Kuwait Airways Case: An Update From Germany
Posted on May 6, 2019
I’ve written a bunch about the Kuwait Airways litigation. The airline had refused to carry Israeli nationals. In the US case, which was an administrative proceeding before the Department of Transportation, the airline refused to carry an Israeli from New York to London. The airline shamefully dropped the route rather than obey an administrative order requiring it to comply with US antidiscrimination laws. In the UK case, the airline settled a case brought by an Israeli refused passage from London to Bangkok. And most recently, a German appellate court rejected a claim by an Israeli refused passage from Frankfurt to Bangkok via Kuwait City.
In my post on the German decision, I reluctantly said that it seemed rightly decided, because Kuwait law does not allow Israelis to enter the country. But in a recent article noted on Conflict of Laws, Prof. Dr. Marc-Philippe Weller and Markus Lieberknecht of Heidelberg University have opined that the decision was wrong. They focus on Article 9(3) of the Rome I regulation, which reads:
Effect may be given to the overriding mandatory provisions of the law of the country where the obligations arising out of the contract have to be or have been performed, in so far as those overriding mandatory provisions render the performance of the contract unlawful. In considering whether to give effect to those provisions, regard shall be had to their nature and purpose and to the consequences of their application or non-application.
They say that under Article 9(3), “German courts are precluded from applying foreign overriding mandatory provisions with an anti-Semitic objective, such as Kuwait’s boycott statute.” I will leave that to the German lawyers. The authors also mention an easier point that I find persuasive—Kuwait Airways is state-owned:
Kuwait Airways is a state enterprise owned by Kuwait, i.e. the very creator of the legal impediment (the boycott statute). Hence, it should not be allowed to rely on a self-created obstacle to refuse performance.
I think the distinction between Kuwait Airways and non-national carriers here is useful. It is not clear to me that if, say, Lufthansa refused to carry an Israeli from Frankfurt to Bangkok via Kuwait because it is following Kuwait law, it should be liable. But the authors are right to say that the Kuwaiti government itself should not be able to point to an legal impossibility it created.
The real answer, of course, is for Arab states to stop discriminating against Israelis on the basis of nationality.