US Supreme Court Hears Turkish Bank Case

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Facts

  • The US Supreme Court on Tuesday began hearing arguments over Turkish state-owned Halkbank's bid to avoid criminal charges in the US for allegedly helping Iran evade economic sanctions. This comes after lower courts ruled in favor of the US government, allowing the prosecution to proceed.
  • At issue in Türkiye Halk Bankasi v. United States is whether a foreign company can be held accountable under US law if it is owned by a foreign government; foreign countries enjoy sovereign immunity and cannot face criminal charges in the US.
  • The Turkish bank, which was criminally charged for allegedly participating in a scheme to launder billions of dollars worth of Iranian oil and natural gas proceeds, claims that the US Foreign Sovereign Immunities Act extends to state-owned businesses.
  • Halkbank finds support from a brief filed by Azerbaijan, Pakistan, and Qatar pointing out that if the decision stands, the US would become an "extreme outlier in the international community" as "no other country allows criminal prosecution of foreign states."
  • This comes after the then-US Attorney for the Southern District of New York Geoffrey Berman indicted Halkbank in 2019 on six criminal charges — including conspiracy to defraud the US, conspiracy to violate sanctions, bank fraud, money laundering, and conspiracy to commit both bank fraud and money laundering.
  • Meanwhile, Turkey's foreign minister Mevlüt Çavuşoğlu departed for a meeting to be held Wednesday with his US counterpart Antony Blinken with the intent to smooth out strained relations between the two NATO allies.

Sources: Reuters, New Republic, France24, Scotus Blog, Lawfare Blog, and Associated Press.

Narratives

  • Establishment-critical narrative, as provided by Daily Sabah. The US Supreme Court must drop this unlawful and unprecedented prosecution against Halkbank as the standing of this lower court's ruling would threaten future indictments of any sovereign state. By doing so, it would also help the smoothing out of critical relations between Ankara and Washington.
  • Pro-establishment narrative, as provided by SCOTUS Blog. Halkbank may argue that it is entitled to sovereign immunity, but this notion rests on a false premise that the bank and the Turkish government are the same. Established international law and practice are unequivocal that despite being a publicly owned corporation, the bank is not a sovereign entity. This is about conforming to well-established international norms.