Over the past decades, the Italian legal system has had to deal with a complex systemic issue related to the application of international custom regarding the immunity of states from civil jurisdiction for conduct constituting international crimes. Both national and international jurisprudence have outlined a layered and often conflicting legal framework, culminating in the pronouncements of the Constitutional Court and the recent regulatory intervention of the Italian legislature with Decree-Law No. 36 of April 30, 2022. The present analysis aims to examine the jurisprudential and regulatory developments on the subject, with particular reference to the recent ruling No. 159/2023 of the Constitutional Court, which ruled out profiles of constitutional illegitimacy in relation to the ex lege extinction of enforcement proceedings against the Federal Republic of Germany (FRG) for reparations for damages resulting from a series of crimes committed by the Third Reich between 1939 and 1945.

Jurisprudential (and normative) evolution since the Ferrini jurisprudence

The issue of state immunity found its first relevant declination in the landmark Italian Supreme Court on ruling March 11, 2004, No. 5044, appellant Ferrini (see Yearbook 2011, p. 222 and Yearbook 2012, p. 282), which disregarded the international custom on the immunity of states from civil jurisdiction when matters of international crimes are involved, admitting the jurisdiction of Italian courts over disputes about reparations for war crimes. This interpretation was censured by the International Court of Justice (ICJ) in its ruling of 3 February 2012 (Germany v. Italy), in which Italy was condemned for violating the customary rule in question.

In Judgment No. 238 of 2014, the Constitutional Court then revived the debate on the compatibility of international customary law with the domestic legal systems, noting that the recognition to foreign states of jurisdictional immunity even in cases of serious violations of fundamental rights would result in an impermissible compression of the inviolable right to sue and resist in court to protect one's human rights, as well as an impairment of the principle of human dignity (see Articles 2 and 24 Const.). This decision reaffirmed the so-called “counter-limits” theory, which would prevent the automatic prevalence of international norms (albeit transposed into Italian law through Article 10 Const.) if they infringe on non-derogable principles of the constitution. The Constitutional Court's ruling annulled as unconstitutional a law adopted to implement the 2012 ICJ decision, besides excluding the applicability in Italy of the rule (contained in the law providing for Italy's accession to the United Nations) that recognises the mandatory nature for Italy of ICJ rulings, insofar as it gave legal cover to the ICJ ruling found to be contrary to the aforementioned national constitutional principles.

Following further submission to the ICJ by Germany, the Italian Parliament adopted Decree-Law No. 36 of April 30, 2022 (later converted into Law No. 79 of 2022), establishing the “Fund for Compensation of Damages Suffered by Victims of War Crimes and Crimes against Humanity for the Injury of Inviolable Rights of the Person, Carried Out on Italian Territory or Otherwise to the Detriment of Italian Citizens by the Forces of the Third Reich in the Period between September 1, 1939 and May 8, 1945,” thus leading Germany to suspend the proceedings before the ICJ.  

However, with an order dated November 21, 2022, the Court of Rome (civil section IV) raised a question of the constitutionality of Article 43, paragraph 3, of the decree-law mentioned above, complaining of a conflict with Articles 2, 3, 24 and 111 of the Italian Constitution. The Constitutional Court, in Judgment No. 159/2023, ruled out the illegitimacy of the controversial provisions, considering that the ex lege extinction of the proceedings in execution was offset by the protection offered by the newly established Fund, which guarantees equivalent and indeed more effective protection than that only theoretically deriving from the full implementation of the 2014 Constitutional Court’s judgment, considering that the application of the latter is burdened by the uncertainties arising from the restricted immunity of foreign states in execution proceedings.

Customary international law on restricted immunity at the execution stage

Indeed, the Constitutional Court pointed out that the inapplicability of international customary law in the face of constitutional “counter-limits,” as outlined in Judgment No. 238/2014, concerns only the cognitive phase of the judgment, without extending to the enforcement phase. In the enforcement phase, on the other hand, the international custom on restricted immunity operates, as recognised by the ICJ and according to the 2005 New York Convention on Jurisdictional Immunity of States and their Property, and as arguably acknowledged by the Italian legal system based on the incorporation mechanism of Article 10 Const. Restricted immunity requires a distinction between state properties subject to seizure (the properties destined for iure gestionis activities) and those exempt from execution due to their use for public functions (iure imperii properties). The latter would then be covered by restricted executive immunity.

This custom does not violate the right of access to justice under Article 24 of the Constitution (in other words, it does not exclude the fundamental right “to a judge and a judgment”), as it only excludes certain categories of property from enforcement measures. In truth, Article 43 of Decree-Law 36/2022 establishes the extinction of all enforceable proceedings. It prevents initiating or continuing enforcement proceedings against the Federal Republic of Germany (FRG), making the distinction between assailable and non-assailable assets practically moot. The Court, however, held that the regulatory framework in question achieves a fair balance between compliance with international obligations arising from the 1961 Bonn Agreement (which closed any dispute over reparations due to Italian victims of Nazi persecution) and the judicial protection of victims of war crimes, constituting a differentiated and exceptional regulatory solution that is not unreasonable.

