Forth Issue of Jessup International competition 2014/2015

4. REVERENTIA’S REMOVAL OF THE SOFTWARE AT THE MARTHITE EXTRACTION FACILITIES VIOLATED INTERNATIONAL LAW.
The Applicant requests the court to find that Reverentia’s removal of the software at the Marthite extraction facilities violated international law through its conduct of [A] depriving Agnostica’s ownership over the software and [B] intervening into Agnostica’s right to property. Thus, [C] Reverentia’s countermeasure is unlawful.
A. REVERENTIA DEPRIVED AGNOSTICA’S OWNERSHIP OVER THE SOFTWARE.
Software may be embedded in machines for the sake of their functionality.1 In fact, software installed at the Marthite extraction facilities is custom-designed software that specially designed and programmed to denote the specific graphic location of building with the proximity of the corresponding Marthite reserves.2 Here, software is used in working the facility without being separated from it.3
All the rights that had been possessed by Reverentia at first as an author had been transferred completely to Agnostica during the sale of facilities which included the software4. By virtue of Article 2 of the Marthite Convention, Agnostica had paid sum of 100 Swiss francs to Reverentia.5 Plus, international sales contract occurs when it transfer the property from one party to another party with certain price.6
The termination of the treaty on 2 April 2012, does not affect the right, obligation or legal situation executed by the parties prior to termination.7 Accordingly, the software of the facilities remains Agnostican property.
Thus, removal of the software by Reverentia has deliberately deprived Agnostica’s ownership over the software.
B. REVERENTIA INTERVENED INTO AGNOSTICA’S RIGHT TO PROPERTY.
i. Reverentia’s conduct constituted an abuse of rights. The doctrine of abuse of rights is a general principle of law.8 It refers to a State exercising a right in which it impedes the enjoyment by other States of their own rights and caused injury to that State.9 International Law summarized this doctrine as neminem laedit qui suo jure utitur where nobody harms other when he exercises his own rights. 10
An abuse of rights should be viewed as supplemental to the principle of good faith. 11 However, as ICJ noted the principle of good faith relates only to the fulfilment of existing obligations.12 A lack of good faith gives rise to a violation of international law with all the attendant consequences. 13
Based on State practice, the doctrine of abuse of rights was an express claim before the ICJ to impose upon the State concerned the duty to avoid acts which would amount to a violation of this doctrine. 14
By removing the software from the mining facilities, Reverentia had abused Agnostica’s right over its own property. The removal had severely damaged the Marthite operations. Further, Reverentia exercised its rights by removing the software in a way that impaired the capacity of Agnostica to extract the Marthite.15 There is a doubt as to whether the facilities will start the extraction activities on any meaningful scale.16 So, the effect of this abuse of rights is long-lasting. As Agnostica is focusing its economic development on the harvest, extraction and exportation of its abundant natural resource17, the disadvantages to Agnostica is considerable; Marthite is the central of Agnostican economy. ii.Reverentia deprived Agnostica’s peaceful enjoyment of property. A deprivation or taking of property occurs through unreasonable interference with the use, enjoyment or disposal of property. The interference is completed when the owner is not able to use, enjoy, or dispose of the property within a reasonable period of time after the inception of such interference.18
The Iran-US claims Tribunal held that the deprivation of property exists where the use and enjoyment of benefits related to the property is interfered even the legal ownership is not affected.19
In Middle East Cement v Egypt20, Egypt’s revocation of a free zone license through the prohibition of import cement constituted a deprivation to Middle East Cement’s right to enjoy the use and benefits of its investment.
In the present case, Reverentia’s removal of the software clearly violated the rights of Agnostica to peaceful enjoyment of its own property. This is because; Agnostica cannot use the software to extract the Marthite on any meaningful scale and need to rely heavily on manual labours.21 iii.Reverentia conducted unlawful expropriation of property. Expropriation is not illegal per se under international law. In principle, a State has the power and the right to expropriate the property of nationals and of foreigners. However, a legal expropriation of foreign owned property is subject to certain conditions.22 At custom, the legality of a measure of expropriation is conditioned on three cumulative requirements which are23:
i. Expropriation is resorted to as part of a scheme intended for a public purpose.24 ii. It is applied without discrimination against aliens. iii. There is prompt, adequate and effective compensation. Reverentia had conducted unlawful expropriation of property as it does not fulfill all the conditions.
i. Reverentia’s expropriation is not intended for a public purpose. It is universally agreed that sovereign States have the right to expropriate foreign owned property for public and not private use. This has been affirmed by the United Nations General Assembly in its Resolution 1803 where the Assembly declared that expropriation shall be based on grounds or reasons of public utility, security or the national interest.25 In fact, Marthite is important ingredient in Reverentia’s traditional medicine. Removal of the software by Reverentia was done in order for Agnostica to respect its treaty obligations and supply of Marthite can be distributed among Reverentians.26 However, by removing the software, the supply of Marthite cannot be given to them in adequate amount.27 Besides, before the termination of the treaty, Reverentia had sold 75% of the total quantity of mined Marthite to oversea company which causing concern among traditional users regarding the shortages and high price of the Marthite.28 ii.Reverentia conducted discriminatory expropriation. The principle of non-discrimination is recognized in international customary practice as part of general international law.29 This principle acts as a yardstick of the legality of various state actions.30
In Libyan American Oil Company v Libyan Arab Republic (LIAMCO case) 31, it suggests that non-discrimination is a condition of a lawful expropriation although it is not an absolute requirement.
