The U.S. Willful Practice of Long-arm Jurisdiction and its Perils

February 2023

Contents

Introduction

I. An Overview of U.S. Long-arm Jurisdiction

II. Exercise and Expansion of U.S. Long-arm Jurisdiction

III. The Perils of U.S. Long-arm Jurisdiction

Conclusion

Introduction

The United States has a longstanding practice of exerting frequent long-arm jurisdiction over other countries, including both its allies and countries with which it has hostile or strained relations. In recent years, the practice has kept expanding in scope, with U.S. "arms" stretching longer and longer. Examining cases of U.S. abuse of long-arm jurisdiction, this report lays bare the severe harm it has done to the international political and economic order and the international rule of law.

I. An Overview of U.S. Long-arm Jurisdiction

◆According to U.S. domestic law, long-arm jurisdiction refers to jurisdiction over persons or entities domiciled or resident outside the territory of the sanctioning state. First established by the U.S. Supreme Court in the case of International Shoe Co. v. State of Washington (1945), long-arm jurisdiction allows state courts to exercise in personam jurisdiction in civil and commercial cases where jurisdiction cannot be exercised because the defendant is not domiciled in the state, on the basis that the defendant has some "minimum contacts" with the state.

◆According to international law, the exercise of a country's jurisdiction over an extraterritorial person or entity generally requires that the person or entity or its conduct has a real and sufficient connection to that country. Yet the U.S. exercises long-arm jurisdiction on the basis of the "minimum contacts" rule, constantly lowering the threshold for application. Even the flimsiest connection with the United States, such as having a branch in the United States, using U.S. dollar for clearing or other financial services, or using the U.S. mail system, constitutes "minimum contacts."

◆To exercise long-arm jurisdiction, the United States has further developed the "effects doctrine," meaning that jurisdiction may be exercised whenever an act occurring abroad produces "effects" in the United States, regardless of whether the actor has U.S. citizenship or residency, and regardless of whether the act complies with the law of the place where it occurred. The United States has also been expanding the scope of its long-arm jurisdiction to exert disproportionate and unwarranted jurisdiction over extraterritorial persons or entities, enforcing U.S. domestic laws on extraterritorial non-US persons or entities, and wantonly penalizing or threatening foreign companies by exploiting their reliance on dollar-denominated businesses, the U.S. market or U.S. technologies.

◆In essence, long-arm jurisdiction is an arbitrary judicial practice, wielded by the U.S. government on the strength of its national power and financial hegemony, to enforce extraterritorial jurisdiction over entities and individuals of other countries on the ground of its domestic law.

II. Exercise and Expansion of U.S. Long-arm Jurisdiction

◆In the many years of exercising such jurisdiction, the United States has gradually developed a massive, mutually reinforcing and interlocking legal system for long-arm jurisdiction, and continued to lower the threshold and expand its discretionary power, thus shaping long-arm jurisdiction into a tool for the United States to advance hegemonic diplomacy and pursue economic interests. Such practice disregards other countries' sovereignty, blatantly meddles in others