Scenario and Problems
The conflict between Russia and Ukraine continued to elicit international reactions from States beyond the pair at the epicentre of concern. Just a few months ago, the Secretary of State of the United States issued a press statement, announcing sanctions on USM Holdings owned by the Russian oligarch Alisher Usmanov and his other companies, in cooperation with the UK. The actions involve blocking all property and interests in property of the designated companies. USM Holdings criticised the financial measures for being ‘unfair and unreasonable’, citing Usmanov’s holdings of less than 50% and his lack of involvement in the company’s management for a significant period.
There could of course be debates about the characteristics of these sanctions on a conceptual level. For instance, one might believe that they constitute retorsion, namely unfriendly yet legal responses under international law. The assumption in this piece is that these sanctions are prima facie wrongful, as they are likely to breach the US and UK’s international obligations. For instance, they may constitute expropriation without prompt, adequate, and effective compensation which is generally prohibited by international investment agreements (IIAs) or by customary international law. To justify sanctions as such, some States and scholars have proposed another intriguing reasoning: they can be a form of countermeasures (see e.g. here, here, and here), as outlined in the International Law Commission (ILC)’s Articles of Responsibility of States for Internationally Wrongful Acts 2001. According to the Articles on State Responsibility, countermeasures may be used to preclude the wrongfulness of a State’s potential breach of some international obligation owed to another State, provided, inter alia, that the conduct is carried out in response to an internationally wrongful act committed by the other State and is meant to encourage the other State to comply with its international obligations. To apply this to the scenario above, the sanctions directed at Russian companies may be deemed as lawful countermeasures taken in response to Russia’s breach of the prohibition on the use of force and aggression (see e.g. here) along with other obligations under international human rights law and international humanitarian law (see e.g. here).
Under the rules of state responsibility, two possible theoretical objections, nonetheless, may be raised. First, how can the US and the UK, which are not the injured State in the Russian-Ukrainian conflict, resort to countermeasures against Russia? Second, how can countermeasures target private investors from Russia, instead of Russia or its state assets? It is argued here that these doubts can be dismissed.
States Other than an Injured State as Initiators of Countermeasures
There appear to be two paths open to States to establish their standing for enforcing countermeasures under the ILC Articles on State Responsibility, contingent upon the nature of the obligations breached by the initial wrongdoer. According to Article 42, if the obligation at stake is seen as owed to them either individually or as parties to interdependent obligations, then States are the injured States in relation with the initial wrongdoer and thus entitled to react with countermeasures against it by virtue of Article 49. On the other hand, if the obligation breached is one stipulated in Article 48, namely obligations erga omnes partes or erga omnes, it might be contended that even States that are not the injured state are entitled to take countermeasures against the initial wrongdoer, though it is worth noting that the wording of Article 54 is neutral on this issue as it merely allows states other than the injured state to take ‘lawful measures’.
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