My colleague William E. Butler has produced an excellent short examination of what he describes as a "remarkable step taken by the Russian Federation of endowing an individual state corporation with various powers in treaty making, including the right to conclude treaties with foreign states or their departments." William E. Butler, Current Developments: Treaty Capacity and the Russian State Corporation, 102(2) American Journal of International Law 310 (2008). The context is not necessarily a happy one for the ordered world that preceded this sort of activity--where public entities acted like states, and private entities inhabited their own world, and both were disabled from entering into the territory of the other both by notions of seemliness and by the apparently natural and eternal ordering of the law into neat little categories. And indeed, Professor Butler sets the tone early, taking note of a nice (and tone setting) passage from Vaughn Lowe's recent work of comfort for traditionalists, decrying the "tendency at present for international lawyers to write of the growth of [non governmental organizations] and other non-State actors, and of the decline of the nation-State, with the gleeful enthusiasm of a cartoon character sawing off the tree branch on which he is sitting". A.V. Lowe, International Law 290 (Oxford: Oxford University Press, 2007) quoted in Butler, supra, at 310. Mercifully, not all of us are constrained by a need to honor traditional boundaries of international law or burdened with a mission to preserve those boundaries in the face of a shifting reality in which states increasingly seek to participate in markets as private juridical persons and private economic enterprises are increasingly disposed (and permitted) to exercise those powers once reserved to the holders of territorial sovereignty.
Well, what does a more gleefully enthusiastic reading of Professor Butler's excellent dissection of this new juridical animal reveal? Or, perhaps better put, what is this thing that is proving so annoying if only by reason of its deliberate character of legal mongrel? Professor Butler provides an superb analysis of the creature that the Russian state apparatus intends as neither fish nor fowl. Perhaps it will turn out to be more state than participatory market entity.
Professor Bulter looks at the State Atomic Energy Corporation (Rosatom"), established by Russian federal law on December 1, 2007. Id. at 310. It is a unique creature of Russian law with no exact counterpart in imperial or Soviet law, with origins in a Russian law of 1999 making possible the creation of non-commercial state corporations. Id., 310-311. The mongrel nature of the state corporation is succinctly described by Professor Butler (Id., at 311): its functioning is defined as noncommercial (though whether this characterization would survive analysis under American application of its Foreign Sovereign Immunities jurisprudence would remain to be seen, see Larry Catá Backer, Markets in Infants: The Hague Convention on Intercountry Adoptions, National Reform Efforts in Guatemala and Consumerism in the United States, Law at the End of the Day, December 11, 2007). It is a wholly owned entity of the state, but controls a number of economic and non-economic entities, over which it presumably has control as a shareholder. The management of the enterprise is mongrelized as well--"The management organs are a hybrid of the state unitary enterprise under Russian law and the Russian joint stock company--but without a shareholder meeting." Id. While Professor Butler fears that such an organization presents problems of tracing authority for acts, corporate lawyers might finds the system, like many other exotic systems created by the flexible provisions of many corporate regimes with respect to management (especially of wholly owned concerns), hardly daunting. Moreover, to the extent that the organizational structure makes one unsure, the result might well be to raise the costs of transactions --or shift them down to the operating company level, or to the shareholder (the Russian State) when the stakes are great enough and the Russians willing enough. otherwise, business people will take the sorts of risks that they have taken with odd and perhaps disreputable governments for a long period of human history. Still, Professor Butler is right to warn non-Russian corporate specialists to beware of the challenges posed by the formal governance structures of these entities.
But for all that, Rosatom is especially interesting in one respect. Of the seven such state corporations created, apparently only Rosatom is endowed with treaty making capacity. Id., 311. Professor Butler reproduces Article 14 of the federal law on Rosatom which suggests the public nature of this state "corporation." Id. Professor Butler offers a rationale for the mongrelization--a bad effort at multi-tasking by a Russian state appearing efficient but evidencing otherwise.
