Florida Bankers Ass’n v. Treasury: Court Upholds Reporting Requirements Facilitating IRS Information Sharing with Foreign Revenue Authorities

By Steve Johnson, University Professor, Florida State University College of Law

There is a strong trend in the direction of international cooperation in tax enforcement. The ease with which money can flow around the global – approximately $1 trillion cross national borders every day – means that determined tax evaders often can hide taxable amounts from their home countries by moving wealth abroad.

Florida Bankers is an important recent event in international cooperation to detect and defeat such evasion. The United States District Court for the District of Columbia upheld the validity of Treasury regulations requiring U.S. banks to report interest paid to account holders residing in 70 foreign countries.[1] Pursuant to treaty obligations, this information can then be shared with the revenue authorities in those countries, to help them ascertain whether their residents are evading resident-country tax by using – and not reporting interest from – accounts in U.S. banks. Foreign countries will be expected to reciprocate by collecting and providing to the IRS information on accounts held by U.S. citizens and residents in banks in the foreign countries, helping the IRS curb evasion of U.S. taxes.[2]

For decades, Treasury regulations have required U.S. banks to provide to the IRS, to be shared with Canada, interest earned by Canadians from U.S. accounts.[3] In 2001, Treasury considered extending this approach as to nonresident aliens from all countries, but it chose not to do so.[4]

In 2011, Treasury revived that proposal. Extensive comments – some supportive, many negative – were submitted to Treasury with respect to the proposed regulations. Treasury considered and responded to these comments. It finalized the regulations, in 2012, but with changes.[5] Most importantly, the final regulations narrow the scope of the required reporting from accountholders from 196 countries to accountholders from only 70 countries – the 70 countries with which the U.S. has treaty obligations to share tax information.

The Florida Bankers Association and Texas Bankers Association collectively represent over 800 banks, at least 300 of which are considered small businesses under federal criteria. The Associations brought suit seeking injunctive and declaratory relief. They argued that the Treasury violated both the Administrative Procedure Act (“APA”)[6] and the Regulatory Flexibility Act (“RFA”)[7] in promulgating the regulations.

Before reaching the merits, the district court considered two jurisdictional arguments advanced by the Government. First, the court unsurprisingly rejected the Government’s contention that the plaintiffs lacked standing to sue. The Associations’ member banks were directly affected by the regulations. Under the representative standing doctrine, the Associations were proper parties to sue to vindicate their members’ interests because the suit was germane to their organizational purposes, “which involves policy advocacy on behalf of financial institutions.”[8]

Second, the Anti-Injunction Act (“AIA”) provides that, outside certain exceptions not here applicable, “no suit for the purpose of restraining the assessment or collection of any tax shall be maintained in any court by any person, whether or not such person is the person against whom such tax was assessed.”[9] Although judicial application of the AIA has been less than fully consistent, the AIA usually has been held to bar pre-enforcement challenge to tax regulations, requiring taxpayers or other aggrieved parties to raise the invalidity of the regulations in litigation after the IRS asserted that a tax or penalty was due.[10]

The district court rejected the Government’s contention that the AIA precluded the Associations’ pre-enforcement challenge to the regulations. The court reasoned in part that the suit sought to restrain a reporting requirement, not “the assessment or collection of [a] tax.”[11] Other recent cases also avoided the AIA on a variety of grounds.[12] Current AIA doctrine is in a state of serious confusion.

On the merits, the Associations’ principal set of arguments contended that the regulations were “arbitrary and capricious” under the APA. A long list of perceived substantive and procedural inadequacies was offered to support this contention, including that Treasury had failed to adequately quantify the relevant factors, had failed to adequately explain the choices embodied in the regulations, and had failed to appropriately balance the benefits and burdens of the additional reporting. Among the alleged burdens, the Associations were particularly concerned about loss of privacy of customers’ tax information and about possible capital flight – foreign depositors pulling their money out of U.S. accounts.

The court appropriately rejected these contentions. The Associations exaggerated the degree of precision the APA demands of an agency engaged in rulemaking. Agencies need not measure the immeasurable when exact data is not available. They may estimate within the bounds of reason. They need not explain what is common-sensical.[13]

Moreover, the Associations asked the court to perform an impermissible action in reweighing the competing policy considerations. The court noted that “arbitrary and capricious” is a narrow standard of review under which the court “is not supposed to substitute its judgment for that of the agency.”[14] Instead, “[b]alancing such costs and benefits is a policy choice for the Executive Branch to make.”[15]

The Associations’ other contention involved the RFA, which requires agencies to either analyze the impact of proposed rules on small businesses or certify “that the rule will not, if promulgated, have a significant economic impact on a substantial number of small entities.”[16] The Treasury had so certified. Courts are highly deferential as to such certifications, upholding them as long as the agency made a “reasonable, good-faith effort to carry out RFA’s mandate.”[17]

The Associations’ “capital flight” contention did not matter for RFA purposes. The Court read the RFA narrowly, concluding that it is concerned only with direct impacts (like reporting, recordkeeping, and similar costs), not with indirect effects, such as capital flight.[18]

Two “meta” conditions contributed to the Associations’ defeat. First, Treasury saw the regulations as important to the effectiveness of our extensive web of information sharing tax treaties, and judicial deference to the Executive Branch is at or near its apogee when foreign relations are implicated.[19]

Second, the court understood the seriousness of cross-border tax evasion and the importance of international cooperation to solve it. The challenged regulations are part of that cooperation. Similarly, the IRS has begun doing joint audits of some taxpayers with other countries’ tax agencies; the Organization for Economic Cooperation and Development is spearheading an international effort to prevent erosion of countries’ tax bases through avoidance and evasion schemes, and the U.S. Foreign Account Tax Compliance Act[20] is spawning a network of cooperative treaty arrangements. The Associations’ suit appears as an “America First” effort in tension with growing international tax cooperation. It seems like an attempt to turn the clock back. A party on “wrong end of history” is fighting up a steep hill.

