Michaelmas Term

[2021] UKSC 57
On appeal from: [2020] EWCA Civ 1249

JUDGMENT

“Maduro Board” of the Central Bank of Venezuela

(Respondent/Cross-Appellant) v “Guaidó Board” of
the Central Bank of Venezuela (Appellant/Cross-
Respondent)

before
Lord Reed, President
Lord Hodge, Deputy President
Lord Lloyd-Jones
Lord Hamblen
Lord Leggatt

JUDGMENT GIVEN ON
20 December 2021

Heard on 19, 20 and 21 July 2021

 Guaidó Board
Timothy Otty QC
Sir Daniel Bethlehem QC
Andrew Fulton QC
Mark Tushingham
(Instructed by Arnold & Porter Kaye Scholer LLP)

Maduro Board
Sir Jeffrey Jowell QC
Nicholas Vineall QC
Professor Dan Sarooshi QC
Brian Dye
Jonathan Miller
Naina Patel
Mubarak Waseem
(Instructed by Zaiwalla & Co Ltd)

Intervener (Secretary of State for Foreign, Commonwealth and Development Affairs)

Sir James Eadie QC
Sir Michael Wood
Jason Pobjoy
Belinda McRae
(Instructed by The Government Legal Department)
 TABLE OF CONTENTS

Paragraphs
Introduction................................................................................................................. 1-58
Factual background ...................................................................................................... 6-38
The proceedings ........................................................................................................... 39-58
Recognition.................................................................................................................. 59-110
The submissions of the parties..................................................................................... 59-62
Recognition of states and governments in international law ....................................... 63
FCDO practice in recognition ....................................................................................... 64-68
Recognition and the courts .......................................................................................... 69-79
Express and implied recognition .................................................................................. 80-82
De jure and de facto recognition.................................................................................. 83-86
Application of the principles to this case ..................................................................... 87-101
Subsequent events ....................................................................................................... 102-105
Head of government .................................................................................................... 106-109
Conclusion on recognition ........................................................................................... 110
Act of State .................................................................................................................. 111-180
The issues raised .......................................................................................................... 114-115
Rule 2: An act of a foreign state’s executive ................................................................ 116-170
Limitations and exceptions .......................................................................................... 136
Appointments as acts of state ...................................................................................... 137-146
Territoriality ................................................................................................................. 147-150
Incidental issue ............................................................................................................ 151-152
The judgments of the STJ ............................................................................................. 153-170
Rule 1: A foreign state’s legislation or other laws ........................................................ 171-180
Conclusion ................................................................................................................... 181
LORD LLOYD-JONES: (with whom Lord Reed, Lord Hodge, Lord Hamblen and Lord
Leggatt agree)

Introduction

1. This appeal raises fundamental issues concerning the recognition of a foreign

head of state, the foreign act of state doctrine and their inter-relationship.

2. The central question arising on this appeal is which of two contending claimants
is entitled to give instructions to financial institutions within this jurisdiction on behalf
of the Central Bank of Venezuela (the “BCV”) and to represent the BCV in a London
Court of International Arbitration (“LCIA”) arbitration. The Bank of England (the “BoE”)
holds gold reserves of about US$1.95 billion for the BCV, while Deutsche Bank (“DB”)
has paid the proceeds of a gold swap contract owed to the BCV in the sum of about
US$120m to court-appointed receivers (the “Receivers”) to hold on behalf of the BCV.
The two competing claimants to the funds held by the BoE and the Receivers have
been referred to in these proceedings as the “Maduro Board” and the “Guaidó Board”.
They each claim to be entitled to represent the BCV in relation to the assets of the BCV
in this jurisdiction.

3. The Maduro Board claims to be the only validly appointed board of the BCV,
appointed by Mr Nicolás Maduro Moros (“Mr Maduro”) as President of Venezuela,
and, as such, authorised to give instructions on behalf of the BCV in respect of BCV
assets held within Venezuela and also, for present purposes, in respect of BCV assets
held in financial institutions in England. The Guaidó Board claims to be an ad hoc board
of the BCV, appointed by Mr Juan Gerardo Guaidó Márquez (“Mr Guaidó”) as interim
President of Venezuela, and authorised to give instructions on behalf of the BCV,
including in respect of BCV assets held in financial institutions in England. The Maduro
Board denies the Guaidó Board has the authority it claims to have. The Maduro Board
has challenged Mr Guaidó’s right to appoint the Guaidó Board and a Special Attorney
General. The Maduro Board contends that Mr Guaidó’s acts of appointment are null
and void under Venezuelan law, and notes that they have been held to be null and void
by the Venezuelan courts.

4. The dispute as to who is entitled to give instructions on behalf of the BCV

concerning the assets held in England involves two issues:

(1) Whether Mr Guaidó or Mr Maduro is recognised as the President of

Venezuela; and

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 (2) If the answer is that Mr Guaidó is the President and Mr Maduro is not,
the validity of Mr Guaidó’s appointment of the Guaidó Board and of the Special
Attorney General.

5. The parties identified a large number of issues arising from the pleadings. On
the Guaidó Board’s application, and against the Maduro Board’s objections, the
Commercial Court ordered a trial of two preliminary issues which were addressed by
the courts below:

(1) The “recognition issue” namely:

Does Her Majesty’s Government (“HMG”) (formally) recognise Juan Guaidó or

Nicolás Maduro and, if so, in what capacity, on what basis and from when? In
that regard:

(i) Has Her Majesty’s Government formally recognised Mr Guaidó as

interim President of Venezuela by virtue of the Foreign and
Commonwealth Office (FCO) letter dated 19 March 2020 to the Court
and/or the public statements made by Her Majesty’s Government?

(ii) If so, is that recognition as both head of state and head of

government? and

(iii) Is any such recognition conclusive pursuant to the “one voice”

doctrine for the purpose of determining the issues in these proceedings?

(2) The “act of state issue” namely:

Can this Court consider the validity and/or constitutionality under Venezuelan
law of (a) the Transition Statute; (b) Decrees Nos 8 and 10 issued by Mr Guaidó;
(c) the appointment of Mr Hernández as Special Attorney General; (d) the
appointment of the Ad Hoc Administrative Board of BCV; and/or (e) the
National Assembly’s Resolution dated 19 May 2020, or must it regard those acts
as being valid and effective without inquiry? In that regard:

(i) Does the “one voice” doctrine preclude inquiry into the validity of
such matters?

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 (ii) Are such matters foreign acts of state and/or non-justiciable?

(iii) Does the Court lack jurisdiction and/or should it decline as a

matter of judicial abstention to determine such issues?

Factual background

6. In April 2013, Mr Maduro was elected President of Venezuela.

7. In December 2015, there were elections for Venezuela’s legislature, the

National Assembly. A dispute arose as to the validity of the election of four deputies
for the State of Amazonas. The Supreme Tribunal of Justice of Venezuela (the “STJ”),
the highest Venezuelan constitutional court, granted provisional relief suspending the
implementation of the election of these deputies. However, the opposition coalition,
which claimed victory in the elections, decided that the four deputies should be sworn
in anyway.

8. There is a dispute between the Guaidó Board and the Maduro Board in relation
to all of the judgments of the STJ upon which the Maduro Board relies from 2016
onwards. The Guaidó Board’s pleaded case is that the STJ’s judgments were issued in
violation of principles of due process and that the members of the STJ are not impartial
and independent but were acting corruptly to support Mr Maduro.

9. On 1 August 2016, the STJ issued a judgment in which it declared that all
decisions taken by the National Assembly would be null and void for so long as it was
constituted in breach of the judgments and orders of the STJ. Subsequently, other
judgments were issued to the same or similar effect.

10. In May 2017, a National Constituent Assembly was established on Mr Maduro’s

initiative and an election was held for its members. This was essentially a rival
legislature to the National Assembly.

11. In May 2018, a Presidential election took place which Mr Maduro claims to have
won. The United Kingdom considered that this election was deeply flawed.

12. On 19 June 2018, Mr Maduro appointed Mr Ortega as President of the BCV. On

26 June 2018, the National Assembly passed a resolution declaring Mr Ortega’s

Page 4
appointment to be unconstitutional. The STJ in turn has declared the National
Assembly Resolution unconstitutional.

13. On 10 January 2019, Mr Maduro was sworn in before the STJ for a second term
as the President of Venezuela.

14. However, on 15 January 2019, the National Assembly and the President of the
National Assembly, Mr Guaidó, announced, relying upon article 233 of the Venezuelan
Constitution, that Mr Maduro had usurped the office of President and that Mr Guaidó
was the interim President of Venezuela by virtue of his position as President of the
National Assembly.

15. On 26 January 2019, the United Kingdom joined European Union partners in
giving Mr Maduro eight days to call fresh elections, in the absence of which those
countries would recognise Mr Guaidó as interim President “in charge of the transition
back to democracy”. Mr Maduro did not call such elections.

16. On 4 February 2019, the then Foreign Secretary, the Rt Hon Jeremy Hunt MP,
issued the following statement:

“The United Kingdom now recognises Juan Guaidó as the

constitutional interim President of Venezuela, until credible
presidential elections can be held.

The people of Venezuela have suffered enough. It is time for

a new start, with free and fair elections in accordance with
international democratic standards.

The oppression of the illegitimate, kleptocratic Maduro

regime must end. Those who continue to violate the human
rights of ordinary Venezuelans under an illegitimate regime
will be called to account. The Venezuelan people deserve a
better future.”

17. This was followed by an exchange of letters between Tom Tugendhat MP, Chair
of the House of Commons Select Committee on Foreign Affairs and Sir Alan Duncan
MP, Minister of State for Europe and the Americas, which has been made public. Mr
Tugendhat asked for an explanation of the legal basis for this act of recognition.
Page 5
18. On 25 February 2019, Sir Alan explained that the decision to recognise Mr
Guaidó was a “case specific exception to our continuing policy of recognising states not
governments” and was based on two points. First, Mr Guaidó and the National
Assembly were acting consistently with the Venezuelan constitution when they
declared the Presidency vacant following the May 2018 elections which were “deeply
flawed”. Secondly, the circumstances in Venezuela were “exceptional”: 3.6m people
had fled the country and the regime, which was “holding onto power though electoral
malpractice and harsh repression of dissent”, had been referred to the International
Criminal Court by six countries for its abuse of human rights.

19. Meanwhile, on 5 February 2019 the National Assembly passed the “Transition
Statute”. This was described in its preamble as a statute that “governs a Transition to
democracy to restore the full force and effect of the Constitution of the Bolivarian
Republic of Venezuela.” The translation before the court records that it was “issued,
signed and sealed at the Federal Legislative Palace, seat of the National Assembly of
the Bolivarian Republic of Venezuela, in Caracas, on February 5, 2019.” The signatories
were Mr Guaidó, as President of the National Assembly, two vice-presidents, a
secretary and an under-secretary of the National Assembly. It bears the seal of Mr
Guaidó as President of Venezuela.

20. Article 4 of the Transition Statute provides that “The present Statute is a legal
act in direct and immediate execution of article 333 of the Constitution of the
Bolivarian Republic of Venezuela.”

21. Article 14 of the Transition Statute provides that, in accordance with article 233
of the Constitution, the President of the National Assembly (ie, Mr Guaidó) is “the
legitimate Interim President of the Bolivarian Republic of Venezuela.”

22. Article 15 of the Transition Statute provides:

“The National Assembly may adopt any decisions necessary

to defend the rights of the Venezuelan State before the
international community, to safeguard assets, property and
interests of the state abroad, and promote the protection
and defense of human rights of the Venezuelan people, all in
accordance with Treaties, Conventions, and International
Agreements in force.

Page 6
In exercising the powers derived from article 14 of this
Statute, and within the framework of article 333 of the
Constitution, the Interim President of the Bolivarian Republic
of Venezuela shall exercise the following powers, subject to
authorisation and control by the National Assembly under
the principles of transparency and accountability.

a. Appoint ad hoc administrative boards to

assume the direction and administration of public
institutes, autonomous institutes, state foundations,
state associations and state civil societies, state
companies, including companies established abroad,
and any other decentralized entity, for the purpose of
appointing administrators and, in general, adopting
the measures necessary to control and protect their
assets. The decisions adopted by the Interim President
of the Republic shall be executed immediately, with
full legal effect.

b. While an Attorney General is validly appointed

in accordance with article 249 of the Constitution, and
within the framework of articles 15 and 50 of the
Organic Law of the Attorney General of the Republic,
the Interim President of the Republic may appoint a
special attorney general to defend and represent the
rights and interests of the Republic, state companies
and other decentralized entities of the Public
Administration abroad. The special attorney general
shall have the power to designate judicial
representatives, including before international
arbitration proceedings, and shall exercise the powers
set forth in article 48, paragraphs 7, 8, 9 and 13, of the
Organic Law of the Attorney General of the Republic,
subject to the limitations derived from article 84 of
that Law and this Statute. Such representation shall be
especially oriented toward ensuring the protection,
control, and recovery of state assets abroad, as well as
executing any action required to safeguard the rights
and interests of the state. The attorney general thus
appointed shall have the power to execute any action
and exercise all of the rights that the Attorney General
would have, with regard to the assets described
Page 7
 herein. For such purposes, such special attorney
general shall meet the same conditions that the Law
requires to occupy the position of Attorney General of
the Republic.”

23. On 5 February 2019, Mr Guaidó purported, as interim President, to appoint Mr

José Ignacio Hernández as Special Attorney General. He purported to do so pursuant to
articles 233, 236 and 333 of the Venezuelan Constitution and article 15b of the
Transition Statute. The decree was “issued at the Federal Legislative Palace in
Caracas”.

24. On 8 February 2019, the STJ issued a judgment holding that the Transition
Statute was unconstitutional, a nullity and of no legal effect. This was followed on 11
April 2019 by a judgment holding that the appointment of Mr Hernández was also
unconstitutional, a nullity and of no legal effect.

25. On 18 July 2019, Mr Guaidó purported, as interim President, to appoint an ad

hoc board of the BCV (ie, the Guaidó Board) by “Decree No 8”. The decree was
expressed to be “issued at the Federal Legislative Palace in Caracas”.

26. Article 3 of Decree No 8 purports to provide that the Ad Hoc Board would
represent the BCV abroad in connection with agreements relating to the management
of international reserves, including gold.

27. Article 7 of Decree No 8 purports to provide that the acts that resulted in the
appointment of the person who currently occupies the Presidency of the BCV (ie, Mr
Ortega) were declared null and void.

28. On 25 July 2019, the STJ issued a judgment holding that the appointment of the
Guaidó Board was unconstitutional, a nullity and of no legal effect.

29. On 13 August 2019, Mr Guaidó, as interim President, passed “Decree No 10”

appointing an additional member to the Guaidó Board and naming Mr Ricardo Villasmil
as Chairman of the Guaidó Board.

30. On 5 January 2020, Mr Guaidó was re-elected President of the National

Assembly.

Page 8
31. On 19 May 2020, the National Assembly passed a resolution stating that the
BCV was a “decentralised entity” and that the BCV’s assets abroad may only be
administered by the Guaidó Board. This resolution was declared unconstitutional by
the STJ on 26 May 2020.

32. The Maduro Board contends that the STJ has declared that all decisions taken
by the National Assembly since 2016 are null and void, including the appointment of
Mr Guaidó as interim President, the Transition Statute, the appointment of Mr
Hernández as Special Attorney General and the appointment of the Guaidó Board. The
Maduro Board also contends that the STJ has ruled that the BCV is not a “decentralised
entity”, a term referred to in the Transition Statute.

33. The courts below have not made any findings of fact about (1) the status of the
STJ judgments or (2) the issue of who actually exercises effective control within
Venezuela. These issues fall outside the scope of the two preliminary issues quoted at
para 5 above.

34. The Maduro Board’s case is that in practice Mr Maduro continues effectively to
exercise all the powers of head of state and head of government, through the
government of which he is the head, and that Mr Guaidó does not and has never done
so. The Guaidó Board accepts that the Maduro regime exercises at least a degree of
effective control in Venezuela, although the manner and extent of such control is
disputed. In particular, the Guaidó Board does not accept that the Maduro regime
enjoys the habitual obedience of the bulk of the population of Venezuela with a
reasonable expectancy of permanence. Nevertheless, the Guaidó Board’s position is
that these considerations are irrelevant to the preliminary issues.

35. It is common ground that there has been no change in diplomatic relations
between the United Kingdom and Venezuela in the period after 4 February 2019. Mr
Andrew Soper, who was originally appointed in October 2017, remained the
Ambassador of the United Kingdom to Venezuela until March 2021 when he was
replaced by Ms Rebecca Buckingham OBE as chargée d’affaires ad interim. Venezuela’s
Ambassador to the United Kingdom has remained Mrs Rocío Maneiro, who was
originally appointed in November 2014.

36. HMG declined to grant diplomatic status to Mr Guaidó’s (former) official

representative in the UK, Ms Vanessa Neumann, or to establish diplomatic relations
with Mr Guaidó, although there have been contacts between Ms Neumann and UK
ministers including the Prime Minister.

Page 9
37. On 6 December 2020, National Assembly elections took place in Venezuela. Mr
Guaidó did not stand for election. Mr Guaidó and his political allies boycotted the
elections on the basis that they considered that the conditions under which they were
being held were neither free nor fair.

38. On 7 December 2020, the Foreign, Commonwealth and Development Office

(“FCDO”), as the FCO had now become, released the following statement:

“The Venezuelan National Assembly election on 6 December

was neither free nor fair. It did not meet internationally
accepted conditions, as called for by the International
Contact Group on Venezuela including the UK, the
Organisation of American States, the European Union, and
others; nor did it meet the requirements of Venezuelan law.
The UK considers the election to have been illegitimate and
does not recognise the result. The UK recognises the National
Assembly democratically elected in 2015 and recognises Juan
Guaidó as interim constitutional President of Venezuela. It is
vital that Venezuelans are given the opportunity to vote soon
in presidential and legislative elections that are free, fair and
effectively overseen. The UK considers that restoring
democracy is an essential step towards ending the political,
economic and humanitarian crises afflicting Venezuela’s long-
suffering people and calls on all its leaders to commit to
supporting a solution to this end.”

The proceedings

39. On 13 May 2019, DB issued an Arbitration Claim Form seeking the appointment
of receivers to hold and manage the proceeds of a gold swap contract concluded with
the BCV (the “DB Proceedings”). The swap contract was governed by English law and
provided for disputes to be resolved by LCIA arbitration in London. The DB Proceedings
were commenced in support of DB’s LCIA arbitration proceedings against BCV. The
confidential arbitral proceedings are effectively stayed, pending resolution of the
question of who is entitled to represent the BCV.

40. The claim was issued because DB had received conflicting instructions with
regard to the payment of the proceeds of the gold swap contract. The court appointed
the Receivers and DB transferred the proceeds of the gold swap contract to the
Receivers.
Page 10
41. Between September and October 2019, the Guaidó Board and the Maduro
Board served statements of case setting out, respectively, the entitlement of Mr
Hernández and Mr Ortega to give instructions on behalf of the BCV in the LCIA
Arbitration which DB had commenced against the BCV.

