Piercing the Corporate Veil Doctrine in International Investment Agreements

Diploma Thesis, 2017

58 Pages, Grade: 1.7








1. Definition of “Investment” in IIA
(a) ICSID Convention
(b) ECT
(d) BITs
1. Separate Legal Personality and Derivative Shareholders’ Rights
2. Barcelona Traction and the Development of Shareholders Rights to Bring Investment Claims
3. Shareholders Standing Independent from the Affected Company
4. Standing of Shareholders as a Joint Conception of Jurisdiction and Admissibility
1. Standing based on the definition of investment under the IIAs
2. Standing based on foreign control requirement

1. Criteria of Determination of Nationality of Investors
2. The Meaning of Corporate “Seat” for the Purposes of Coverage under IIAs
1. State’s Invocation of Denial of Benefits Clauses
a) Corporate nationality (“A-B-A scenario”)
b) Continuous nationality
c) Control by foreign nationals (“A-B-C scenario”)


ANNEX 1. Known treaty-based ISDS cases initiated in 2016 involving Ukraine


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The constant increase in cross-border investments[1]and, concordantly, the need for their protection substantiate the rapid growth in the number of IIAs (BITs and MITs). In parallel with the expanding IIA regime, the number of investor-state disputes has increased as well.

“[For] [r]easons of neutrality, reasons of efficiency, reasons of expertise and reasons of enforceability – the default mechanism[s] of international arbitration … provide a desirable mechanism for the legislators in Singapore and Romania (or Thailand, Ukraine or Switzerland) to make available to their respective nationals.”[2]By that, Garry Born put in a nutshell the driving force of the fast rising system of international investment arbitration that only emerged around 50 years ago.[3]In confirmation of this, the Sixth Edition of the survey “Improvements and Innovations in International Arbitration”[4]conducted by the Queen Mary University of London, indicated that the need to “[avoid] specific legal systems/national courts” and “neutrality” are among the most valuable characteristics of international arbitration.[5]

According to the latest report prepared by the UNCTAD, the rate of new treaty-based ISDS cases continued unabated: in 2016, 62 new cases were initiated pursuant to IIAs, collectively resulting in 767 of known cases.[6]Among these, Ukraine is involved as a Respondent State or as Home State of the Claimant in 4 new cases initiated in 2016.[7]It is important to indicate that the ECT, the NAFTA, and the Russian Federation–Ukraine BIT are the most frequently invoked IIA in 2016,viz., the ECT resulted in 10 new cases, and two others in 3 new cases each.[8]

Analysing the totality of decisions on the merits by the end of 2016, about 60 per cent of cases were decided in favour of the investor and 40 per cent in favour of the State, and herein of the uttermost, about half were dismissed for lack of jurisdiction.[9]These numbers prove that ISDS, which some call “a strange beast,”[10]together with intertwining jurisdictional issues, is one of the pressing topics in international arbitration.

Considering the sophisticated yet unequal nature of ISDS actorsper se, namely, the private investors and the sovereigns, the ISDS system, as any other great invention of humanity, has a tendency to be abused, particularly when discriminating States with a less developed legal culture meet corrupted foreign investors, or even their own nationals desiring to get additional protection and guarantees that should not properly belong to them. From this perspective, the resolution of jurisdictional issues that investors and States might have becomes pivotal for the survival and effective development of ISDS mechanisms.

An important issue in the determination of the jurisdiction of the ISDS tribunalrationae materiae(to solve the merits of the case) is the legality of both investment and investor.[11]An alleged illegality demonstrates that the particular interrelatedness between the investor and its investment, such as a claimant-investor’s act of bribery, renders its investment illegal and undermines the possible protection of the investment, for example under both the ECT and ICSID Convention.[12]At that, the problem of whether a tribunal should find that the asset or transaction constitutes a covered “investment” by the relevant IIA, or whether that claimant is a covered “investor” by the IIA, is crucial for ISDS.

Frequently, when testing the respective wording of IIAs and when determining the reasons that could deprive a tribunal of the competence to decide the case on the merits, or to affirm it, arbitrators or parties resort topiercing the corporate veil doctrine.

The international legal community has been widely discussing the need for, and the limits of, the application of thepiercing the corporate veildoctrine– the idea that shareholders might, under certain circumstances, be personally liable for the debts or deeds of a corporation. At times, thepiercing the corporate veildoctrinehas challenged the limited liability principle in different spheres of law enforcement on the domestic and international scales. As Marcantel points out, the emergence of the doctrine was an “equitable response to the perceived – or actual – unfairness that could result from the application of strict limited liability statutes.”[13]Starting fromSalomon v. Salomon,[14]the doctrine became widely recognised, signalling a transition from an anecdotal and occasional application to a well-established practice that is now quite entrenched in many civil law jurisdictions.[15]

In turn, international dispute resolution has also made use of thepiercing the corporate veil[16]doctrine. The origins of the application of this doctrine in international dispute resolution can be traced back to the ICJ case ofBarcelona Traction, which has since been transposed to ISDS.[17]Arguably, the tribunal should take into account of who really suffered from a public measure allegedly in breach of an IIA. The discretionary power of the tribunal is limited by the relevant investment treaty provisions regarding the notion of an “investment” that could be protected and the “investor” that could seek such protection.

Thepiercing the corporate veilin ISDS plays a twofold role. From the investors’ perspective, it is instrumental if a tribunal can ignore the difference between the legal personality of the company in which they invested in and the shares that they hold.[18]Per contra, States also invoke this doctrine by trying to convince a tribunal to look at the true personalities involved and not to allow an investor to hide behind the veil of the different legal personalities.

To address these competing interests, the author of this Master Thesis in Chapter II intends to analyse the characteristic pattern and standing of shareholders in bringing indirect claims aimed to persuade the tribunal to ignore the difference between the legal personality of a company and its shareholders and to look at the true interests at stake instead. In Chapter III, the applicability of thepiercing the corporate veildoctrinewill be approached from the States’ perspective and when they invoke the denial of benefits clauses.

On the basis of the foregoing, this Master Thesis purports to address the intersection between the jurisdiction of the arbitral tribunal in ISDS and the concepts of investor and investment underlying the application of thepiercing the corporate veildoctrine. By doing so, the author of this Master Thesis explores the provisions of IIAs commented on by authoritative treatises, contemporary views embodied in articles, and jurisprudence of international investment treaty tribunals. In order to arrive at its findings and conclusions, this Master Thesis utilizes the method of description, method of conceptual analysis, comparative method, and method of evaluation.


In ISDS proceedings, investors try to bring both direct and indirect claims against the Host State. The common ground here is the investors’ perception that their shares (any stake holding) in a company grants them the right to bring a clam not only against measures affecting their status as shareholders, but also against measures affecting their derivative rights and damaging the value of their shares.[19]


1. Definition of “Investment” in IIA

There is no universal definition of the concept ofinvestment” in international law. Commentators have often described it as “untraceable,” “inexistent,” “nebulous,” and “used in law without an established definition.”[20]Despite the fact that it is central to international investment law,[21]and widely used by investment treaties, scholars, and tribunals, the understanding of “investment” can be quite controversial, similar to the notion of thenationality of investor.”

However, it is worth to mention that both conceptions are indissolubly connected, since the substantive protection undertaken by the parties of the IIA can be granted towardsinvestmentsofinvestors. Majority of IIAs elaborated the approach, in accordance with which an investment-related claim may overcome jurisdictional objections and proceed to the merits phase, provided that arbitral tribunal finds that the investor has an investment within the meaning of the relevant IIA. For instance, when an ECT dispute is brought for resolution under the provisions of the ICSID Convention, investors must observe a two-fold test, i.e., both jurisdictional requirements of the ECT and of the ICSID Convention must be satisfied.[22]

IIAs traditionally contain broad and comprehensive asset-based notions of investment.[23]The common definition of the term “investment” in IIAs refers to “every kind of investment in the territory of one Party owned or controlled directly or indirectly by nationals or companies of the other Party, such as equity, debt, and service and investment contracts and includes without limitation a company or shares of stock or other interests in a company or interests in the assets thereof.”[24]

Many IIAs require that an “investment” should be owned or controlled by an investor as a part of the definition of investment or investor. Obviously, claimants, in order to determine the jurisdiction of the arbitral tribunal and to justify their standing to bring direct and indirect claims, strive to expand such definition and, consequently, the scope of investment-related dispute resolution.[25]Thus, the concepts to be developed below relates to the definitions of “investment” under certain IIAs that limit the stretching of investment protection to a certain extent.

(a) ICSID Convention

The negotiators of ICSID, in Article 25 of the ICSID Convention, opted for the simple unqualified use of the term “investment,” after several attempts to reach consensus on a definition did not lead to a clear result.[26]The basic idea behind the uncertainty which arises from the lack of a clear definition is to fill a procedural gap and to allow flexibility and progressive development in the definition of an “investment”.[27]When faced with a question on the existence of an “investment,” it thus becomes the function of the ICSID tribunal to set the common notion of investment satisfying both the ICSID Convention and relevant investment treaty under consideration.