More importantly, perhaps, Rosatom is one of a species of concerns that appear to be appealing in post-Marxist regimes seeking the benefits of global economic engagement on Western free market terms without actually giving up all of the control once wielded by central planners and now devolved to the creatures of the state apparatus in more subtle ways. For a discussion, see, Larry Catá Backer, Cuban Corporate Governance at the Crossroads: Cuban Marxism, Private Economic Collectives and Free Market Globalism. Transnational Law & Contemporary Problems, Vol. 14, No. 1, 2005.
For all this interesting material, Professor Butler reserves the bulk of his analysis to ten carefully reasoned consequences of the Rosatom law for Russian law and for application of the law of treaties (a heretofore public law concern) when exercised from out of the peculiar creation of this non commercial corporate enterprise with power to control commercial enterprises and more importantly to assert state treaty making powers. Id., 312-315. These consist of:
1. Russian law was changed to provide essentially, that (private) contracts by state corporations like Rosatom would be deemed to be (public) law treaties. This, in effect, makes sense if one considers that treaties, in the 20th century, were the,selves transformed from public contracts between states to some sort of "higher" law binding on states. The regulatory character of treaties is mirrored by the public character of certain contracts to be entered into by enterprises owned by the state (or really by anyone vested lawfully by the state with such power) reflected in the creation of Rosatom. International lawyers, therefore, might be reaping a whirlwind of their own creation--the way the German Imperial Government reaped the rewards of sending Lenin back to Russia.
2. Rosatom is an "empowered organization." Such organizations are granted treaty making power. But the definition of "empowered organization" is "opaque." Id., at 312. Professor Butler is right to suggest the problems of interpretation but then also suggests that other provisions make a broad interpretation of Article 14(2) reasonable. He also notes that for internal purposes, the sort of treaties which Rosatom may conclude are not defined in the 1969 Vienna Convention. That is true enough--though from the perspective of foreign states seeking enforcement of treaty obligations it may not matter much, except, as Professor Bulter points out, to the effect the categorization may affect the place of such treaties within the hierarchy of Russian law. Id., 313.
3. Rosatom is required to consult with constituent entities of the Russian Federation when treaties under consideration touch on matters within their respective competences.
4. Rosatam's treaties bind the Russian Federation, though the extent and nature of that binding are still to be worked out.
5. Under certain circumstances, empowered organizations like Rosatom may make proposals for the conclusion of a treaty by others and with the permission of the Ministry of Foreign Affairs, may speak with foreign counterparts about such treaties. Id. 314.
6. There are some interesting issues of authority to conclude treaties within the governance structure of these state corporations. Professor Butler suggests that the director general s empowered to decide to execute treaties, but not other officers without appropriate grants of power.
7. Proposals to ratify treaties may be submitted jointly with the Ministry of Foreign Affairs, "although the Ministry may act independently in this respect." Id., 314.
8. State corporations with treaty powers may keep the original of executed treaties in their own archives, with copies to the Foreign Ministry.
9. The state corporation is empowered to publish treaties it concludes--permitting effectively such entities to keep a version of an official gazette. "Since Russian courts are zealous in confirming that a treaty has been officially published and has entered into force as a condition of enforcing any of its provisions, the foreign party dealing with Rosatom has a special interest in ensuring that agreements with it are duly published." Id., at 314-315. That is true enough--if such agreements are treaties,. But contracts? An interesting conflation of contract as treaty and treaty as contract in relation to the dealing of such state juridical personalities. Though, again, it might make sense that treaties (public regulatory) actions are conducted with Rosatom and that contracts are concluded with the operating subsidiaries.
10. The last is the most interesting for me. Entities like Rosatom are empowered "to watch over and monitor the performance of treaty obligations by themselves and by the other party or parties, to report any breaches, and to be involved in developing proposals for a response to violations." Id., 315. In the world that Professor Butler describes, where the differences between contract and treaty is fungible to some extent, and the the state entity empowered to act actually operates through a number of other organizations, the possibilities of delegation and diffusion of this monitoring power are vast. And, as I have suggested else, the regulatory effect of the power to monitor can be greater than and more effective than traditional positive legislation. See Larry Catá Backer, Global Panopticism: States, Corporations and the Governance Effects of Monitoring Regimes. Indiana Journal of Global Legal Studies, Vol. 15, 2007.