42. On 14 February 2020, after hearing argument in the arbitration application,

Robin Knowles J wrote to the then Foreign Secretary, The Rt Hon Dominic Raab MP,
inviting HMG to provide a written certificate on two questions:

“(i) Who does HMG recognise as the head of state of the

Bolivarian Republic of Venezuela?

(ii) Who does HMG recognise as the head of government

of the Bolivarian Republic of Venezuela?”

43. On 19 March 2020, a reply was sent by Mr Hugo Shorter, Director for the
Americas at the FCO. Mr Shorter referred to the two questions and to the policy
statement issued by Lord Carrington in 1980 explaining that the UK would no longer
recognise governments. He continued:

“The policy of non-recognition does not preclude Her

Majesty’s Government from recognising a foreign
government or making a statement setting out the entity or
entities with which it will conduct government to
government dealings, where it considers it appropriate to do
so in the circumstances.

In this respect we refer you to the statement of the then

Foreign Secretary, the Rt Hon J Hunt, on 4 February 2019,
recognising Juan Guaidó as constitutional interim President
of Venezuela until credible elections could be held, in the
following terms: …”

The statement made by the then Foreign Secretary on 4 February 2019 (see para 16
above) was then quoted and Mr Shorter ended by confirming that this remained the
position of HMG.

Page 11
44. On 30 March 2020, Robin Knowles J ordered that the recognition issue and the
act of state issue be determined as preliminary issues in the DB Proceedings. On 29
April 2020, Flaux LJ refused the Maduro Board permission to appeal from that decision.

45. On 14 May 2020, a separate claim form was issued in the name of the BCV,
upon the instructions of the Maduro Board, against the BoE, claiming that the BoE was
in breach of its contractual obligation to accept instructions from the Maduro Board
with regard to payment of the gold reserves held by it (the “BoE Proceedings”).

46. Two applications were then issued in the BoE Proceedings:

(1) First, also on 14 May 2020, an application by the Maduro Board for an
expedited hearing of the entire claim on Covid-19 grounds; and

(2) Second, on 19 May 2020, a stakeholder application issued by the BoE

(who, like DB, had received conflicting instructions) seeking an order under CPR
rule 86.1 for the court to determine upon whose instructions (as between the
Maduro Board or the Guaidó Board) the BoE was authorised to act in respect of
the gold reserves held by the BoE on behalf of the BCV.

47. Both applications were heard by Teare J on 21 and 28 May 2020. Teare J
considered the preliminary issues in both the DB Proceedings and the BoE Proceedings
and ordered that the individual members of the Guaidó Board and the Maduro Board
be joined as stakeholder claimants in the BoE Proceedings. After the BoE had made an
application for a stay on 25 May 2020, Teare J also ordered a stay of the BCV’s action
against the BoE.

48. The preliminary issues were heard by Teare J over four days between 22-25
June 2020. Teare J handed down his judgment on 2 July 2020 ([2020] EWHC 1721
(Comm); [2021] QB 455). He resolved both preliminary issues in the Guaidó Board’s
favour.

49. On the recognition issue he held (at para 42) that HMG had recognised Mr
Guaidó in the capacity of the constitutional interim President of Venezuela by virtue of
the FCO’s 19 March 2020 letter to the court and/or the public statements made by
HMG and, it must follow, does not recognise Mr Maduro as the constitutional interim
President of Venezuela. It recognised Mr Guaidó on the basis that such recognition is in
accordance with the Constitution of the Republic of Venezuela and had done so since 4
February 2019. This recognition was as head of state but not as head of government. It
Page 12
was conclusive pursuant to the “one voice” principle for the purpose of determining
the issues in these proceedings.

50. On the act of state issue Teare J held (at para 93) that it was not open to the
court to consider the validity and/or constitutionality under Venezuelan law of (a) the
Transition Statute; (b) Decrees No 8 and 10 issued by Mr Guaidó; (c) the appointment
of Mr Hernandez as Special Attorney General; (d) the appointment of the Ad Hoc
Administrative Board of BCV; and/or (e) the National Assembly’s Resolution dated 19
May 2020. The court was required to regard those acts as being valid and effective
without inquiry. The one voice principle precluded inquiry into the validity of such
matters, but only in so far as the challenge is based upon decisions of the STJ which are
themselves based upon Mr Guaidó not being the constitutional interim President of
Venezuela. Such matters were foreign acts of state and non-justiciable. The court
lacked jurisdiction because of subject matter immunity.

51. Teare J granted the Maduro Board permission to appeal to the Court of Appeal
on one ground relating to act of state. The Maduro Board then sought and obtained
permission to appeal (from Hickinbottom LJ) against Teare J’s Judgment. The appeal,
which was directed to be expedited, was heard over three days between 22-24
September 2020 by Lewison, Males and Phillips LJJ. The Court of Appeal allowed the
appeal and handed down its judgment on 5 October 2020 ([2020] EWCA Civ 1249;
[2021] QB 455. Males LJ gave the leading judgment with which Lewison and Phillips LJJ
agreed.

52. On the recognition issue, Males LJ held (at para 126) that “HMG has since 4
February 2019 formally recognised Mr Guaidó as the de jure President of Venezuela,
that is to say as the person entitled to be regarded as the President of Venezuela”.
HMG had formally recognised Mr Guaidó as interim President of Venezuela by virtue of
the FCO’s 19 March 2020 letter to the court and/or other public statements. That
recognition was as head of state but not as head of government. Such recognition was
not conclusive pursuant to the “one voice” principle for the purpose of determining
the issues in these proceedings. While such recognition was conclusive for the purpose
of determining who is the de jure President of Venezuela, it leaves open the possibility
that HMG may impliedly recognise Mr Maduro as the de facto President of Venezuela.
He held (at para 127) that before a definitive answer could be given on the recognition
issue, it was necessary to determine whether (1) HMG recognises Mr Guaidó as
President of Venezuela for all purposes and therefore does not recognise Mr Maduro
as President for any purpose or (2) HMG recognises Mr Guaidó as entitled to be the
President of Venezuela and thus entitled to exercise all the powers of the President
but also recognises Mr Maduro as the person who does in fact exercise some or all of
the powers of the President of Venezuela. In his view these questions were best

Page 13
determined by posing a further question or questions to the FCO and the matter was
remitted to the Commercial Court for this purpose.

53. Males LJ held (at paras 138-139) that the act of state issue was not capable of
being answered at that stage without seeking further clarification from the FCO or, in
the absence of such clarification, determining whether HMG continues by necessary
implication to recognise Mr Maduro as the President of Venezuela de facto.
Furthermore, the act of state issue was not capable of being answered at that stage
because there was an unresolved issue as to whether the various judgments of the STJ
should be recognised by courts in this jurisdiction. In his view this was an issue which
the English court can and must investigate.

54. Applications by the Guaidó Board and the Maduro Board for permission to
appeal to the Supreme Court were refused by the Court of Appeal.

55. On 9 December 2020, the Supreme Court granted the Guaidó Board’s
application for permission to appeal on all grounds. The Supreme Court refused the
Maduro Board’s application for permission to cross-appeal in relation to the
recognition issue.

56. On 10 December 2020, Cockerill J ordered a stay of the proceedings in the

Commercial Court to await the outcome of the present appeal to the Supreme Court.

57. On 18 January 2021, the Maduro Board applied for permission to cross-appeal
on the act of state issue, but on a contingent basis, indicating that its preferred course
was that if the Guaidó Board’s third ground of appeal were to succeed, act of state
issues should be remitted to the Court of Appeal for reconsideration, rather than be
decided in the Supreme Court in the absence of a full Court of Appeal decision and
against an undetermined factual background. The Guaidó Board resisted the proposal
for remittal but consented to the alternative basis of the Maduro Board’s application,
namely that the Supreme Court should give permission to cross-appeal. On 22 April
2021, the Supreme Court granted the Maduro Board’s application for permission to
cross-appeal.

58. On 14 May 2021, the Supreme Court granted an application by the Secretary of
State for Foreign, Commonwealth and Development Affairs (“the Foreign Secretary”)
for permission to intervene in the appeal.

Page 14
Recognition

The submissions of the parties

59. The Guaidó Board, the appellant in these proceedings, submits that on the
correct application of the one voice principle and the act of state doctrine, courts in
this jurisdiction must conclude that the Guaidó Board is entitled to give instructions on
behalf of the BCV. In particular, it submits that:

(1) Mr Guaidó has been expressly and unequivocally recognised by HMG as

the President of Venezuela, as evidenced by a formal statement provided by the
FCO dated 19 March 2020, in response to a request from the Commercial Court.

(2) In that capacity Mr Guaidó has appointed the Guaidó Board as an ad hoc
board of the BCV and has also appointed a Special Attorney General.

(3) These appointments by Mr Guaidó were executive acts undertaken in the

exercise of sovereign authority by the person formally recognised by HMG as
the President of Venezuela, which acts courts in this jurisdiction are bound to
treat as valid and effective under the foreign act of state doctrine, subject only
to a public policy exception which has no application in this case.

60. The Maduro Board responds that the meaning of the executive statement was
clear. It is a formal recognition of Mr Guaidó as the person HMG considers entitled to
exercise the powers of interim President of Venezuela, but it does not go further than
that. At the very least, it leaves open the possibility of a continuing express or implied
recognition of Mr Maduro as President. The Maduro Board submits, further, that the
absence of any statement withdrawing recognition from Mr Maduro and the
continued maintenance of diplomatic relations and consular dealings with persons
appointed by Mr Maduro show clearly and unambiguously that HMG continues to
recognise Mr Maduro as in fact exercising the powers of President of Venezuela. In
reliance on Bank of Ethiopia v National Bank of Egypt [1937] Ch 513, at p 519 per
Clauson J, and Banco de Bilbao v Sancha [1938] 2 KB 176, at pp 195-196 per Clauson LJ,
it submits that such de facto recognition “trumps” de jure recognition and effect
should therefore be given to the acts of the de facto President. Further or
alternatively, the Maduro Board says that, even if the courts were to decide that there
was an absence of any relevant express or implied de facto recognition of Mr Maduro,
the court would then need to decide who in fact exercises the powers of President.
However, it accepts that these further points would have to await remission of the

Page 15
case to the Commercial Court because of what it maintains is the unsatisfactory way in
which the preliminary issues were drawn.

61. At first instance, Teare J held that the executive statement amounted to an
unequivocal express recognition of Mr Guaidó as the constitutional interim President
of Venezuela by which the court was bound under the one voice principle. He further
held that the challenges by the Maduro Board to the appointment by Mr Guaidó of the
Guaidó Board and the Special Attorney General were therefore barred by the foreign
act of state doctrine.

62. The Court of Appeal held that while Mr Guaidó had been recognised by HMG as
the de jure President of Venezuela, that had left open the possibility that HMG may
impliedly recognise Mr Maduro as the de facto President. Accordingly, it considered
that it was appropriate for a further question or questions to be posed to the FCDO
and for proceedings to be remitted to the Commercial Court for further consideration.

Recognition of states and governments in international law

63. Recognition of a foreign state or government is a political act by the state

granting recognition which has legal consequences on both the international and
municipal planes.

“The grant of recognition is an act on the international plane,

affecting the mutual rights and obligations of states, and
their status or legal capacity in general. Recognition also has
consequences at the national level, as where the application
of rules of municipal law is affected by a decision to recognise
a new state or government.” (Sir Robert Jennings and Sir
Arthur Watts (eds), Oppenheim’s International Law, 9th ed
(1992), p 128)

Recognition of a state must be distinguished from recognition of a government.

Recognition of a state is an acknowledgement that the entity concerned has attained
the status of statehood. In the present case, no question arises as to the continuing
existence of Venezuela as a state. Rather, these proceedings concern the recognition
of an individual as head of state of Venezuela which, as the Foreign Secretary
expresses it in his written case, “signifies the recognising state’s willingness to deal
with that individual as representing the state concerned on the international plane”.

Page 16
FCDO practice in recognition

64. The recognition of foreign states, governments and heads of state is, under the
constitutional arrangements in force within the United Kingdom, one element of the
conduct of foreign relations which is entrusted to the executive and which is
performed in large part pursuant to the royal prerogative.

65. The practice of the FCDO in relation to the recognition of foreign governments
has changed over the years. Prior to 1980 it was the long-standing practice of HMG to
make and announce decisions formally recognising a new government following an
unconstitutional regime change. Recognition would be granted if specific criteria were
met. In an answer to a question in the House of Commons on 21 March 1951 the
Secretary of State for Foreign Affairs, Mr Herbert Morrison, stated:

“The question of the recognition of a state or government

should be distinguished from the question of entering into
diplomatic relations with it, which is entirely discretionary.
On the other hand, it is international law which defines the
conditions under which a government should be recognised
de jure or de facto, and it is a matter of judgment in each
particular case whether a régime fulfils the conditions. The
conditions under international law for the recognition of a
new régime as the de facto government of a state are that
the new régime has in fact effective control over most of the
state’s territory and that this control seems likely to
continue. The conditions for the recognition of a new régime
as the de jure government of a state are that the new régime
should not merely have effective control over most of the
state’s territory, but that it should, in fact, be firmly
established. His Majesty’s Government consider that
recognition should be accorded when the conditions
specified by international law are, in fact, fulfilled and that
recognition should not be given when these conditions are
not fulfilled. The recognition of a government de jure or de
facto should not depend on whether, the character of the
régime is such as to command His Majesty’s Government’s
approval.” (Hansard (HC Debates), 21 March 1951, vol 485,
cols 2410-2411)

Page 17
66. Following a review of that practice, on 28 April 1980, the Secretary of State for
Foreign and Commonwealth Affairs, Lord Carrington, stated in a written answer in the
House of Lords:

“… we have conducted a re-examination of British policy and

practice concerning the recognition of governments. This has
included a comparison with the practice of our partners and
allies. On the basis of this review we have decided that we
shall no longer accord recognition to governments. The
British Government recognise states in accordance with
common international doctrine.

Where an unconstitutional change of régime takes place in a

recognised state, governments of other states must
necessarily consider what dealings, if any, they should have
with the new régime, and whether and to what extent it
qualifies to be treated as the government of the state
concerned. Many of our partners and allies take the position
that they do not recognise governments and that therefore
no question of recognition arises in such cases. By contrast,
the policy of successive British Governments has been that
we should make and announce a decision formally
‘recognising’ the new government.

This practice has sometimes been misunderstood, and,

despite explanations to the contrary, our ‘recognition’
interpreted as implying approval. For example, in
circumstances where there might be legitimate public
concern about the violation of human rights by the new
régime, or the manner in which it achieved power, it has not
sufficed to say that an announcement of ‘recognition’ is
simply a neutral formality.

We have therefore concluded that there are practical

advantages in following the policy of many other countries in
not according recognition to governments. Like them, we
shall continue to decide the nature of our dealings with
regimes which come to power unconstitutionally in the light
of our assessment of whether they are able of themselves to
exercise effective control of the territory of the state

Page 18
 concerned, and seem likely to continue to do so.” (Hansard
(HL Debates), 28 April 1980, vol 408, cols 1121-1122)

67. On 23 May 1980, in answer to a question as to how in future, for the purposes
of legal proceedings, it may be ascertained whether, on a particular date, HMG
regarded a new regime as the government of the state concerned, the Lord Privy Seal,
Sir Ian Gilmour replied:

“In future cases where a new régime comes to power

unconstitutionally our attitude on the question whether it
qualifies to be treated as a government will be left to be
inferred from the nature of the dealings, if any, which we
may have with it, and in particular on whether we are dealing
with it on a normal government to government basis.”
(Hansard (HC Debates), 23 May 1980, vol 985, col 385W)

68. Notwithstanding this announced policy, there have been occasions since 1980
on which HMG has, exceptionally, recognised or formally declined to recognise a
foreign government where it considers it appropriate to do so. Nor has the policy
prevented HMG from informing the courts of such recognition. In Kuwait Airways
Corpn v Iraqi Airways (Nos 4 and 5) [2002] UKHL 19; [2002] 2 AC 883, paras 349-350,
the Court of Appeal made clear that, despite the 1980 statement, there is nothing to
prevent HMG, if it thinks it appropriate, from tendering to the courts an unequivocal
certificate of recognition or non-recognition of the existence of a foreign government.
In that case the United Kingdom was under a positive obligation under UN resolutions
not to recognise any regime other than the legitimate government of Kuwait. More
recently, on 27 July 2011, HMG withdrew recognition from the Government of Libya
led by Muammar Muhammad al-Qadhafi and recognised the National Transitional
Council of the State of Libya as the “sole governmental authority in Libya” (British Arab
Commercial Bank plc v National Transitional Council of the State of Libya [2011] EWHC
2274 (Comm), paras 1-6). On those occasions when HMG does issue a formal
statement of recognition or non-recognition of a foreign government, the certificate
will be taken by the court as conclusive. (Veysi Dag v Secretary of State for the Home
Department (2001) 122 ILR 529, paras 17, 18; British Arab Commercial Bank plc v
National Transitional Council of the State of Libya, para 25 per Blair J. See also R (HRH
Sultan of Pahang) v Secretary of State for the Home Department [2011] EWCA Civ 616,
paras 14, 30.)

Page 19
Recognition and the courts

69. As the conduct of foreign relations is entrusted to the executive branch of

government, this is a field where the judiciary must normally defer to the executive
which alone is competent to determine foreign policy. This is embodied in the “one
voice principle” which finds its classic formulation in the speech of Lord Atkin in The
Government of the Republic of Spain v SS “Arantzazu Mendi” [1939] AC 256, 264:

“Our state cannot speak with two voices on such a matter,

the judiciary saying one thing, the executive another. Our
Sovereign has to decide whom he will recognise as a fellow
sovereign in the family of states: and the relations of the
foreign state with ours in the matter of state immunities
must flow from that decision alone.”

As a result, courts in this jurisdiction accept as conclusive statements made by the

executive relating to certain questions of fact in the field of international affairs. These
questions include the sovereign status of a state or government and whether an
individual is to be regarded as a head of state (Mighell v Sultan of Johore [1894] 1 QB
149; Carr v Fracis Times & Co [1902] AC 176).