The Associations may choose to appeal, but such an appeal would not be likely to succeed.[21] But the Associations and their allies may also pursue political redress. Home states congressional delegations have protested the regulations. Thus, the district court’s decision probably will not be the last we hear of this issue.


[1] Florida Bankers Ass’n v. U.S. Dep’t of Treasury, ___ F. Supp. 2d ___, 2014 WL 114519 (D.D.C. Jan. 13, 2014).

[2] The seriousness of evasion of U.S. taxes by use of foreign accounts, and the seriousness of the Government’s efforts to combat such evasion, are indexed in Senate Comm. on Homeland Security & Governmental Affairs, Permanent Subcomm. on Investigations, Offshore Tax Evasion: The Effort to Collect Unpaid Taxes on Billions in Hidden Offshore Accounts (Feb. 26, 2014).

[3] 61 Fed. Reg. 17,572 (Apr. 22, 1996).

[4] 66 Fed. Reg. 3925 (Jan. 17, 2001), corrected by 66 Fed. Reg. 15,820 (Mar. 21, 2001) & 66 Fed. Reg. 16,019 (Mar. 22, 2001), withdrawn by 67 Fed. Reg. 50,386 (Aug. 2, 2002).

[5] T.D. 9584, 77 Fed. Reg. 23,391 (2012).

[6] As here relevant, 5 U.S.C. § 706(2)(A) & (E).

[7] 5 U.S.C. §§ 603 to 605.

[8] 2014 WL 114519 at * 6 (citing International Broth. of Teamsters v. Dep’t of Transp., 724 F.3d 206, 211 (D.C. Cir. 2013)).

[9] 26 U.S.C. § 7421(a). A comparable prohibition exists with respect to declaratory judgments. 28 U.S.C. § 2201(a).

[10]  E.g., Alexander v. “Americans United” Inc., 416 U.S. 752, 762 (1974).

[11] 2014 WL 114519 at * 6-7 (citing Foodservice & Lodging Inst. Inc. v. Regan, 809 F.2d 842, 846 (D.C. Cir. 1987).

[12] E.g., National Fed’n of Indep. Bus. v. Sebelius, 132 S. Ct. 2566 (2012) (“NFIB”); Seven-Sky v. Holder, 661 F.3d 1 (D.C. Cir. 20122) abrogated on other grounds by NFIB; Cohen v. United States, 650 F.3d 717, 724 (D.C. Cir. 2011) (en banc); Halbig v. Sebelius, ___ F. Supp. 2d ___, 2014 WL 129023 (D.D.C. Jan. 15, 2014).

[13] 2014 WL 114519 at * 7-8.

[14] Id. at * 5 (quoting National Ass’n of Home Builders v. Norton, 340 F. 3d 835, 841 (9th Cir. 2003)).

[15] 2014 WL 114519 at * 9.

[16] 5 U.S.C. §§ 603-605(b).

[17] 2014 WL 114519 at * 10 (quoting United Cellular Corp. v. FCC, 254 F. 3d 78, 88 (D.C. Cir. 2001)).

[18] 2014 WL 114519 at * 10.

[19] E.g., Pasquantino v. United States, 544 U.S. 349, 369 (2004); United States v. Curtiss-Wright Export Corp., 299 U.S. 304, 320 (1936).

[20] 26 U.S.C. §§ 1471-1474.

[21] But see Patrick J. Smith, District Court Misapplies APA in Florida Bankers Association, 142 Tax Notes 745 (Feb. 17, 2014) (criticizing the decision).

Treasure salvage industry impacts of recent decisions upholding wreck sovereignty

By Davis George Moye, Journal of Transnational Law & Policy Member

Florida is a major center for commercial treasure salvage.  Countless wrecks have littered its waters since colonial days, and it is home to some of the most successful salvors in the world, such as Mel Fisher’s Fisher Salvors, which has recovered hundreds of millions of dollars worth of gold and silver, and Odyssey Marine Exploration, whose aggregate finds exceed $1 billion.[1] 

            Critics fear recent case law may dampen this industry.  Under the Abandoned Shipwreck Act, the federal government granted states title to any abandoned wrecks in state waters[2] and Florida has enacted laws creating a regulatory framework to responsibly govern salvage.[3]  However, federal courts constitutionally have jurisdiction over admiralty cases[4] and federal judicial procedure forbids attachment, arrest, and execution of sovereign wrecks—the remains of vessels that belonged to a sovereign state.[5] 

            Formerly, courts granted salvage rights when governments, most notably, Spain, failed to assert property rights over wrecks.[6]  This stance has changed in the past fifteen years, since the Fourth Circuit denied treasure salvors and the Commonwealth of Virginia title over two wrecks in Virginia waters because the Spanish government asserted a claim.[7]  Specifically, the court held the United States’ duties to Spain under treaty as a friendly nation supersede Virginia’s title claim under the Abandoned Shipwreck Act.[8] 

            In 2011 the Eleventh Circuit also declared Spanish sovereign vessels immune from arrest in admiralty court in Odyssey Marine Exploration. v. Unidentified Shipwrecked Vessel.[9]  Many Spanish treasure galleons lost in Florida’s waters belonged to the Spanish crown.  Because Florida is central to treasure salvage, there have been fears that the Eleventh Circuit’s holding in Spain’s favor may have eliminated a multi-billion dollar industry.[10]  The full effects have yet to reveal themselves, but salvors have begun to negotiate salvage agreements with sovereign wrecks’ governments. 