Therefore, the ICSID Convention provides a basic regime for the resolution of disputes between Host States and foreign investors and contains procedural and jurisdictional remedies, all of which are contingent on the claimants being nationals of another ICSID Member State.[28]This condition is embodied in Article 25(1) of the ICSID Convention, which literally extends the jurisdiction of the ICSID to “any legal dispute arisingdirectly out of an investment, between a Contracting State (…) and anationalof another Contracting State.”[29]

According to the test of nationality formulated in Article 25(2)(b),[30]bearing the nationality of a contracting state other than that of the Respondent State attracts jurisdictionrationae personae. It is therefore said that the lack of provisions on nationality test in Article 25 of the ICSID Convention sets the “outer limits” of jurisdiction, and that the peripheral aspects, like the investors’ nationality, are left to the treaty in question.[31]However, frequently in practice, the nationality of the investors is scrutinized twice: first, under the light of the ICSID; and, second, under the treaty.

The requirement of “foreign control” is stated in Article 25(2)(b) of the ICSID Convention. Some commentators suggest, that such drafting of the Article was aimed at expanding the jurisdiction of the Centre.[32]However, according to the doctrine,[33]the determination of what amounts to foreign control bears the function of an objective requirement and is a prerogative of the interpreting powers of the arbitral tribunal that cannot be subjected to the agreement between the parties of IIAs. Arbitral tribunals then estimate foreign control on the basis of certain facts (majority shareholding, shares with the voting rights, vetoing powers, the management structure) that could be interpreted as a patterns of control.[34]Therefore, the availability or absence of such control played a crucial role in some awards described below and was established through the prism ofpiercing the corporate veildoctrineby means of application of the provisions of the IIAs to the relevant facts of the case.

On this point, Schreuer suggested that that “the better approach would appear to be a realistic look at the true controller thereby blocking access to the Centre for juridical persons that are controlled directly or indirectly by nationals of non-Contracting States or nationals of the host State.”[35]On the contrary, Amerashinghe opined that determination of an actual, not only legal, control could be appropriate in cases of treaty abuse.[36]

Such views on interpretation of provisions of the ICSID convention and assessment of nationality of a corporate investor favour the application of thepiercing the corporate veil doctrinefor determination of his investment that could be protected by IIAs.

(b) ECT

Article 1(6) of the ECT defines that investment means every kind of asset, owned or controlled directly or indirectly by an Investor and includes a wide range different kinds of assets.[37]In this regard, Thomas Wäelde explained that the ECT “assigns the widest possible meaning to the term ‘investment,’ basically encompassing any legal right of financial value.”[38]In order to interpret the term “investment” under the ECT in accordance with international law and public policy through the aims of the ECT itself,[39]in must normally be concluded that only legal and non-corrupt investments enjoy its protections.[40]

The Tribunal inAMTOsummarized the definition of “investment” under Article 1(6) of the ECT, stating that it has three parts: (i) a wide definition (“every kind of asset”) illustrated by a list of six types of rights; (ii) a clarification (covering changes in form, and a temporal qualification of the investment); and (iii) a restriction as to the types of economic activity included in the definition of investment.[41]“The definition part reflects a standard formula of investment treaties; the clarifications are also routine; and the restriction reflects the purpose of the Energy Charter Treaty to promote long term cooperation in a particular sector, namely the energy sector.”[42]

In addition to the notion of investment, to determine a claimant’s standing over his investment, Article 26(7) of the ECT[43]provides a link to Article 25(2)(b) of the ICSID Convention cited above and builds a bridge between the two instruments. Accordingly, the prevailing test to determine the standing under the ECT is effective control, which could be demonstrated by the shareholder, usually by majority shareholder or ultimate beneficiary owner.[44]At that, the ECT underlines prerequisites for the application of thepiercing the corporate veildoctrinewhile determining the standing of claimant in case of indirect claims. Further, in combination with the definition of the term “investor” contained in Article 1(7) ECT,[45]a local company could act a claimant and enjoy standing of its own.


Most of the arguments around the issue of shareholder claims are hinged on the definition of “investor” and “investment” in Article 1139 of the NAFTA. For instance, the NAFTA defines“investment of an investor of a Party”as an investment owned or controlled directly or indirectly by an investor of such Party, and contains two lists of assets: (i) assets that may be considered investments; and (ii) and assets that are excluded from the notion of investment.

Article 1117 of the NAFTA allows foreign investors to bring claims on behalf of their locally incorporated companies. In doing so, the NAFTA sets forth a broad standing threshold together with limitation provisions for the submission of the claims by investors from two perspectives: (i) on its own behalf;[46]and (ii) on behalf of an enterprise.[47]It is worth to peruse the parallel nature of both articles,[48]which gives an investor that owns or controls an investment that is an enterprise the ability to bring a claim on behalf of that investment.

Article 1117 further addresses the allegations of indirect injury to an investor caused by injury to a company in the Host State and permits an investor to bring a claim on behalf of an enterprise of another Party provided that enterprise is both a juridical person that the investor owns or controls, directly or indirectly, and has incurred loss or damage as a result of a breach of Section A of Chapter 11. This approach is consistent with what the NAFTA tribunals term the “derivative rights” theory – that the claimant steps into the shoes of the Host State when it asserts a claim under Chapter 11.[49]

The focus is, therefore, on the enterprise and the damage it suffers.[50]For a claimant bringing an indirect claim, this poses a problem because an award under Article 1117 is rather payable to the enterprise.[51]

Accordingly, as in case of ECT, the requirement of foreign control becomes a decisive element in order to determine standing of a claimant.

(d) BITs

As indicated above, in order to establish jurisdiction, the ICSID Convention should be supplemented by respective provisions of MIT or BIT. Therefore, in order to exercise jurisdiction, the transaction in question must satisfy a two-stage approach and fall within definitions of “investment” both under the BIT and Article 25 ICSID.[52]

David Gaukrodger in his OECD Working Paper indicated that many ISDS arbitral tribunals, when applying overbroad definition of “investment,” have found that shareholders have a standing to bring indirect claims.[53]Such decisions of the tribunal are heavily tied to the text of IIAs.[54]Quite often BITs specifically apply to investments “owned or controlled” by an investor. For example, the US 2012 Model BIT defines investment as “every asset that an investor owns or controls, directly or indirectly.”[55]Similarly, the UK 2008 Model IPPA uses almost identical broad language: “every kind of asset, owned or controlled directly or indirectly,” which is close to that used by other European countries in their Model BITs.[56]

The 2009 German Model BIT is different. It suggests the need for an active role in investment, defining investment to mean “every kind of asset which is directly or indirectly invested by investors of one contracting state in the territory of the other contracting state.”[57]Further, it provides that “in the case of indirect investments, in principle only those indirect investments shall be covered which the investor realises via a company situated in the other contracting state.”[58]

Despite the overbroad definitions indicated above, this approach is currently a subject of reconsideration. Recent developments in new model BITs demonstrate the tendency of limiting the possibility of wide approach to the definition of investment.[59]The restrictive attitude is embedded in narrowing down the scope of the term investment, by excluding specific types of assets as portfolio investments, certain commercial contracts, loans and debt securities, and, in contrast, by including a “closed list” asset-based exhaustive definition impaired with supplementing requirements like investment risk, requirements of the host country law, time of the investment establishing etc.[60]Such practice is aimed at limiting the shareholders’ standing to sue the host state by means of indirect claims, echoing a practice that was already conceived by arbitral tribunals.[61]

Therefore, it can be concluded that IIAs generally try to narrow the scope by imposing additional requirements, as direct or indirect control test, that could be satisfied by different means, including the application of thepiercing the corporate veil doctrine.


Foreign investors frequently establish local companies as subsidiaries, incorporated in a host state and managed in a multi-shields arrangement.[62]Obviously, shareholders have economic benefits from its indirectly-held equity investments in a form of assets, transactions, profits and other rights of such companies. Should this then underline an apprehension that by virtue of those type of investments the corporate veil should be pierced in order to establish derivative shareholders’ rights as a basis for indirect claims for reflective loss?

