Jam v. International Finance Corp.

In Jam v. International Finance Corp., decided by the U.S. Supreme Court on February 27, 2019, a group of Indian fishermen and farmers, led by Budha Ismail Jam, sued the International Finance Corporation (IFC) for environmental damage caused by a coal-fired power plant in Gujarat that the IFC had financed. The IFC claimed absolute immunity under the International Organizations Immunities Act of 1945. The Supreme Court held that the Act grants international organizations the same immunity that foreign governments receive under the Foreign Sovereign Immunities Act, which includes a commercial activity exception. Thus, the IFC was not entitled to absolute immunity for its commercial lending activities, and the case was remanded for further proceedings.

The Supreme Court reversed the D.C. Circuit's ruling, holding that the IOIA confers immunity consistent with the FSIA, meaning the IFC is not absolutely immune and may be sued for acts based on its commercial activity. The case was remanded to allow the lawsuit to proceed.

Whether the International Organizations Immunities Act affords international organizations like the IFC absolute immunity from lawsuits, or only the restrictive immunity that foreign governments enjoy under the Foreign Sovereign Immunities Act, specifically whether commercial activities are subject to suit.

The decision enables lawsuits against international financial institutions in U.S. courts for harms stemming from their commercial projects, significantly increasing legal accountability for environmental and human rights impacts and potentially reshaping the operational risk landscape for organizations such as the World Bank Group.