Daredevil #5

We last wrote about Daredevil back in September, when we discussed the story of Austin Cao, a blind translator who overheard some Latverians talking at the investment firm where he worked—and got fired for his trouble.  In Daredevil #5 we learn just what it was the Latverians were up to.

I. Flags of Convenience

What we learn is that Latveria plans to offer flags of convenience to international criminal organizations like HYDRA and A.I.M.  Ordinarily a ship is subject to the laws of the owner’s country, and some countries, such as the United States, even extend their jurisdiction to ships of that country while they’re at sea.  See, e.g., 18 U.S.C. § 7(1).  A flag of convenience allows a ship owner to register the ship with another country, thus placing the ship under that country’s laws.  Ship owners usually select a country with particularly lax laws, such as Liberia or Panama.

So why would Latveria want to get involved?  According to Murdock it makes shipowners legally anonymous and virtually impossible to prosecute in civil and criminal cases.  This is true, but it’s not a complete shield to prosecution, at least for the people onboard the ship.  For example, the U.N. Convention on the Law of the Sea allows a coastal state to exercise criminal jurisdiction over a foreign ship in its territorial waters “if the consequences of the crime extend to the coastal State.”  The U.S. Coast Guard will also examine ships even before they enter port, if they are judged to be a significant security risk.  Tracing things back to the shipowner may not be possible, however.

But more practically, if Latverian-registered ships are frequently involved in terrorism and Latveria doesn’t seem to be doing anything about it, then Latveria risks being labeled a state sponsor of terrorism and subject to an embargo.  The result would be restrictions on U.S. foreign assistance; a ban on defense exports and sales; certain controls over exports of dual use items (items capable of being used in weapons); and miscellaneous financial and other restrictions.  This is especially significant given the second part of Latveria’s scheme.

II. Latverian Shell Companies

The other part of the scheme is that criminal organizations can incorporate shell companies in Latveria, all organized by the investment company Austin Cao worked for.  This is a reasonable scheme if they wanted to do something mundane like evade taxes, but if Latveria is a state sponsor of terror, then the embargo would make it virtually impossible to move money, equipment, and personnel to and from Latveria from the U.S.

And once the U.S. has embargoed Latveria, it becomes likely that other countries will follow suit, especially given that few countries are particularly friendly with Latveria.

III. Conclusion

The law in this issue was pretty accurate, but we’re not sure the consequences are quite as bad as Murdock makes them out to be.  Still, maybe it is that bad, since Latveria seems to have avoided significant sanctions thus far, despite Dr. Doom’s own direct attacks on U.S. territory and countless attacks against U.S. citizens.