The following is an excerpt of comments given by Patricia McNerney
at the International and National Security Law Practice Group Breakout
Session during the Federalist Society Lawyers Convention, Washington,
D.C., October 17, 1997.
I want to be clear at the outset today that although I am from
the Senate Foreign Relations Committee, I am not an expert in the
Helms-Burton Act, and I am prepared to talk about international
property rights issue in general.
In March of 1994, the Republican staff of the Foreign Relations
Committee produced a report resulting from months of staff travel
and investigation through Honduras, Nicaragua, and Costa Rica. That
report set out in precise detail an alarming number of expropriations
that were made without prompt, adequate, or effective compensation.
Although that would be, of course, the international standard, the
efforts of the State Department were spotty at best in raising the
red flags with respect to U.S. property being taken illegally.
This was raised at the time with Secretary of State Warren Christopher
and this issue was raised when he appeared before the Committee.
In addition, a number of efforts to deal with the issue were undertaken
in connection with the State Department authorization bill, which
is the committees normal authorization vehicle.
As the Committee staff continued working on the issue, certainly
we became familiar with a number of cases. There was Jencks Caldwell,
an American citizen who died last year. Only after his death, -
- many years after he had an airplane expropriated by the Argentine
government, - - was his estate was paid.
Pierre Talenti, a gentleman from Italy, who died just last month,
still has not received compensation for the property that was expropriated
by the Italian government, despite many letters written on his behalf
by Senators and Congressmen.
Joe Hamiltons case is one that I know particularly well --
I have visited his property in Costa Rica. For more than 17 years,
he has been trying to receive compensation for his property. His
property is some of the most beautiful and pristine land in the
Guanacaste region of Costa Rica. He has persevered with the assistance
of the Committee, (which has sometimes taken heavy-handed action
to help, such as withholding of bilateral aid or directing multilateral
aid). We have pressed on and the matter is finally in international
arbitration. It has taken 17 years, constant letters and constant
pressure on the Costa Rican Government are necessary to push this
I raise these examples to make the point that often governments
can outlast claimants. Thats the bottom line in international
property law, and thats the context in which Senator Helms
has pushed the Committees activities on this front.
Then comes Helms-Burton, with which you are all very familiar.
That legislation was basically designed to address a Cuban precedent.
We all know that international law is based largely on precedent
and on what the international community condones. And certainly,
if you look at the Cuba precedent, the international community saw
a dramatic example of takings in which there was no pretense of
compensation in return for using such property for the public good.
In time, the international community not only condoned the actions,
but actually became a party to them through direct investment in
the Cuban property.
I think there are many components to what constitutes an established
legal order, and, in the case of property, it means a system that
ensures prompt, adequate, and effective compensation. In exercising
the treaty power the committee has been diligent in making sure
the administration has that language in every bilateral investment
treaty that comes before the Committee and the Senate in exercising
the treaty power. And we are very cautious about how these terms
are defined. The key question is how these terms are really defined
with respect to implementation worldwide.
It is important to understand the history of this issue in terms
of where we have been, where we are with Helms-Burton, and where
we are not in the discussions on the Multilateral Agreement on Investment
Senator Helms gave Assistant Secretary of State Stuart Eizenstat
his word that he would in no way obstruct the negotiations that
are going on with the European Union, They have lasted 6 months,
and now there is to be an extension, certainly a short-term one.
There is a willingness to continue those discussions and not, as
I say, obstruct them. But at the same time the Senator has made
clear that these negotiating efforts should in no way lead to a
lessening of enforcement of Helms-Burton or U.S. law.
The negotiations that are going on are a positive step, if in that
, they globalize the recognition that there is a problem in terms
of enforcement of international property rights. Yet, there is still
a lot of work to do on such a treaty, and a number of questions
need to be asked. Whats effective? Whats enforceable?
Are there going to be strict global sanctions that are implemented
fully? Implementation is the key. Indeed, when Mr. Eizenstat came
to the Hill to brief the committee on how he expected to proceed,
there was interest not only in the creation of a document that set
out proper norms, but also in the implementation of such a document.
Senators and Congressmen will be asking important questions about
The agreement also must be able to survive the current occupant
of the Office of the Under Secretary of Economic Affairs. Certainly,
Mr. Eisenstat has been out in front on this issue and has been doing
important work. But I think this issue will only be resolved through
a long-term, concrete process.
The Congress is willing to watch what happens on the multilateral
front and see what is produced. But the Senate will not be satisfied
with going from a bilateral process to a multilateral process that
still would enable governments to outlive claimants. There will
be a very deaf ear if such document comes up to the Senate. Senator
Helms often likes to quote President Reagans maxim, "trust
but verify." I think thats probably a good way to summarize
how the Senate will look at this process.
*Patricia McNerney is the associate counsel to the United States
Senate Committee on Foreign Relations. She is principally responsible
for treaties and nominations. She also works on legislation regarding
the United States membership in the United Nations and other international