70. While the existence of the one voice principle is today not open to question, it
has taken a long time to coalesce as an established rule. Its origins can be traced at
least as far back as the early 19th century. (See, generally, Lyons, “The Conclusiveness
of the Foreign Office Certificate” (1946) 23 BYIL 240; Parry, A British Digest of
International Law, (1965), Part VII, pp 186-216.) Although some indication of a
willingness on the part of the judiciary to be guided by the executive can be detected
in the judgment of Lord Mansfield in Heathfield v Chilton (1767) 4 Burr 2016,
concerning entitlement to diplomatic immunity, the need for an identity of view
between the branches of government becomes more apparent in several judgments of
Lord Eldon early in the next century where he stated that the courts could not take
notice of a foreign government not recognised by the Government. The first of these
cases arose out of the Swiss Revolution (City of Berne v Bank of England (1804) 9 Ves
Jun 347; Dolder v The Bank of England (1805) 10 Ves Jun 352; Dolder v Lord
Huntingfield (1805) 11 Ves Jun 283). Later cases arose out of the revolt of the Central
and South American colonies against Spain in the 1820s (Jones v Garcia del Rio (1823)
Turn & R 297; Thomson v Byree, The Times, 29 May 1824; In re Colombian Bonds, The
Times, 21 January 1823; In re Government of Peru, The Times, 13 February 1823: “I
know of no government but such as is acknowledged by my Sovereign”. See also Kinder
v Everett, The Times, 22 December 1823 (Abbott CJ); Thompson v Powles (1828) 2 Sim
194 (Shadwell VC).) In Taylor v Barclay (1828) 2 Sim 213, the first reported case in
Page 20
which the court itself applied to the Foreign Office for an executive statement,
Shadwell VC stated (at p 220) that he was “authorised to state that the Federal
Republic of Central America has not been recognised as an independent government
by the Government of this country” and he therefore disregarded the averment of the
plaintiff that the Republic had been recognised.

71. The conclusive nature of the executive certificate seems, however, to have been
a later development. In the early cases cited above, the question appears to have been
treated as a question of evidence. Similarly, in The Charkieh (1873) LR 4 A & E 59 Sir
Robert Phillimore seems to have concluded on the basis of his own researches that the
Khedive of Egypt was not a sovereign prince, but he also communicated, as an
afterthought, with the Foreign Office whose statement supported his conclusion (Parry
(para 70 above), pp 203-204). In Mighell v Sultan of Johore (at p 158), however, where
the issue once again was whether the defendant was an independent sovereign
power, a different view was taken. It was submitted that the judge ought not to have
been satisfied with the letter on behalf of the Secretary of State for the Colonies
stating that Johore was an independent state and that the defendant was the present
sovereign ruler, but should have informed himself from historical and other sources as
to the status of the Sultan. Lord Esher MR responded (at p 158):

“It was said that Sir Robert Phillimore did so in the case of
The Charkieh. I know he did; but I am of opinion that he
ought not to have done so; that, when once there is the
authoritative certificate of the Queen through her minister of
state as to the status of another sovereign, that in the courts
of this country is decisive. Therefore this letter is conclusive
that the defendant is an independent sovereign.”

Similarly, Kay LJ observed (at pp 161-162):

“It was contended that that letter was not sufficient, and did
not satisfactorily establish the status of the defendant as an
independent sovereign. I confess I cannot conceive a more
satisfactory mode of obtaining information on the subject
than such a letter. Proceeding as it does from the office of
one of the principal secretaries of state, and purporting to be
written by his direction, I think it must be treated as
equivalent to a statement by Her Majesty herself, and, if Her
Majesty condescends to state to one of her courts of justice,
that an individual cited before it is an independent sovereign,
I think that statement must be taken as conclusive.”
Page 21
In an earlier passage in his judgment, however, Kay LJ had observed that the status of a
foreign sovereign is a matter of which the courts take judicial cognisance, “a matter
which the court is either assumed to know or to have the means of discovering,
without a contentious inquiry” (at p 161).

72. In In re Suarez [1918] 1 Ch 176 the Court of Appeal held that the defendant had
ceased at the relevant time to be the Bolivian Minister, on the basis of a letter to that
effect from the Foreign Office to the plaintiff’s solicitors. However, once again the
reasoning differed. Warrington LJ referred (at p 195) to the letter as “sufficient
evidence”, while Scrutton LJ referred (at p 199) to “the Foreign Office through whom
this court obtains conclusive information as to the status of foreign dignitaries”.

73. In The Gagara the Esthonian National Council applied to set aside proceedings
on the ground that it was a sovereign power. The Attorney General appeared in court
on behalf of the Foreign Office and stated that HMG had provisionally recognised the
Esthonian Government. At first instance (1919) 35 TLR 243 Hill J considered himself
bound to recognise the sovereign rights of the Esthonian Government because HMG
did so. On appeal [1919] P 95 the Court of Appeal considered itself bound to decline
jurisdiction lest there should be “a divergence of action as between the courts of this
country and the statements that have been made by the Government of the country as
to the attitude which this country was prepared to take” (per Bankes LJ at p 104).

74. Aksionernoye Obschestvo AM Luther v James Sagor & Co (“Luther v Sagor”)

concerned title to movable property which had been expropriated by the Soviet
Government in Russia and which had subsequently been brought to England. At first
instance [1921] 1 KB 456, Roche J received statements from the Foreign Office as to
the status of the Soviet Government which he described as “guarded”. He concluded
that he could not be satisfied that HMG had recognised the Soviet Government. “I
therefore am unable to recognize it, or to hold it has sovereignty, or is able by decree
to deprive the plaintiff company of its property” (at pp 477-478). On appeal [1921] 3
KB 532 a further Foreign Office certificate was produced stating that HMG now
recognised the Soviet Government as the de facto government of Russia. Warrington
LJ (at p 548) considered this “clearly conclusive as to the status of the Soviet
Government”. Similarly, Scrutton LJ stated (at p 556) that “the courts in questions
whether a particular person or institution is a sovereign must be guided only by the
statement of the sovereign on whose behalf they exercise jurisdiction”. In his view the
court was bound to hold that the acts of expropriation and sale were acts of a
sovereign state.

75. The one voice principle was considered and affirmed by the House of Lords in
Duff Development Co Ltd v Government of Kelantan [1924] AC 797. The appellant
Page 22
obtained an order in the High Court giving leave to enforce an arbitration award it had
secured against the Government of Kelantan. The Government of Kelantan applied to
set the order aside on the ground that it was a sovereign independent state. The
Master in the King’s Bench Division asked the Secretary of State for the Colonies to
provide information as to the status of Kelantan and received in reply an official letter
stating that Kelantan was an independent state, that its Sultan was the sovereign ruler
and that the King did not exercise or claim any rights of sovereignty over Kelantan.
Documents enclosed with the reply showed that Kelantan had formerly been
recognised as a dependency of Siam, that the Siamese Government had by a treaty
transferred to the British Government all its rights over Kelantan and that by an
agreement of 1910 the Rajah (subsequently styled the Sultan) of Kelantan had engaged
to have no political relations with any foreign power except through the medium of His
Majesty the King of England and to follow in all matters of administration (save those
touching the Mohammedan religion and Malay custom) the advice of an adviser
appointed by His Majesty.

76. While their Lordships agreed on the existence of a principle that the executive
and the judiciary should speak with one voice on the status of Kelantan and its Sultan,
it was described in widely varying terms. Viscount Cave, Viscount Finlay and Lord
Carson seem to have been in substantial agreement as to the basis of the principle.

“First, it was argued that the Government of Kelantan was

not an independent sovereign state, so as to be entitled by
international law to the immunity against legal process which
was defined in The Parlement Belge. It has for some time
been the practice of our courts, when such a question is
raised, to take judicial notice of the sovereignty of a state,
and for that purpose (in any case of uncertainty) to seek
information from a Secretary of State; and when information
is so obtained the court does not permit it to be questioned
by the parties.” (Per Viscount Cave at pp 805-806)

“It is settled law that it is for the court to take judicial

cognizance of the status of any foreign government. If there
can be any doubt on the matter the practice is for the court
to receive information from the appropriate department of
His Majesty’s government, and the information so received is
conclusive. … There are a great many matters of which the
court is bound to take judicial cognizance, and among them
are all questions as to the status and boundaries of foreign
powers. In all matters of which the court takes judicial

Page 23
 cognizance the court may have recourse to any proper source
of information. It has long been settled that on any question
of the status of any foreign power the proper course is that
the court should apply to His Majesty’s Government, and that
in any such matter it is bound to act on the information given
to them through the proper department. Such information is
not in the nature of evidence; it is a statement by the
Sovereign of this country through one of his ministers upon a
matter which is peculiarly within his cognizance.” (Per
Viscount Finlay at p 813)

“… I agree with your Lordships that the courts of this country

are bound to take judicial notice of the status of any other
country in accordance with the information afforded to them
by the proper representative of the Crown. … Indeed, it is
difficult to see in what other way such a question could be
decided without creating chaos and confusion, …” (Per Lord
Carson at p 830)

Lord Dunedin considered that the source of the principle was in international comity.

“If our sovereign recognizes and expresses the recognition

through the mouth of his minister that another person is a
sovereign, how could it be right for the courts of our own
sovereign to proceed upon an examination of that person’s
supposed attributes to examine his claim and, refusing that
claim, to deny to him the comity which their own sovereign
had conceded?” (Per Lord Dunedin at p 820)

Lord Sumner, however, found the source of the principle in the best evidence rule.

“The status of foreign communities and the identity of the

high personages who are the chiefs of foreign states, are
matters of which the courts of this country take judicial
notice. Instead of requiring proof to be furnished on these
subjects by the litigants, they act on their own knowledge or,
if necessary, obtain the requisite information for themselves.
I take it that in so doing the courts are bound, as they would
be on any other issue of fact raised before them, to act on
the best evidence and, if the question is whether some new
Page 24
 state or some older state, whose sovereignty is not
notorious, is a sovereign state or not, the best evidence is a
statement, which the Crown condescends to permit the
appropriate Secretary of State to give on its behalf. It is the
prerogative of the Crown to recognize or to withhold
recognition from states or chiefs of states, and to determine
from time to time the status with which foreign powers are
to be deemed to be invested. This being so, a foreign ruler,
whom the Crown recognizes as a sovereign, is such a
sovereign for the purposes of an English court of law, and the
best evidence of such recognition is the statement duly made
with regard to it in His Majesty’s name. Accordingly where
such a statement is forthcoming no other evidence is
admissible or needed. I think this is the real judicial
explanation why it was held that the Sultan of Johore was a
foreign sovereign. In considering the answer given by the
Secretary of State, it was not the business of the court to
inquire whether the Colonial Office rightly concluded that the
Sultan was entitled to be recognized as a sovereign by
international law. All it had to do was to examine the
communication in order to see if the meaning of it really was
the Sultan had been and was recognized as a sovereign.

I conceive that, if the Crown declined to answer the inquiry,

as in changing and difficult times policy might require it to do,
the court might be entitled to accept secondary evidence in
default of the best, …” (Lord Sumner at pp 823-825)

77. Lord Sumner’s view of the principle as one of evidence and of an executive
certificate as the best evidence available to the court has not found favour. In Duff
Development itself, Viscount Finlay expressly rejected the suggestion (at p 813 cited at
para 75 above). In The Arantzazu Mendi [1939] AV 256, 264 Lord Atkin rejected “the
opinion implied in the speech of Lord Sumner … that recourse to His Majesty’s
Government is only one way in which the judge can ascertain the relevant fact”. In
Lord Atkin’s view it was for the domestic sovereign to decide whom he will recognise
and questions of status before the courts necessarily flowed from that decision alone.

78. I consider that the most satisfactory explanation of the one voice principle lies
in the view that certain matters are facts of state in the sense that they are peculiarly
Page 25
within the cognisance of the executive which has the conduct of foreign relations.
Where, as here, the issue is recognition of a foreign head of state, what matters is the
attitude of the executive, of which the executive statement can be the only
authoritative source and which should therefore be treated as conclusive. This is a
point made by Viscount Finlay in Duff Development (at p 813, cited above) and taken
up by Professor Clive Parry in A British Digest of International Law, (para 70 above), pp
215-216:

“it is clear that the executive certificate commonly relates to

the question whether or not the Crown has done a particular
act or adopts or has adopted a particular attitude: whether,
for instance, the Crown has or has not recognised a foreign
state or government, or has declared war, or has claimed or
claims jurisdiction or territorial sovereignty with respect to a
given place. Where such a matter is in question, the
statement of the Crown, in the form of the executive
certificate, would seem to be necessarily conclusive. In such a
case the matter is indeed ‘peculiarly within [the] cognizance’
of the Crown, as Lord Finlay expressed it in Duff Development
Co v Government of Kelantan. In such a case also the
certificate itself, or its equivalent, may constitute the very act
of the Crown which is certified, as for instance in The
Fagernes [1927] P 311 …, where the Crown’s disclaimer of
jurisdiction over a place in the middle of the Bristol Channel
was made by the Attorney General in open court …, or in
Duff’s case … where the Attorney General maintained in
argument that the Colonial Office’s statement in relation to
the status of Kelantan ‘amounted to a recognition’. And cases
where the certificate has been refused or appears
ambiguous, or where it has not been considered to be
conclusive, may be found upon analysis to be generally cases
where the question put has related to something other than
an act of the Crown itself, which is not ‘peculiarly within [its]
cognizance’.”

79. In the United Kingdom it is for the executive to decide with which entities or
persons it will have relations on the international plane. Where the executive makes an
express statement of recognition of a government or head of state the courts will
speak with the same voice, in accordance with the one voice principle.

Page 26
Express and implied recognition

80. On the plane of international law recognition of states and governments may be
express or implied. (See, generally, J Crawford, Brownlie’s Principles of Public
International Law, 9th ed (2019), p 139; Oppenheim, pp 169ff; H Lauterpacht,
Recognition in International Law, (1947), pp 370ff, 406.) Implied recognition will
depend on the existence of a subjective intention to recognise.

“Recognition is primarily and essentially a matter of

intention. Intention cannot be replaced by questionable
inferences from conduct.” (H Lauterpacht, above, p 371)

81. On the municipal plane, the adoption by the FCO of its new policy on
recognition of governments in 1980 created a potential problem for courts in the
United Kingdom. Hitherto, when asked to take cognisance of the acts of an entity or
person claiming to be a government or a head of state, the courts had followed the
one voice principle and had deferred to the view of the executive. (See, generally, D P
O’Connell, International Law, 2nd ed (1970), Chapter 6.) The 1980 policy statement
announced, however, that the executive would no longer accord recognition to
governments. In future, the voice of the executive would be silent on such issues. As
we have seen, this prompted a question in the House of Commons as to how
thereafter the attitude of HMG towards a foreign regime might be ascertained for the
purposes of legal proceedings which led to an answer from the Lord Privy Seal that the
attitude of HMG would be left to be inferred from the nature of the dealings, if any,
which HMG may have with it, and in particular on whether it was dealing with the
foreign regime on a normal government to government basis (see para 67 above).

82. In the light of these statements, a number of academic writers suggested,

perhaps understandably given the terms of the answer, that the courts should
continue to seek to ascertain whether Her Majesty’s Government had recognised a
foreign entity as a government as a matter of inference from the dealings HMG had
with it. (See, for example, J Crawford, “Decisions of British courts during 1985-1986
involving questions of public international law” (1986) 57 BYIL 405; Brownlie,
“Recognition in Theory and Practice” (1982) 53 BYIL 197, p 209; cf F A Mann, Foreign
Affairs in English Courts (1986), pp 42ff; Warbrick, “The New British Policy on
Recognition of Governments” (1981) 30 ICLQ 568.) This approach was, however,
rejected by Hobhouse J in Republic of Somalia v Woodhouse Drake & Carey (Suisse) SA
[1993] QB 54. In his view the impracticability of the “inferred recognition” theory as a
legal concept for forensic use was obvious and it could not be thought that that was
the intention of the Government in giving the Parliamentary answers. The use of the
phrase “left to be inferred” was designed to fulfil a need for information in an
Page 27
international or political, not a judicial context. Hobhouse J then went on to identify (at
p 68) the factors by reference to which a court should decide not whether a
government is recognised but rather whether it exists as the government of a state.
Similarly, in Kuwait Airways Corpn v Iraqi Airways Co (No 5) [1999] CLC 31 Mance J
concluded (at p 65) that “the government did not intend in 1980 to replace clear
statements of binding intention with coded language from which courts would then
struggle invidiously to derive an inferred intention”.

De jure and de facto recognition

83. It is necessary to say something about a further distinction, namely that

between recognition of a government as the government de jure and recognition of a
government as the government de facto. This distinction, to which no reference is
made in the executive statements in the present case, has undoubtedly complicated
the present proceedings and was central to the approach adopted by the Court of
Appeal.

84. Great caution is necessary in employing these concepts as they are not precise
terms of art and their meaning may vary according to context. Judge Crawford
expresses the matter as follows:

“General propositions about the distinction are to be

distrusted: everything depends on the intention of the
government concerned and the general context of fact and
law. On the international plane, a statement that a
government is recognized as the ‘de facto’ government of a
state may involve a purely political judgement, involving a
reluctant or cautious acceptance of an effective government,
lawfully established in terms of international law and not
imposed from without, or an unwarranted acceptance of an
unqualified agency. On the other hand, the statement may
be intended as a determination of the existence of an
effective government, but with reservations as to its
permanence and viability.” (J Crawford, Brownlie’s Principles
of Public International Law, p 143)

Professor Talmon identifies six different senses in which states and scholars have used
the term “de facto government”.

Page 28
 “Thus, the term de facto government has been used to
describe (1) an effective government, ie a government
wielding effective control over people and territory, (2) an
unconstitutional government, (3) a government fulfilling
some but not all the conditions of a government in
international law, (4) a partially successful government, ie a
belligerent community or a military occupant, (5) a
government without sovereign authority, and (6) an illegal
government under international law.” (Talmon, Recognition
of Governments in International Law: With Particular
Reference to Governments in Exile (1998), p 60)

85. In the present proceedings the Court of Appeal distinguished between two
different uses of the terminology. The first, which it referred to as “the Luther v Sagor
sense” is taken from the observation of Warrington LJ in Luther v Sagor (at p 551) that:

“a de jure government in international law means ‘one

which, in the opinion of the person using the phrase, ought
to possess the powers of sovereignty, though at the time it
may be deprived of them’; while a de facto government is
one which is ‘really in possession of them, although the
possession may be wrongful or precarious’.”

The second, which it referred to as “the Oppenheim sense” is derived from the 1951
statement on recognition by the then Foreign Secretary, set out at para 65 above. The
conditions for recognition of a new regime as the de facto government are that it has
in fact effective control over most of the state’s territory and that this control seems
likely to continue. The condition for recognition of a new regime as the de jure
government are that it should not merely have effective control over most of the
state’s territory but that it should be firmly established. Support for the use of the
distinction in this sense is provided by Oppenheim (see para 63 above) (at pp 154-155):

“States granting recognition often distinguish between de

jure recognition and de facto recognition. These terms are
convenient but elliptical: the terms de jure or de facto qualify
the state or government recognised rather than the act of
recognition itself. Those terms are in this context probably
not capable of literal analysis, particularly in terms of the ius
to which recognition de jure refers. The distinction between
de jure and de facto recognition is in essence that the former
is the fullest kind of recognition while the latter is a lesser
Page 29
 degree of recognition, taking account on a provisional basis
of present realities. Thus de facto recognition takes place
when, in the view of the recognising state, the new authority,
although actually independent and wielding effective power
in the territory under its control has not acquired sufficient
stability or does not yet offer prospects of complying with
other requirements of recognition.”