            After locating the wreckage of H.M.S. Victory in 2008, Odyssey negotiated a salvage agreement with the British government in early 2012.[11]  The agreement transferred ownership of the wreck to a government-owned charity, the Maritime Heritage Foundation, whereby the Maritime Heritage Foundation agreed to pay Odyssey a commission on the artifacts it recovers.[12]  Odyssey could not reach a similar agreement with the Spanish government in the case of Nuestra Señora de las Animas (the Mercedes).[13]  Nonetheless, Odyssey attempted to salvage the Mercedes without the Spanish government’s permission, incurring over $1 million in Rule 11 sanctions in the Middle District of Florida.[14] 

            The order granting sanctions estimated Mercedes’ value at $600 million dollars.[15]  With such rewards, even $1 million in sanctions may not deter some salvors.[16]  Odyssey’s recent actions indicate sovereign immunity has dampened salvage efforts little.  Rather, it has made salvors more furtive. 


[1] Odyssey Marine Exploration, http://www.shipwreck.net/ (last visited Oct. 6, 2013); Mel Fisher’s Treasures, http://www.melfisher.com/default.html (last visited Oct. 6, 2013).

[2] Abandoned Shipwreck Act, 43 U.S.C. § 2101 (1988).  Historical wrecks often fall into this category.  Situations where a true owner has not abandoned the vessel will be described in further detail.

[3] Historical Resources Act, XVIII Fla. Stat. § 267.031 (2008).

[4] U.S. Const. art. III, § 2.

[5] 28 U.S.C. § 1609 (1976).

[6] Treasure Salvors, Inc. v. The Unidentified Wrecked and Abandoned Sailing Vessel, 569 F.2d 330, 337 (5th Cir. 1978).

[7] Sea Hunt, Inc. v. Unidentified Shipwrecked Vessel or Vessels, 221 F.3d 634, 641 (4th Cir. 2000).

[8] Id.

[9] Odyssey Marine Exploration, Inc. v. Unidentified Shipwrecked Vessel, 657 F.3d 1159, 1166 (11th Cir. 2011).

[10] Id.

[11] Odyssey Marine Exploration Executes Agreement with Maritime Heritage Foundation for Admiral Balchin’s HMS Victory Shipwreck, http://www. shipwreck.net/pr240.php (last visited Oct. 10, 2013).

[12] Id.

[13] Odyssey Marine Exploration, Inc. v. Unidentified Shipwrecked Vessel, 2013 WL 5408413, at *1 (M.D. Fla. Sep. 25, 2013).

[14] Id. at 13.

[15] Id. at 1.

[16] Id.

Steroids and State Sovereignty: Who Has the Last Laugh in International Steroids Regulations?

By: Muriel Jones, Member of Journal of Transnational Law & Policy

In light of the upcoming Winter Olympics in Sochi, Russia, the world once again becomes captivated by the unique snow-oriented sports and conditioned athletes who have become masters of their craft. Behind the quirky sports, the International Olympics Committee (IOC) is coordinating an enormous body of international athletes and must regulate those athletes according to agreed upon international standards.  But what happens when a host country’s standards differ from the IOC established international standards in areas like steroids usage?  Should a State be forced to change domestic laws in order to comply with international standards?

Such a case arose in the London 2012 Olympics, where international anti-doping measures and UK domestic steroid laws were at odds. “Soft” UK laws concerning the importation of anabolic steroids allowed athletes to cross the border with banned substances without fear of criminal consequences from the UK.[1]  An athlete could not be apprehended if the banned drugs were deemed to be solely for “personal use.”[2]  The UK government, unlike the Summer Olympics hosts before it, had not toughened drug importation legislation before the games, synthesizing domestic steroid laws with IOC standards.[3]  Athletes were still strictly liable under the World Anti-Doping Agency (WADA), but the UK wasn’t.

