing hockey in the United States, and thus the act of state doctrine would not be applicable.

439 F. Supp. 1315, 1323, 1324-1325 (1977).

Chapter 7

LAW OF THE SEA AND INTERNATIONAL

WATERWAYS

§1 General

U.S. Oceans Policy

U.N. Conference on Law of the Sea

On July 20, 1977, Elliot L. Richardson, Ambassador at Large and Special Representative of the President to the Law of the Sea Conference at the United Nations, provided the following press statement assessing the Sixth Session of the Third U.N. Conference on the Law of the Sea, concluded on July 15, 1977, in New York City:

The Informal Composite Negotiating Text resulting from this session of the U.N. Law of the Sea Conference evidences real progress on vital issues relating to international security and freedom of navigation. At the same time it substantially sets back prospects for agreement on an international regime for the conduct of seabed mining. Both the substance of the text on this issue and the lack of fair and open processes in its final preparation require me to recommend that the United States undertake a most serious and searching review of both the substance and procedures of the conference.

It is with a sense of considerable frustration that I make this accounting. For true progress was made during the past session:

-New provisions were negotiated to clarify the legal status of the new 200-mile economic zone. They seek to safeguard traditional high seas freedoms within this zone except for specific resource-related rights accorded coastal states by the Convention. These provisions are a marked improvement over previous texts and may help prevent erosion of high seas freedoms by coastal state attempts to extend their sovereignty over ocean space.

-We successfully retained the generally satisfactory previous texts on passage of straits which a determined minority sought to change. At the same time we found a way to accommodate the real need for environmental protection in straits, particularly in areas such as the Straits of Malacca.

-The provisions of the text dealing with scientific research were improved. An effort by some delegations to increase the degree of coastal state control of scientific research in the economic zone was defeated. In the new text, the conditions for conducting scientific research are set out clearly, and are likely to be copied into national laws, thus regularizing what has until now been a capri

cious situation. Also, we successfully eliminated a clause that could have obliged the U.S. to restrict publication of scientific data after the fact and without the consent of scientists, which was highly offensive to our concepts of free science and free speech. Now the coastal state, in granting consent, must indicate in advance if it wishes to impose such a restriction, and if so the scientist can decide whether he wishes to proceed with the project under such circumstances.

-We were successful in eliminating texts that could have prevented us from imposing rules in our territorial sea to prevent pollution from foreign ships. At the same time, we retained our right to fix strict environmental conditions-including construction, manning, equipment and design regulations-for entry into U.S. ports. These changes bring the text into full harmony with the Administration's antipollution program.

-Continued progress was made in the design of a comprehensive system for peaceful settlement of disputes relating to ocean uses. -Under the fair and judicious leadership of Minister Jens Evensen of Norway a responsible and effective discussion of seabed issues took place. This discussion and the texts formulated by Minister Evensen offered real prospect that the impasse on seabed mining issues could be resolved on terms acceptable to both the developed and developing nations.

Regrettably, however, the new "composite" text concerning the system of exploitation and governance of the deep seabed area (Part XI) is now fundamentally unacceptable. It deviates markedly from the proposed compromise text which had been prepared on the basis of full, fair and open discussion under Minister Evensen's leadership.

The Evensen text, although not without problems, was generally viewed as a useful basis for further negotiation. The newer textproduced in private, never discussed with a representative group of concerned nations, and released only after this session of the conference terminated-cannot be viewed as a responsible substantive contribution to further negotiation. Indeed, the manner of its production-treating weeks of serious debate and responsible negotiation as essentially irrelevant-raises an equally serious procedural problem: whether the Law of the Sea Conference can be organized to treat deep seabed issues with the seriousness they, and the conference which depends upon their satisfactory resolution, demand. Among the serious points of substantive difficulty in the latest deep seabeds text, and the system it would define, are the following:

It would not give the reasonable assurance of access that is necessary if we and others could be expected to help finance the Enterprise and to accept a "parallel system" as a basis of compromise. It could be read to make technology transfer by contractors a condition of access to the deep seabed-subject, at least in part, to negotiation in the pursuit of a contract.

It could be read to give the Seabed Authority the power effectively to mandate joint ventures with the Authority as a condition for access.