In the present case, Reverentia’s removal of the software had discriminated Agnostica’s rights over its own property. This is because, through payment, all the facilities including the software belong to Agnostica.32 Further, the removal of the software had caused Agnostica cannot fully utilize the facilities to extract Marthite.33 Further, it can be shown that removal of the software amount to discrimination as Reverentia knows that Agnostica lacks of technology and cannot repair the facilities without getting help from them.34 iii.Reverentia’s expropriation did not accompanied by prompt, adequate and effective compensation. According to United Nations General Assembly in its resolution 1803 where the Assembly has declared that when a State expropriate foreign property the owner must be paid appropriate compensation in accordance with the rules in force in the State taking such measures in the exercise of its sovereignty and in accordance with international law.35
The International Law Commission (ILC) has codified the duty of the responsible State to compensate for the damage that is not made good by restitution and shall cover any financially assessable damage including loss of profits as it is established.36
Compensation covers any financially assessable damage including loss of profits. This includes material damage to the State which mainly consists in damage to property and incidental costs arising out of the need to pay any expenses for injury as a result of the wrongful act.37
In the Saiga case38, the International Tribunal for the Law of the Sea awarded a substantial amount of compensation for what it considered direct material damage to the State included damage to the vessel, costs of repair, loss of charter hire and loss related to the detention of the vessel.
In Amco Asia Co v Republic of Indonesia39, international tribunals award compensation for loss of profits if they are the result of the ordinary course of events having their origin in the wrongful act and if they are non-speculative.
However, Reverentia did not compensate any of the damage. In fact, the removal of the software had crippled the Marthite operations where extraction activities cannot be done on any meaningful scale. This situation will surely affect the profits gained by Agnostica through the selling of mined Marthite. Besides, the removal of the software also had incurred Agnostica cost of repairs in order to restore the computer systems at the facilities and cost to employ extra workers to work manually at the Marthite facilities. iv. Alternatively, if the court found that Agnostica contributes to his own loss, Agnostica will not receive full compensation. According to general principle of law and in international case law, if an injured party acts in some way negligently and contributes to his own loss he will not receive full compensation.40
In the determination of reparation, account shall be taken of the contribution to the injury by willful or negligent action or omission of the injured State.41 In fact, the removal of software was a countermeasure done by Reverentia as Agnostica decided to terminate the Convention without the consent from both parties and directly prevent Reverentia from obtaining the Marthite.
C. REVERENTIA’S COUNTERMEASURE WAS UNLAWFUL. Countermeasures are taken by injured States to seek their rights and to restore the legal relationship with the responsible State which has been ruptured by the internationally wrongful act.42
International Law provides that countermeasures are lawful when six cumulative conditions are satisfied43:
i. The act of countermeasures must be taken in response to a previous international wrongful act of another State.44 ii. The act of countermeasure must be direct to the responsible state.45 iii. The injured State must have called upon the State committing the wrongful act to discontinue its wrongful conduct or to make reparation for it.46 iv. The act of countermeasures must be proportionate.47
v. The act of countermeasure is temporary and not permanent.48 vi. It not imposes when the dispute is pending before a court.49

In this vein, (i) the absence of International wrongful act committed by Agnostica and (ii) the disproportionality of countermeasures rendered the countermeasures by Reverentia as unlawful.
i) There is no international wrongful act committed by Agnostica.50 Reverentia at first has failed to show that there was an international wrongful act committed by Agnostica. In the present case, the termination of the Marthite Convention by Agnostica is permissible under international law and cannot be considered as an international wrongful act because Agnostica only exercising its rights as the aggrieved party due to the breach of the treaty done by Reverentia at the first place. Reverentia clearly breached that treaty by selling the extracted Marthite to the international market which contravene the preamble of Marthite Convention. ii) The act of countermeasure is disproportionate. Proportionality means that a State’s acts must be a rational and reasonable exercise of means towards achieving a permissible goal without unduly encroaching on protected rights of either the individual or another State.51
Proportionality is an essential limit on the taking of countermeasure by an injured State. It is relevant in determining what countermeasures may be applied and their degree of intensity.52 In the case of Gabcikovo Nagymaros Project53, the effects of countermeasure must be commensurate with the injury suffered and taking account of the rights in question.
Reverentia by removing and unilaterally control of the software had deprived Agnostica’s ownership upon the facilities. Besides, the withdrawal of personnel and software had crippled the Marthite operations where the extraction of Marthite needs to rely heavily on manual labour.54 Thus, the removal of the software carried out by Reverentia as a countermeasure is disproportionate.