Sovereign enforcement disputes are rarely short on drama, but behind the headlines lie some of the longest and most complex recovery battles in international law. In this article, Deminor explores the world of sovereign disputes and enforcement, from the landmark Monetary Gold case to modern-day aircraft and yacht seizures, and examines how third-party funding can help creditors accelerate the path to recovery.
Sovereign disputes and related enforcement proceedings tend to be eye-catching for various reasons. Firstly, the sums involved are often astronomical, with the past decade demonstrating a shift towards higher damages claims and awards. The average claim is approximately USD 1.1 billion, although the distribution is highly skewed by a relatively small number of mega-claims.
Secondly, they frequently revolve around cloak-and-dagger strategies in which parties have been known to covertly shuffle around their assets, produce forged documentation and point fingers at previous administrations – all in the name of preserving their personal interests and those of the state, which are not always readily differentiated.
Thirdly, unlike standard commercial proceedings, their resolution often ultimately relies on a complex interplay of internal and external factors, typically including assets identified for enforcement, changing regime dynamics, geopolitical trends, and a debtor state’s ability to protect itself on the grounds of sovereign immunity.
Above all, though, it is the enforcement of so-called trophy assets and the narratives surrounding them that make these cases so attention-grabbing in the first place.
The Monetary Gold Case
The “Corfu Channel Incident” is one such example. In 1946, 44 British personnel died after a Royal Navy flotilla struck Albanian mines in the Corfu Channel. A year later, Great Britain and Northern Ireland filed proceedings in the International Court of Justice against the People’s Republic of Albania, with the court ultimately ruling that Albania was responsible for the explosions and liable for damages.
In lengthy recovery proceedings that lasted until the 1990s, the UK sought to seize approximately 1,600kg of Albanian gold that had been looted by Nazi Germany in 1943 from a vault in Rome. Ownership of the gold, which was being held by the Bank of England, was subject to various competing claims, including from Italy. The case ultimately concluded in 1992, when the UK agreed to return Albania’s gold in return for USD 2mn (worth roughly USD 4.7mn today) in compensation to settle the dispute.
This was a landmark case and a classic example of external dynamics, namely the collapse of the USSR, serving as a crucial turning point and opening the door to a diplomatic resolution. Diplomatic relations between the UK and Albania were restored in 1991, and the former Soviet state sought to normalise relations with the West. Hence, it became incentivised – practically overnight – to reach a mutually beneficial resolution after years of deadlock. Moreover, many of the key asset recovery mechanisms – tracing gold flows and seeking to attach the gold itself – are not uncommon in today’s sovereign enforcement landscape.
Modern-Day Enforcement Seizures
While historical sovereign enforcement cases often involved gold reserves and cultural property, such as famous artworks, today’s disputes typically centre on commercial assets – from government aircraft and shipping interests to bank accounts and state-owned enterprises. Moveable assets, such as planes, are uniquely vulnerable because they can physically enter jurisdictions where local courts can act quickly.
State-owned aircraft are a classic enforcement target that can cause diplomatic uproar when successfully seized. In August 2024, a French court impounded three jets owned by the Nigerian government in relation to a long-running dispute with a Chinese company. The aircraft included a presidential Falcon 7X, a high-end business jet valued at USD 54mn-60mn, prompting fierce condemnation from the authorities in Nigeria. The creditor, Zhongshan Fucheng, reportedly implemented a multi-jurisdictional enforcement strategy aimed at pressurising a Nigerian state into a settlement following a c. USD 70mn award obtained in 2021. By July 2025, the dispute had purportedly been settled.
In another dramatic aircraft seizure that occurred in June 2020, Lebanese creditors enforcing against the Republic of Congo attached and ultimately auctioned off a Falcon 7X linked to President Denis Sassou Nguesso, who has reportedly amassed a personal net worth of around USD 150mn during his three decades in power. The jet was sold at auction for EUR 7.1mn in late 2023, notwithstanding diplomatic immunity arguments raised by Congolese government. The dispute, which arose from a 2000 ICC arbitral award, has led to decades of litigation and remains ongoing.
Other attempts to facilitate favourable settlements have been more successful. For example, in April 2021, Tanzania paid USD 22mn to settle a dispute and avoid the seizure of three of its aircraft to satisfy an UNCITRAL award. More recently, in July 2023, it appeared to have settled a dispute after securing the release of a plane that had been grounded in the Netherlands, simultaneously withdrawing its challenge to a USD 165mn award.
Other moveable assets, such as yachts, represent another potential enforcement target. In February 2023, South African officials seized a 67-metre superyacht belonging to Equatorial Guinea’s vice president, Teodoro Nguema Obiang Mangue. Blue Shadow, measuring 67 metres and valued at USD 17mn to 20mn, was impounded in Cape Town following a lawsuit initiated by Daniel Janse van Rensburg, a South African businessman who had been unlawfully detained in Equatorial Guinea. In response, Equatorial Guinea detained two South African engineers working in the country.
However, the yacht was released just weeks later after Obiang insisted that it was in fact a military vessel owned by the country’s ministry of defence, not a privately-owned commercial asset. Although this is a complicated and highly technical area of law, broadly speaking, sovereign assets usually benefit from immunity from enforcement and cannot be attached, unless such immunity has been waived or alter ego arguments successfully presented.
Most examples of yacht seizures, though, have occurred in the context of sanctions cases rather than pure sovereign arbitration or litigation enforcement. This is likely because planes are more likely to be used by sovereigns for commercial purposes than seacraft, which are typically beneficially owned by private individuals rather than states. For example, in May 2022, the 106m superyacht Amadea was seized in Fiji at the request of the US Department of Justice’s KleptoCapture Task Force, a now-defunct sanctions enforcement agency, due to its alleged ownership by Suleiman Kerimov, a Russian oligarch with close links to Vladimir Putin.
Conclusion
From an outsider’s perspective, sovereign enforcement cases can appear glamorous, often involving large sums of money and high-value trophy assets, such as presidential planes and luxury property. While some of these disputes settle quickly, the stark reality is that many of them are lengthy, laborious and cost-intensive processes that can run for decades, as the above examples show.
To mitigate some of these risks, litigation-fatigued and arbitration-weary creditors may accelerate the path to recovery through third-party funding, which can provide immediate monetisation through award assignment or enforcement underwriting on a no-cost, no-fee basis. As part of this, litigation funders can streamline the collection process, leveraging in-house expertise and resources to exert legitimate pressure on recalcitrant debtors. Such relief can be a boon to creditors seeking to offset their losses and put an end to years of hard-fought legal proceedings.