1. Separate Legal Personality and Derivative Shareholders’ Rights

According to the separate legal personality principle of comparative corporate law, the local company, whose shares are held by foreign investors, has its own rights, status, and legal relationship, distinct from its shareholders. A wrong done to the company does not constitute a wrong done to its shareholders, and shareholders cannot be held liable for the wrongdoings and debts of the company.[63]Therefore, on the level of domestic legal systems, shareholders’ indirect claims for loss that is inseparable from the general loss of the company,i.e., reflective loss, such as a decline of value of shares, are usually barred,[64]as only directly injured companies can claim recovery.[65]In some instances, though, the corporate relationship between a parent and its subsidiary are sufficiently close so as to justify piercing the corporate veil and holding one corporation legally accountable for the actions of the other.[66]Arguably, in case of indirect loss, a foreign shareholder himself would be willing to request the arbitral tribunal to pierce the entity shields separating him from his company in order to gain protection and to be entitled to recover damages directly,[67]subject to any damages in the claim that should be on the account of the Host State’s wrongful measures.[68]

In a view of the above, it could be assumed that the cause of action for indirect loss should be distinct from the general protection accorded by international law to a shareholder’s direct corporate rights.[69]In his discussion on the execution of shareholder’s derivative rights albeit in international commercial arbitration, Garry Born noted that in principle, a minority (or other) shareholder should be allowed to act on behalf of its company, particularly to invoke an arbitration clause agreed upon by its company, provided that the applicable national corporate law permits the shareholder to act on behalf of the signatory.[70]At that, an interesting question is whether such shareholder may also bring an indirect claim against measures of the Host State, stretching the provisions of the respective IIA, and whether such possibility would be regulated only by the IIA, or by domestic legal system as well.

2. Barcelona Traction and the Development of Shareholders Rights to Bring Investment Claims

Historically, investors did not have the legal capacity on the international level to stand for their rights infringed by the Host State and to have recourse against such infringement. They could only rely on the discretionary right of the State of their origin to exercise diplomatic protection. The inadmissibility of shareholders’ indirect claims was discernible in international law as well. For instance, in theDiallo case,the ICJ similarly dismissed at a preliminary stage a claim based on shareholder reflective loss by Guinea to exercise diplomatic protection of a shareholder “by substitution” for Host State companies.[71]

The protection of shareholders under IIAs came about as a new development in international law in replacement of diplomatic protection has been considered by the ICJ inBarcelona Traction.[72]Over the last 50 years, the situation has changed dramatically,[73]when, in case of clashes of interests, investors are elevated to the international arena as quasi-subjects of international law[74]and vested with the capacity to participate in an equal playing field with States for their rights.[75]

Some commentators suggest that shareholders are not exercising indirect rights in ISDS initiated under the IIAs, since they merely invoke rights directly granted to them.[76]In principle, this understanding underlines the conceptual difference between the approaches to shareholders’ rights under the rules of diplomatic protection and the “supranational regime” for the protection of shareholders’ property rights under the IIAs system.[77]The availability of direct recourse to the IIAs regime has thus transformed the principle of espousal and diplomatic protection by nation states on behalf of their nationals into a residual mechanism of contemporary public international law.[78]

3. Shareholders Standing Independent from the Affected Company

It is quite often the case that the claimant is not the immediate shareholder of the affected company, but rather one of the shareholders of the joint venture established together with local partners,[79]or minority shareholder, or ultimate beneficiary owner. In this regard the question arises whether the parent company can make a claim in relation to its investment.

Some renowned commentators opine that the right of shareholders to seek protection independently from the company has been recognized as a basic premise of ISDS,[80]and that any problems in determining legal standing of shareholders are presupposed by “the greatest misconception that has plagued the investment treaty jurisprudence.”[81]However, the limits of an investor’s ability to bring a claim with respect to injuries suffered by companies in which it owns shares, and by the subsidiaries of those companies, have not been yet clearly defined in international investment law. The main issue here, is that even when the shareholder-investor could be qualified as a claimant under the IIA, it still needs to show that it has standing to recover damages for a wrong committed to a separate corporate entity, and that the IIA jurisprudence provides respective grounds for corporate veil piercing for the shareholder-investor to claim losses suffered by this entity.[82]

As discussed in Part A of this Chapter, the IIAs construct grounds for standing of shareholders to request protection of their investments through the ISDS mechanism and include both direct and indirect shareholdings as investments. Although, it must be noted that a great amount of treaties, for instance in Latin America, do not specify the criteria of “directedness.”[83]From this perspective, the widely-citedEnrondecision on jurisdiction is remarkable, providing that even if the respective IIA,in casuArgentina-US BIT, is silent on a matter of the right to bring indirect claims, it should not be interpreted as excluding so.[84]

Arbitral tribunals, while applying tools of international law,[85]have endorsed a different standard of standing of a shareholder in the ISDS in a comparison with domestic law,[86]depending on the claims from different kinds of shareholders: (i) 100% parent companies, (ii) majority shareholders; (iii) minority shareholders; (iv) indirect shareholders with ultimate control; (v) other indirect shareholders, such as intermediate holding companies.[87]Currently, the more debated issue in legal doctrine and practice is whether claims raised by the indirect shareholders in a string of local companies are admissible in investment treaty arbitration. Commentators suggest that any legal entity in a chain of companies may have standing to claim with respect to the same investment, provided that they meet certain requirements with respect to their nationality, which is easier to establish in a case of direct shareholding interest.[88]

Zachary Douglas in his monograph elaborated, that “if an investment treaty stipulates that the investment can be held directly or indirectly by the claimant, then it is immaterial that the investment is held through an intermediate legal entity with the nationality of a third state.”[89]In principle, such approach expands the tribunal’srationae personaejurisdiction to indirect shareholders’ claims.

4. Standing of Shareholders as a Joint Conception of Jurisdiction and Admissibility

The nature and handling of objections to indirect claims in ISDS is characterised by conceptual uncertainty. Attempts to have indirect claims dismissed in preliminary decisions have been subject to different procedural approaches.

With the development of ISDS jurisprudence, the conception of admissibility and jurisdiction is inevitably applied and interpreted in a quite opposite way.[90]Despite numerous investment arbitration cases that demonstrated that this issue is of great practical importance, the evolving jurisprudence lacksstare decisisand consistency in addressing the distinction between jurisdiction and admissibility.[91]

When shareholders indulge in corporate manoeuvring and treaty shopping,[92]the Host State, in an attempt to counter the IIA claims initiated by such shareholders, may invoke legal mechanisms,[93]includingpiercing the corporate veil doctrine(the possible outcome of that, for example, denial of benefits clauses, will be addressed in Chapter III of this Thesis). In case of success, the tribunal will find that it lacks jurisdictionrationae personaeover the claim, or that the claim is inadmissible. International investment tribunals, however, do not draw a clear line between jurisdiction and admissibility,[94]when the distinction of between the two are equally relevant in addressing the indirect claims of shareholders.[95]

Jan Paulsson noted the conceptual difference between admissibility and jurisdiction important for the tribunal’s power to determine the claim.[96]For example, questions of the existence of a legal dispute, the existence of a legal interest by the claimant, or the nationality of the claim provide grounds to challenge admissibility.

From an international law perspective, Ian Brownlie drew the line as follows: “[o]bjections to the jurisdiction, if successful, stop all proceedings in the case, since they strike at the competence of the tribunal to give rulings as to the merits or admissibility of the claim. An objection to the substantive admissibility of a claim invites the tribunal to reject the claim on a ground distinct from the merits – for example, undue delay in presenting the claim. In normal cases the question of admissibility, especially those concerning the nationality of the claimant and the exhaustion of local remedies, may be closely connected with the merits of the case.”[97]

Generally, ISDS international tribunals refer to the test enunciated by Judge Rosalyn Higgins that has been adopted by investment treaty tribunals,[98]according to which, the claimant bears the burden of proof to demonstrate thatprima facieits claim fall under the relevant IIA provision.[99]However, when considering such claims, tribunals often blur the distinction on whether shareholders have standing in connection with a violation of an obligation under the IIA owed by the Host State: (i) vis-à-vis the shareholder; or (ii) vis-à-vis the company.[100]This distinction is relevant because in the first option the claim is based on a loss suffered by the shareholder, when in the second option the claim for loss of value of shares is ade factoclaim on behalf of the company.

Considering the certain level of confusion and indifference,[101]despite notorious risk to cause possible contestations, in the present Thesis, the Author refers to both concepts of admissibility and jurisdiction under the joint conception of “standing.” Such approach is presupposed by the main purpose of this Thesis, whose scope is limited to the application ofpiercing the corporate veil doctrinein the ISDS.


In connection with the views on standing of shareholders outlined in Part B above as well as IIA provisions on indirect claims addressed in Part A, it could be concluded that a shareholder has standing before an international arbitral tribunal when an investment treaty includes shares within its scope of protection. However, the question remains whether such standing can only be derived from any kind of shares and other forms of participation, disregarding the type of such shares. The Author suggests to cut off the corresponding practice developed though decisions of arbitral tribunals to two main limbs justifying the standing of shareholders to bring indirect claims in ISDS: (i) interpretation of the definition of investment in IIAs; and (ii) meeting the requirement of foreign control.

