On a 6-2 vote with Justice Elena Kagan recused, the court, in a ruling written by Chief Justice John Roberts, said the law violates the First Amendment free speech rights of non-governmental organizations that work on HIV/AIDS prevention.
The 2003 law bars funding for organizations that operate programs overseas but do not have a blanket policy opposing prostitution and sex trafficking. The Alliance for Open Society International and Pathfinder International - NGOs that receive funding for overseas HIV/AIDS prevention - sued in 2005, citing the First Amendment's guarantee of free speech.
The groups obtained an injunction in 2006 that has prevented the policy from being enforced since. Thursday's ruling means groups will not be barred from seeking funds based on their views on prostitution.
Justices Antonin Scalia and Clarence Thomas dissented.
International organizations that receive funds through the President's Emergency Plan for AIDS Relief (PEPFAR) have been required to sign the "anti-prostitution pledge" for the past ten years. Many HIV/AIDS activists say this has undermined the already underfunded response to the global HIV epidemic among some of the most vulnerable and marginalized populations, such as sex workers and men who have sex with men, reports The Guardian.
The multibillion-dollar PEPFAR initiative, launched by President George W Bush in 2003, funds HIV prevention, care and treatment in more than 150 countries. Most of the money goes to sub-Saharan Africa.
Around 200 organisations and individuals have signed a petition demanding that the US government repeals the pledge. The petition says the pledge has led to "the reduction or complete elimination of HIV prevention and treatment services for sex workers in numerous countries". "The US is preventing the delivery of successful health programmes and important resources to sex workers worldwide," it says.
Last [year], the Global Commission on HIV and the Law said the pledge puts grantees in "an impossible bind: if they don't sign, they are denied the funds they need to control and combat HIV. If they sign, recipient organisations are barred from supporting sex workers in taking control over their own lives … including taking steps to avoid HIV and prevent its spread."
PEPFAR's controversial anti-prostitution pledge has lead to major and violent protests at international HIV/AIDS conferences in Africa, Europe and Asia.
According to the United Nations, less than 1% of global funding to prevent HIV/AIDS is spent on sex workers, despite disproportionately high infection rates.