International athletes are subject to the rules, standards and procedures of the IOC, WADA, International Federations (IF), which monitor individual sports, and their origin country’s National Olympic Committee (NOC).  Olympic athletes are monitored by all of these agencies with overlapping regulations.[4]  To participate in any Olympic sport, athletes must agree to be regulated by and under the sole authority of WADA and the World Anti-Doping Code (Code); however, countries themselves are not so strictly regulated.  “The Code sets forth specific anti-doping rules, definitions of doping, burdens of proof, prohibited substances and methods, and addresses standards for testing, sample analysis, sanctions, appeals, confidentiality, reporting and statute of limitations.”[5]  Like most international agreements there is no enforcement mechanism or world court to force State governments to adopt the Code and be legally bound by it.[6]

At the Second World Conference on Doping in Sport in March 2003, several States decided to formally recognize and implement the Code through the Copenhagen Declaration.[7]  The Copenhagen Declaration does not require countries to implement domestic legislation, but only “[c]ooperate with WADA…subject to relevant host countries’ regulations.”[8]  This seems to suggest that WADA’s anti-doping measures are subject to a host country’s regulations. Therefore, any difference in laws, as displayed in the London Olympics, could frustrate the international standard.  139 countries, including Russia, have signed the Copenhagen Declaration. [9]

175 countries, including the United States and Russia, have also ratified the International Convention against Doping in Sport through the United Nations Educational, Scientific, and Cultural Organization (UNESCO) Convention.[10]  Unlike the Copenhagen Declaration this is the “first global treaty against doping in sport.”[11]  However, ratification of a treaty does not necessarily equal compliance.  States must uphold their treaty obligations or face consequences set forth in the treaty, but many States have varying degrees of treaty implementation into domestic laws.  For example, the United States considers a case-by-case policy of examining whether a treaty is “self-executing” and whether the treaty law should automatically apply in the domestic law sphere.  Therefore, if the U.S. signs an international treaty and ratifies it internationally and domestically, through 2/3 approval of the Senate, but the treaty is not self-executing, then the international law does not apply to the domestic states.[12]  Other countries, like France, have duly ratified treaties, which are essentially always self-executing, automatically allowing ratified treaties to have the force of law in the domestic sphere. While in other countries, like the UK, treaties are never self-executing, and require an implementing statute from the domestic legislature to apply in the domestic sphere.  Therefore, even the ratification of an international treaty may not automatically compel a country to implement domestic legislation that conforms to international standards.

To encourage States to adopt international standards, States are subject to fines by international sports governing bodies if athletes are found to be doping. WADA may report non-compliance to the IOC, which can impose sanctions.[13]  Also, sports that do not adopt the Code are not eligible to be included in the Olympic Games.[14]  “Similarly, if a country does not ratify the UNESCO International Convention against Doping in Sport, it may also be subject to sanctions from the IOC and from other sports organizations, including losing the right to host major games.”[15]  There is no enforcement mechanism to force States to adopt the Code, but the IOC may issue “consequences” to non-compliant States including ineligibility to bid on host events, cancellation of international events, and symbolic consequences.[16]

Russia is no stranger to these measures and has had several athletes fail international steroid standards in recent years.[17]  In 2010 there was major concern that Russia’s anti-doping programs were inadequate, especially if the enormous country – which spans nine time zones – was going to be able to successfully regulate not only its native athletes but also global athletes in an international competition.[18]  However, unlike the UK, Russia, through its anti-doping agency RUSADA, has updated domestic anti-doping standards in compliance with WADA Code and International Conventions.[19]  Even though Russia has implemented RUSADA there are still major problems.  Since the beginning of 2013, 88 athletes have been sanctioned for a variety of anti-doping offenses, and more than 80 other competitions are currently under investigation.[20]

Why wouldn’t a country want to conform to WADA’s standards? Most NOC’s implement standards very similar if not identical to the Code, so why fight it?  And why not just fix domestic legislation right before the games like Australia and China did so that both domestic and international laws align?

It all comes down to State sovereignty and the role of international treaties in domestic laws.  Because there is no overhead enforcement mechanism or supreme world court to force compliance, countries are free to make and break treaties as they please.  It may be in a country’s best interest on an international stage to make sure steroid regulations are consistent, but outside of international competitions, governments are free to regulate domestic steroid usage however they want.

Despite a State’s seeming freedom under international regulation of steroid usage, there seems to be an overall high rate of compliance. There is a serious attempt by international organizations and participating States to gain across the board international anti-doping standards.  Also, most Olympic host countries seem to agree to the Code on its face.  However, despite there shaky anti-doping standards, both Russia and Brazil where given, some would deem, the greatest honor under the IOC – the privilege to host the Olympics.


[1] Jacquelin Magnay, “London 2012 Olympics,” The Telegraph (Mar. 29, 2012, 9:35 PM),

[2] Id.

[3] Id.

[4] Zachary Blumenthal, The Punishment of All Athletes: The Need For A New World Anti-Doping Code in Sports, 9 J. Int’l Bus. & L. 201, 204-07 (2010).

[5] Maureen A. Weston, 10 Pepp. Disp. Resol. L.J. 5, 25 (2009).

[6] See Governments, WADA http://www.wada-ama.org/en/World-Anti-Doping-Program/Governments/ (last updated Oct. 2009); Copenhagen Declaration on Anti-Doping in Sport, WADA http://www.wada-ama.org/en/World-Anti-Doping-Program/Governments/Copenhagen-Declaration-on-Anti-Doping-in-Sport/ (last updated Oct. 2009).

[7] See Governments, WADA http://www.wada-ama.org/en/World-Anti-Doping-Program/Governments/ (last updated Oct. 2009).

[8] “Copenhagen Declaration,” available at:  http://www.wada-ama.org/Documents/World_Anti-Doping_Program/Governments/WADA_Copenhagen_Declaration_EN.pdf

[10] See International Convention against Doping in Sport, WADA http://www.wada-ama.org/en/World-Anti-Doping-Program/Governments/UNESCO-International-Convention-against-Doping-in-Sport/ (last updated Oct. 2009).

