This Article argues that the self-execution framework that courts have adopted—and scholars have endorsed—in addressing whether McCarran-Ferguson enables states to reverse preempt the New York Convention is inadequate. First, the Article addresses the interpretive question: what is an “Act of Congress” under McCarran-Ferguson? By examining whether a treaty is self or non-self-executing, courts discard proper methods of statutory interpretation. Second, the Article argues that courts have failed to satisfactorily transpose the self-execution doctrine—which has been relevant only in determining whether a treaty confers a legally enforceable right in the U.S.—into the context of the conflict between McCarran-Ferguson and the New York Convention. Finally, the Article argues that the treaty’s self-executing or non-self-executing status is irrelevant because enforcing an international arbitration agreement under the New York Convention implicates Chapter 2 of the Federal Arbitration Act—which implemented the Convention—and McCarran-Ferguson permits a state law to reverse preempt an Act of Congress. Since the self-execution approach fails to answer the interpretive problem posed by McCarran-Ferguson, practitioners and courts should adopt an alternative approach that is more consistent with proper methods of statutory interpretation.
Part II of this Article sets up the framework in which the previously mentioned legal question arises. It reviews federal law governing the enforceability of arbitration agreements, including the Federal Arbitration Act, the New York Convention, and McCarran-Ferguson’s reverse preemption scheme as it relates to federal arbitration law. Part III introduces the disagreement between federal courts as to whether McCarran-Ferguson permits states to reverse preempt the implementation of the New York Convention to the extent that it may be applied to the business of insurance. Part IV argues that the methodology of resolving this disagreement—which currently centers on whether or not the New York Convention is a self-executing treaty—inadequately addresses Congress’s purpose in enacting McCarran-Ferguson. It further contends that regardless of the self-executing or non-self-executing status of the New York Convention, McCarran-Ferguson protects state law from preemption by the substantive guarantees of the New York Convention because an Act of Congress, Chapter 2 of the Federal Arbitration Act, provides the sole mechanism for the enforcement and recognition of international arbitration agreements under the Convention. Part V briefly concludes this Article.
Michael J. Ritter, Disputing Arbitration Clauses in International Insurance Agreements: Problems with the Self-Execution Framework, 3 Pace Int’l L. Rev. Online Companion 40 (2012).