Professor Butler has done us a great service in highlighting an interesting wrinkle in the use of the corporate form for mixed purposes--private (participation in the market through ownership or control of economic entities) and public (through the regulatory and treaty making powers with which the central entity is vested). He has focused the reader on the issues of internal Russian law such a newfangled mongrelized juridical form presents--as well its implications for the law of treaties--as an internal matter of Russian law (how does it fit into the Russian legal structure) and its potential external effects (what are foreigners to make of all of this). For that reason alone, this commentary was worth a careful read.
But it also suggests a number of lacunae in the nature of corporate law--and its consequences for the convergence of public and private law--that might bear some further study. Whatever the convolutions of Russian law, and the fecundity of the Russian legal imagination, it appears that the Russian state corporation may be viewed as both public and private from outside Russia. In some ways, the Russian state corporation resembles attempts by European states to control recently privatized national industries. In the recent golden share cases, the European Court of Justice has applied its treaty principles of free movement of capital to determine that such constructs--whether created as legislative or private corporate arrangements--retain their public character. As such, both entity and arrangement will be treated as bound by the treaty obligations of the controlling Member State. The Advocates Generals would go further--and treat all such arrangements as essentially public, unless the Member State could effectively show no discriminatory effect (where it controls both regulation and participates in the economic arrangement) or where the State could meet a fairly strict "reasonable private investor" standard (where the state provides money for the purchase of debt or equity). The analysis is essentially functionalist. See Larry Catá Backer, The Private Law of Public Law: Public Authorities as Shareholders, Golden Shares, Sovereign Wealth Funds, and the Public Law Element in Private Choice of Law. Tulane Law Review, Vol. 82, No. 1, 2008 pp. 1801-1868. On the other hand, like the Russians, the Americans have tended to apply a more formalist analysis to such entities (id.)--except in matters of the application of its sovereign immunities law. See Larry Catá Backer,Permanent Mission of India to the U.N. v. City of New York: The State as Private Actor in a World of Private Actors Law at the End of the Day, June 30, 2007.
Thus, the more interesting question might well be how Europeans and Americans might apply their law to the activities of Russian state corporations and their subsidiaries or controlled entities for activities outside of Russia. In this case one is met with a department of the state apparatus , organized in corporate form, to which have been devolved certain traditional state powers--including a limited right to conclude treaties. The fact that the state chose to organize its power in this way, by reconstituting itself in part as a conglomerate, with a number of subordinate juridical persons, ought not affect the character of the state apparatus itself. As the Europeans might suggest from their golden share cases, the public character of the enterprise is not lost merely because of the organizational choice made by the state. That the state corporation is organized as a non-commercial entity suggests a predominance of its regulatory (public) rather than its market participatory (private) character. That, to the extent it remains interesting, is so as a matter of domestic law. Yet this department of the Russian State appears also to manage state enterprises. Where these are operated directly, then the state organization becomes a contradiction in terms--a non-commercial entity operating commercial enterprises. To that extent, the entity might be considered both subject to the limitations of private law (with respect to its commercial activities) as well as public law (to the extent that such law restrains the power of governmental entities). That might well be the consequence under European legal conceptions. Under American law, the commercial character of the activities of the state corporation would be determined in context and the form of the entity would play little part in the analysis. With respect to its operating subsidiaries, though, the Americans would treat those as commercial, independent and subject to private but not public law constraints. The more interesting questions for the Americans would be the ability to reach state assets should American courts determine that the separate entity status of state corporation and subsidiary ought to be disregarded.