[11] Id.

[12] See Foster & Elam v. Neilson, 27 U.S. 253 (1829); Asakura v. City of Seattle, 265 U.S. 332 (1924).

[13] Questions & Answers on Stakeholder Obligations on Compliance, WADA http://www.wada-ama.org/en/Resources/Q-and-A/Stakeholder-Obligations-on-Compliance/ (last updated Sept. 2011).

[14] Id.

[15] Id.

[16] Questions & Answers on WADA Compliance Monitoring, WADA http://www.wada-ama.org/en/Resources/Q-and-A/WADA-Compliance-Monitoring/ (last updated Sept. 2011).

[17] See “Russian Sports Minister promises major clean-up before Sochi 2014, inside the games,” June 4, 2010, http://www.insidethegames.biz/olympics/winter-olympics/2014/9750-russian-sports-minister-promises-major-clean-up-before-sochi-2014; “Three Russian track and field athletes recognized ineligible,” Oct. 14, 2013, http://www.rusada.ru/en/press/news/three-russian-track-and-field-athletes-recognized-ineligible-0; “Two Russian kayak & canoe athletes provisionally suspended,” Oct. 9, 2013, http://www.rusada.ru/en/press/news/two-russian-kayak-canoe-athletes-provisionally-suspended.

[18] See Associated Press, Anti-doping programs fall short, 2010, http://sports.espn.go.com/oly/news/story?id=5768257.

[19] See RUSADA National Anti-Doping Rules http://www.rusada.ru/en/work/national.

[20] Duncan Mackay, “Russians caught for drugs doubled in a year, admit country’s anti-doping agency,” Oct. 3, 2013, http://www.insidethegames.biz/news/1016407-russians-caught-for-drugs-doubled-in-a-year-admit-country-s-anti-doping-agency.

What Has Been the Impact of the 2016 Olympic Bid on Environmental Efforts Throughout Rio de Janeiro, Brazil?

By Michael Kelly, Member of Journal of Transnational Law & Policy

  1. Overview

With Brazil’s longstanding history of environmental transgressions and deterioration, this blog post will discuss the regulatory structures that are in place from the International Olympic Committee (hereinafter “IOC”) and Brazilian Government to ensure that the Rio Olympics are the greenest games to date.

Since receiving the winning bid in 2009, environmental protection efforts and recognition in Brazil has significantly increased.[1] The Brazilian Government and various private organizations have focused on four areas, in setting standards and preparation for the Olympics and in following the guidelines laid out by the IOC (international, non-profit organization that is the governing body of the Olympic Movement): (1) Water Conservation; (2) Renewable Energy; (3) Carbon Neutral Games; and (4) Waste Management and Social Responsibility. These parties are making sure that the development of the Olympic Games will comply with local, national and international regulations to protect the environment.[2]

                                      i.         Water Conservation

Ensured by the Federal Government’s National Environmental Policy,[3] investment of $4 billion is already committed for restoration programs for two bays in proximity to Rio.[4] These programs will result in more than eighty percent of overall sewage in the area being collected and treated by 2016.[5] The State of Rio and private sector has made various contributions by donating over $165 million to complete full regeneration of two bodies of water in the Barra Zone of Rio.[6] The beaches in this area will have a water quality index that will be elevated from fifty to eighty percent[7] and monitoring of the beaches will be significantly expanded to make sure that no harmful substances are present.[8]

                                    ii.         Renewable Energy

Even though Rio’s air quality meet the World Health Organization’s standards, a 2009 Nationwide Air Quality Control Program (also known as PROCONVE)[9] was undertaken, which led to an increase in the number of air quality-monitoring stations in the area to monitor Carbon Monoxide and Sulfur Dioxide gases in the atmosphere.[10] Environmental authorities in Rio have already installed sixteen of these monitoring stations in locations where Olympic competitions are to be held, so air pollution can be closely monitored to make sure that harm does not occur to the athlete’s or those watching the events.[11] These new quality-monitoring stations will carry out a constant check on emissions of polluting gases like Carbon Monoxide while allowing strategies for prevention and immediate action if something were to occur in Rio. Also, through analyzing Brazil’s National Climate Change Plan,[12] a plan is being developed by the government to strengthen the protection and conservation of all city forests and parks while preserving local biodiversity.[13] To promote healthier lifestyles, government authorities have also begun improving mobility for Rio residents by implementing more direct routes for their bus system.[14] The objective is to reduce carbon emissions and develop optimal green space within the Olympic site.[15]

                                   iii.         Carbon Neutral Games

Some ideas for the Olympic Bid, such as a reforestation of many of the areas near Rio are already underway, while others are in early development.[16] Planting of 24 million trees is underway throughout the State of Rio to help air flow throughout the city.[17] Rio’s Olympic Park recently began construction and this building will focus on preserving the environment, while making use of existing structures in the area.[18] After the games have ended, Rio has a goal to use at least seventy percent of the new infrastructures built for the Olympics, including the Olympic Park. [19]

As part of the selection process, the IOC required Brazil to build arenas for the 2016 games to high environmental standards for low carbon emissions and energy efficiency.[20] Venues such as the Rio Olympic Village must demonstrate a range of requirements meant to meet a series of environmental criteria that include low energy consumption and use of local construction materials.[21] These facilities will reduce energy usage through measures such as increasing the use of natural light, adding solar panels to reduce power from the grid and installing “intelligent” elevators that are designed to make fewer trips to save energy.[22]

