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In re Arbitration Between: Trans Chemical Limited & China National Machinery Import & Export Corporation

United States District Court for the Southern District of Texas
978 F. Supp. 266 (1997)


Facts

Trans Chemical Ltd. (plaintiff) sued China National Machinery Import & Export Corporation (CNMC) (defendant) in the United States District Court for the Southern District of Texas to enforce an arbitration award under the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards. It was undisputed that CNMC was organized under Chinese law and was not a citizen of the United States. However, CNMC tried to avoid the district court’s jurisdiction by arguing that it was not an “agency or instrumentality of a foreign state” under the Foreign Sovereign Immunities Act (FSIA). CNMC asserted that it was not an agency or instrumentality of a foreign state under Edlow Int’l v. Nuklearna Elektrarna Krsko, 441 F. Supp. 827 (D.D.C. 1977) (Edlow), because CNMC did not provide a government function, nor did the Chinese government control CNMC.

Rule of Law

Issue

Holding and Reasoning (Lake, J.)

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