1. Standing based on the definition of investment under the IIAs

It could be assumed that the separate cause of action on indirect claims existing in IIAs, for instance an inclusion of the word “shares” in the definition of investment, allows for indirect claims for reflective loss. With regard to the above, Campbell McLachlan pointed that “if an ‘investment’ can include shares in a company there is no conceptual reason to prevent an investor recovering for damage caused to those shares which has resulted in a diminution in their value.”[102]

International tribunals used such simple and broad approach to justify indirect claims on multiple occasions,e.g., in well-known decisions includingAAPL v. Sri Lanka,[103]AMT v. Zaire,[104]and the batch of cases against Argentina:Enron,[105]Vivendi,[106]Siemens,[107]CMS Gas Transmission Co.,[108]Total,[109]Suez,[110]and Impregilo.[111]

The reasoning and conclusions in the ICSID decisions named above correspond to the tribunal’s findings inGeneration Ukraine,even though the legal and factual details in this case were somewhat different, as the claimant, a US corporate vehicle, wholly owned by a US national, sought damages under the Ukraine-US BIT.[112]Generation Ukraine owned and controlled a Ukrainian company, Heneratsiya, a local vehicle used in urban projects,[113]holding interest in which was recognised as an investment protected by the Ukraine-US BIT. In turn, Ukraine tried to challenge investor’s standing basing on several reasons. Firstly, Heneratsiya did not actually made an investment in the urban project.[114]Secondly, local corporate vehicle had no factual business connection with the United States, but was instead controlled from Canada (Claimant was assisted by the Embassy of Canada in Kyiv, established the representative office in Toronto, used the bank account of the Royal Bank of Canada, a Canadian national was a CEO of the Generation Ukraine, and the Claimant’s letterhead referred to Canada).[115]Thirdly, it was not demonstrated that the shareholder’s ownership rights were somehow affected by the conduct of the host state.[116]Therefore, the dispute could not be qualified as an investment dispute for the purposes of the BIT. Despite that, Tribunal invoked the pre-investment protection and established jurisdictionrationae personaeallowing to consider the alleged expropriation on the merits.[117]

In contrast, a great number of the IIAs do not contain either an explicit definition of types of investment or any test of shareholder’s control over it and in such a way concomitantly limit the tribunal’s jurisdictionrationae personae. However, even when the broad interpretation of shares as investment referring to terms “directly or indirectly” is missing in the relevant BIT, arbitral tribunals still decide in favour of the investor. For example, the ICSID Tribunal inEnCana v. Ecuador,applying Article XIII (12) of the Canada-Ecuador BIT,[118]rejected the objection of an Ecuador regarding lack of standing to claim damages for an injury to subsidiaries incorporated in Barbados, a third state, and decided in favour of its jurisdiction, however only in relation to the expropriation claim.[119]Likewise, inSiemensthe Tribunal ruled that indirect control would suffice even though the terms “directly or indirectly” were again absent in the Germany-Argentina BIT.[120]

Recent decisions on jurisdiction adopted the similar broad approach, albeit it was based on another instrument, the ECT. For example, in theRREEF v. SpainAward rendered in 2016, the Respondent State argued that the claimants had not made an investment in Spain within the meaning of the ECT (1994) or the ICSID Convention. In particular, the Respondent State contended that the claimants had not contributed economic resources into Spain or assumed any risk in the projects as the funds were contributed by other entities.[121]According to the Respondent State, the claimants were simply shell companies without any real business or economic object.[122]

The Tribunal found that the claimants’ assets fell within the ECT’s open asset-based definition of “investment.”[123]The Tribunal rejected the attempt to add extra-textual elements to that definition: “[t]here is no test, set of criteria or guidelines that can or should be relied upon in international law to restrict or replace the definition that exists in the ECT. There is no reason to place any such test, set of criteria or guidelines on the language of Article 25 of the ICSID Convention.”[124]

Turning to the Respondent State’s argument that the assumption of risk was an intrinsic characteristic of “investment,” the Tribunal decided that it would be “improper” to read this or criteria such as the contribution of economic resources and duration into the ECT or the ICSID Convention.[125]

In this regard, it should be mentioned that NAFTA-type treaties and the ICSID Convention[126]have explicit derivative action provisions establishing the recovery by the company through the ISDS mechanism as a solution to a shareholder’s reflective loss. In arbitrations under those instruments, damages for shareholder’s loss could be awarded to the claimant shareholder itself, but not to the company, e.g. as in Award in NAFTA caseFeldman v. Mexico.[127]However,in casuMexico requested the Tribunal to correct this decision and to grant the payment of damages in favour of the company (CEMSA) instead of the shareholder, Mr. Marvin Feldman, in conformity with the mandatory NAFTA requirement on the damages payable to the company in accordance with NAFTA Article 1135.[128]

The UNCITRAL arbitral tribunal in another NAFTA case,S. D. Myers Inc. v. Canada, also reviewed a “loss or damage” issue but elaborated an alternative approach to justify the indirect claim. In a nutshell, a claim was brought under Article 1116 by an American company S.D. Myers Inc. (SDMI) with a polychlorinated biphenyls (“PCB”) waste disposal facility in Ohio when Canada banned the export of PCBs from Canada.[129]In response, Canada argued that SDMI was not an investor under the definition of Article 1139 because it did not have an investment in Canada, since the only SDMI's claimed investments was a Canadian enterprise Myers Canada, which was not owned directly by SDMI but by the members of the Myers family individually.[130]Eventually, the Tribunal upheld the SDMI claim as an indirect shareholder, stressing that “that an otherwise meritorious claim should [not] fail solely by reason of the corporate structure adopted by a claimant in order to organise the way in which it conducts its business affairs.”[131]In such a manner, through the application of thepiercing the corporate veil doctrine, the niceties of corporate ownership were mitigated in order to grant shareholders the standing to assert a claim.

In all the abovementioned cases, they interpret shares as well as other forms of participation, directly or indirectly owned by investors, to constitute protected investment, on the basis of which a shareholder has the independent right to claim alongside the company regardless of whether the company has a claim. The potential or even actual recourse of the company with regard to the direct loss appears to be seen as largely irrelevant in a number of ISDS cases.[132]The shareholder’s claim is autonomous and admissible even when a company is actively negotiating with the Host State to achieve a settlement in respect of any prejudice caused to the company by the acts of the Host State.[133]This again demonstrates the special legal capacity of an investor elevated on an international level, but also raises many practical negative consequences addressed below.

2. Standing based on foreign control requirement

Thepiercing the corporate veil doctrineis usually applied in order to determine the foreign control over a company. As such, the corporate shields of the limited legal personality are diminished.

In determining the standing of a claimant based on the requirement of control, namely whether an investment is controlled by the claimant or by another entity, the understanding is this requirement refers to an actual exercise of control or to a legal ability to control is crucial.[134]InAguas del Tunari, the Tribunal, in trying to elaborate on the “ordinary meaning” of the word “controlled,”[135]said that control would seemingly encompass both actual exercise of powers or direction and the rights arising from the ownership of shares.[136]Further, the Tribunal concluded that when a BIT refers to investments that are “controlled directly or indirectly,” the requirement of control is limited only to the legal capacity to control an entity, but not to actual day-to-day or ultimate control.[137]

Some tribunals in other ISDS decisions[138]also discerned a view that the determination of legal capacity to control prevails over actual control and that shareholding is a significant criterion to establish it. For example, inYukos, the evidence of ade factoor actual managerial control was dismissed in favour of an inquiry into the legal formalities relating to the potential to control the relevant investment.[139]

However, at times, a tribunal’s approach can directly be the opposite. In theLemire case, the Tribunal did not examine the admissibility conditions of the claim with respect to the standing of the Claimant, Joseph Charles Lemire, since the Respondent, Ukraine, failed to raise it as a basis for its jurisdictional objections.[140]Thus, despite the fact that Claimant had no right but depended upon the rights of another legal person to protect its own interests, which is equal to the absence of a breach of the Ukraine-United States BIT, the Tribunal did not elaborate on the lack of standing of the Claimant. Dissenting arbitrator, Jürgen Voss, criticised the Tribunal’s disregard of the separate legal personality of the local company, CJSC “Radiocompany Gala.”[141]He noted that the claimant filed a claim asserting the rights that belonged to this local company.[142]The operation of thepiercing the corporate veil doctrineand disregarding the legal personality of the local company could not be justified by the fact that claimant’s personal assets were commingled with the local company’s corporate assets.[143]This doctrine could be only encountered when the applicable IIA directly provides that the distinction between the local company and its shareholders designed by the law of the host state could be undermined on the international level.[144]For instance,Salomon v. Salomon, as cited in Chapter I, stated that even the separate legal personality of a one-man company had to be respected to the full extent. According to the aforementioned, Lemire should have had standing only if Ukraine would violate certain obligations owed directly to him by virtue of the BIT but not to the company where he had a shareholding. A similar outcome was decided by theAMTOtribunal.[145]

In similar vein, this deduction appears to have escaped the tribunal inSedelmayer v. Russia. Basically, in this case the arbitral tribunal pierced the corporate veil and allowed claims to be asserted by the ultimate beneficiary owner in a corporate structure based on his full control.[146]Franz Sedelmayer, a German citizen, brought a claim against Russia under the Germany-Russia BIT, despite the fact that his investment was made through a US corporation, Sedelmayer Group of Companies International Inc. The choice of the IIA is superficial as there was no BIT in force between the United States and Russia, while the BIT that was applied included beneficial owners in definition of investments.[147]The Tribunal did not elaborate on the two-fold advantages that ultimate beneficiary owners get when their protection by treaties is allowed (as initially they enjoy the shield of the limited liability principle while making their investments, which they are willing to remove only in case of a dispute with the Host State).[148]Commenting on this award, Christoph Schreuer said that due to its controversial nature, this decision not followed by subsequent cases.[149]Further, the arbitrators did not develop the issue of limits on shareholders protection but rather applied thepiercing the corporate veil doctrinein order to find a true investor in accordance with control theory. This is the similar approach elaborated by the tribunal inLemire.