More interesting still would have to be the approach of foreigners to the character of the agreements of the state corporation. It is clear that the Russians mean to muddy the waters by creating ambiguity between treaties and contracts. They are likely eager to reap the strategic advantage of characterizing their agreements as one or the other depending on which serves their interests best. Russian state corporations, then, point to a need to much better refine the notions contract and treaty. The simplest approach would rely on the fetishes of formalism. The better approach might be functionalist. That approach might be better if only because formalist approaches are far too easy to abuse where a public entity is free to act like a private one. Where states and their controlled entities could be limited in the scope of their activities, formalism provides a simple and convenient method of analysis. Where the public and private activities of state agencies converge in single agencies, then formalism tends to mask as easily as it reveals. In such a case, agreements of a commercial and participatory character ought to be treated as contract, and those of a regulatory character ought to be treated as treaty--irrespective of the form.
Ironically, the question--are Russian state corporations corporations a all--is largely irrelevant, except perhaps to those whose life work is to preserve legal field boundaries. And there is a certain benefit to that noble task--as a method of disciplining performance with the academy. But otherwise, the question is beside the point. Russia has chosen to provide juridical personality to a certain sort of organization. To some extent that juridical personality is public in character--for example in its conveyance of a power to conclude treaties. To some extent it is private in character--for example in its control of and maintenance of commercial enterprises. The private and commercial character of its operations may be said to implicate the law of corporations (undertakings) and corporate organization (as well as commercial and other law fields). The public and regulatory character of the enterprise is not. That the Russians seek the protection of public law for their private commercial activities--seek to clothe their contracts as treaties, their state regulatory activities as commerce, etc., may be effective within the territory of the Russian Federation, but will hardly carry over abroad. As the Russians seek refuge in 19th century conceptions of state immunity, they build 21st century juridical entities that construct in corporate form 20th century Soviet bureaucratism for the protection of their assets. For Europeans, this activity would appear to clothe public power in private garb. There is no "corporation" here--just the Russian state. And questions of liability and sovereign immunity would hinge on a different analysis. For the Americans, the nature of the entity depends on the character of its activity--corporation is it participates in the market, state if it regulates. In either case, there is no "corporation" there, there is merely the State: asserting its regulatory authority, on the one hand, and seeking to participate in economic activity, on the other.
Well, what does a more gleefully enthusiastic reading of Professor Butler's excellent dissection of this new juridical animal reveal? Or, perhaps better put, what is this thing that is proving so annoying if only by reason of its deliberate character of legal mongrel? Professor Butler provides an superb analysis of the creature that the Russian state apparatus intends as neither fish nor fowl. Perhaps it will turn out to be more state than participatory market entity.
Professor Bulter looks at the State Atomic Energy Corporation (Rosatom"), established by Russian federal law on December 1, 2007. Id. at 310. It is a unique creature of Russian law with no exact counterpart in imperial or Soviet law, with origins in a Russian law of 1999 making possible the creation of non-commercial state corporations. Id., 310-311. The mongrel nature of the state corporation is succinctly described by Professor Butler (Id., at 311): its functioning is defined as noncommercial (though whether this characterization would survive analysis under American application of its Foreign Sovereign Immunities jurisprudence would remain to be seen, see Larry Catá Backer, Markets in Infants: The Hague Convention on Intercountry Adoptions, National Reform Efforts in Guatemala and Consumerism in the United States, Law at the End of the Day, December 11, 2007). It is a wholly owned entity of the state, but controls a number of economic and non-economic entities, over which it presumably has control as a shareholder. The management of the enterprise is mongrelized as well--"The management organs are a hybrid of the state unitary enterprise under Russian law and the Russian joint stock company--but without a shareholder meeting." Id. While Professor Butler fears that such an organization presents problems of tracing authority for acts, corporate lawyers might finds the system, like many other exotic systems created by the flexible provisions of many corporate regimes with respect to management (especially of wholly owned concerns), hardly daunting. Moreover, to the extent that the organizational structure makes one unsure, the result might well be to raise the costs of transactions --or shift them down to the operating company level, or to the shareholder (the Russian State) when the stakes are great enough and the Russians willing enough. otherwise, business people will take the sorts of risks that they have taken with odd and perhaps disreputable governments for a long period of human history. Still, Professor Butler is right to warn non-Russian corporate specialists to beware of the challenges posed by the formal governance structures of these entities.