Other private organizations are getting involved with green development in Brazil as well. The Zurich based RAFAA Design Studio has also begun implementing a concept for a 345-foot tall solar city tower.[23] The tower is projected to be built atop the island of Cotonduba and would be the welcome symbol to the 2016 Games.[24] This tower is proposed to consist of a massive power plant that will generate energy for the Olympic village in Rio and will allow excess energy from the solar panels to pump seawater into the tower.[25] At night, the seawater can be released to power a turbine, which will be able to generate a substantial amount of energy.[26]

                                   iv.         Waste Management and Social Responsibility

The Brazilian government is introducing waste management systems that will help ensure the maximization of recycling waste products, with a plan to eradicate all illegal landfills in Rio by 2010.[27] The government is also planning on launching a new concept for the reuse of materials in all phases of the Olympics by installing methane gas pumps from landfills for energy production.[28] In areas where new venues are needed, buildings are going to use materials made from recycled objects such as plastic bottles and avoid paint and carpeting with toxic materials.[29]

  1. Conclusion

While Brazil is taking steps in the right direction for environmental protection, many countries tend to ignore the IOC regarding environmental regulations because they are often difficult to follow. While there are mechanisms in place for the IOC to sanction a host country for not following the standards set out in the Olympic Charter, in reality the IOC is unlikely to issue a sanction since it also has an interest in seeing the Games commence on time. Once a country is selected, the IOC should enter a legal contract with the host country to demand the country follow certain requirements that have been established. These revisions will hopefully reform substantive Olympic and international policies and bind all international parties to uphold their commitments to protect the environment.


[1] The Olympics have had a clear impact on the interest in green construction in Rio, where nearly all of the buildings under development by the city and state governments include LEED sustainability criteria. Brian

Ellsworth, Brazil Olympics spurring green construction, REUTERS (Nov. 3, 2010), http://www.reuters.com/article/2010/11/03/us-brazil-construction-green-idUSTRE6A25RZ20101103.

[2] Rio 2016 Olympics Report: Brazil’s moment to Shine, UK Trade & Investment 68 (2011), available at http://www.coneq.org.uk/Brazil_docs11/Brazil_Rio2016Olympics_2011.pdf.

[3] The National Environment Policy, Lei No. 6.938, de 31 agosto de 1981, DOFC de 02.09.1981 (Brazil), available at http://www.planalto.gov.br/ccivil_03/leis/l6938.htm.

[4] These programs are the Guanabara Bay Sanitation Program and the Barra-Jacarepagua Sanitation. Rio 2016 Olympics Report: Brazil’s moment to Shine, UK Trade & Investment 68 (2011), available at http://www.coneq.org.uk/Brazil_docs11/Brazil_Rio2016Olympics_2011.pdf.

[5] This treatment of sewage water is the process of removing contaminants and household sewage to produce an environmentally safe fluid waste stream and a solid waste suitable for disposal or reuse. United States Environmental Protection Agency, Primer for Municipal Wastewater Treatment Systems 8 (2004), available at http://www.epa.gov/npdes/pubs/primer.pdf.

[6] Id.

[7] Water quality index provides a single number ranging from 1 to 100 and scores are determined for temperature, pH, fecal coliform, bacteria, dissolved oxygen, total suspended sediment, total phosphorus, and total nitrogen contained in the water. Scores are combined and results tabulated over time to produce a single yearly score for each sample station. Boulder Area Sustainability Information Network, Water Quality Index (December 27, 2005), http://bcn.boulder.co.us/basin/watershed/wqi_info.html. With the beaches in Rio, the water quality index number the beaches are at currently will increase by a percentage of fifty to 80 percent. Rio 2016 Olympics Report, supra note 4, at 97.

[8] Rio 2016 Olympics Report, supra note 4, at 97.

[9] Ministry of Environment, Proconve: Program Air Pollution Control For Vehicles (2006), available at http://www.mma.gov.br/estruturas/163/_arquivos/proconve_163.pdf.

[10] These air quality-monitoring stations are monitors of several components of ambient air and pollutants such as Carbon Monoxide (N02); Sulfur Dioxide (SO2); and Ozone (O3). Summary reports of this data are then made available to the public at large to make sure that the air levels are not polluted. Fabiana Frayssinet, Fresh Air for the Rio Olympics, Inter Press Service (Dec. 24, 2012), http://www.ipsnews.net/2012/12/fresh-air-for-the-rio-olympics-2/.

[11] Rio 2016 Olympics Report, supra note 4, at 88.

[12] Interministerial Committee on Climate Change, National Plan on Climate Change (2008), available at http://www.mma.gov.br/estruturas/208/_arquivos/national_plan_208.pdf.

[13] The plan does not have a name at this point. Rio 2016 Olympics Report, supra note 4, at 88.

[14] Id.

[15] Id.

[16] Scot Horst, Let the Sustainability Games Begin, U.S. Green Building Council (Sep. 4, 2012), http://new.usgbc.org/articles/let-sustainability-games-begin.

[17] All of the trees should be planted by 2016. Rio 2016 Olympics Report, supra note 4, at 88.

[18] Id.

[19] Horst, supra note 16.

