The United States District Court for the District of Columbia denied a motion to confirm an arbitration award sought by GSS Group Ltd. (GSS) against the National Port Authority of Liberia (NPA). The court granted NPA’s motion to dismiss the confirmation petition due to lack of personal jurisdiction. The roots of the case lie in a contract entered into in June 2005 between GSS, a private corporation established in the British Virgin Islands, and NPA, a state owned corporation, for the express purpose of building and operating a container park in the Liberian capital of Monrovia. GSS later claimed breach of contract and consequently instituted arbitration proceedings the following year. NPA largely ignored the proceedings, which went ahead in spite of its minimal presence. In the end, the arbitrator agreed that NPA did breach the
contract with GSS, culminating with two arbitration awards totaling $44,347,260 in damages. GSS then sought confirmation of said arbitration awards and petitioned the court to that effect in July 2009.

The court resorted to sovereign immunity exception requirements set forth in the Foreign Sovereign Immunities Act (FSIA) in its consideration of the jurisdiction question, and concluded that the requisite subject matter jurisdiction and proper service had been satisfied. First and foremost, it held that NPA was a foreign state according to the FSIA, which specifies instrumentalities and agencies of a foreign state as well. Secondly, the FSIA withholds the shield of sovereign immunity in particular actions, one of which is the petitioning for confirmation of arbitration awards made pursuant to the New York Convention. Lastly, the court emphasized that the issue of service of process never was raised. Thus, it found that a statutory basis for personal jurisdiction had been demonstrated. However, the court also examined the applicability of the Due Process Clause with regards to the exercise of such jurisdiction. The Due Process Clause restricts the jurisdiction of courts over nonresident defendants and stipulates that minimum contacts with the forum are necessary in constituting jurisdiction. Its protections do not extend to foreign sovereign states and the court stressed they only pertained to private foreign entities. While acknowledging that NPA occupied a somewhat fuzzy area between the two groups of defendants, the court maintained that because NPA portrayed itself as legally and financially autonomous from the Liberian government, a representation to which GSS offered no opposition, the exemption of foreign states from due process rights was not called for in this case. In addition, NPA described itself as operating solely in Liberia, again eliciting no opposition from GSS to such characterization, as the court pointed out. It ruled that it did not have jurisdiction over NPA, the minimum contacts standard not having been met, and underscored the fact that GSS had not tried in the least to show that NPA had any contacts with the United States.