But for all that, Rosatom is especially interesting in one respect. Of the seven such state corporations created, apparently only Rosatom is endowed with treaty making capacity. Id., 311. Professor Butler reproduces Article 14 of the federal law on Rosatom which suggests the public nature of this state "corporation." Id. Professor Butler offers a rationale for the mongrelization--a bad effort at multi-tasking by a Russian state appearing efficient but evidencing otherwise.
Atomic energy and nuclear power are among the most sensitive issues on the planet. Rosatom was created to bridge the chasm between classical state concerns about safety, national security, non-proliferation obligations [though in Russia's case that might be more laughable than real] and the like. on the one hand, and perceptive exploitation of commercial opportunities represented by atomic and nuclear capacity, on the other. . . . Seen another way, Rosatom is the tangible result of a massive reorganization ands restructuring of thew atomic energy and nuclear power branch of the Russian economy.Id., 311-312. And the attempt at reorganization was meant to conform to market expectations of structure and form. "Given the decision to clothe the restructuring in corporate dress, it could hardly fail to give rise to implications for the law of treaties generally, and the Russian Federation's treaty obligations with respect to this subject matter specifically." Id., 312. True enough from the perspective of the international lawyer--but more importantly the effort to clothe regulation and participation under the umbrella of a non commercial corporation also presents interesting problems of corporate law, especially in the legal consequences of the relationship between the ultimate shareholder (the Russian Federation), the management obligations of the state corporation (however defined), and the operations of the commercial and non-commercial subsidiaries. Of course, to the extent that these operating subsidiaries are confined to Russian territory the Russian Federation can create such garbling as suits them. But to the extent the assets of such concerns can be reached by foreign courts, and to the extent that subsidiary entities are established elsewhere (or operate through local entities elsewhere), then the consequences of the peculiarities of Russian corporate organization will not be entirely under the control of the Russians. At a minimum, the opportunities for veil piercing--and reaching the commercial assets of the Russian federation abroad, might provide a tempting enough insurance policy of sorts for foreigners seeking to do business with Rosatom or its subsidiaries.
More importantly, perhaps, Rosatom is one of a species of concerns that appear to be appealing in post-Marxist regimes seeking the benefits of global economic engagement on Western free market terms without actually giving up all of the control once wielded by central planners and now devolved to the creatures of the state apparatus in more subtle ways. For a discussion, see, Larry Catá Backer, Cuban Corporate Governance at the Crossroads: Cuban Marxism, Private Economic Collectives and Free Market Globalism. Transnational Law & Contemporary Problems, Vol. 14, No. 1, 2005.
For all this interesting material, Professor Butler reserves the bulk of his analysis to ten carefully reasoned consequences of the Rosatom law for Russian law and for application of the law of treaties (a heretofore public law concern) when exercised from out of the peculiar creation of this non commercial corporate enterprise with power to control commercial enterprises and more importantly to assert state treaty making powers. Id., 312-315. These consist of:
1. Russian law was changed to provide essentially, that (private) contracts by state corporations like Rosatom would be deemed to be (public) law treaties. This, in effect, makes sense if one considers that treaties, in the 20th century, were the,selves transformed from public contracts between states to some sort of "higher" law binding on states. The regulatory character of treaties is mirrored by the public character of certain contracts to be entered into by enterprises owned by the state (or really by anyone vested lawfully by the state with such power) reflected in the creation of Rosatom. International lawyers, therefore, might be reaping a whirlwind of their own creation--the way the German Imperial Government reaped the rewards of sending Lenin back to Russia.
2. Rosatom is an "empowered organization." Such organizations are granted treaty making power. But the definition of "empowered organization" is "opaque." Id., at 312. Professor Butler is right to suggest the problems of interpretation but then also suggests that other provisions make a broad interpretation of Article 14(2) reasonable. He also notes that for internal purposes, the sort of treaties which Rosatom may conclude are not defined in the 1969 Vienna Convention. That is true enough--though from the perspective of foreign states seeking enforcement of treaty obligations it may not matter much, except, as Professor Bulter points out, to the effect the categorization may affect the place of such treaties within the hierarchy of Russian law. Id., 313.