[20] These standards line up with LEED standards. Brian Ellsworth, supra note 177.

[21] Brian Ellsworth, Brazil Olympics spurring green construction, REUTERS (Nov. 3, 2010), http://www.reuters.com/article/2010/11/03/us-brazil-construction-green-idUSTRE6A25RZ20101103.

[22] Id.

[23] Solar Waterfall Could Power Rio Olympics, Environmental Leader: Environmental & Energy Management News (Aug. 3, 2012), http://www.archivenue.com/solar-city-tower-for-rio-olympics-2016-by-rafaa/.

[24] Id.

[25] Id.

[26] Id.

[27] In Brazil, there has been a problem of many recyclable materials being forwarded to landfills even though they should have been recycled. These new plants will be implemented to minimize waste that is forwarded from the recycling plants to landfills and hopefully lead to a zero waste approach of recyclable materials. Rio 2016 Olympics Report, supra note 4, at 89.

[28] Id.

[29] Brian Ellsworth, supra note 21.

Challenges Facing the Future of Criminal Law

JTLP’s Senior Articles Editor, Margaret Spicer, recently wrote a post for one of the other international law blogs we follow, Int Law Grrls! She wrote the post with professor Mark Drumbl after moderating a panel at a Southeastern Association of Law Schools conference on”The Law and Politics of International Criminal Prosecutions.” Professor Drumbl teaches at Washington & Lee Law School and is the director of the Transnational Law Institute. He has written numerous critically-acclaimed articles and books, including a 2012 book about reforming international law and policy that relates to child soldiers. Professor Drumbl’s biography and information about his work is available at http://law.wlu.edu/faculty/profiledetail.asp?id=11.

Margaret and Professor Drumbl’s post discusses the future viability of international criminal law as an accountability mechanism for episodes of mass atrocity, and is a great read for anyone with an interest in the topic.  The link is below.

http://ilg2.org/author/margaretspicer410/

 

Breaking Bad in International Law: The Troubling Specter of Efficient Breach in Syria

By Edward Grodin, Journal of Transnational Law & Policy Articles Selection Editor

Two wrongs don’t make a right. 

Every child knows that axiomatic statement.  Responding to a wrong with another wrong will not vindicate your response. 

Yet, this seems to be the path upon which the United States and select allies have set themselves in Syria.  Secretary of State John Kerry presented the Obama administration’s argument for “limited” strikes, even framing this as “our Munich moment.”  On September 10th, President Obama delivered his speech laying the groundwork for the use of force, should emerging diplomatic avenues fail.  In particular, he appealed to the humanitarian sensibilities of the American people: “[W]hen, with modest effort and risk, we can stop children from being gassed to death, and thereby make our own children safer over the long run, I believe we should act. That’s what makes America different. That’s what makes us exceptional.” 

Both Secretary of State Kerry and President Obama have put forward the administration’s moral case for intervention, but what about the legal case?  As numerous legal commentators have pointed out, Article 2(4) of the UN Charter expressly forbids the threat or use of force, subject to the exceptions of collective or individual self-defense (Article 51) and Security Council-authorized actions (Chapter VII).  Since the Security Council has not authorized any strikes, and the self-defense argument is unsuitable for this internal conflict, the “letter of the law” remains clearly on the side of non-intervention.

Taking a “spirit of the law” approach instead of a “letter of the law” approach similarly leaves the Obama administration’s Syria plans on shaky legal ground.  Article 1 of the UN Charter makes clear that the United Nations shall, as its central governing principle, aim to collectively maintain international peace and security and to put an end to aggressive war.  Even limited strikes in Syria would undercut these principles by simultaneously depriving the Security Council of its role as the “enforcer” of international law and potentially exacerbating a “threat to international peace” through a non-authorized bombing campaign. 

Regardless, a growing chorus of officials (including UN Ambassador Samantha Power) argue that while intervention may be illegal, it is legitimate and justifiable on moral grounds.  This “illegal but legitimate” approach should be alarming for those who believe in the rule of law in the international legal system.  Casually floating the idea of flouting international law sends a signal to the world that international law plays no role in this situation.

Whether or not you find the Obama administration’s moral case convincing, US intervention in Syria raises the ever-present question (and problem) of enforcement and remedies in international law.  Supporters of strikes against Syria rightly point to Assad’s violation of the ban on chemical weapons (if proven) as a breach of an international norm deserving of punishment.  Yet, violations of international law do not bestow upon non-violator countries the legal right to subvert existing channels of enforcement and use unilateral force as a remedy.  Even if Syria uses chemical weapons and the United States faces opposition from other P5 members, the United States does not have the option of refusing to resort to the Security Council for strikes.  Unlike many other areas of international law, international crimes have well-established remedies, chiefly through the International Criminal Court (ICC) and the Security Council.  If the enforcement of international criminal law and the laws of war cannot be achieved through these channels, and violations of international law can be answered with further violations, then the Syria situation will seriously undermine the need for an international legal regime in any policy arena.  It would perpetuate the stereotype of international law as a façade for Great Power policy preferences rather than a tool for collectively tackling critical international challenges.       