However, textual elements of some BITs may indicate the need for active control and participation of claimant over an investment. Considering such framework, tribunals are more restrictive in upholding standing merely based on the broad definition of investment in the BIT. In such a way, those tribunals, while upholding jurisdiction with respect to investments owned indirectly by investors, have limited the claims that an investor can bring. In this respect, recent award inSCB v. Tanzaniais quite illustrative. The ICSID Tribunal ruled on the requirement that shareholders have to play an active role in making an investment in order to have a standing.[150]The dispute has its origins in an agreement entered into between Tanzanian state-owned entity TANSECO and Independent Power Tanzania Limited IPTL regarding the building of an electricity plant.[151]IPT, a corporation formed by the Malaysian corporation Mechmar (70%) and Tanzanian engineering company VIP (30%), raised money for the project by means of a credit facility from a consortium of Malaysian banks.[152]SCB, with a Hong Kong subsidiary (SCB HK) bought these loans and claimed that its interest in the loans constituted a specific category of investment covered by the UK-Tanzania BIT, Articles 1(a)(ii) and (iii), namely, “investment held through a subsidiary in another jurisdiction.”[153]The Respondent State raised a jurisdictional objection that the BIT covers only those investments in Tanzania that were “actually made or directly owned by a national or company of the United Kingdom,” when Claimant instead failed to meet the burden of proving both direct or indirect ownership of shares in SCB HK and indirect holding of an investment in Tanzania.[154]The Tribunal, after interpretation of BIT’s provisions, concluded that the BIT required an active relationship between the investor and the investment, in that the latter should be funded and controlled in an active and direct manner.[155]Therefore, passive ownership of shares in a company is not sufficient for the corporate veil of the ownership shields to be lifted, since allowing the contrary could lead to unreasonable results.[156]

SCB v. Tanzaniademonstrates an eloquent departure from the established approach with respect to claims by shareholders. Remarkably, the lack of standing in the IIA ICSID arbitration was ascertained[157]in parallel with the more successfulSCB HK v. TANSECOICSID contractual arbitration,[158]which award is currently the subject of an annulment proceeding.[159]

Sometimes, it is a Respondent State, not a tribunal, that would ask to invoke thepiercing the corporate veildoctrine, based on the foreign control requirement. According to such position, the requirement of foreign control goes beyond the formal nature and serves as an objective condition allowing the arbitral tribunal to lift the corporate veil and to determine the real controllers of the company.[160]However, in one of the most famous energy disputes in the previous year 2016,Charanne, the Tribunal rejected jurisdictional objections of Spain[161]and did not allow to pierce the veil.

The Tribunal was clear that the ECT does not provide grounds to pierce the veil, when no circumstances of fraud are present. A negative consequence of such vision is that those domestic investors who secured effective corporate organisation can make investments in respect of their domestic energy market and still maintain the protection afforded by the ECT, as well as other IIAs. To some extent, such abuse of rights may undermine the whole regime of the IIAs and the idea behind the free movement of capital and investments promotion, and should be subject to denial of benefits provided by the respective IIAs.

Therefore, the analyses of the cases above demonstrate that the questions of the legal or actual, direct or indirect nature of control are interwoven and often arise together during the establishing of jurisdictionrationae personae. Again, there is nojurisprudenceconstanteon the matter. Some tribunals apply thepiercing the corporate veildoctrinewhen examining factual elements to disregard the of shields of formal corporate structures and to pursue an objective determination of foreign control up to its real source, as it was inSedelmeyerandLemire. This, however, did not take place inAMTO,SCB v. Tanzania,and round-tripping[162]YukosandCharanne.


The widely recognised autonomous nature of shareholders’ indirect claims, referred to in Parts B and C above, could raise the following practical questions: (i) Could the ultimate beneficiary owner bring the separate claim alongside with the intermediary shareholders, and subsidiaryper se? (ii) Could damages be awarded more than once in respect of the same measures of the Host State? (iii) Could they result in unjust enrichment of the claimant or claimants? (iv) Could those measures be interpreted as the same in respect to the subsidiary and all parental shareholders of this company? (v) Could all the above be considered as the same claimant?

Even bearing in mind the approach of arbitral tribunals and provisions of IIAs on indirect claims, the remaining problem is why indirect investors should be protected merely on the basis of a broad interpretation of investment in IIAs. Such problem is presupposed by exposure to the obvious risk of possible multiple protection leading to “double-dipping” and abuse of investors rights.

Some commentators suggest that as a counter to formal legal individual personality of the parties, the stringent criteria ofpiercing of the corporate veilshould be met.[163]In this respect the understanding offered by Thomas Wälde is useful:“On considerations of all aspects it seems correct to apply rather a standardised approach of “economic identity” and to presume, without detailed counter-proof, that the subsidiary’s harm is economically equivalent to the harm suffered, and to be compensated, by the foreign owner pro rata commensurate with its share ownership.”[164]

It could be assumed that the more indirect the shareholder gets, the more remote the damage will be. Logically, at one point the causal link between the measures and the damage will disappear. In opposition to the practice of investment treaty tribunals, Thomas Wälde suggested to require a sufficient direct relationship with the damage and to establish a cut-off point of ownership.[165]

Further, Stanimir Alexandrov accurately pointed that all the tribunal’s decisions (majority of which were discussed above in Part C), gave almost no credence to the argument that disputes invoked by shareholders did not arise directly out of an investment in the shareholding of the company, since such disputes related to assets of the local company, like contractual rights or rights under a license.[166]By doing so, the tribunals simply estimated the broad definition of investment, which ultimately covered different types of interests in local companies. As such, the distinction between the contract claims and treaty claims were blurred.[167]Such approach again leads to some confusion and uncertainty.

The abusive claims for protection to all shareholders of the same group on various levels are addressed by instruments of international investment law to the extent that the benefits granted by the IIAs may be denied. The legal aspects of application ofpiercing the corporate veil doctrinefor such purposes are addressed in Chapter III of this Master Thesis.


IIAs justify foreign investment by providing standards and remedies in the relationships between States and foreign investors.[168]IIA are typically one-way instruments, since they basically establish obligations of Host States, and not of investors, with far-reaching implications. The rights of an investor are derived from the coordinated wills of the sovereign parties embodied in the IIAs, which make them intended beneficiaries under investment treaties. Parallelizing this with contract law, they could be considered “third-party beneficiaries,”[169]entitled to the rights to independently claim treaty standards directly at the level of international law.[170]

However, only investors who qualify as nationals of an IIA member-State other than the Host State of the investment may benefit from the particular treaty and to have a standing to claim such protection.[171]Quite often investors are involved in nationality planning, also called “treaty shopping” in regard to the conduct of foreign investors who seek to benefit from the protection under IIAs by structuring their investments in a way that allows them to get maximum protection under the existing treaties. In alignment with provisions on standing of shareholder deriving from the investment, as outlined in Chapter II, the international rights of an investor and its legal standing are contingent on the satisfaction of the nationality requirement. If the requirement fails, then the tribunal would have norationae personaejurisdiction over the claim brought by such investor.