3. Rosatom is required to consult with constituent entities of the Russian Federation when treaties under consideration touch on matters within their respective competences.
4. Rosatam's treaties bind the Russian Federation, though the extent and nature of that binding are still to be worked out.
5. Under certain circumstances, empowered organizations like Rosatom may make proposals for the conclusion of a treaty by others and with the permission of the Ministry of Foreign Affairs, may speak with foreign counterparts about such treaties. Id. 314.
6. There are some interesting issues of authority to conclude treaties within the governance structure of these state corporations. Professor Butler suggests that the director general s empowered to decide to execute treaties, but not other officers without appropriate grants of power.
7. Proposals to ratify treaties may be submitted jointly with the Ministry of Foreign Affairs, "although the Ministry may act independently in this respect." Id., 314.
8. State corporations with treaty powers may keep the original of executed treaties in their own archives, with copies to the Foreign Ministry.
9. The state corporation is empowered to publish treaties it concludes--permitting effectively such entities to keep a version of an official gazette. "Since Russian courts are zealous in confirming that a treaty has been officially published and has entered into force as a condition of enforcing any of its provisions, the foreign party dealing with Rosatom has a special interest in ensuring that agreements with it are duly published." Id., at 314-315. That is true enough--if such agreements are treaties,. But contracts? An interesting conflation of contract as treaty and treaty as contract in relation to the dealing of such state juridical personalities. Though, again, it might make sense that treaties (public regulatory) actions are conducted with Rosatom and that contracts are concluded with the operating subsidiaries.
10. The last is the most interesting for me. Entities like Rosatom are empowered "to watch over and monitor the performance of treaty obligations by themselves and by the other party or parties, to report any breaches, and to be involved in developing proposals for a response to violations." Id., 315. In the world that Professor Butler describes, where the differences between contract and treaty is fungible to some extent, and the the state entity empowered to act actually operates through a number of other organizations, the possibilities of delegation and diffusion of this monitoring power are vast. And, as I have suggested else, the regulatory effect of the power to monitor can be greater than and more effective than traditional positive legislation. See Larry Catá Backer, Global Panopticism: States, Corporations and the Governance Effects of Monitoring Regimes. Indiana Journal of Global Legal Studies, Vol. 15, 2007.
Professor Butler has done us a great service in highlighting an interesting wrinkle in the use of the corporate form for mixed purposes--private (participation in the market through ownership or control of economic entities) and public (through the regulatory and treaty making powers with which the central entity is vested). He has focused the reader on the issues of internal Russian law such a newfangled mongrelized juridical form presents--as well its implications for the law of treaties--as an internal matter of Russian law (how does it fit into the Russian legal structure) and its potential external effects (what are foreigners to make of all of this). For that reason alone, this commentary was worth a careful read.
But it also suggests a number of lacunae in the nature of corporate law--and its consequences for the convergence of public and private law--that might bear some further study. Whatever the convolutions of Russian law, and the fecundity of the Russian legal imagination, it appears that the Russian state corporation may be viewed as both public and private from outside Russia. In some ways, the Russian state corporation resembles attempts by European states to control recently privatized national industries. In the recent golden share cases, the European Court of Justice has applied its treaty principles of free movement of capital to determine that such constructs--whether created as legislative or private corporate arrangements--retain their public character. As such, both entity and arrangement will be treated as bound by the treaty obligations of the controlling Member State. The Advocates Generals would go further--and treat all such arrangements as essentially public, unless the Member State could effectively show no discriminatory effect (where it controls both regulation and participates in the economic arrangement) or where the State could meet a fairly strict "reasonable private investor" standard (where the state provides money for the purchase of debt or equity). The analysis is essentially functionalist. See Larry Catá Backer, The Private Law of Public Law: Public Authorities as Shareholders, Golden Shares, Sovereign Wealth Funds, and the Public Law Element in Private Choice of Law. Tulane Law Review, Vol. 82, No. 1, 2008 pp. 1801-1868. On the other hand, like the Russians, the Americans have tended to apply a more formalist analysis to such entities (id.)--except in matters of the application of its sovereign immunities law. See Larry Catá Backer,Permanent Mission of India to the U.N. v. City of New York: The State as Private Actor in a World of Private Actors Law at the End of the Day, June 30, 2007.