86. The Foreign Secretary’s written case makes the following submissions in relation
to de jure and de facto recognition.

(1) In modern times, and certainly by the time of the 1980 policy, the terms
de jure and de facto were no longer in wide usage. The more recent practice of
HMG has been to accord recognition without using these terms at all.

(2) When a distinction of this kind is sought to be drawn, and no doubt

reflecting the rarity of doing so in modern practice, the relevant terms are
expressly used by the recognising state. Where no such term is used in a formal
announcement, the assumption is that “recognition” refers to full recognition.

(3) As a matter of international law, in general terms, de jure is full

recognition whereas de facto is lesser recognition. This is reflected in early UK
practice where de facto recognition preceded fuller de jure recognition, eg
Soviet Government (de facto 1921; de jure 1924); Spanish Nationalist
Government (de facto 1937; de jure 1939); PRC Government (de facto 1949; de
jure 1950). It is also consistent with Lord Wilberforce’s comment in Carl Zeiss
Stiftung v Rayner & Keeler Ltd (No 2) [1967] 1 AC 853, p 957 that:

“De jure recognition in all cases but one is the fullest

recognition which can be given: the one exception is the case
where there is concurrently some other body de facto
exercising a rival authority to that of the ‘de jure’ sovereign
(as in the case of Banco de Bilbao v Sancha).”

(4) The Foreign Secretary also objects to the use of the terms in the Luther v
Sagor sense as “not an ordinary or correct use of this term”. Nevertheless, he
accepts that several cases have adopted “this alternative, lesser meaning”,
referring to Bank of Ethiopia v National Bank of Egypt [1937] Ch 513 and Banco
de Bilbao v Sancha [1938] 2 KB 176. He submits that its application is limited to

Page 30
 the specific and unusual situation where HMG chooses to recognise rival
governments and he states that HMG has no modern practice of dual
recognition of rival governments of the kind at issue in those cases.

Application of the principles to this case

87. Before Teare J and the Court of Appeal there were two executive statements.
The statement by the Rt Hon Jeremy Hunt MP dated 4 February 2019 (“the Hunt
statement”) is set out at para 16 above. It is incorporated in the letter from Mr Hugo
Shorter dated 19 March 2020 (“the Shorter letter”) which is set out at para 43 above. I
refer to them together as “the certificate”.

88. Teare J concluded ([2021] QB 455, para 42) on the basis of the certificate that
HMG recognises Mr Guaidó in the capacity of the constitutional interim President of
Venezuela and does not recognise Mr Maduro as the constitutional interim President
of Venezuela.

89. In the Court of Appeal Males LJ, with whom Phillips and Lewison LJJ agreed,
referred in detail to express and implied recognition, de jure and de facto recognition
and the one voice principle. He considered that there was no doubt that the certificate
meant at least that HMG recognises Mr Guaidó as the person entitled to be the head
of state of Venezuela and thus as head of state de jure in the Luther v Sagor sense.
However, in his view this left open the question whether HMG continues to recognise
Mr Maduro as President de facto (at paras 121-122). In the view of Males LJ, the Hunt
statement was not saying that Mr Guaidó was exercising effective control over the
territory of Venezuela and that such control was firmly established ie he was not
recognising Mr Guaidó as President de jure in the Oppenheim sense, so as to leave no
room for the possibility of continuing to recognise Mr Maduro as President de facto.
The Hunt statement might have said in terms that HMG did not recognise Mr Maduro
in any capacity, but it did not. When its language was viewed in context, it was
ambiguous or at any rate less than unequivocal. He continued (at para 123):

“That context includes:

(1) the pre-existing recognition of Mr Maduro as

President of Venezuela in the fullest sense, or perhaps more
accurately, HMG’s unequivocal dealings with him as head of
state;

Page 31
 (2) the acknowledgement in the statement that the
Maduro regime continues to exercise substantial, albeit
‘illegitimate’, control over the people of Venezuela;

(3) the continued maintenance of diplomatic relations

with the Maduro regime, including through an ambassador
accredited to Mr Maduro as President of Venezuela;

(4) the fact that HMG has declined to accord diplomatic

status to Mr Guaidó’s representative in London; and

(5) the established existence of a distinction between

recognition de jure (ie that a person is entitled to a particular
status) and de facto (ie that he does in fact exercise the
powers that go with that status).”

Accordingly, in his view the certificate left open the possibility that HMG continues to
recognise Mr Maduro as President de facto. That was best determined by posing
further questions of the FCDO and the matter was remitted to the Commercial Court
for that purpose.

90. I consider that the approach of the Court of Appeal was erroneous in a number
of respects.

91. The starting point is that it is for HMG to decide with which entities or
individuals it will have dealings in the conduct of foreign relations. While its usual
practice under the 1980 policy statement is not to recognise foreign governments or
heads of state, it reserves the right to do so where it considers it appropriate to do so
in all the circumstances. In the present case it took that exceptional course and the
certificate drew attention to this fact. It is the duty of the receiving court to interpret
and to give effect to such a certificate in accordance with the one voice principle. What
matters here is the subjective intention of the executive as disclosed by the certificate.

“The practice of obtaining the Executive’s certificate and the

rationale supporting it cannot be justified, unless the courts
take every possible step to ensure that their interpretation of
the certificate accords with the Executive’s intentions.” (F A
Mann, Foreign Affairs in English Courts (1986), p 57)

Page 32
92. First, I consider that the Court of Appeal erred in concluding that the language
of the certificate was ambiguous or less than unequivocal. It is necessary to seek to
ascertain the intention of HMG from the words used in the certificate in the light of the
request to which it responds. Here the letter dated 14 February 2020 from Robin
Knowles J to the Foreign Secretary expressly asked who is recognised by HMG as the
head of state of Venezuela and who is recognised by HMG as head of government of
Venezuela. The answer was unequivocal. It referred to and set out the Hunt statement:

“The United Kingdom now recognises Juan Guaidó as the

constitutional interim President of Venezuela, until credible
presidential elections can be held.”

It said nothing about the recognition of Mr Maduro. There was no need for it to do so.
The certificate was a clear and unequivocal recognition of Mr Guaidó as President of
Venezuela. This recognition necessarily entailed that Mr Maduro was not recognised as
President of Venezuela.

93. Secondly, the Court of Appeal erred in interpreting the certificate by reference
to extrinsic evidence and in permitting that extrinsic evidence to found an argument
that the certificate was ambiguous when no ambiguity was apparent on the face of the
certificate. In its judgment ([2021] QB 455, para 123, set out above at para 89) the
Court of Appeal referred to five extraneous factors which were clearly influential in its
reasoning. These included the dealings of HMG with Mr Maduro prior to the
recognition of Mr Guaidó, diplomatic relations with the Maduro regime and the
absence of accreditation of Mr Guaidó’s representative in London. It was not
appropriate for the Court of Appeal to look beyond the terms of the certificate in this
way. I agree with the submission on behalf of the Foreign Secretary that an
interpretative approach which has regard to HMG’s wider conduct is capable of
undermining the very purpose of a certificate and the constitutional allocation of
functions which is reflected in the one voice principle. The dealings which HMG may
have had or may continue to have with different persons or entities within Venezuela
are irrelevant to the question of recognition which turns on the intention of HMG as
stated in the executive certificate. The matter was stated by Lord Reid in Carl Zeiss in
the following terms ([1967] 1 AC 853, 901E):

“It is a firmly established principle that the question whether

a foreign state ruler or government is or is not sovereign is
one on which our courts accept as conclusive information
provided by Her Majesty’s Government: no evidence is
admissible to contradict that information.”

Page 33
(See also at p 925C-D per Lord Hodson, at p 941B-D per Lord Upjohn; at p 957F-G per
Lord Wilberforce; Gur Corpn v Trust Bank of Africa Ltd [1987] QB 599, 623A-B per Sir
John Donaldson MR; 625F-G per Nourse LJ.)

94. A striking example is provided by Duff Development where it was argued on

behalf of the appellant that the statement in the letter of the Secretary of State for the
Colonies must be held to be qualified by the terms of the documents enclosed with it
and that, taking the information as a whole, the true result was that Kelantan was not
an independent but a dependent state and that accordingly the Sultan was not
immune from process in the English courts. This submission was unanimously rejected
by the House of Lords, notwithstanding the contents of the documents enclosed with
the certificate. Viscount Cave stated ([1924] AC 797, 808-809):

“In the present case the reply of the Secretary of State shows
clearly that notwithstanding the engagements entered into
by the Sultan of Kelantan with the British Government that
government continues to recognize the Sultan as a sovereign
and independent ruler, and that His Majesty does not
exercise or claim any rights of sovereignty or jurisdiction over
that country. If after this definite statement a different view
were taken by a British court, an undesirable conflict might
arise; and, in my opinion, it is the duty of the court to accept
the statement of the Secretary of State thus clearly and
positively made as conclusive upon the point.”

Viscount Finlay stated (at pp 814-816):

“In the present case it is obvious that the Sultan of Kelantan

is to a great extent in the hands of His Majesty’s
Government. We were asked to say that it is for the court
and for this House in its judicial capacity to decide whether
these restrictions were such that the Sultan had ceased to be
a sovereign. We have no power to enter into any such
inquiry.

While there are extensive limitations upon its independence,

the enclosed documents do not negative the view that there

Page 34
 is quite enough independence left to support the claim to
sovereignty. But, as I have said, the question is not for us at
all; it has been determined for us by His Majesty’s
Government, which in such matters is the appropriate
authority by whose opinion the courts of His Majesty are
bound to abide.”

Similarly, Lord Carson (at p 830) expressed the view that if it was open to him to
disregard the statements contained in the letter from the Secretary of State, he “would
find great difficulty in coming to that conclusion of fact, having regard to the terms of
the documents enclosed in the letter”. However, he considered that the courts were
bound to decide the issue in accordance with the evidence provided by the Crown.

95. In this regard it is necessary to say something about the recent decision of the
Court of Appeal in Mohamed v Breish [2020] EWCA Civ 637 which appears to have
influenced the approach of the Court of Appeal in the present case (see Males LJ at
para 75). The litigation arose out of competing claims by the appointees of rival
governments in Libya to control the assets of the Libyan Investment Authority in this
jurisdiction. Two formal letters were issued by the FCO for use in the litigation. In the
first letter the FCO stated that HMG supported the Government of National Accord
(“GNA”) and the Presidency Council as the legitimate executive authorities of Libya. In
the second it stated that it continued to recognise those appointed by the GNA. These
letters did not use the word “recognise” in relation to the GNA itself. Popplewell LJ,
delivering the judgment of the Court of Appeal considered (at paras 30-39) that the
question whether there had or had not been an unequivocal recognition fell to be
determined from the terms of the two FCO letters and the public stance HMG had
taken in its statements and conduct, including the fact that “HMG has full diplomatic
relations with representatives of the GNA and has maintained them throughout the
relevant period” (para 38). On this basis, the Court of Appeal concluded (at paras 39)
that there was “no room for any doubt that HMG has recognised the GNA as the
executive arm of government with sole oversight of executive functions”. (By contrast,
the Foreign Secretary has maintained in the present proceedings that Breish was not a
case in which HMG deliberately departed from the 1980 policy.)

96. On its face, the resort by the Court of Appeal in Breish to such extraneous
materials is inconsistent with the one voice principle. The Guaidó Board submits,
however, that this is not the case because the Court of Appeal in Breish was not
concerned with the meaning of a certificate but with the logically prior question as to
the status of the letters ie whether HMG had made a statement of recognition which
engaged the one voice principle or merely a statement of political support. But, even if
that is accepted, it leaves a further difficulty. The Court of Appeal seems to have

Page 35
engaged in a process of inferring recognition from the dealings between HMG and the
relevant Libyan entities. For reasons developed below I consider it inappropriate for
courts in this jurisdiction to rely on notions of implied recognition. If the FCDO has
departed from its usual practice by issuing an express statement of recognition, any
ambiguity in the statement should be resolved by a further request to the FCDO for
clarification. In the absence of such an express statement of recognition by HMG, the
issue of recognition does not arise and the courts are left to conduct an inquiry as to
whether the entity in fact carries out the functions of a government in accordance with
Republic of Somalia v Woodhouse Drake & Carey (Suisse) SA.

97. Thirdly, the Court of Appeal erred in introducing the concept of implied de facto
recognition and in addressing the possibility that HMG might recognise Mr Guaidó as
President de jure, while also impliedly recognising Mr Maduro as President de facto.

98. Implied recognition is a concept of international law and its function on the
international plane is widely acknowledged. However, there is no scope for the
application of any notion of implied recognition by courts in this jurisdiction. In the
present case, exceptionally, Her Majesty’s Government departed from its 1980 policy
and made an express statement in relation to the status of a person claiming to be
head of state of Venezuela. That statement must be interpreted and applied by the
courts and is determinative. No question of implied recognition arises. Where there is
no such express statement, Hobhouse J in Republic of Somalia v Woodhouse Drake &
Carey (Suisse) SA and Mance J in Kuwait Airways Corpn v Iraqi Airways Co (No 5) have
demonstrated that it is not open to the courts to infer recognition from the conduct of
HMG. Quite apart from the practical difficulties of doing so, to infer the intention of
HMG in relation to recognition would be to trespass into an area which is
constitutionally within the exclusive competence of the executive. In such
circumstances recognition ceases to be the determinative criterion and the court must
identify who may be the government or head of state by making its own findings of
fact as indicated in Republic of Somalia v Woodhouse Drake & Carey (Suisse) SA.

99. Reliance by the Court of Appeal on the concepts of de jure and de facto
recognition was also misplaced. HMG has on occasions in the past used the terms de
facto and de jure to describe concurrent recognition of two different authorities in
situations where the de facto regime had usurped power against the will of the de jure
sovereign, most notably during Italy’s invasion and occupation of Ethiopia between
1935 and 1939 (Bank of Ethiopia v National Bank of Egypt; Haile Selassie v Cable and
Wireless (No 2) [1939] Ch 182) and during the Spanish Civil War between 1936 and
1939 (Banco de Bilbao v Sancha; The Arantzazu Mendi). The Foreign Secretary has also
drawn attention to periods of concurrent recognition of two governments in Greece in
1916 (Hansard (HC Debates), 14 November 1916, Vol 87, col 551) and in China

Page 36
between 1949 and 1950 (Civil Air Transport Inc v Central Air Transport Corpn [1953] AC
70, 86-89). In all of these instances the terms de jure and de facto were used expressly
by HMG in formal statements of recognition. However, we have been told by the
Foreign Secretary that by the time of the 1980 policy statement the terms de jure and
de facto recognition were no longer in wide usage and that the more recent practice of
HMG, on the exceptional occasions when it has accorded recognition to a government
at all, has been to accord recognition only, without using these terms. I doubt,
therefore, that the distinction between de facto and de jure recognition, in any of its
forms, has a useful role to play any longer before courts in this jurisdiction.

100. The executive certificate in the present case did not include any reference to de
jure or de facto recognition. On the contrary, its only statement of recognition was an
express unequivocal statement that Mr Guaidó was recognised as the constitutional
interim President. It was not appropriate for the Court of Appeal to infer from the
statement in the certificate that “the oppression of the illegitimate, kleptocratic
Maduro regime must end” that this might amount to the recognition by HMG of the
Maduro regime as the de facto government of Venezuela. Still less was it appropriate
for the Court of Appeal to infer from the references to Mr Guaidó as “constitutional
interim President of Venezuela until credible elections could be held” that HMG might
recognise Mr Guaidó as the person entitled to exercise all the powers of the President,
while also recognising Mr Maduro as the person who does in fact exercise some or all
of the powers of the President.

101. For these reasons, I consider that the certificate was an unambiguous and
unqualified statement by the executive that it recognises Mr Guaidó as interim
President of Venezuela. That statement is binding on courts in this jurisdiction.

Subsequent events

102. Subsequent events have placed beyond doubt the conclusion that Mr Guaidó is
recognised by HMG as the interim President of Venezuela. The Foreign Secretary has
intervened before the Supreme Court on the hearing of these appeals and has made
further statements to the court through his counsel. There is no requirement that an
executive statement be in the form of a formal certificate (Parry (para 70 above), pp
186-187, 206-207; Wilmshurst, “Executive Certificates in Foreign Affairs: The United
Kingdom” (1986) 35 ICLQ 157, pp 168-169). In The Gagara (1919) 35 TLR 243 the
Attorney General appeared to support a written statement of the Foreign Office and
stated that HMG had provisionally recognised the Esthonian Government. In The
Fagernes [1927] P 311 information as to the extent of the realm was provided by the
Attorney-General on instructions from the Home Office. On the present appeals, the

Page 37
Supreme Court has received a written case and oral statements on behalf of the
Foreign Secretary.

103. The Foreign Secretary’s written case made detailed submissions in relation to
the executive certificate in the form of the Shorter letter of 19 March 2020. In
particular he submitted:

“The Certificate was clear and not ambiguous. The Certificate

expressly stated that HMG recognised Mr Guaidó as the
interim President of Venezuela on 4 February 2019 and
continued to do so. Its language communicated HMG’s
recognition of Mr Guaidó, in place of Mr Maduro, from that
date onwards. The consequence is that, from that date, Mr
Guaidó and no other was the individual recognised by HMG
as having the authority to act on behalf of Venezuela in the
capacity of head of state.”

The interpretation of the executive certificate is, of course, a matter for the court.
However, the Foreign Secretary then further stated (at para 41):

“In addition, the Foreign Secretary, on behalf of HMG, hereby

confirms that the UK recognised Mr Guaidó as the interim
President of Venezuela on 4 February 2019 and continues to
recognise him in that capacity. From that date, the UK no
longer recognised Mr Maduro as the Venezuelan Head of
State, whether de facto or de jure.”

This further statement not only reaffirms that Mr Guaidó is recognised as the interim
President, but also eliminates any possibility that Mr Maduro is recognised as
President for any purpose.

104. Furthermore, Sir James Eadie QC, continuing the practice established in The
Gagara and The Fagernes, stated in the course of his oral submissions before us:

“The UK now recognises Mr Guaidó as President of Venezuela

until credible elections can be held. Of the choices open, the
Foreign Secretary has given, on behalf of the Government, a
single and unqualified answer. He recognises Mr Guaidó, one
President and one President only is recognised, and it is
Page 38
 ‘President’ that is the key, covering both of the questions
that were asked, but splits it out between head of state and
head of government. The answer was given by reference to
the Presidency, … but one President and one President only is
recognised out of a field of two. By contrast, and the flipside
is just as important as the positive, there is no recognition of
Mr Maduro at all.”