An investor who wants to rely on the treaty must show that he has nationality of one of the contracting states in accordance with the nationality test prescribed in the investment treaty.[172]

1. Criteria of Determination of Nationality of Investors

IIAs refer to both natural and juridical persons in the notion of investor. The determination of the nationality of a corporation, or in Prof. Brownlie’s words, “the assignment of [corporations] to states,”[173]is a more complicated task than for a natural person.[174]The nationality of natural persons is mainly determined by the national law of the state whose nationality they claim.[175]In contrast, nationality of corporations when tested as a ground for challenge to the tribunal’s jurisdiction is decided on the basis of the relevant IIAs rather than national laws.[176]Therefore, investment agreements set out numerous grounds upon which the nationality can be qualified and tends to involve a more complex analysis.[177]

Due to the fact that companies use many different approaches to their structuring, which may lead to the possibility for an investor to bring claims under different BITs, most of investment treaties specifically define the objective criteria that need to be satisfied in order for a company do be considered a national of respective State.[178]At that, IIAs suggest to define nationality, singularly, alternatively or in combination, on the basis of the following criteria: (i) place of incorporation or legal establishment; (ii)siège social,or place of the principal seat of business; (iii) place of real economic activity, showing a bond between investor and host, also referred to as place of nationality of controlling shareholder; and (iv) place of company’s preponderant interest.[179]

There is no definition of “nationality” in the ICSID Convention. As such, the definitions of nationality used in the treaties providing for ICSID jurisdiction are crucial in determining whether nationality requirements under Article 25 ICSID Convention have been met.[180]Thus, in ICSID disputes governed foremost by BITs and MITs, the assessment of nationality is often tempered by treaty-based provisions demonstrating that the place incorporation and the social seat are the most utilised tests.[181]

As observed by Zachary Douglas, investment treaties do not usually require a “genuine link” between the individual investor or corporate entity and the national state.[182]However, in his treatise, he mentioned that a possible negative outcome of application a formal requirement ofincorporationis that it can lead to the coverage by an investment treaty of an “investment vehicle,” a corporate shell in a tax friendly jurisdiction.[183]

Thesiège socialcriterion, which has been the most commonly used criteria for corporate nationality in civil law countries for an appreciable length of time,[184]plays a prominent roleinter aliain German IIAs.[185]The renowned professor of international law Paul de Visscher, already indicated in 1961 that this criterion connotes a stronger factual tie than mere incorporation.[186]The approach of French Civil Law embodied in the France Model BIT, Art. 1(3), addresses such issue, requiring incorporation in the Host State and the presence of the company’s “siege” or seat or headquarters in the Host State.[187]When it comes to the German practice, the necessity for a genuine link and control only exists when the regular criterion is deviated from.[188]

2. The Meaning of Corporate “Seat” for the Purposes of Coverage under IIAs

The interrelation among the application of the criteria of incorporation, corporate seat, and control is demonstrated in the most recent decisions of ICSID Tribunals rendered in 2016.

InCEAC v. Montenegro, the claimant sought protection under the Cyprus–Montenegro BIT (2005), alleging that – as required by the BIT – its “seat” of business was in Cyprus. The claimant relied on a certificate of registered office issued by the Cypriot authorities. The Tribunal ruled that it was “not bound by the nationality determinations and the certificates issued by domestic authorities, but must make its own determination under international law”.[189]After examination of the available evidence, the Tribunal concluded that the claimant had failed to establish that it had its seat, in the meaning of a registered office, in Cyprus,[190]since the claimant failed to prove that registered office is “accessible to the public for purposes of inspecting the company’s registers, that CEAC is amenable to service at that address, that the company’s records are kept there, or that the address bears a plate with CEAC’s name”.[191]Moreover, the Tribunal rejected the claimant’s alternative arguments that the company was managed and controlled from Cyprus at the relevant time,[192]at that insisting that the “effective seat” criterion means actual presence of the management more than just on papers.

Another ICSID tribunal again tested thesiège socialcriterion in its next two decisions involving the same disputing parties. InTenaris and Talta v. Venezuela (I), the Tribunal interpreted the notion of “seat” to mean “the place of actual or effective management.”[193]The Tribunal stressed that it must take into account the precise nature of the company in question,in casua “holding company” whose “day-today ‘management’ will necessarily be very limited, and so will its physical links with its corporate seat”.[194]The Tribunal noted that “it would be entirely unreasonable to expect a mere holding company […] to maintain extensive offices or workforce, or to be able to provide evidence of extensive activities, at its corporate location.”[195]For the Tribunal, the claimants met the legal test of “actual or effective management” as they had premises in the respective home States, held annual general meetings and/or board meetings there, and had certain other documented ties.[196]

InTenaris and Talta v. Venezuela (II), the Tribunal similarly found that the concept of “seat” could not be understood as statutory seat but, rather, as effective seat,i.e., the place where the company’s management activities took place.[197]To this effect, it tested three criteria to determine whether the seat was effective, namely: (i) where shareholder and board administration meetings took place; (ii) where the management activities (establishing contacts with clients, conclusion of the principal contracts, main financial activities) took place; and finally (iii) where the books and accounts were located.[198]The Tribunal concluded that the claimants had fulfilled these criteria.[199]

The solution of the cases above is hardly surprising, given that nationality is, indeed, a qualifying condition for the protection and benefits granted by treaty.


Quite often MNTs enjoy an opportunity of nationality planning[200]through incorporation of a multijurisdictional network of subsidiaries in order to be able to gain protections of favourable IIAs when it is required.[201]In trying to address this tendency of the globalised economy, most of BITs and MITs include straightforward clauses regarding the nationality of foreign investors[202]aimed at restricting (denying) benefits under the respective IIA when the requirement of nationality is not met.

1. State’s Invocation of Denial of Benefits Clauses

Denial of benefits clauses are an expected “counter-measure” of the State to address legal arrangements of investors to whom they did not intend to offer treaty protection. Commentators indicate the increasingly important role of denial of benefits clauses in defining the outer limits of acceptable investment treaty shopping and planning of nationality of investors.[203]Modern IIAs are worded specifically to ensure actual control and to require effective management instituted from the country of nationality.[204]

The limited nature of protection that could be granted under the IIA regime was maintained by the tribunal inIoannis Kardassopoulos v. The Republic of Georgia.The arbitral tribunal considered if the investment enjoyed protection under the ECT and Georgia-Greece BIT while applied a general interpretative principle in order to assess whether an investor could be granted with a protection under the investment treaty towards his investment. The Tribunal concluded that “protection of investments” under a BIT is obviously not without some limits. It does not extend, for instance, to an investor making an investment in breach of the local laws of the Host State. A State thus retains a degree of control over foreign investments by denying protection and benefits to those investments that do not comply with its laws.[205]

Denying protection and benefits clauses are embodied in IIAs in different formulations. Some commentators offer simplifying characteristic of such clauses within two grounds: (i) the “nationality-leg” clauses refer to clauses drafted in a similar way to Article 17 ECT[206]and relate to the situation when claimant investor isownedorcontrolledby entities of a third state; and (ii) the “operations-leg” clauses refer to clauses similar to Article 1113 NAFTA[207]and relate to claimant investor who hasno substantial businessin the territory of the IIA party under whose law it is constituted.[208]

The necessity to establish the State’s right on invocation of such clauses is likely to be connected with the dispute that arose.[209]Thus, denial of benefits clauses refer to the issue of jurisdictionrationae personaeand standing of the claimant, since they are inextricably connected with the determination of nationality through the application of the test of control.[210]

In order to establish whether an investor satisfies the nationality test and has substantial business activities, and whether the host state may legitimately apply denial of benefits clauses, arbitral tribunals refer topiercing the corporate veil doctrine.

2. Application of the Control Test

Recent ISDS jurisprudence has revealed three problems[211]in the application of the nationality test to legal entities, which is connected with the correlation among corporate nationality, continuous nationality, and control by foreign state.

a) Corporate nationality (“A-B-A scenario”)[212]

Due to corporate restructuring, it is a common situation for a company, which is registered in one State, to try to pursue a claim against the Host State, when it is also controlled by shareholders in the Host State. The solution to such situation was determined in the following awards.

One of the most-well known decisions on the topic isTokios Tokeles, where a claimant was a business entity established under the laws of Lithuania but was 99% controlled byUkrainian nationals.[213]In view of those facts, the Respondent State, Ukraine, argued that Tokios Tokeles is not a “genuine entity” of Lithuania[214]and requested to pierce the corporate veil, that is, to look behind the technical detail of the Tokios Tokeles place of incorporation and to attribute to the company the nationality of those who control the company.[215]With a reference toBarcelona Traction, the Tribunal concluded that the doctrine could only be applied to prevent a misuse of the privileges of legal personality, as in certain cases of fraud or malfeasance, to protect third persons, or to prevent the evasion of legal requirements or of obligations.[216]However, inasmuch as none of the preceding circumstances wasprima faciedemonstrated by the Respondent State,[217]the Tribunal placed in stark relief the relative weight of substantive control over the corporate form of the investment vehicle.[218]Since the ICSID Convention leaves the room for the free choice of the test, theTokios TokelesTribunal held that the legal place of incorporation was the only relevant consideration to determine whether the tribunal had jurisdictionrationae personae.[219]

Tokios Tokelesis also prominent because of the fact that the President of the Tribunal, Prosper Weil, issued a Dissenting Opinion, where he expressed a strong disagreement with the majority’s findings, stating that it undermined the purpose and object of the ICSID Convention.[220]Weil’s dissent is actually more discussed in the investment arbitration community rather than the majority decision in this case.[221]


[1]SeeWorld Investment Report 2016, “Investor Nationality: Policy Challenges,” UNCTAD: “In 2015, global flows of foreign direct investment rose by about 40 per cent, to $1.8 trillion, the highest level since the global economic and financial crisis began in 2008.”; World Investment Report 2017 “Investment and the Digital Economy,” UNCTAD: “After a strong rise in 2015, global FDI flows lost growth momentum in 2016, showing that the road to recovery remains bumpy. FDI inflows decreased by 2 per cent to $1.75 trillion, amid weak economic growth and significant policy risks, as perceived by multinational enterprises (MNEs).”