Thus, the more interesting question might well be how Europeans and Americans might apply their law to the activities of Russian state corporations and their subsidiaries or controlled entities for activities outside of Russia. In this case one is met with a department of the state apparatus , organized in corporate form, to which have been devolved certain traditional state powers--including a limited right to conclude treaties. The fact that the state chose to organize its power in this way, by reconstituting itself in part as a conglomerate, with a number of subordinate juridical persons, ought not affect the character of the state apparatus itself. As the Europeans might suggest from their golden share cases, the public character of the enterprise is not lost merely because of the organizational choice made by the state. That the state corporation is organized as a non-commercial entity suggests a predominance of its regulatory (public) rather than its market participatory (private) character. That, to the extent it remains interesting, is so as a matter of domestic law. Yet this department of the Russian State appears also to manage state enterprises. Where these are operated directly, then the state organization becomes a contradiction in terms--a non-commercial entity operating commercial enterprises. To that extent, the entity might be considered both subject to the limitations of private law (with respect to its commercial activities) as well as public law (to the extent that such law restrains the power of governmental entities). That might well be the consequence under European legal conceptions. Under American law, the commercial character of the activities of the state corporation would be determined in context and the form of the entity would play little part in the analysis. With respect to its operating subsidiaries, though, the Americans would treat those as commercial, independent and subject to private but not public law constraints. The more interesting questions for the Americans would be the ability to reach state assets should American courts determine that the separate entity status of state corporation and subsidiary ought to be disregarded.
More interesting still would have to be the approach of foreigners to the character of the agreements of the state corporation. It is clear that the Russians mean to muddy the waters by creating ambiguity between treaties and contracts. They are likely eager to reap the strategic advantage of characterizing their agreements as one or the other depending on which serves their interests best. Russian state corporations, then, point to a need to much better refine the notions contract and treaty. The simplest approach would rely on the fetishes of formalism. The better approach might be functionalist. That approach might be better if only because formalist approaches are far too easy to abuse where a public entity is free to act like a private one. Where states and their controlled entities could be limited in the scope of their activities, formalism provides a simple and convenient method of analysis. Where the public and private activities of state agencies converge in single agencies, then formalism tends to mask as easily as it reveals. In such a case, agreements of a commercial and participatory character ought to be treated as contract, and those of a regulatory character ought to be treated as treaty--irrespective of the form.
Ironically, the question--are Russian state corporations corporations a all--is largely irrelevant, except perhaps to those whose life work is to preserve legal field boundaries. And there is a certain benefit to that noble task--as a method of disciplining performance with the academy. But otherwise, the question is beside the point. Russia has chosen to provide juridical personality to a certain sort of organization. To some extent that juridical personality is public in character--for example in its conveyance of a power to conclude treaties. To some extent it is private in character--for example in its control of and maintenance of commercial enterprises. The private and commercial character of its operations may be said to implicate the law of corporations (undertakings) and corporate organization (as well as commercial and other law fields). The public and regulatory character of the enterprise is not. That the Russians seek the protection of public law for their private commercial activities--seek to clothe their contracts as treaties, their state regulatory activities as commerce, etc., may be effective within the territory of the Russian Federation, but will hardly carry over abroad. As the Russians seek refuge in 19th century conceptions of state immunity, they build 21st century juridical entities that construct in corporate form 20th century Soviet bureaucratism for the protection of their assets. For Europeans, this activity would appear to clothe public power in private garb. There is no "corporation" here--just the Russian state. And questions of liability and sovereign immunity would hinge on a different analysis. For the Americans, the nature of the entity depends on the character of its activity--corporation is it participates in the market, state if it regulates. In either case, there is no "corporation" there, there is merely the State: asserting its regulatory authority, on the one hand, and seeking to participate in economic activity, on the other.
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