105. These further statements leave the issue of recognition beyond doubt.

Head of government

106. Finally in this regard, it is necessary to refer to an issue which has unnecessarily
complicated the issue of recognition. In his letter of 14 February 2020 to the Foreign
Secretary Robin Knowles J asked two questions: (1) who does HMG recognise as the
head of state of Venezuela? and (2) who does HMG recognise as the head of
government of Venezuela? The response contained in the Shorter letter of 19 March
2020 simply referred to the Hunt statement of 4 February 2019 which stated that “the
United Kingdom now recognises Juan Guaidó as constitutional interim President of
Venezuela until credible elections can be held”. Teare J ([2021] QB 455, paras 33-36)
considered the response to be a clear and unequivocal statement that Mr Guaidó was
recognised as President of Venezuela and that Mr Maduro was not recognised as
President of Venezuela. In his view, the statement of recognition concerned not the
Government of Venezuela but the President of Venezuela. It was confined to the
position of Mr Guaidó as constitutional interim President of Venezuela. This was
reflected in the answers given by Teare J to the preliminary issues, to the effect that
recognition of Mr Guaidó was as head of state but not as head of government. It was
also reflected in his observation that counsel for the Maduro Board, in advancing
argument as to whether HMG had recognised a government, was “shooting at the
wrong target”. Teare J also noted, however, that it was common ground between the
parties that pursuant to article 226 of the Venezuelan Constitution the President is the
head of state and head of the national executive, in which latter capacity he directs the
actions of the Government. Argument on behalf of the Guaidó Board had concentrated
on the President of Venezuela not only because of the language used by HMG but also
because the appointments which were challenged by the Maduro Board were
appointments made by Mr Guaidó as President of Venezuela. There had been, on the
case of the Guaidó Board, a change in the person recognised by HMG as the President
of Venezuela. It was unnecessary for the Guaidó Board to say that there had been a
change of government and they had not said that. In oral submissions it had been
made clear that no case was advanced concerning the Government of Venezuela.

Page 39
107. There was no appeal against the decision of Teare J that Mr Guaidó was not
recognised by HMG as head of government. Following the judgment of Teare J the
Guaidó Board amended its pleadings to delete the averment that HMG had recognised
Mr Guaidó as head of government. In the Court of Appeal Males LJ noted ([2021] QB
455, para 112) that it was unnecessary to decide whether the executive certificate
meant that HMG recognised Mr Guaidó as the person entitled to be head of
government, a role accorded to the President under the Constitution of Venezuela,
because the judge’s answer to the preliminary issue had been that the recognition of
Mr Guaidó was as head of state only, a ruling from which there was no appeal. Males
LJ also noted that Mr Fulton QC, on behalf of the Guaidó Board, had been content to
take his stand on the recognition of Mr Guaidó as head of state, submitting that it was
irrelevant for the purpose of these proceedings whether HMG had also recognised Mr
Guaidó as head of government.

108. In his oral submissions before this court, Sir James Eadie on behalf of the
Foreign Secretary, informed the court that “the answer that was given by the Secretary
of State was given to the dual question [posed by Robin Knowles J] … and was given by
reference to who was recognised as the President of Venezuela”. He also stated that
the focus on head of state as opposed to head of government in the Foreign
Secretary’s written case simply reflected this understanding of the context of the
proceedings.

109. The key question is whether or not Mr Guaidó is recognised as the head of
state, it being irrelevant for the purposes of the proceedings whether HMG had also
recognised Mr Guaidó as head of government. It has been common ground between
the parties that article 226 of the Venezuelan Constitution provides:

“The President of the Republic is the head of state and of the

National Executive, in which latter capacity he directs the
action of the Government.”

Similarly, article 236 provides that the attributions and duties of the President include
“to direct the activity of the Government” (article 236(2)) and “any others vested in
the President under this Constitution and law” (article 236(24)). The appointments
which are challenged by the Maduro Board were purportedly made by Mr Guaidó in
his capacity as President of Venezuela. The material issue for the court in this part of
the proceedings is not the existence or identity of any government of Venezuela but
the identity of the President of Venezuela. That question has been unequivocally
answered by the executive statements.

Page 40
Conclusion on recognition

110. I would therefore answer the questions on the recognition issue as follows:

(1) HMG has since 4 February 2019 recognised Mr Guaidó as the

constitutional interim President of Venezuela until credible presidential
elections can be held.

(2) HMG has since 4 February 2019 not recognised Mr Maduro as President
of Venezuela for any purpose.

(3) These conclusions follow from the Hunt statement dated 4 February
2019, the Shorter letter dated 19 March 2020 and the further statements made
to the court on behalf of the Foreign Secretary, which statements are conclusive
under the one voice principle.

Act of state

111. One consequence of this outcome on the recognition issue is that interim
President Guaidó’s appointments of public officials are sovereign acts of the
Venezuelan state. On behalf of the Guaidó Board it is submitted that, the acts of
appointment having taken place within Venezuela, those acts are not open to
challenge as to their validity under Venezuelan law in a court in this jurisdiction and, as
a matter of English law, must be treated as valid and effective without inquiry. So
much, it is said, is the result of the foreign act of state doctrine.

112. The foreign act of state was famously described by Dr F A Mann as “one of the
most difficult and most perplexing topics which, in the field of foreign affairs, may face
the municipal judge in England” (F A Mann, Foreign Affairs in English Courts (1986), p
164). The foreign act of state doctrine, which must be distinguished from its domestic
cousin Crown act of state (see Nissan v Attorney General [1970] AC 179; Serdar
Mohammed v Ministry of Defence [2017] UKSC 1; [2017] AC 649), was considered by
the Supreme Court most recently in the linked appeals in Belhaj v Straw; Rahmatullah
(No 2) v Ministry of Defence [2017] UKSC 3; [2017] AC 964. The judgments in those
appeals reveal widely differing views on a number of aspects of the topic. While there
was agreement, foreshadowed by Lord Reid in Nissan at pp 211-212 and Lord
Wilberforce in Buttes Gas & Oil Co v Hammer (No 3) [1982] AC 888, 930-931, that act
of state in fact comprises a number of discrete principles, there was a lack of unanimity
on their classification. As it appears that the ratio decidendi of the case is to be found
Page 41
in the judgment of Lord Neuberger, it is convenient to start by taking Lord Neuberger’s
classification. (Lord Wilson agreed with Lord Neuberger. Lady Hale and Lord Clarke
agreed with the reasoning and conclusion in the judgment of Lord Neuberger, but did
not consider it necessary to express a view on issues which did not strictly arise for
decision.)

113. Lord Neuberger considered that the domestic cases suggested that there may
be four possible rules which had been treated as aspects of the doctrine.

(1) The first rule (“Rule 1”) is that the courts of this country will recognise
and will not question the effect of a foreign state’s legislation or other laws in
relation to any acts which take place or take effect within the territory of that
state ([2017] AC 964, para 121).

(2) The second rule (“Rule 2”) is that the courts of this country will recognise,
and will not question, the effect of an act of a foreign state’s executive in
relation to any acts which take place or take effect within the territory of that
state (at para 122).

(3) The third rule (“Rule 3”) has more than one component, but each
component involves issues which are inappropriate for the courts of the United
Kingdom to resolve because they involve a challenge to the lawfulness of the
act of a foreign state which is of such a nature that a municipal judge cannot or
ought not to rule on it. Examples are making war and peace, making treaties
and the annexation and cession of territory. Similarly, the courts of this country
will not, as a matter of judicial policy, determine the legality of acts of a foreign
government in the conduct of foreign affairs (para 123).

(4) A possible fourth rule (“Rule 4”), described by Rix LJ in Yukos Capital SARL
v OJSC Rosneft Oil Co (No 2) [2012] EWCA Civ 855; [2014] QB 458, para 65, is
that “the courts will not investigate acts of a foreign state where such an
investigation would embarrass the government of our own country: but that
this doctrine only arises as a result of a communication from our own Foreign
Office” (para 124).

In this part of the present appeal we are directly concerned only with the first and
second manifestations of the act of state doctrine.

Page 42
The issues raised

114. The principal submissions made in relation to foreign act of state on these
appeals may be summarised as follows.

(1) The Guaidó Board maintains that the Transition Statute passed by the
Legislative Assembly is a legislative act of the State of Venezuela which
authorised Mr Guaidó to appoint members of the board of the BCV and to
appoint a Special Attorney General.

(2) The Maduro Board maintains that

(a) the Transition Statute is a nullity;

(b) there are other constitutional reasons why the appointments of

the Guaidó Board and the Special Attorney General are invalid; and

(c) in any event the BCV is not a “decentralized entity” within the
meaning of the Transition Statute.

Accordingly, it submits that Mr Guaidó’s purported appointments are

ineffective as a matter of Venezuelan law.

(3) The Guaidó Board responds that these facts engage the first two rules
stated by Lord Neuberger in Belhaj. The appointments are executive acts of
state which engage Rule 2 with the result that they cannot be challenged.
Alternatively, the Transition Statute cannot be challenged because of Rule 1.

(4) The Maduro Board raises a range of points in reply, in particular

(a) The act of state doctrine is unclear, unprincipled and unnecessary

and should be strictly confined to circumstances in which it has already
been applied.

(b) The appointments are not properly characterised as acts of state

for the purposes of the act of state doctrine.
Page 43
 (c) If Rule 2 exists, it does not apply in this case because the relevant
acts have been ruled unlawful by the STJ and/or because they are
unlawful.

(d) If Rule 2 exists, it applies only to executive acts affecting property

and not to acts of appointment.

(e) If Rule 2 exists, it does not apply in this case because the relevant
acts, although taking effect in Venezuela, affect assets in the United
Kingdom.

(f) If Rule 2 exists, it does not apply where allegations of unlawfulness

or invalidity arise incidentally rather than directly.

(g) To the extent that it becomes necessary to consider Rule 1, it

cannot rule out an enquiry into whether the Transition Statute is a
legislative act within the meaning of the doctrine.

(h) The act of state doctrine cannot preclude consideration of

whether or not the BCV is a “decentralized entity” within the meaning of
the Transition Statute.

115. On the hearing of this appeal, argument focussed predominantly on issues

relating to the existence and applicability of Rule 2 concerning acts of the executive of
a foreign state. I therefore propose to address those issues first.

Rule 2: An act of a foreign state’s executive

116. The Guaidó Board places its reliance on Rule 2 at the forefront of its
submissions. While it maintains that Mr Guaidó acted lawfully under Venezuelan law in
making the appointments under the Transition Statute, in the face of what it describes
as “the Maduro Board’s barrage of Venezuelan law challenges in these proceedings” it
submits that it is entitled to succeed under Rule 2 by virtue of the sovereign character
of the acts of appointment, a matter to which the lawfulness of the conduct in
Venezuelan law is irrelevant.

117. The Guaidó Board relies on the following appointments by Mr Guaidó.

Page 44
 (1) On 5 February 2019 Mr Guaidó appointed a Special Attorney General “for
the defense and representation of the rights and interest of the Republic, as
well as the rights and interests of companies of the state and other
decentralized entities of the Public Administration abroad”. The appointee was
originally Mr Hernández and subsequently, with effect from 1 July 2020, Mr
Sánchez Falcon.

(2) On 18 July 2019 and 13 August 2019 Mr Guaidó appointed an ad hoc

board of BCV (ie the Guaidó Board) to represent the BCV in connection with
agreements relating to the management of international reserves, including
gold.

After each appointment, the STJ issued rulings declaring the appointments
unconstitutional and of no legal effect.

118. The initial question for consideration here is whether there exists a rule which
prohibits courts in this jurisdiction from questioning an act of the executive of a foreign
state, regardless of whether the act is lawful or unlawful by the law of that state.
Despite judicial statements to the effect that the courts of this country will not sit in
judgment on the lawfulness or validity of an executive act of a foreign state, the
existence of such a rule has often been doubted. In particular, it has been suggested
that many of the cases in which these pronouncements have been made are explicable
on other grounds, for example on grounds of sovereign or state immunity (Duke of
Brunswick v King of Hanover (1848) 2 HL Cas 1) or the application of conventional
choice of law rules governing title to movable property (Luther v Sagor; Princess Paley
Olga v Weisz [1929] 1 KB 718).

119. Although not directly in point in Belhaj, Lord Neuberger’s judgment in that case
([2017] AC 964, paras 136-143) included an extended consideration of the validity of
Rule 2 in relation to property and property rights. He began by accepting that in so far
as the executive act of a state confiscating or transferring property, or controlling or
confiscating property rights, within its territory is lawful, or not unlawful, according to
the law of that territory, the rule is valid and well-established. So much is
uncontroversial. Such a rule would involve no more than a conventional application of
foreign law when indicated by choice of law rules in private international law. More
difficult is the question whether courts in this jurisdiction are obliged to give effect to
an executive act of a foreign state notwithstanding that it is unlawful by the law of that
state. On this issue, Lord Neuberger observed that, in so far as the executive act is
unlawful according to the law of the territory concerned, he was not convinced, at
least in terms of principle, why it should not be treated as unlawful by a court in the
United Kingdom and noted that if it were not so treated there would appear to be
Page 45
something of a conflict with the first rule. Turning to the authorities, he considered
that there were, at best, some obiter dicta which supported the notion that the second
rule could apply to executive acts which are unlawful by the laws of the state
concerned. He accepted that there was a pragmatic attraction in the argument that an
executive act within the state, even if unlawful by the laws of that state, should be
treated as effective in the interest of certainty and clarity, at least in so far as it relates
to property and property rights. There was also practical sense, at any rate at first
sight, if when confiscated property was transferred to another territory following a
sale or other transfer by the state, the transferee was treated as the lawful owner by
the law of the other territory. However, he continued in a passage of some importance
to the present case (at para 142):

“However, there are potential difficulties: if the original

confiscation was unlawful under the law of the originating
state, and the courts of that state were so to hold, or even
should so hold, it is by no means obvious to me that it would
be, or have been, appropriate for the courts of the
subsequent state to treat, or have treated, the confiscation
as valid.”

As the point did not arise directly in that appeal and had, therefore, not been fully
argued, he considered it right to keep the point open.

120. In his judgment in Belhaj Lord Mance proposed a three-fold classification of

foreign act of state. His second category comprises a possible rule that a domestic
court will not normally question the validity of any sovereign act in respect of property
within the foreign state’s jurisdiction, at least in times of civil disorder ([2017] AC 964,
paras 11(iii)(b), 38). In his view, to the extent that it exists at all, this type of foreign act
of state is and should be limited to acts relating to property within the jurisdiction of
the foreign state (paras 11(iv)(a), 74-78). He did not consider it necessary on those
appeals for the Supreme Court to reach or endorse a conclusion that this variety of act
of state exists in any form at all (at para 65).

121. By contrast, Lord Sumption’s judgment in Belhaj (a judgment with which Lord
Hughes agreed) is a ringing endorsement of Rule 2 as a rule of English law. Lord
Sumption identified a principle of foreign act of state “that the courts will not
adjudicate upon the lawfulness or validity of certain sovereign acts of foreign states”.
Unlike state immunity it is not a personal but a subject matter immunity. While it
proceeds from the same premise as state immunity, namely mutual respect for the
equality of sovereign states, it is wholly the creation of the common law. It is not
required by international law. “The foreign act of state doctrine is at best permitted by
Page 46
international law” ([2017] AC 964, paras 199-200). He adopted (at para 227) the
essential distinction made by Lord Wilberforce in Buttes Gas [1982] AC 888 between
“those cases which are concerned with the applicability of foreign municipal legislation
within its own territory and with the examinability of such legislation” (p 931A-B) and
cases concerning “the transactions of sovereign states” (p 931G-H). The former
principle, which Lord Sumption termed “municipal law act of state”, “is that the English
courts will not adjudicate on the lawfulness or validity of a state’s sovereign acts under
its own law” (para 228). Citing Duke of Brunswick and Princess Paley Olga, Lord
Sumption considered that municipal law act of state applies not just to legislative
expropriations of property, but to expropriations by executive act with no legal basis at
all.

“These transactions are recognised in England not because

they are valid by the relevant foreign law, but because they
are acts of state which an English court cannot question.”
([2017] AC 964, para 230)

122. There exists a substantial weight of judicial authority in support of such a rule.
In Duke of Brunswick (1848) 2 HL Cas 1, the deposed Duke of Brunswick, sought to
challenge in the Court of Chancery the validity of the appointment of a guardian over
his property by William IV of England, in his capacity as King of Hanover, and the
deposed Duke’s brother, William. The action was brought against the current guardian,
the successor of William IV as King of Hanover. The House of Lords held that the
appointments had been made in the exercise of sovereign authority and therefore
could not be challenged in an English court, whether or not they were lawful under the
laws of either Brunswick or Hanover. Lord Cottenham LC stated, at p 17:

“The whole question seems to me to turn upon this … that a

foreign Sovereign coming into this country, cannot be made
responsible here for an act done in his sovereign character in
his own country; whether it be an act right or wrong,
whether according to the constitution of that country or not,
the courts of this country cannot sit in judgment upon the act
of a Sovereign, effected by virtue of his Sovereign authority
abroad, an act not done as a British subject, but supposed to
be done in the exercise of his authority vested in him as
Sovereign.”

“It is true, the bill states that the instrument was contrary to
the laws of Hanover and Brunswick, but, notwithstanding
that it is so stated, still if it is a sovereign act, then, whether it
Page 47
 be according to law or not according to law, we cannot
inquire into it. If it were a private transaction, … then the law
upon which the rights of individuals may depend, might have
been a matter of fact to be inquired into, and for the court to
adjudicate upon, not as a matter of law, but as a matter of
fact. But, …, if it be a matter of sovereign authority, we
cannot try the fact, whether it be right or wrong.” (At pp 21-
22)

The decision may be explained on the ground of the personal sovereign immunity
(immunity ratione personae) of the defendant, the King of Hanover. This is clearly one
basis of the decision: “no court in this country can entertain questions to bring
Sovereigns to account for their acts done in their sovereign capacities abroad” (per
Lord Cottenham at p 22). However, the decision is of wider import. First, the claim was
resisted on two distinct grounds, sovereign immunity and non-justiciability. Secondly,
Lord Campbell observed (at p 26) that had the proceedings been brought against the
Duke of Cambridge, the original guardian who was not a sovereign, “it would equally
have been a matter of state”. Thirdly, the statement of principle by Lord Cottenham,
cited above, with which the rest of the House agreed, is clearly intended to be of wider
effect and to relate to the subject matter of the claim (immunity ratione materiae).
(See Buttes Gas at p 932E-F per Lord Wilberforce; Belhaj at para 205 per Lord
Sumption.)

123. In Johnstone v Pedlar [1921] 2 AC 262, a case on Crown act of state, Lord
Sumner, distinguishing Crown act of state from foreign act of state, described the
latter principle at p 290 in very broad terms:

“Municipal courts do not take it upon themselves to review

the dealings of state with state or of sovereign with
sovereign. They do not control the acts of a foreign state
done within its own territory, in the execution of sovereign
powers, so as to criticise their legality or to require their
justification.”

While features of Lord Neuberger’s Rule 2 and Rule 3 are both present in this
formulation, it certainly provides support for the existence of the former.