[2]Born, “BITS, BATS and Buts: Reflections on International Dispute Resolution,” p. 9.

[3]History of BITs traces its roots to the Treaty for the Promotion and Protection of Investments (with Protocol and exchange of notes) between Germany and Pakistan, signed on 25 November 1959, the first BIT instrument that was only replaced in 2009.

[4]The Sixth Edition was carried out by the School of International Arbitration at Queen Mary University of London together with White & Case LLP.

[5]2015 International Arbitration Survey: Improvements and Innovations in International Arbitration, p. 6.

[6]ISDS: Review of Developments in 2016, UNCTAD, p. 1.

[7]SeeAnnex 1 to the Master Thesis, Known treaty-based ISDS cases initiated in 2016 involving Ukraine.

[8]ISDS: Review of Developments in 2016, UNCTAD, pp. 1, 3, fn. 6.

[9]Ibid., p. 1, fn. 6.

[10]Address of Paul Key QC, barrister at Essex Court Chambers;Seealso Egerton-Vernon, “Is Investment Arbitration a Mechanism to Second-Guess Governments’ Exercise of Administrative Discretion: Public Law or Lex Investoria?” p. 202.

[11]Kreindler, “Competence-Competence in the Face of Illegality in Contracts and Arbitration Agreements,” p. 380.


[13]Marcantel, Limiting Judicial Discretion by Introducing Objectivity into Piercing Doctrine, p. 199.

[14]Broderip v Salomon, pp. 340-341;SalomonvA.SalomonandCo.Ltd.

[15]SeeThompson, “Piercing the Corporate Veil: An Empirical Study,” p. 1044: “Piercing the corporate veil is the most litigated issue in corporate law and yet it remains among the least understood;” Presser, “The Bogalusa Explosion […],” p. 411: the current state of veil-piercing law is chaotic;” Michael, “To Know a Veil,” p. 41: “the doctrine represents “jurisprudence without substance”.

[16]Considering the well-settled terminology, references hereinafter to the piercing the corporate veil doctrine will appear without quotes.

[17]SeeBarcelona Traction,p. 39, ¶56: “…The law has recognized that the independent existence of the legal entity cannot be treated as an absolute. […] The process of “lifting the corporate veil” or “disregarding the legal entity” has been found justified and equitable in certain circumstances or for certain purposes;” para. 58: “The process of lifting the veil…is equally admissible to play a similar role in international law.”

[18]Perkams, “Piercing the Corporate Veil in International Investment Agreements,” p. 93.

[19]Perkams,Piercing the Corporate Veil in International Investment Agreements,pp. 3-4.

[20]Williams, Jurisdiction and Admissibility, p. 875.

[21]Tomáš Fecák,‘Protection of Investment in International Agreements and in EU law,’p. 19.

[22]Baltag,The Energy Charter Treaty: The Notion of Investor,p. 164.

[23]Bishop, Crawford, and Reisman,Foreign Investment Disputes,pp. 295-296.

[24]Bottini, Extending Responsibilities in International Investment Law, p. 2.

[25]Rubins,The Notion of ‘Investment’ in International Investment Arbitration, p. 323.

[26]Dolzer and Kim,Commentaries on Selected Model Investment Treaties,p. 304.

[27]Schreuer,The ICSID Convention: A Commentary,p. 160, ¶268; Williams, Jurisdiction and Admissibility, p. 876.

[28]Badia, ‘Piercing the Veil of Investors in Nationality Claims,’p. 140.

[29]ICSID Convention, emphasis added.

[30]See ICSID Convention, Article 25(2)(b):[30] “National of Another Contracting State” means: any juridical person which had the nationality of a Contracting State other than the State party to the dispute on the date on which the parties consented to submit such dispute to conciliation or arbitration and any juridical person which had the nationality of the Contracting State party to the dispute on that date and which,because of foreign control, the parties have agreed should be treated as a national of another Contracting State for the purposes of this Convention.

[31]Broches, “The Convention on the Settlement of Investment Disputes between States and Nationals of Other States”

[32]Broches, A. The Convention on the Settlement of Investment Disputes between States and Nationals of Other States, p. 358.

[33]Schreuer, The ICSID Convention, ¶813; Gaillard, Some Notes on the Drafting of ICSID Arbitration Clauses, p. 140; Amerashinghe, Interpretation of Article 25(2)(b) of the ICSID Convention, p. 235.

[34]Badia, Piercing the Veil of Investors in Nationality Claims, p. 142.

[35]Schreuer,The ICSID Convention: A Commentary,p. 323, ¶849.

[36]Amerashinghe, Interpretation of Article 25(2)(b) of the ICSID Convention, p. 237.

[37]See ECT, Article 1(6): “Investment” means every kind of asset, owned or controlled directly or indirectly by an Investor and includes: (a) tangible and intangible, and movable and immovable, property, and any property rights such as leases, mortgages, liens, and pledges; (b) a company or business enterprise, or shares, stock, or other forms of equity participation in a company or business enterprise, and bonds and other debt of a company or business enterprise; (c) claims to money and claims to performance pursuant to contract having an economic value and associated with an Investment; (d) Intellectual Property; (e) Returns; (f) any right conferred by law or contract or by virtue of any licences and permits granted pursuant to law to undertake any Economic Activity in the Energy Sector.

[38]Waelde, “International Investment under the 1994 Energy Charter Treaty,” pp. 270-1.

[39]Vienna Convention on the Law of Treaties, Art. 31 (3)(c).

[40]Kreindler, competence competence, p. 382.

[41]AMTO, § 36


[43]ECT, Article 26(7), “an investor other than a natural person which has the nationality of a Contracting Party to the dispute… and which, before a dispute between it and that Contracting Party arises, is controlled by Investors of another Contracting Party, shall for the purpose of article 25(2) of the ICSID Convention be threatened as a “national of another Contracting State”

[44]Perkams, “Piercing the Corporate Veil in International Investment Agreements”, pp. 105-6.

[45]ECT, Article 1(7), “Investor means… (ii)a company or other organization organized in accordance with the law applicable in that Contracting Party.”

[46]NAFTA, Article 1116 “Claim by an Investor of a Party on Its Own Behalf.”

[47]NAFTA, Article 1117 “Claim by an Investor on Behalf of an Enterprise.”

[48]NAFTA Article 1116(1) parallels NAFTA Article 1117(1), while NAFTA Article 1116(2) parallels NAFTA Article 1117(2).

[49]Mondev Award, at ¶ 59

[50]Bjorklund, Hannaford and Kinnear, Investment Disputes under NAFTA, p. 1116-4.

[51]NAFTA Art. 1135(2).

[52]Williams, Jurisdiction and Admissibility, p. 877.

[53]Gaukrodger, “Investment Treaties and Shareholder Claims: Analysis of Treaty Practice,” p. 8.

[54]Vestey Group v. Venezuela,¶187The term “investment” in Article 25 of the ICSID Convention has an independent meaning [and] comprises three components: a commitment or allocation of resources, risk, and duration.”

[55]Caplan and Sharpe,Commentaries on Selected Model Investment Treaties,p. 766.

[56]Brown and Sheppard,Commentaries on Selected Model Investment Treaties,p. 711.

[57]Dolzer and Kim,Commentaries on Selected Model Investment Treaties,302-3.


[59]Bishop, Crawford, and Reisman,Foreign Investment Disputes,p. 297.


[61]Garanti Kozav. Turkmenistan,¶¶231-4, 239-42: the tribunal refused to graft extra-textual elements onto the definition of “investment” in the Turkmenistan–United Kingdom BIT (1995) or Article 25 of the ICSID Convention.

[62]Rubins, The Notion of ‘Investment’ in International Investment Arbitration, p. 313.

[63]Hollington, Shareholders’ Rights, p. 389.

[64]Gaukrodger, Investment Treaties as Corporate Law, p. 15; Gaukrodger, Investment Treaties and Shareholder Claims, p. 44.

[65]Gaukrodger, Investment Treaties and Shareholder Claims, p. 8.

[66]Varadi, p. 288.

[67]Demirkol, Admissibility of Claims for Reflective Loss Raised by the Shareholders in Local Companies in Investment Treaty Arbitration, p. 400; Gaukrodger, Investment Treaties and Shareholder Claims for Reflective Loss, p. 18.

[68]SeeSchreuer, Shareholder Protection in International Investment Law, p. 20: “Shareholder protection extends not only to ownership in the shares but also to the assets of the company. Adverse action by the host State in violation of treaty guarantees that affect the company’s economic position gives rise to rights by the shareholders.”

[69]Gaukrodger, Investment Treaties as Corporate Law, p. 13-14.

