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Law

The Doctrine of Sovereign Immunity in Disputes Involving State-Owned Enterprises

Quick fact

Under the restrictive theory of sovereign immunity, a state-owned enterprise is generally NOT immune from suit when it engages in commercial activities, even if the state itself would be immune. In the landmark case Republic of Argentina v. Weltover, the U.S. Supreme Court held that Argentina's issuance of bonds was a commercial activity, so Argentina was subject to suit in U.S. courts.

Why this is interesting

When you sign a contract with a state-owned company, can you ever sue that government in court? The surprising answer depends on a centuries-old legal shield that still protects states today.