124. There are also statements in Luther v Sagor supporting the existence of such a
rule. Bankes LJ ([1921] 3 KB 532, p 545) proceeded on the basis that title to the
confiscated timber was governed by the lex situs and the expropriatory decree was a
Page 48
part of that law. However, Warrington LJ, citing the decision of the US Supreme Court
in Oetjen v Central Leather Co (1918) 246 US 297, 548 considered:

“It is well settled that the validity of the acts of an

independent sovereign government in relation to the
property and persons within its jurisdiction cannot be
questioned in the courts of this country.”

In his view the appellants (at p 549):

“are resisting an endeavour on the part of the respondents to

induce the court to ignore and override legislative and
executive acts of the Government of Russia and its agents
affecting the title to property in that country; it is that which,
in my opinion, we are not at liberty to do.”

Scrutton LJ observed (at pp 558-559), in a passage supportive of Rule 1, that “it

appears a serious breach of international comity, if a state is recognized as a sovereign
independent state, to postulate that its legislation is ‘contrary to essential principles of
justice and morality’” and considered that this was a matter for the executive and not
the judiciary.

125. The question arose once again in Princess Paley Olga. All three members of the
Court of Appeal held that effect was to be given to the Russian decree as part of the
lex situs which, under domestic choice of law rules governed title to movable property.
However, on this occasion all three members of the court also upheld an alternative
argument that even if the decree did not justify the confiscation of the property it was
an act of state into which the court could not enquire. Citing Oetjen, Scrutton LJ
([1929] 1 KB 718, pp 723-725) accepted a submission that if the seizure of the property
began without any legal justification, or only by revolutionary right, it was ultimately
adopted by a government, which was recognised by the British Government as the
lawful government of the territory in which the property was, and that “this was an act
of state into the validity of which the court would not inquire”. Sankey LJ (at pp 729-
730) also cited Oetjen at length and concluded that “the Princess was dispossessed of
this property by an act of state behind which our courts will not go.” Russell LJ also
held that the defendants were entitled to succeed on the act of state point. The
evidence clearly established a seizure of the property in 1918, either by a section of
revolutionaries, whose act was subsequently adopted by the Government, or by a
usurping power which subsequently became the Government. He concluded ([1929] 1
KB 718, p 736):
Page 49
 “This court will not inquire into the legality of acts done by a
foreign government against its own subjects in respect of
property situate in its own territory.”

The Court of Appeal clearly founded its decision on this alternative basis.

126. In Piramal v Oomkarmal (1933) 60 LR Ind App 211 the Indore Government had
seized a debt situated in Indore. The appellants obtained a decree in proceedings
against the original creditor and sought to attach the debt. The Judicial Committee of
the Privy Council held that it was not for the court to enquire whether the Indore
Government in seizing property situate in its own territory had acted within the law of
that state. Lord Atkin, delivering the judgment of the Privy Council, stated that their
Lordships found themselves in complete agreement with the appellate court in
accepting the law laid down in Luther v Sagor and Princess Paley Olga. Having cited the
statement by Russell LJ in Princess Paley Olga set out in the preceding paragraph he
continued (at p 223):

“This is not the case of an action against an individual for a

wrongful act done to the plaintiff. In such a case it may be
that if the defendant seeks to justify under an order of a
foreign state, the courts may inquire into the scope of the
authority: their Lordships express no opinion upon such a
topic. The present case is one of property seized and taken
into possession by the government of the foreign territory in
which it is situate. In such a case the court will not examine
whether the government acted validly or not within its own
domestic laws.”

127. The question is no more than touched on in the judgment of Lord Wilberforce in
Buttes Gas. The decision there turns on the non-justiciability of certain transactions
between states taking place on the international plane (Rule 3). Although Lord
Wilberforce made an oblique reference to executive acts ([1982] AC 888, p 931D), this
does not advance the present debate.

128. Further support for Rule 2 as a rule of English law can be found in Kuwait
Airways Corpn v Iraqi Airways Co (Nos 4 and 5) where Lord Steyn stated ([2002] 2 AC
883, para 112):

Page 50
 “it is well established that courts must not sit in judgment on
the acts of a foreign government within its own territory.”

and Lord Hope stated at para 135:

“There is no doubt as to the general effect of the rule which

is known as the act of state rule. It applies to the legislative or
other governmental acts of a recognised foreign state or
government within the limits of its own territory. The English
courts will not adjudicate upon, or call into question, any
such acts.”

129. In Yukos Capital Sarl v OJSC Rosneft Oil Co (No 2) [2014] QB 458, para 66, Rix LJ
described the act of state doctrine in the following terms:

“The various formulations of the paradigm principle are

apparently wide, and prevent adjudication on the validity,
legality, lawfulness, acceptability or motives of state actors. It
is a form of immunity ratione materiae, closely connected
with analogous doctrines of sovereign immunity and,
although a domestic doctrine of English (and American) law,
is founded on analogous concepts of international law, both
public and private, and of the comity of nations. It has been
applied in a wide variety of situations, but often arises by way
of defence or riposte: as where a dispossessed owner sues in
respect of his property, the defendant relies on a foreign act
of state as altering title to that property, and the claimant is
prevented from calling into question the effectiveness of that
act of state.”

130. In Reliance Industries v Union of India [2018] EWHC 822 (Comm); [2018] 2 All ER
(Comm) 1090, para 105, Popplewell J considered, correctly in my view, that he was
bound by Princess Paley Olga to hold that the act of state doctrine includes the
principle that the English court will not question the effect of a foreign state’s
executive acts in relation to property situated within its territory, and will not
adjudicate upon whether such acts are lawful.

131. In a parallel development the foreign act of state doctrine also took root in the
United States where the principle stated in Duke of Brunswick was adopted in a series

Page 51
of judicial decisions of high authority. Initially, it was established in the late 19th and
early 20th centuries as a principle based on the equality and independence of
sovereign states which prevented domestic courts sitting in judgment on the legality or
validity of the acts of a foreign sovereign (Underhill v Hernandez (1897) 168 US 250;
Oetjen v Central Leather Co (1918) 246 US 297; Ricaud v American Metal Co (1918) 246
US 304). Its subsequent development in that jurisdiction was influenced by the very
different constitutional context and it came to reflect its constitutional underpinnings
and the separation of powers under the US Constitution. In Banco Nacional de Cuba v
Sabbatino (1964) 376 US 398, 423 Harlan J referred to “the strong sense of the Judicial
Branch that its engagement in the task of passing on the validity of foreign acts of state
may hinder ‘the conduct of foreign affairs’”. More recently the US Supreme Court has
affirmed the doctrine as a rule of decision which applies only where the validity of a
foreign sovereign act is at issue.

“The act of state doctrine does not establish an exception for

cases and controversies that may embarrass foreign
governments, but merely requires that, in the process of
deciding, the acts of foreign sovereigns taken within their
own jurisdictions shall be deemed valid.” (WS Kirkpatrick v
Environmental Tectonics (1990) 493 US 400, p 707 per Scalia
J)

132. The early US cases constitute a clear affirmation of Duke of Brunswick. In the
first such case to come before the US Supreme Court, Underhill v Hernandez, the
claimant sued the local commander of the revolutionary army in Venezuela for false
imprisonment, assault and battery during a revolution which led to the establishment
of the Government of Crespo which was subsequently recognised by the United States.
The Supreme Court upheld the decision of the Second Circuit Court of Appeals that the
acts of the defendant were the acts of the Government of Venezuela and as such were
not properly the subject of adjudication in the courts of another government. Fuller CJ
stated the principle as follows:

“Every sovereign state is bound to respect the independence

of every other sovereign state, and the courts of one country
will not sit in judgment on the acts of the government of
another, done within its own territory. Redress of grievances
by reason of such acts must be obtained through the means
open to be availed of by sovereign powers as between
themselves.”

Page 52
133. Oetjen v Central Leather Co concerned a revolution in Mexico during which
forces loyal to Carranza had seized a quantity of hides in Mexico which were
subsequently sold to a Texan company. After the United States had recognised
Carranza’s Government, the assignee of the original owner of the hides sued to
recover them. Clarke J, delivering the opinion of the Supreme Court considered that
this was an act of state and was non-justiciable. Having cited the passage from
Underhill set out above, he continued:

“The principle that the conduct of one independent

government cannot be successfully questioned in the courts
of another is as applicable to a case involving the title to
property brought within the custody of a court, such as we
have here, as it was held to be to the cases cited, in which
claims for damages were based upon acts done in a foreign
country, for it rests at last upon the highest considerations of
international comity and expediency. To permit the validity
of the acts of one sovereign state to be re-examined and
perhaps condemned by the courts of another would very
certainly ‘imperil the amicable relations between
governments and vex the peace of nations’.”

134. The influence of the early US cases, in turn, on developments in this jurisdiction
is apparent from Luther v Sagor (at p 549) where Warrington LJ cited Oetjen and
considered that it reflected the position in English law. In Princess Paley Olga Scrutton
LJ cited Underhill, Oetjen and Ricaud. Similarly, the decision of the House of Lords in
Buttes Gas was substantially influenced by both the US act of state doctrine and the US
political question doctrine to which it is closely linked.

135. It appears therefore that a substantial body of authority, not all of which is
obiter, lends powerful support for the existence of a rule that courts in this jurisdiction
will not adjudicate or sit in judgment on the lawfulness or validity under its own law of
an executive act of a foreign state, performed within the territory of that state. The
rule also has a sound basis in principle. It is founded on the respect due to the
sovereignty and independence of foreign states and is intended to promote comity in
inter-state relations. While the same rationale underpins state immunity, the rule is
distinct from state immunity and is not required by international law. It is not founded
on the personal immunity of a party directly or indirectly impleaded but upon the
subject matter of the proceedings. The rule does not turn on a conventional
application of choice of law rules in private international law nor does it depend on the
lawfulness of the conduct under the law of the state in question. On the contrary it is
an exclusionary rule, limiting the power of courts to decide certain issues as to the

Page 53
legality or validity of the conduct of foreign states within their proper jurisdiction. It
operates not by reference to law but by reference to the sovereign character of the
conduct which forms the subject matter of the proceedings. In the words of Lord
Cottenham, it applies “whether it be according to law or not according to law”. I can,
therefore, see no good reason to distinguish in this regard between legislative acts, in
respect of which such a rule is clearly established (see paras 171-179 below), and
executive acts. The fact that executive acts may lack any legal basis does not prevent
the application of the rule. In my view, we should now acknowledge the existence of
such a rule.

Limitations and exceptions

136. The various manifestations of foreign act of state in English law are undoubtedly
subject to limitations and exceptions. These were considered in detail by Rix LJ in
Yukos ([2014] QB 458, paras 68-115) and may be summarised as follows:

(1) “[T]he act of state must, generally speaking, take place within the
territory of the foreign state itself”. This limitation may not always apply to Rule
3 (Yukos, para 68).

(2) “[T]he doctrine will not apply to foreign acts of state which are in breach
of clearly established rules of international law, or are contrary to English
principles of public policy, as well as where there is a grave infringement of
human rights”. (Oppenheimer v Cattermole [1976] AC 249, 277–278, per Lord
Cross; Kuwait Airways Corpn v Iraqi Airways Co (Nos 4 and 5) [2002] 2 AC 883;
Yukos at paras 69-72.)

(3) Judicial acts will not be regarded as acts of state for the purposes of the
act of state doctrine. (Altimo Holdings and Investment Ltd v Kyrgyz Mobil Tel Ltd
[2011] UKPC 7; [2012] 1 WLR 1804; Yukos at paras 73-91.)

(4) The doctrine does not apply where the conduct of the foreign state is of a
commercial as opposed to a sovereign character. (Empresa Exportadora de
Azucar v Industria Azucarera Nacional SA (The Playa Larga) [1983] 2 Lloyd’s Rep
171; Korea National Insurance Corpn v Allianz Global Corporate & Specialty AG
[2008] EWCA Civ 1355; [2008] 2 CLC 837); Yukos at paras 92-94.)

(5) The doctrine does not apply where the only issue is whether certain acts
have occurred, as opposed to where the court is asked to inquire into them for
Page 54
 the purpose of adjudicating on their legal effectiveness. (WS Kirkpatrick & Co Inc
v Environmental Tectonics Corpn International; Yukos at paras 95-104.)

(6) For the doctrine to apply, challenges to foreign acts of state must arise
directly “and not be a matter of merely ancillary or collateral aspersion”. (Yukos
at para 109.)

(7) The act of state doctrine should not be an impediment to an action for
infringement of foreign intellectual property rights, even if validity of a grant is
in issue, simply because the action calls into question the decision of a foreign
official. (Lucasfilm Ltd v Ainsworth [2011] UKSC 39; [2012] 1 AC 208, para 86 per
Lord Collins and Lord Walker; Yukos at paras 63-64.)

Appointments as acts of state

137. The executive acts of appointment relied on by the Guaidó Board have been
summarised at para 117 above. The Guaidó Board accepts that they did not purport to
alter any rights of ownership or any contractual rights of the BCV. Rather, the
appointments involved a mere change of control and rights of representation in
relation to a Venezuelan public law entity which was already and which remains part of
the Venezuelan state apparatus.

138. On behalf of the Maduro Board, Mr Vineall QC submits that if Rule 2 exists it is
limited to cases of executive acts affecting property and can, therefore, have no
application to conduct such as the making of these appointments. In support of this
submission, he is able to point to observations by Lord Neuberger and Lord Mance in
Belhaj in relation to the scope of Rule 2. Lord Neuberger, proceeding at this point on
the assumption that his Rule 2 can apply to executive acts in relation to property which
are unlawful by the laws of the state in which they occurred, expressed himself
unconvinced that it would apply in so far as the act resulted in injuries to the person.
While he accepted that there was a serious practical argument in favour of Rule 2
applying to unlawful executive acts in so far as they related to interference with
property and property rights, in his view that argument did not apply to personal
harm, whether physical or mental. He considered, therefore, that the court should
hold that Rule 2 does not apply where a foreign state executive has caused physical or
mental harm to a claimant through an act in the territory of that state which was
unlawful under the laws of that state. He also drew attention in this regard to
Lucasfilm Ltd v Ainsworth where Lord Walker and Lord Collins said, at para 161, that
“in England the foreign act of state doctrine has not been applied to any acts other
than foreign legislation or governmental acts of officials such as requisition”. In the
Page 55
result, Lord Neuberger concluded in Belhaj ([2017] AC 964, para 169) that Rule 2 could
not be relied on because the alleged wrongdoing involved harm to individuals and not
property and the public policy exception would apply in any event. Similarly, in
Rahmatullah he considered that Rule 2 was not engaged because the allegations were
of extra-territorial conduct resulting in physical and mental harm ([2017] AC 964, para
170). These conclusions had the support of a majority of the court. Similarly, Lord
Mance was willing to proceed for the purposes of the appeals in Belhaj on the
assumption that Rule 2 existed, because of the special characteristics of property, and
the special considerations applying to it, in particular the need for security of title and
of international trade. However, in his view similar considerations did not apply to
individuals who had been the victim of personal torts. Recognising title to property
was different from refusing to enquire into the justification for the infliction of
personal injury. Rule 2 could and should therefore be limited as a matter of principle to
sovereign acts seizing or affecting (i) property which was (ii) within the jurisdiction of
the state in question at the time when the act took effect. He could see no reason for
giving the doctrine any wider effect (at para 74).

139. I am, nevertheless, not persuaded that we should accept that Rule 2 can have
no application to conduct such as the exercise of a power of appointment in issue
here. First, there is no support in the pre-Belhaj case law in the United Kingdom for
limiting the operation of Rule 2 in this way to cases of expropriation of property and it
is inconsistent with the much broader statements of principle in cases such as Duke of
Brunswick and Princess Paley Olga. Moreover, Hatch v Baez (1876) 7 Hun 596 and
Underhill v Hernandez, early examples of the application of the act of state doctrine in
the United States, were cases concerning imprisonment and personal torts.

140. Secondly, there is no identifiable reason of principle why the rule should be
limited to seizures of property. As Lord Sumption observed in Belhaj (at para 231)
there is no rational reason to distinguish in this regard between seizures of property
and injury to other interests equally protected by the municipal law of the place where
they occurred. (See also the observations of Teare J in the present proceedings at para
69.)

141. Thirdly, while there is undoubtedly a “serious practical argument” identified by

Lord Neuberger (at paras 142, 160) in favour of the application of Rule 2 to unlawful
executive acts in so far as they relate to interference with property and property rights,
referred to at para 119 above, it may be thought that corresponding practical
advantages may arise from the application of Rule 2 to the exercise of a power of
appointment to the board of a public body functioning within the territory of the
foreign state.

Page 56
142. Fourthly, the specific question of the application of Rule 2 to the exercise of a
power of appointment by the executive did not arise for consideration in Belhaj. The
Guaidó Board is, however, able to point to other decisions in this field which touch on
the point. In Dobree v Napier (1836) 2 Bing NC 781 Sir Charles Napier, a British subject,
had been appointed an admiral in the navy of Queen Donna Maria of Portugal. In that
capacity he captured a British steamship, “Lord of the Isles”, while it was trying to run
a blockade of the Portuguese coast. The ship was forfeited as prize by a Portuguese
prize court. On his return to England Napier was sued for trespass in the Court of King’s
Bench. Tindal CJ dismissed the action on the ground that the decree of the prize court
was conclusive. However, he also rejected an argument that Napier was prevented
from relying on the authority of the Queen of Portugal because he had entered her
service in breach of the Foreign Enlistment Act. Tindal CJ held that that breach of
English law could not make the acts of the Portuguese state justiciable:

“Again no one can dispute the right of the Queen of Portugal,

to appoint in her own dominions, the defendant or any other
person she may think proper to select, as her officer or
servant, to seize a vessel which is afterwards condemned as a
prize; …” (At p 796)

The decision on this point was approved by Lord Halsbury LC in Carr v Fracis Times &
Co at pp 179-80. (See also Belhaj per Lord Sumption at para 204.)

143. Duke of Brunswick v King of Hanover itself is a case concerning the exercise of a
power of appointment. Charles, the deposed Duke of Brunswick, sought, inter alia, to
challenge the validity of the appointment of a guardian over his property. As we have
seen, the House of Lords held that, notwithstanding the allegation that the instrument
was contrary to the laws of Hanover and Brunswick, “still if it is a sovereign act, then
whether it be according to law or not according to law, we cannot inquire into it”
((1848) 2 HL Cas 1, per Lord Cottenham LC at p 21).

144. On behalf of the Guaidó Board Mr Fulton fairly accepts that Dobree v Napier and
Duke of Brunswick can be regarded as direct appointments over property and so can
be analysed as property cases. Nevertheless, as he submits, there seems to be no
principled reason to distinguish between direct appointments of that kind and an
appointment over a legal entity which owns or controls property.

