Friday, April 27, 2007

Law? Who cares? It's all about the oil.

U.S. bid to ban oil, gas cartels in breach of int. law

Reported U.S. attempts to prohibit other countries from setting up oil and gas cartels and pursue them through the U.S. courts is a violation of international law and sovereign rights, Russia's Foreign Ministry said Friday.

On Wednesday, the U.S. Senate Judiciary Committee unanimously passed a draft law banning foreign countries from forming oil and natural gas 'cartels' and another bill permitting legal action against foreign states for oil and gas price fixing and other uncompetitive activities.

"If media reports are right and the bill is passed, other countries will be stripped of immunity in American courts, then it is a violation of commonly acknowledged principles of international law, namely sovereign equality, by the U.S.," the ministry's information and press department said.

The idea of an OPEC-style gas cartel was proposed in January by Iran, the world's second largest gas producer after Russia. Russian President Vladimir Putin has backed the idea, although some Russian officials question the initiative.

The bill makes the 'gas cartel' actionable under antitrust laws. The bill also authorizes lawsuits in the U.S. federal court against cartel members by the Justice Department and the Federal Trade Commission.

In 1979, a U.S. Federal Court ruled that price decisions taken by the Organization of Petroleum Exporting Countries result from intergovernmental and not commercial activities and therefore fall under a foreign sovereign immunities law, which makes a foreign country immune from the jurisdiction of courts in other states.

The bill approved by the Judiciary Committee entirely lifts this immunity for any cartel-type oil and gas organization or agreements where parties are represented by governments or state-owned companies.

Original article posted here.

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