Which brings me to the title of this blog post: the application of efficient breach to international law.  The theory of efficient breach in contract law posits the following pattern: a promisor finds out he can make more money from someone other than the promisee and proceeds to “buy” a breach of contract from the promisee.  According to the theory, this “buy-out” leads to an economically-efficient outcome.  However, one of the criticisms of efficient breach theory rests upon the fact that reallocation could occur with the promisee selling to the third party; as such, the promisor’s efficient breach does not necessarily lead to a net social benefit.    

Though the international law aspect of intervention does not entail the same economic considerations, I argue that the theoretical underpinnings of efficient breach theory are at play in the United States’ political calculus on Syria.  The United States (promisor) has promised its compliance with the UN Charter as a Member State of the United Nations (promisee).  While the United States derives value (some might argue disproportionately so) from the UN structure, especially its veto in the Security Council, the Obama administration has determined that the benefits of intervention outweigh the potential costs, namely (from a legal perspective) being hauled before the International Court of Justice (ICJ).  Since the ICJ cannot enforce its own decisions, and in fact relies on the Security Council to do so, the international legal consequences of intervention approach zero.  Moreover, because neither the United States nor Syria is a party to the Rome Statute (that established and governs the ICC), the prospect of any action before the ICC is bleak.

In the eyes of the Obama administration, the low cost of intervention from an international law point-of-view, when compared to the high moral and humanitarian cost of doing nothing, has led US policy at the moment to favor the possible “buy-out” from its obligations under the UN Charter to refrain from force.  Consequently, the United States has chosen to “contract” instead with the Syrian rebels and pursue the higher-value benefit of humanitarian intervention (again, should the diplomatic route fail). 

However, as in the critique of efficient breach theory, the United Nations as the original promisee can also obtain the societal humanitarian value from Syria through collective action.  The United States could continue to put diplomatic pressure on the rest of the Security Council members to refer the situation to the ICC, impose sanctions, or authorize the collective use of force; the UN General Assembly could put further pressure on the Security Council by convening an emergency special session under the “Uniting for Peace” Resolution.  The ultimate irony is that the Security Council’s failure to act thus far, upon which the Obama administration has premised its push for “illegal but legitimate” military action, can be traced to the purposeful institutional design of the Security Council.  While the United States derides the inability of the Security Council to act with a looming Russian veto, it has formally exercised its veto power nearly twice as often as Russia since the end of the Cold War.               

To prevent the resort to efficient breaches in international law, it would help to raise the stakes on all violators.  One such way forward would be to give the ICJ some level of independent enforcement powers.  This would increase the potential costs of noncompliance with international law.  Take the example of Military and Paramilitary Activities in and Against Nicaragua (Nicar. v. U.S.), 1986 I.C.J. 14 (June 27).  Though the ICJ found that the United States violated international law through the threat or use of force as well as its support of the Contras in Nicaragua, the decision remained consequence-free due to the US veto in the Security Council.                        

The political choice between strict adherence to international law and violating it in pursuit of a perceived moral imperative is no easy task.  But as Kenneth Anderson, professor of Law at American University, puts it, “Pragmatic approaches avoid turning international law into a suicide pact, yes, in the sense of being unable to respond to something like a chemical weapons attack on account of some formalist concerns about international law and the language of the Charter.  But reasonableness that allows, as it must, the reasonable yet opposed views of others risks turning international law not into a suicide pact, but into a path to war.” 

Doing nothing at all may be a bad choice, but doing something contrary to law in response to a violation threatens to cause collateral damage.  The United States has a special responsibility to uphold the international legal system and institutions it helped to build; it should respect international law in its pursuit of justice.  Otherwise, like Walter White in Breaking Bad, the United States risks going full Heisenberg in Syria: breaking the law in pursuit of what it sees as a legitimate just cause. 

For more information about this topic, see:

The text of the UN Charter – http://www.un.org/en/documents/charter/index.shtml

Russian President Vladimir Putin’s op-ed in the NYT – http://www.nytimes.com/2013/09/12/opinion/putin-plea-for-caution-from-russia-on-syria.html?pagewanted=all&_r=0

Kenneth Anderson’s full description of international law approaches to the Syria situation – http://www.lawfareblog.com/2013/09/five-fundamental-international-law-approaches-to-the-legality-of-a-syria-intervention/

An article by Richard Posner on the application of efficient breach theory to international law – http://www.michiganlawreview.org/assets/pdfs/110/2/Posner.pdf

Samantha Power’s argument for intervention – http://www.businessinsider.com/samantha-power-why-we-must-strike-syria-2013-9

FSU law professor Fernando Teson’s argument against intervention – http://bleedingheartlibertarians.com/2013/09/syria-and-the-doctrine-of-humanitarian-intervention/

As always, this and all other posts on this blog are only reflective of the views and opinions of their individual authors, and do not reflect the official views or opinions of Journal of Transnational Law & Policy, Florida State University College of Law, or any of its affiliates. 

An Informative Compilation of Recent News and Scholarly Works About U.S. Intervention in Syria

One of the great things about being based out of FSU College of Law is that JTLP’s members are able to work with our school’s team of excellent librarians, many of whom hold J.D.’s and are experts on specific areas of law. Professor Margaret Clark and third-year law student Lesley Boyd recently wrote a research guide to the responses to Syrian conflict and military intervention. For anyone interested in the topic, the guide is a must-read. The link is below:

http://guides.law.fsu.edu/syria

Also check back this week for a student-written piece about the legal implications of U.S. involvement in Syria, and for additional updates on the situation.