145. The more recent authorities to which we have been referred in relation to
powers of appointment do not take the matter any further. Bank of Ethiopia v National
Bank of Egypt concerned the disputed appointment of a liquidator and Banco de Bilbao
Page 57
v Sancha concerned the disputed appointment of a replacement board. In neither case
was reference made to the act of state doctrine presumably because, as Popplewell LJ
pointed out in Breish [2020] EWCA Civ 637, para 69), “In those cases the one voice
principle was determinative of the legal consequences because it identified the
appropriate government from whom the relevant law to be applied flowed”. Similarly,
in Breish itself, no point seems to have been taken on the application of the act of
state doctrine to the disputed appointment of the Chairman of the Libyan Investment
Authority.

146. For these reasons, I consider that Rule 2 applies to an exercise of executive
power such as the power of appointment to the board of the BCV.

Territoriality

147. On behalf of the Maduro Board, Mr Vineall further submits that if Rule 2 exists it
is limited to acts the direct consequences of which are felt only in the foreign state. He
submits that Rule 2 cannot apply in the present case because the relevant acts,
although they took effect in Venezuela, affect assets in the United Kingdom. Indeed, he
submits that this was the intended consequence and very purpose of the impugned
acts and that the expressed motivation in making the appointments was to ensure the
“protection … of state assets abroad”. In his submission, the acts of appointment are
concerned and concerned only with who could represent the BCV in its external
dealings outside Venezuela and, in particular, in Threadneedle Street.

148. Although the principle of non-justiciability reflected in Lord Neuberger’s Rule 3

may not invariably be limited to intra-territorial acts (Yukos [2014] QB 458, para 66,
per Rix LJ considering Buttes Gas; Belhaj per Lord Sumption [2017] AC 964, para 236),
his Rule 2 is undoubtedly subject to a territorial limitation. This was made clear in the
formulation of the rule in the earliest cases. The principle stated by Lord Cottenham in
Duke of Brunswick is that “a foreign Sovereign, coming into this country, cannot be
made responsible here for an act done in his sovereign character in his own country”
((1848) 2 HL Cas 1, p 17). In Belhaj, Lord Neuberger’s Rules 1 and 2 were expressed to
apply “to any acts which take place or take effect within the territory of that state”.
(See also para 135 per Lord Neuberger; para 36 per Lord Mance; para 229 per Lord
Sumption.) Relying in particular on Lord Neuberger’s reference to the effect of the
conduct of a foreign state, Mr Vineall seeks to expand this limitation on the act of state
principle so as to exclude from the operation of the principle conduct which has
repercussions outside the territory of the state concerned. There is no warrant for such
an extension. The reason for the territorial limitation is that the principle applies only
to sovereign acts of a foreign state performed within its proper jurisdiction, which is
usually limited to the territory of that state. There can be no justification for according
Page 58
such preferential status to sovereign acts of a foreign state where they exceed the
jurisdictional limits imposed by international law. As Lord Sumption explained in Belhaj
(at para 229), what he termed municipal law act of state is by definition confined to
sovereign acts done within the territory of the state concerned, since as a general rule
neither public nor private international law recognises the application of a state’s
municipal law beyond its own territory. However, this cannot provide a basis for an
unprincipled extension of the limitation simply on the ground that effects of the
relevant conduct, whether intended or not, are felt extra-territorially. Sovereign acts
legitimately performed within the territory of a state will not fall outside the ambit of
Lord Neuberger’s Rule 2 simply because they may have extra-territorial effect.

149. In the present case, the relevant acts of appointment were made within
Venezuela and were not in excess of the jurisdiction of Venezuela in international law.
Here, I gratefully adopt the analysis of Teare J at first instance in the present
proceedings in relation to the appointment of both the Special Attorney General and
the Guaidó Board ([2021] QB 455, paras 80-81):

“When the interim President appointed Mr Hernandez on 5

February 2019 he did so by means of a document ‘issued at
the Legislative Federal Palace in Caracas’. Thus the
appointment was made in Venezuela. The act of state
doctrine is based upon the court’s lack of jurisdiction over
the internal affairs of a sovereign state; see Buck v Attorney
General [1965] Ch 745, 770 per Diplock LJ quoted above and
Yukos Capital v Rosneft (No 2) at paras 53 and 54 where Rix LJ
quoted from R v Bow Street Metropolitan Stipendiary
Magistrate, Ex p Pinochet Ugarte (No 3) [2000] 1 AC 147. The
appointment by a head of state of a Special Attorney General
is surely to be characterised as part of the internal affairs of
Venezuela. Mr Hernandez derives his authority from an
executive act of the President in Caracas, Venezuela. In
making the appointment the President was not seeking to
exercise power over the territory of another state. The
ownership of the proceeds of the London arbitration
remained with the BCV. Although the effect of that
appointment could be said to be felt in Washington DC (if
that is where Mr Hernandez was) or in London (where he
gave instructions to DB) it would not accord with the
principles underlying the act of state doctrine to regard the
appointment as breaching the territorial requirement of that
doctrine.

Page 59
 When the interim President appointed the Ad Hoc Board of
BCV and declared the appointment of the previous President
of BCV as null and void pursuant to Decree No 8 he did so at
the Federal Legislative Palace in Caracas. The decree
concerned BCV which is a Venezuelan entity. Its Board and
President were changed. That took effect in Venezuela
because BCV is a Venezuelan entity. Again, although the
effect of that appointment could be said to be felt wherever
the board members are (it was suggested in the United
States) or in London, where gold was held for BCV by BoE,
the reality is that the appointment, which concerned a
Venezuelan entity, was made or took place in Venezuela and
had its most obvious effect there by reason of the change in
the Board and President of BCV. In making the appointment
the President was not seeking to exercise power over the
territory of another state. The ownership of the gold held by
the BoE remained with the BCV. The President was
concerned with an internal matter, the governance of
Venezuela’s central bank. In my judgment, to regard the
appointment of the Ad Hoc Board as extra-territorial and so
beyond the scope of the act of state doctrine would be
inconsistent with the principles underlying that doctrine.”

150. Finally in this regard, I note that in Jimenez v Palacios No 2019-0490-KSJM, 250
A 3d 814 (Delaware Chancery Court), a case which concerned the appointment by Mr
Guaidó of the board of the Venezuelan oil company PDVSA, the judge rejected a
submission that the appointment was an extra-territorial assertion of sovereign
authority because of its effect on Delaware corporations headquartered in Houston.
McCormick VC concluded (at p 841):

“In this case the official act is the replacement of the PDVSA
board. That act occurred within Venezuela’s territorial
boundaries and the plaintiffs do not contend otherwise. The
knock-on effects of that act which took place outside
Venezuela do not render the original act extraterritorial.”

That decision was upheld by the Supreme Court of Delaware: Jimenez v Palacios No
399, 2019, 237 A 3d 68 (Del SC, 22 July 2020).

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Incidental issue

151. On behalf of the Maduro Board, Mr Vineall submits that it can rely on an
exception to the act of state doctrine which applies where the allegations of
unlawfulness or invalidity arise incidentally rather than directly. Such an exception
finds support in the authorities. In Buck v Attorney General [1965] Ch 745, which
concerned a challenge to the validity of the constitution of Sierra Leone, Diplock LJ
considered (at p 770) that the validity of that law did not come in question incidentally
in proceedings in which the High Court undoubtedly had jurisdiction, “as, for instance,
the validity of a foreign law might come in question incidentally in an action upon a
contract to be performed abroad”. (Cf Al-Jedda v Secretary of State for Defence [2010]
EWCA Civ 758; [2011] QB 773, para 189 per Elias LJ.) In Buttes Gas [1982] AC 888, a
case concerned essentially with transactions of sovereigns on the international plane
and the extent of the territory of a foreign state, Lord Wilberforce accepted that a
question relating to foreign land, even to the title to foreign land, may arise
incidentally or collaterally to some other question and may therefore be decided (at pp
926-927, citing British South Africa Co v Companhia de Mocambique [1893] AC 602,
626; Tito v Waddell (No 2) [1977] Ch 106, 262, 263). However, in that case he
considered that the question of title to the location did not arise incidentally or
collaterally but was at the heart of the case. This was taken up by the Court of Appeal
in Yukos where Rix LJ observed ([2014] QB 458, para 109):

“Now in our judgment we would agree that challenges to

foreign acts of state, in order to invoke the act of state
doctrine, must, as Lord Wilberforce put it, lie at ‘the heart’ of
a case, and not be a matter of merely ancillary or collateral
aspersion: and that a test of necessity to a decision may
therefore be a useful test.”

Similarly, in Belhaj [2017] AC 964 Lord Neuberger stated (at para 140) that it did not
appear to him that the common law regards it as inappropriate for an English court to
decide whether a foreign state’s executive action infringed the law of that state, “at
least where that is not the purpose of the proceedings”. Lord Sumption, citing the
decision of the US Supreme Court in WS Kirkpatrick & Co Inc v Environmental Tectonics
Corpn International, stated (at para 240):

“[The act of state doctrine] applies only where the invalidity

or unlawfulness of the state’s sovereign acts is part of the
very subject matter of the action in the sense that the issue
cannot be resolved without determining it.”

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152. Applying the test formulated by Rix LJ in Yukos, there can be little doubt that the
present proceedings involve a direct attack upon the lawfulness and validity of
Presidential appointments made by Mr Guaidó, as advanced by appointees of his
political opponent, Mr Maduro. The essential dispute is between the Guaidó Board and
the Maduro Board and the focus of that dispute is on the validity of Mr Guaidó’s
appointments which undoubtedly lie at the heart of the case. In these circumstances, it
is not necessary to seek to resolve the issue raised by Mr Vineall as to whether Lord
Sumption’s formulation of the exception is unduly narrow.

The judgments of the STJ

153. If Rule 2 forms part of English law, as in my view it does, it might appear that
since Mr Guaidó is recognised by HMG as the President of Venezuela it is not open to
UK courts to challenge the lawfulness or legality of his appointments to the board of
the BCV. However, this reasoning fails to take account of the existence of judgments of
the STJ to contrary effect.

154. On behalf of the Guaidó Board it is submitted that the validity of the acts of
appointment under Venezuelan law are of no relevance because the act of state
doctrine requires acknowledgement of the executive acts of appointment by Mr
Guaidó as acts of sovereign power. As a result, it is further submitted, it is likewise
irrelevant that the STJ has in a series of rulings declared invalid both the appointments
themselves and the legislation pursuant to which they were made.

155. Where it applies, the foreign act of state doctrine holds national courts
incompetent to adjudicate upon the lawfulness or validity of the sovereign acts of a
foreign state. However, within most modern states sovereign power is shared among
the legislative, executive and judicial branches of government and it cannot be
assumed that the conduct of the executive is the sole manifestation of sovereign
power or that it should necessarily prevail over the position taken by the legislature or
the judiciary. As a result, in seeking to respect the sovereignty of a foreign state, it will
not always be appropriate for courts in this jurisdiction to focus exclusively on acts of
the executive. In Belhaj [2017] AC 964 both Lord Neuberger and Lord Mance touched
on the difficulties which can arise in this regard if sovereignty is equated with
executive activity. Thus, Lord Neuberger explained (at para 137) that where an
executive act is unlawful by the law of the state concerned, a failure by a court in the
United Kingdom to treat it as unlawful by the application of Rule 2 might conflict with
Rule 1 which requires courts in the United Kingdom to recognise and not question a
foreign state’s legislation and other laws which take effect within its territory. In a
further passage (at para 142), cited at para 119 above, he observed that if a
confiscation was unlawful under the laws of the foreign state and its courts were so to
Page 62
hold, it was by no means obvious to him why it would be appropriate for the
confiscation to be treated as valid by the courts of another state to which the property
had been transferred. Similarly, Lord Mance (at para 65) warned against equating
sovereignty with executive activity.

“In states subject to the rule of law, a state’s sovereignty may

be manifest through its legislative, executive or judicial
branches acting within their respective spheres. Any excess
of executive power will or may be expected to be corrected
by the judicial arm. A rule of recognition which treats any
executive act by the government of a foreign state as valid,
irrespective of its legality under the law of the foreign state
(and logically, it would seem, irrespective of whether the
seizure was being challenged before the domestic courts of
the state in question), could mean ignoring, rather than
giving effect to, the way in which a state’s sovereignty is
expressed. The position is different in successful
revolutionary or totalitarian situations, where the acts in
question will in practice never be challenged. It is probably
unsurprising that the cases relied upon as showing the
second kind of foreign act of state are typically concerned
with revolutionary situations or totalitarian states of this
kind.”

156. The present case is indeed unusual by comparison with other cases which raise
issues of justiciability in that here both the executive and judicial branches within
Venezuela have spoken. Mr Guaidó, recognised by HMG as the President of Venezuela,
has made appointments to the board of the BCV which the STJ, as a part of the judicial
branch of government, has declared to be unlawful and of no effect. As a result, this
court is confronted with conflicting positions adopted by the executive and the
judiciary of Venezuela. The question arises, therefore, whether in such circumstances
the foreign act of state doctrine in the form of Rule 2 requires courts in this jurisdiction
to defer to acts of the executive of a foreign state, in priority to recognising the rulings
of its judiciary. It should be noted in this regard that it is the pleaded case of the
Guaidó Board that the STJ is not to be regarded by an English court as an independent
court of law. That issue, however, falls outside the preliminary issues in this appeal and
consideration of it, if necessary, would have to be deferred. At this stage of the
proceedings we are concerned with the submission by the Guaidó Board that it is
entitled to succeed on the basis of act of state, quite apart from the position in the
municipal law of Venezuela.

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157. Although judicial rulings of a foreign state are manifestations of state
sovereignty, it is now clear that they do not themselves attract the operation of any
rule of foreign act of state applicable in this jurisdiction and, as a result, are not
entitled to the deference which may be shown to legislative and executive acts of a
foreign state. So much was established by Lord Collins delivering the judgment of the
Judicial Committee of the Privy Council in Altimo Holdings and Investment Ltd v Kyrgyz
Mobil Tel Ltd [2011] UKPC 7; [2012] 1 WLR 1804, para 101:

“The true position is that there is no rule that the English

court (or Manx court) will not examine the question whether
the foreign court or the foreign court system is corrupt or
lacking in independence. The rule is that considerations of
international comity will militate against any such finding in
the absence of cogent evidence. That, and not the act of
state doctrine or the principle of judicial restraint in Buttes
Gas & Oil Co v Hammer (No 3) …, is the basis of Lord Diplock’s
dictum in The Abidin Daver … and the decisions which follow
it. Otherwise the paradoxical result would follow that, the
worse the system of justice in the foreign country, the less it
would be permissible to make adverse findings on it.”

158. Rix LJ was able to build on this foundation when delivering the judgment of the
Court of Appeal in Yukos, which held justiciable the issue whether judicial acts had
been part of a “campaign waged by the Russian state for political reasons against the
Yukos group and its former CEO” ([2014] QB 458, paras 29(ii), 90). This difference of
approach does not reflect any hierarchical inferiority of judicial acts but rather reflects
a shared understanding of how courts should behave under the rule of law. As Lord
Mance put it in Belhaj, para 73(ii):

“If one believes in justice, it is on the basis that all courts will
or should subscribe to and exhibit similar standards of
independence, objectivity and due process to those with
which English courts identify.”

159. As a result, courts in this jurisdiction are more willing to investigate whether a
foreign court is acting in a way that meets the standards expected of a court and
whether there has occurred or is likely to a occur a failure of substantial justice. For
this reason, foreign judgments fall to be assessed under different rules from those
applicable to legislative and executive acts and are simply less impervious to review.
The matter is admirably expressed by Rix LJ in Yukos [2014] QB 458, para 87:

Page 64
“So the position is, to put the matter broadly, that whereas in
a proper case comity would seem to require (at any rate as a
principle of restraint rather than abstention) that the validity
or lawfulness of the legislative or executive acts of a foreign
friendly state acting within its territory should not be the
subject of adjudication in our courts, comity only cautions
that the judicial acts of a foreign state acting within its
territory should not be challenged without cogent evidence.
If then the question is asked - Well, why should acts of a
foreign judiciary be treated differently from other acts of
state, and what is the basis of that difference? - the answer,
in our judgment, is that judicial acts are not acts of state for
the purposes of the act of state doctrine. The doctrine in its
classic statements has never referred to judicial acts of state,
it has referred to legislative or executive (or governmental or
official) acts of a foreign sovereign. … It is not hard to
understand why there should be a distinction. Sovereigns act
on their own plane: they are responsible to their own
peoples, but internationally they are responsible only in
accordance with international law and internationally
recognised norms. Courts, however, are always responsible
for their acts, both domestically and internationally.
Domestically they are responsible up to the level of their
supreme court, and internationally they are responsible in
the sense that their judgments are recognisable and
enforceable in other nations only to the extent that they
have observed what we would call substantive or natural
justice, what in the United States is called due process, and
what internationally is more and more being referred to as
the rule of law. In other words the judicial acts of a foreign
state are judged by judicial standards, including international
standards regarding jurisdiction, in accordance with doctrines
separate from the act of state doctrine, even if the dictates of
comity still have an important role to play. As Lindley MR said
in Pemberton v Hughes [1899] 1 Ch 781, 790:

‘If a judgment is pronounced by a foreign court over

persons within its jurisdiction and in a matter with
which it is competent to deal, English courts never
investigate the propriety of the proceedings in the
foreign court, unless they offend against English views
of substantial justice’.” (Emphasis added)

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In the result, the Court of Appeal therefore agreed with the holding of Hamblen J at
first instance, [2011] EWHC 1461 (Comm); [2012] 1 All ER (Comm) 479, para 201, that
“there is no rule against passing judgment on the judiciary of a foreign country”.

160. Similarly, the US act of state doctrine does not apply to foreign court judgments
(Timberland Lumber Co v Bank of America, NT & SA, 549 F 2d 597, 608 (9th Cir 1976);
The American Law Institute, Restatement of the Law Fourth, the Foreign Relations Law
of the United States (2018), para 441, pp 313-314). The commentators to the US
Restatement note that, were the rule otherwise, courts in the United States would
face a significant conflict between the doctrines governing the recognition and
enforcement of foreign judgments, on the one hand, and the act of state doctrine on
the other. Philippine National Bank v United States District Court for the District of
Hawaii (2005) 397 F 3d 768 (9th Cir) in which the act of state doctrine was applied to
the judicial acts of a foreign court is disapproved in the US Restatement (at p 314) as
confusing the question whether a foreign judgment could be an act of state with the
question whether the existence of a foreign judgment would preclude a US court from
giving effect to the foreign official act on which the judgment rested. It was not
followed by the Court of Appeal of England and Wales in Yukos [2014] QB 458, paras
88-89, where Rix LJ noted that in Altimo Holdings [2012] 1 WLR 1804, para 102, Lord
Collins cited a number of US federal court decisions in which allegations of impropriety
against foreign courts had been adjudicated in the context of forum non conveniens
and enforcement of judgments.

161. There is therefore no rule requiring an unquestioning acceptance by courts in

the United Kingdom of the validity or legality of a foreign judgment. Rather, the status
of a foreign judgment is left to be determined in accordance with domestic rules on
the recognition and enforcement of foreign judgments.

