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This Note presents an analysis of whether the Foreign Sovereign Immunities Act of 1976 (FSIA) provides foreign state-owned enterprises (SOEs) with immunity in U.S. courts when those entities cause transboundary pollution with effects inside the borders of the United States. Foreign SOEs around the world are heavily involved in the energy sector, which makes them a likely class of defendants in cases involving transboundary pollution. Nonetheless, they may be entitled to immunity in U.S. courts under the FSIA. While the activities of SOEs that result in transboundary pollution seem to fall under the commercial activity exception to the FSIA, a number of cases hold that, to varying extents, activities involving the exploitation of natural resources are sovereign in nature and therefore protected by the FSIA. In this Note, I argue that because the relevant case law is ultimately based on the right of states to control their natural resources under international law, the application of such cases should be limited when that international legal right is also limited. Because international law balances control over natural resources with an obligation to not cause transboundary harm, I argue that acts of foreign SOEs resulting in transboundary pollution should not be viewed as sovereign acts. Therefore, the commercial activity exception to the FSIA should apply in such cases, and foreign SOEs should be subject to the jurisdiction of U.S.
courts.