On the alleged violation of the fundamental right to judicial protection (Articles 2 and 24 of the Constitution): satisfactory mechanism outlined in Article 43 of the Decree Law

The first issue of constitutionality, raised by the Court of Rome with the order of December 1, 2022, concerned the (alleged) violation of Articles 2 and 24 of the Constitution, according to which "the Republic recognizes and guarantees the inviolable rights of man" and "everyone can take legal action to protect their rights and legitimate interests". According to the lower court, the provision of Article 43, paragraph 3 of Decree Law No. 36 of 2022 compromised the right to judicial protection, which should be understood not only as the ability to approach a Court to have one's rights protected but also access to the enforcement phase for compensation for the damages suffered, in the part where it resulted in the automatic extinguishment of ongoing enforcement procedures.

The Court emphasized that the "relief" Fund, on the other hand, constitutes an adequate satisfactory mechanism, as it provides for a "shift in the economic burden" from the Federal Republic of Germany (FRG) to Italy, ensuring full satisfaction of the recognized compensation obligations. Under Article 43, the victims’ claims against Germany are transformed into an equivalent right imposed on the Fund, offering an alternative protection to forced enforcement against the FRG, the implementation of which would be uncertain due to the applicability of limited immunity and the difficulty of identifying seizable assets.

Thus, the extinction of proceedings in the enforcement phase is compensated by the protection recognized by the Fund, which, moreover, satisfies creditors more fully because "there is no uncertainty related to the applicability of the restricted immunity of States in enforcement proceedings". In other words, the Fund removes this uncertainty by enhancing the prospects of satisfaction for those entitled and balancing the principle of victim protection with respect for the pre-existing international agreements between Italy and Germany. The Court has repeatedly stated that there is no illegitimacy in procedural provisions that provide for the extinction of pending proceedings, as long as they are accompanied by substantial measures that ensure – even through alternative methods to judicial enforcement – the effective realization of the concerned rights.

Italian-German Bonn Agreements: balancing victims' rights with the need to respect international obligations (Article 117 of the Constitution)

The Court of Rome also considered that the contested provision violated Articles 3 and 111 of the Constitution, in relation to the principles of sovereign equality between States and the equality of the parties in the trial, arguing that the "creditors" of the FRG could not find adequate compensation in the Fund because, at the time the order was issued, there were no guidelines for accessing the Fund or the procedures for payment of compensation by the relevant Ministry.

The Constitutional Court, in Judgment No. 159 of 2023, ruled that this aspect of the unconstitutionality of Article 43, paragraph 3 of Decree Law No. 36 of 2022 was unfounded, considering that the provision constitutes a satisfactory means not only more adequate but also capable of fully meeting the international obligations arising from the Bonn Agreements, thus avoiding any violation of Article 117 of the Constitution. In particular, the judgment states: “The absolute peculiarity of the case, which sees the need to balance the obligation to respect the Bonn Agreement of 1961 and the judicial protection of the victims of the aforementioned war crimes, constitutes a sufficient justification for a differentiated and exceptional regulation, which [...] represents a not unreasonable point of balance in the complex issue of indemnities and reparations for war crimes" (consideration 18).

The judgment highlights how, in the complex matter of reparations for war damage, it is necessary to balance the obligations arising from the 1961 Bonn Agreement between Germany and Italy with the right to judicial protection for the victims of war crimes. Both principles are of constitutional rank: on one hand, there is Article 24 of the Constitution and the fundamental right to judicial protection, and on the other hand, Article 117, which, in the first paragraph, provides for compliance with obligations arising from international agreements (in this case, the commitments arising from the Bonn Agreements signed between Italy and Germany in 1961).

The 1961 Agreement between the Italian Republic and the Federal Republic of Germany for compensation to Italian citizens affected by Nazi persecution measures provides in Article 1 that Germany will pay 40 million marks to Italy "for the benefit of Italian citizens who, due to race, faith, or ideology, were subject to Nazi persecution measures and who, due to these measures, suffered deprivation of freedom or damage to health, as well as for the survivors of those who died due to these persecutions".

The Constitutional Court believes that the legislator, by establishing the Fund, has acted in continuity with this Agreement, ensuring that the Italian state takes on the burden of compensating the damages suffered by the victims of war crimes committed by the armed forces of the Third Reich. The Court also points out that the Council of Ministers established, by interministerial decree of June 28, 2023, a procedure for accessing the Fund and the related compensation modalities, which were not yet available at the time the question was referred by the judge of the Court of Rome.

Conclusions

The Constitutional Court has been called upon to rule on a long-standing and delicate issue, that of reparations for damages suffered by the victims of war crimes committed by the military forces of the Third Reich. The Court found that the current legal framework strikes an appropriate balance between the protection of fundamental rights, including the right to be compensated for damages suffered as a fundamental right to judicial protection, and the obligation of states to respect the commitments arising from international agreements.

According to the Court, through the establishment of the Fund under Article 43, paragraph 3 of Decree Law No. 36 of 2022, the Italian state has acted in compliance with and continuity with the commitments arising from the Bonn Agreements of 1961 and has ensured a better satisfaction of the right to compensation for the victims and their heirs.