162. Mr Andrew Fulton QC on behalf of the Guaidó Board submits that the correct
approach in situations where such a conflict arises between the executive and the
judiciary in a foreign state is to apply Lord Neuberger’s Rule 2 and to give effect to the
executive act, subject only to the domestic public policy exception in cases where that
applies. If the executive act is a sovereign act and if recognition of the act would not
offend English public policy, then an English court should treat it as valid and effective
under the act of state doctrine, without further inquiry. He submits that in the present
case this requires effect to be given to the executive acts of Mr Guaidó and the Guaidó
Board since there are no grounds of public policy which require UK courts to decline to
do so. It does not necessarily follow, however, that when confronted with such
conflicting positions by the executive and the judiciary of a foreign state, courts in this
jurisdiction are required to accept the lawfulness and validity of the executive act in
preference to recognising the foreign judgment, save in cases where to do so would

Page 66
conflict with the public policy of the forum. No doubt situations will arise in which the
act of the executive has been quashed by the foreign court on grounds which would
also attract the operation of UK public policy, such as a gross violation of human rights.
However, there are likely to be other situations in which the executive act has been
quashed on some less egregious ground, such as a failure to follow the correct
procedure, and it is not immediately obvious that effect should nevertheless be given
to the executive act. In this regard, I note by way of analogy that in Oppenheimer v
Cattermole [1976] AC 249 the House of Lords gave effect to a 1968 decision of the
German Federal Constitutional Court both with regard to the discriminatory National
Socialist decree which had purported to deprive the appellant of his German
nationality, which it held to be “Unrecht” and not law, and with regard to the Federal
Basic Law of 1949 (see Lord Hailsham LC at pp 262, 263; Lord Cross at pp 270-273). In
this way the House of Lords followed a decision of the Federal Constitutional Court in
order to determine the effect of a constitutional provision on prior legislation (see H W
Baade, “The Operation of Foreign Public Law” (1995) 30(3) Texas International Law
Journal 429, 461).

163. The question for consideration here is, to my mind, a more fundamental one. It
is necessary to ask whether Rule 2 has any application to a situation in which an
executive act of a foreign state has been quashed by the judiciary of that state. In
order to answer this question, it is necessary to have regard to the rationale of that
rule.

164. In Belhaj Lord Sumption noted ([2017] AC 964, para 225) that the English
decisions had rarely tried to articulate the policy on which the foreign act of state
doctrine is based and had never done so comprehensively. However, he discerned two
main considerations underlying the doctrine. The first was what is commonly called
“comity” but which he preferred to call “an awareness that the courts of the United
Kingdom are an organ of the United Kingdom”. Like any other organ of the United
Kingdom, its judiciary must respect the sovereignty and autonomy of other states.
Secondly, the act of state doctrine is influenced by the constitutional separation of
powers, which assigns the conduct of foreign affairs to the executive. I agree.

165. As we have seen, the authorities supporting the existence of Rule 2, proceed on
the basis that courts in this jurisdiction should not sit in judgment or adjudicate upon
the lawfulness or validity of a foreign state’s sovereign acts within its own territory. On
closer examination it appears that what is considered objectionable in such a course of
conduct is the intrusion into the internal affairs of a foreign state which such an
examination or passing of judgment would involve. While international law does not in
general require states to apply rules of act of state such as those identified here, there
can be little doubt that such rules, where they exist, are rooted in the concept of

Page 67
mutual respect for the sovereignty and independence of states and are intended to
promote international comity. This is apparent, for example, in the following
observation of Diplock LJ in Buck v Attorney General [1965] Ch 745, 770, where the
claimants sought to challenge the legality and validity of the Constitution of Sierra
Leone, an independent sovereign state:

“As a member of the family of nations, the Government of

the United Kingdom (of which this court forms part of the
judicial branch) observes the rules of comity, videlicet, the
accepted rules of mutual conduct as between state and state
which each state adopts in relation to other states and
expects other states to adopt in relation to itself. One of
those rules is that it does not purport to exercise jurisdiction
over the internal affairs of any other independent state, or to
apply measures of coercion to it or to its property, except in
accordance with the rules of public international law.

… For the English court to pronounce upon the validity of the

law of a foreign sovereign state within its own territory, so
that the validity of that law became the res of the res judicata
in the suit, would be to assert jurisdiction over the internal
affairs of that state. That would be a breach of the rule of
comity. In my view, this court has no jurisdiction so to do.”

166. Similarly, in R v Bow Street Metropolitan Stipendiary Magistrate, Ex p Pinochet

Ugarte (No 3) [2000] 1 AC 147, a case concerning a claim of immunity by General
Pinochet, a former head of state of Chile, Lord Millett referred to the close relationship
between state immunity ratione materiae (ie subject matter immunity) and the Anglo-
American act of state doctrine. He observed (at p 269F):

“The immunity finds its rationale in the equality of sovereign

states and the doctrine of non-interference in the internal
affairs of other states: see Duke of Brunswick v King of
Hanover (1848) 2 HL Cas 1; Hatch v Baez, 7 Hun 596;
Underhill v Hernandez (1897) 168 US 250. These hold that the
courts of one state cannot sit in judgment on the sovereign
acts of another …”

167. In the same case, Lord Phillips explained that there were two explanations for
immunity ratione materiae. The first was that to sue an individual in respect of the
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conduct of the state’s business was indirectly to sue the state. He continued (at p
286B-D):

“The second explanation for the immunity is the principle

that it is contrary to international law for one state to
adjudicate upon the internal affairs of another state. Where a
state or a state official is impleaded, this principle applies as
part of the explanation for immunity. Where a state is not
directly or indirectly impleaded in the litigation, so that no
issue of state immunity as such arises, the English and
American courts have none the less, as a matter of judicial
restraint, held themselves not competent to entertain
litigation that turns on the validity of the public acts of a
foreign state, applying what has become known as the act of
state doctrine.”

168. A further statement to similar effect is to be found in Oetjen v Central Leather

Co (1918) 246 US 297 (see para 133 above).

169. The act of state principle under consideration would therefore prohibit courts in
this jurisdiction from questioning or adjudicating upon the lawfulness or the validity of
certain executive acts of a foreign state on the ground that to do so would constitute
an objectionable interference with the internal affairs of that state. This rationale can
have no application, however, where courts in this jurisdiction merely give effect to a
judicial decision whereby the courts of the foreign state concerned, acting within their
proper constitutional sphere, have previously declared the executive acts to be
unlawful and nullities. If a UK court were to give effect to such a foreign judgment, it
would not itself be sitting in judgment on the executive act but giving effect to the
view of it taken by the judicial branch of government within the foreign state. Lord
Neuberger’s Rule 2 could therefore have no application to such a situation.
Furthermore, although judicial acts of that foreign state do not enjoy before UK courts
the protection of any such rule of non-justiciability, it may in certain circumstances
nevertheless be appropriate to recognise or give effect to them in accordance with
domestic rules of private international law. If, for example, an executive act of the US
President were to be declared unconstitutional by a judgment of the US Supreme
Court, recognition of that judgment (if it were otherwise entitled to recognition before
UK courts) would not involve any investigation into or adjudication upon the internal
affairs of the United States so as to bring the act of state principle into operation. The
matter was neatly expressed by Males LJ in the Court of Appeal in the present case
([2021] QB 455, para 150):

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 “There is, however, no want of comity in holding that the act
of state doctrine does not require the English court to treat
as valid and effective as a sovereign act of executive power
that which the foreign court has held to be unlawful and
therefore null and void, while recognition of the separation
of powers should operate both ways. To recognise the
decision of the foreign court, acting within its own sphere of
responsibility under the constitution of the foreign state, is in
accordance with principles of comity and the separation of
powers.”

170. The focus of the present case therefore shifts to the status of the judgments of
the STJ on which the Maduro Board relies. These judgments do not themselves attract
the protection of any act of state rule. The question becomes whether, and if so to
what extent, they should be recognised or given effect by courts in this jurisdiction.
These are matters which fall outside the preliminary issues and which have not been
addressed in argument before us. It will, accordingly, be necessary to remit this issue
for further consideration by the Commercial Court. One matter, however, is clear.
Courts in this jurisdiction will refuse to recognise or give effect to foreign judgments
such as those of the STJ if to do so would conflict with domestic public policy. On this
appeal we have not been taken to the judgments in question and the Commercial
Court will have to address this issue among others when the matter is remitted to it. It
is important to note at this point, however, that the public policy of the forum will
necessarily include the fundamental rule of UK constitutional law that the executive
and the judiciary must speak with one voice on issues relating to the recognition of
foreign states, governments and heads of state. As a result, if and to the extent that
the reasoning of the STJ leading to its decisions that acts of Mr Guaidó are unlawful
and nullities depends on the view that he is not the President of Venezuela, those
judicial decisions cannot be recognised or given effect by courts in this jurisdiction
because to do so would conflict with the view of the United Kingdom executive.

Rule 1: A foreign state’s legislation or other laws

171. Although the principal focus of the appeals before us has been on executive acts
which the Guaidó Board submits must, by virtue of Rule 2, be given effect as sovereign
acts regardless of their status in the law of Venezuela, the Guaidó Board relies, in the
alternative, on Rule 1 as prohibiting a challenge before courts in this jurisdiction to the
validity or lawfulness of the legislation or other laws of a foreign state. On this basis,
the Guaidó Board submits that the Transition Statute which conferred the powers of
appointment must be treated as valid and effective and that the challenges to it made
by the Maduro Board must be treated as non-justiciable. It submits that the Maduro

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Board is advancing a head-on challenge to the validity of a sovereign legislative act of a
foreign state which is precluded by Rule 1.

172. There can be no doubt as to the existence of Rule 1. Normally, courts in this
jurisdiction will recognise and will not question the effect of a foreign state’s legislation
or other laws in relation to any acts which take place or take effect within the territory
of that state (Belhaj [2017] AC 964, para 121 per Lord Neuberger). As Lord Neuberger
explained in Belhaj (at para 135) there is ample authority in support of Rule 1, at least
in relation to property situated within the territory of the state concerned. (See Duke
of Brunswick (1848) 2 HL Cas 1, p 17 per Lord Cottenham LC; Carr v Fracis Times & Co
[1902] AC 176, 179 per Lord Halsbury LC; Luther v Sagor [1921] 3 KB 532, 549 per
Warrington LJ; at p 545 per Bankes LJ; Princess Paley Olga [1929] 1 KB 718, 722-723
per Scrutton LJ; at pp 730-732 per Sankey LJ; at pp 732-736 per Russell LJ; Buttes Gas
[1982] AC 888, 937 per Lord Wilberforce.) In Belhaj Lord Sumption (at para 228) stated
the principle as follows:

“The principle is that the English courts will not adjudicate on

the lawfulness or validity of a state’s sovereign acts under its
own law.”

In Belhaj Lord Neuberger observed (at para 135):

“Sovereignty, which founds the basis of the Doctrine,

‘denotes the legal competence which a state enjoys in
respect of its territory’ (Brownlie’s Principles of Public
International Law, 8th ed (2012), p 211), and there is no
more fundamental competence than the power to make
laws.”

173. In the Court of Appeal, Males LJ ([2021] QB 455, paras 140-141) carefully
explained the significance of the Transition Statute to this part of the Guaidó Board’s
case. The Guaidó Board does not suggest that Mr Guaidó was entitled, as a matter of
Venezuelan law, to appoint members of the board of the BCV or to appoint a Special
Attorney General by virtue of his position as interim President. Its case is that the
National Assembly was entitled to and did pass the Transition Statute, a legislative act
of the state of Venezuela, which authorised Mr Guaidó to make those appointments
and that that attracts both Rule 1 and Rule 2. However, Rule 1 can only apply if the
Transition Statute is to be regarded as a legislative act of the state of Venezuela.

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174. The effect of Rule 1 is that courts in this jurisdiction would not normally
entertain a direct challenge to a foreign state’s legislation such as that brought by the
Maduro Board in relation to the Transition Statute. Teare J accepted ([2021] QB 455,
para 64) that there was credible evidence before the court that the Transition Statute
is the act of the Venezuelan legislature, namely evidence that it had been issued and
signed by the officers of the National Assembly and that it bore the seal of the interim
President of Venezuela. That evidence was not challenged. The Maduro Board then
submits that the issue as to the lawfulness or validity of the Transition Statute and the
subsequent executive acts arise only incidentally. It accepts that this issue has to be
decided in order to determine who controls the arbitration and the gold, but submits
that determining the lawfulness or validity of this legislative act is not the purpose or
object of either claim. I am unable to accept this submission. Applying the test
formulated by Rix LJ in Yukos (see para 151, above), it is clear that the challenge to the
lawfulness and validity of the Transition Statute and the executive acts of appointment
taken pursuant to it lie at the heart of this case. This is not a matter of merely ancillary
or collateral aspersion. The Maduro Board’s case involves a direct attack on legislation
passed by the Legislative Assembly.

175. In the present case, however, there exist judgments of the STJ which hold that
the Transition Statute is, as a matter of Venezuelan law, a nullity. In particular, that
result is said to flow from the judgment of the STJ of 1 August 2016 holding that all
decisions taken by the National Assembly would be null and void for so long as the
Assembly was constituted in breach of the judgments and orders of the STJ. The
Guaidó Board submits that those judgments should not be recognised or given effect
in this jurisdiction on grounds of failure of due process and lack of impartiality on the
part of the STJ judges.

176. The resulting situation closely resembles that in relation to Rule 2 which has
been addressed above. The rationale of Rule 1 is similar to that of Rule 2. For courts in
this jurisdiction to rule on the lawfulness or validity of the legislation or other laws of a
foreign state would be an unwarranted intrusion into its internal affairs and a breach
of comity. This is readily apparent from Buck v Attorney General, a case involving a
challenge to the constitution of Sierra Leone, in which, as we have seen, Diplock LJ
considered ([1965] Ch 745, 770) that to pronounce on the validity of a law of a foreign
sovereign state within its own territory, so that the validity of that law became the res
of the res judicata in the suit, would be to assert jurisdiction over the internal affairs of
that state. However, no such objectionable intrusion would occur where the courts of
one state were merely recognising or giving effect to judgments by the courts of
another. In my view, such a situation would fall outside the scope of Rule 1.

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177. Rule 1 would prohibit a challenge to the lawfulness or validity of the Transition
Statute, save to the extent that a judgment of the STJ is to be recognised or given
effect in this jurisdiction. Such a judgment would not itself attract any enhanced status
by virtue of the act of state doctrine which has no application to judicial decisions. The
question then becomes whether, and if so to what extent, courts in this jurisdiction
should give effect to judgments of the STJ, a matter which falls outside the scope of
the preliminary issues raised on this appeal and which will have to be addressed by the
Commercial Court when this matter is remitted to it. That hearing will have to take
account of and rule upon the Guaidó Board’s challenge to the decisions of the STJ on
grounds of failure of due process and lack of impartiality. Furthermore, it must be
emphasised once again that effect could only be given to such foreign judgments
subject to the overriding operation of the public policy of the forum which will
necessarily include the effective application of the one voice principle. As a result, no
recognition or effect could be given to a judgment of the STJ if and to the extent that
to do so would conflict with the recognition by HMG of Mr Guaidó as the interim
President of Venezuela.

178. The Maduro Board maintains that there are other constitutional reasons why
the appointments of the Special Attorney General and the Guaidó Board are invalid.
The only one which has been developed at all before us - and that only in the Maduro
Board’s written case - is its submission that the Transition Statute cannot be effective
legislation because it has not been published in the Official Gazette as required by
article 215 of the Venezuelan Constitution. Once again, Rule 1 would in my view
prohibit a challenge on this ground to the lawfulness or the validity of the Transition
Statute, save to the extent that there may exist a judicial ruling of the STJ to which
effect should be given by courts in this jurisdiction in accordance with domestic rules
of private international law and the public policy of the forum.

179. It is necessary to refer to a further submission on behalf of the Maduro Board

that the BCV is not a “decentralized entity abroad” within the Transition Statute, with
the result that the enabling power in article 15 does not extend to permit
appointments in relation to the BCV. This point was not developed before us. It seems
to be accepted by both parties that this is not an attack on the validity of the Transition
Statute but rather a submission as to its interpretation and applicability and that, as a
result, Rule 1 is not engaged. The Guaidó Board then submits that to the extent that
this argument is deployed to challenge the validity of the executive acts of
appointment it is precluded by Rule 2. The applicability of Rule 2 to the present case
has been considered earlier in this judgment. Finally, the Guaidó Board submits that
the National Assembly has confirmed by its Resolution dated 19 May 2020 that the
BCV is a decentralised entity within the meaning of the Transition Statute and that this
Resolution is a legislative act which a court in the United Kingdom will not question. If
and to the extent that the Maduro Board may seek to challenge the lawfulness or
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validity of the Resolution of 19 May 2020, Rule 1 would prohibit such a challenge, save
to the extent that a judgment of the STJ is to be recognised or given effect in this
jurisdiction.

180. Finally in this regard, I should point out that in the light of the conclusion to
which I have come in relation to Rule 2, Rule 1 is not necessary to the analysis of this
case since Rule 2 has the effect (subject to the STJ judgments) that the validity of the
executive acts of Mr Guaidó in appointing members of the BCV board cannot be
questioned by courts in this jurisdiction. Whether the validity of the underlying
legislation can be questioned is, therefore, immaterial.

Conclusion

181. For these reasons I would allow the appeal in part and dismiss the cross-appeal.

(1) Courts in this jurisdiction are bound by the one voice principle to accept
the statements of the executive which establish that Mr Guaidó is recognised by
HMG as the constitutional interim President of Venezuela and that Mr Maduro
is not recognised by HMG as President of Venezuela for any purpose. It is
appropriate to grant declaratory relief to that effect.

(2)(a) There exists a rule of domestic law that, subject to important exceptions,
courts in this jurisdiction will not adjudicate or sit in judgment on the lawfulness
or validity under its own law of an executive act of a foreign state, performed
within the territory of that state.

(b) There exists a rule of domestic law that, subject to important exceptions,
courts in this jurisdiction will recognise and will not question the effect of a
foreign state’s legislation or other laws in relation to any acts which take place
or take effect within the territory of that state.

Accordingly, subject to (3) below, courts in this jurisdiction will not question the
lawfulness or validity of: (i) Decrees Nos 8 and 10 issued by Mr Guaidó; (ii) the
appointment of the Special Attorney General; or (iii) the appointment of the Ad
Hoc Administrative Board of the BCV (ie the Guaidó Board).

(3) However, in agreement with the Court of Appeal, I consider that, to the
extent that the Maduro Board may rely on judgments of the STJ to which
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recognition or effect should be given by courts in this jurisdiction in accordance
with domestic rules of private international law and the public policy of the
forum, the rules identified in para 2(a) and (b) above would not be engaged. It is
therefore necessary for the proceedings to be remitted to the Commercial Court
for it to consider whether the judgments of the STJ should be recognised or
given effect in this jurisdiction.

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