Merchant Shipping Act 1993 Defeats State Immunity

The well-established principle of state immunity was

re-examined in the context of the Marine Shipping Act 1993 when

the question arose of whether a governmental organisation

should pay its proportion of a salvage operation from which it

had benefited.

Salvage company, Tsavliris, carried out a successful salvage

pursuant to a Lloyd's Open Form (LOF) agreement signed by

both owners and cargo interests, the Grain Board of Iraq (GBI).

The agreement contained a London arbitration clause. A dispute

arose when GBI challenged the request for payment of their

proportion of cargo salvage on, among others...