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that the property in question must be in use for an activity not pursuing government
non-commercial purposes, or that the State has expressly consented to the taking of a
measure of constraint, or that that State has allocated the property in question for the
satisfaction of a judicial claim. As Villa Vigoni was used for governmental purposes
that were entirely non-commercial (this villa is the seat of a cultural centre intended
to promote cultural exchange between Germany and Italy), the ICJ found that the
registration of a legal charge on Villa Vigoni constituted a violation by Italy of its
obligation to respect the immunity owed to Germany.
24
The above-stated ICJ case clearlydemonstrates the significance of theUNConvention
for current international legal practice and the relevance of State immunity as such that
I was trying to point out in the introduction to this article.
3. The Czech-Austrian Declaration: Why It Was Prepared and What Is in It
Similarly to Germany, the Czech Republic also had a sort of “Villa Vigoni of
its own”, only in the form of paintings. The case in question is an episode in a long
legal battle between the Diag Human company and the Czech Republic. It all started
with a plan of Diag Human for a blood plasma business with the Czech Republic
that later went wrong. Allegedly, the reason for this failure was a letter of the Czech
Minister of Healthcare addressed to a Danish company in 1992 causing damage to
Diag Human. The Czech Republic and Diag Human then concluded an arbitration
agreement under Czech law in 1996. In 2002, an arbitral tribunal ordered the Czech
Republic to pay to Diag Human a compensation in the amount of CZK 326,608,334.
Nevertheless, in 2008 there was another arbitral award for an incredible amount
of CZK 4,089,716,666 (approximately USD 164 mil.). This complex dispute was
subsequently moved to the Czech courts and ended in 2014, when the review arbitral
tribunal finally declared that the proceedings are discontinued.
During this legal battle the National Gallery in Prague and the Moravian Gallery
in Brno provided three valuable paintings to an exhibition in the Vienna castle of
Belvedere. In May 2011 these paintings were seized on the basis of a decision of
an Austrian court issued on request of Diag Human aiming to enforce the 2008
arbitral award pursuant to the New York Convention on the Recognition and
Enforcement of Foreign Arbitral Awards. At that time, Austria had already ratified
the UN Convention, while the Czech Republic was just a signatory. Although the
UN Convention has not entered into force, its relevant provisions should have been
applied due to their customary law nature, in particular Art. 21(1)(e) providing
for State immunity from post-judgment measures of constraint in case of certain
categories of State property: “The following categories, in particular, of property of
a State shall not be considered as property specifically in use or intended for use
by the State for other than government non-commercial purposes under article 19,
24
See
supra
note 16, paras 109-120.