[70]Born ,International Commercial Arbitration, p. 1408.

[71]Diallo, ¶94.

[72]Barcelona Traction, par. 90: “States [] provide for [shareholders’] protection, in both bilateral and multilateral relations, either by means of special instruments or within the framework of wider economic arrangements;”SeeBottini, Indirect Claims Under the ICSID Convention, p. 577: “Granted the establishment of appropriate

international procedures, the corporation might itself invoke the international jurisdiction.”

[73]SeeMcLachlan, International Investment Arbitration, ¶6.75: “The ICJ’s restrictive ruling in Barcelona Traction has never been followed in treaty arbitrations.”

[74]International legal personality of corporations as non-state actors was discussed by Phillip C. Jessup in 1948,SeeJessup, The Subjects of a Modern Law of Nations, p. 109;

[75]The legal capacity of private investors is limited by the framework negotiated between the sovereign state and embodied in IIAs. For instance, such regime is ensured through more than 3000 IIAs (UNCTAD calculated 3,268 IIAs in 2014),SeeRecent Trends in IIAs and ISDS, UNCTAD, p. 1.

[76]Bottini, Indirect Claims Under the ICSID Convention, pp. 571, 592, with reference to ICSID cases against Argentina addressing thejus standiof shareholders invested in local companies.

[77]Douglas, The International Law of Investment Claims, p. 401.

[78]Laird, A Community of Destiny – The Barcelona Traction case and the Development of Shareholders Rights to Bring Investment Claims, p. 94.

[79]SeeEscher, Foreign Direct Investment, p. 40: “Countries like China, India and Thailand favour the conclusions of equity or contractual joint ventures between foreign and domestic companies.”

[80]Alexandrov, The “Baby-Boom” of Treaty-Based Arbitrations, p. 27; Laird, A Community of Destiny – The Barcelona Traction case and the Development of Shareholders Rights to Bring Investment Claims, p. 94.

[81]Douglas, International Law of Investment Claims, p. 398.

[82]McLachlan, International Investment Arbitration, ¶6.71.

[83]Rubins, The Notion of ‘Investment’ in International Investment Arbitration, p. 314.

[84]Enron, ¶46.

[85]Vicuña, The Protection of Shareholders under International Law, p. 163.

[86]Sasson , Substantive Law in Investment Treaty Arbitration, p. 130;CMS, ¶¶43-45;Suez and Vivendi, ¶50; at that, some commentators disputes such approach, for ex.See ELSI, Separate Opinion of Judge Oda, p. 86: “general principle of law concerning the rights or status of shareholders, which underlies [comparative] company law of states, may not be altered by any treaty aimed at the protection of investments, unless that treaty contains express provision to that end.”

[87]Valasek, Dumberry, Developments in the Legal Standing of Shareholders and Holding Corporations in Investor-State Dispute, p. 73 et seq.

[88]SeeSchreuer, Shareholder Protection in International Investment Law, p. 2; Bottini, Extending Responsibilities in International Investment Law, p. 2; Perkhams, 103; Dumberry, The Legal Standing of Shareholders before Arbitral Tribunals, p. 356; See also, Alexandrov, The “Baby-Boom” of Treaty-Based Arbitrations, p. 30: “It is beyond doubt that shareholders have standing in [ICSID] to submit claims separate and independent form the claims of corporations… this principle applies to all shareholders…”

[89]Douglas, The International Law of Investment Claims, p. 310, fn. 96.

[90]Laird, “A Distinction without a Difference? An Examination of the Concepts of Admissibility and Jurisdiciton inSalini v JordanandMethanex v USA,” p. 201.

[91]Ibid;Seealso Williams, Jurisdiction and Admissibility, p. 919, referencing toEureko BV, ¶92 et seq.;Sempra Energy, ¶109 et seq;Antoine Goetz¶86 et seq.

[92]Plokhenko, Treaty Shopping in Investment Treaty Arbitration, p. 201 et seq.

[93]Voon, Mitchell, and Munro, Legal Responses to Corporate Maneuvering in International Investment Arbitration, p. 44.

[94]For ex., Chevron, ¶137; Pac Rim, ¶2.10; RomPetrol, ¶111-14.

[95]RomPetrol, ¶115.

[96]Paulsson, Jurisdiction and Admissibility, p. 604;Seealso Williams, Jurisdiction and Admissibility, pp. 868, 919.

[97]Brownlie,Principles, p. 479.

[98]See Separate opinion of Judge Higgins, Oil Platforms.,para. 34; Cited in Plama Consortium Limited v. Bulgaria, para. 118; See also Vasani, and Foden, Burden of Proof Regarding Jurisdiction, pp. 272-273.

[99]See Waguih Elie George Siag and Clorinda Vecchi v. Egypt, para. 139; Saipem v. Banglash, para. 85; United Parcel Service of America v. Canada, paras. 35-37.

[100]Sasson, Substantive Law in Investment Treaty Arbitration, p. 131.

[101]Gaukrodger, Investment Treaties and Shareholder Claims, p. 46.

[102]McLachlan, International Investment Arbitration, ¶6.77;SeeAlexandrov, The “Baby-Boom” of Treaty-Based Arbitrations, pp. 40-45.

[103]AAPL v Sri Lanka,¶95.

[104]AMT v Zaire,¶¶5.14-5.15.

[105]Enron, ¶¶45-9.


[107]Siemens, ¶150.

[108]CMS Gas Transmission Co.,¶68.


[110]Suez, ¶49.


[112]Generation Ukraine,¶¶1.1-1.3.

[113]Ibid., ¶¶8.5-8.6.


[115]Ibid, ¶15.8.

[116]Ibid, ¶¶8.5-8.6.

[117]Ibid, ¶8.8.

[118]EnCana v. Ecuador,¶115.


[120]Siemens, ¶¶136-7, 206.

[121]RREEF v. Spain,¶¶149-150.


[123]Ibid.,¶¶156, 160.



[126]Art. 25(2)(b).

[127]Feldman v. Mexico,Award, ¶211.

[128]Feldman v. Mexico,Correction and Interpretation of the Award, ¶12.

[129]S. D. Myers Inc. v. Canada, paras. 88-93, 123-6.

[130]S. D. Myers Inc. v. Canada, para. 227.

[131]S. D. Myers Inc. v. Canada, para. 228.

[132]Gaukrodger, Investment Treaties as Corporate Law, p.27.

[133]Douglas, The International Law of Investment Cliams, ¶856.

[134]Voon, Mitchell, and Munro, “Legal Responses to Corporate Maneuvering in International Investment Arbitration,” p. 55.

[135]SeeVCLT, Article 31(2) requires that the interpreter should look to the “ordinary meaning” of the word or phrase unless a “special meaning” was intended by the parties.

[136]Aguas del Tunari, ¶227.


[138]Mobil,159-160;Autopista, ¶119-121.

[139]Yukos, ¶508-511.

[140]Lemire, ¶38.

[141]Dissenting Opinion of Arbitrator Dr Jürgen Voss, ¶63.

[142]Ibid, ¶62.

[143]Ibid, ¶74-8.

[144]Sasson, Substantive Law in Investment Treaty Arbitration, p. 132.


[146]Sedelmayer v Russia,p. 27.

[147]Ibid, p. 28.

[148]McLachlan, International Investment Arbitration, ¶6.92.

[149]Schreuer, Shareholders’ protection in International Investment Law, p. 16.

[150]GAR, Defining “investment” in shareholder claims.

[151]SCB v Tanzania,¶23.

[152]Ibid, ¶¶27-8.

[153]Ibid, ¶¶40, 59, 139-47.

[154]Ibid, ¶¶70-2.

[155]Ibid, ¶230.

[156]Ibid, ¶270: “it would be unreasonable to read the BIT to permit a UK national with subsidiaries all around the world to claim entitlement to the UK-Tanzania BIT protection for each and every one of the investments

around the world held by these daughter or granddaughter entities.”


[158]https://www.italaw.com/cases/4332, $148,400,000 Award in favour of an investor

[159]SeeSCB HK v. TANESCO, Committee’s Decision of 12 April 2017.

[160]GAR, Energy Arbitrations, p. 3.

[161]Charanne, ¶228.

[162]SeeSornarajah,The International Law on Foreign Investment, p. 328: “‘Round-tripping’ is a technique which nationals of a state use in order to protect their investments from interference by their own states. It involves an investor transferring funds to another state and then redirecting the funds into his own home state, thus securing the protection as well as the advantageous treatment that may be given by the law of the home state to foreign investors.”

[163]Bentolila, Shareholders’ Action to Claim for Indirect Damages in ICSID Arbitration, p. 140.

[164]Wälde and Sabahi, Compensation, Damages and Valuation in International Investment Law, p. 43.

[165]Wälde and Sabahi, Compensation, Damages and Valuation in International Investment Law, p. 42.

[166]Alexandrov, The “Baby-Boom” of Treaty-Based Arbitrations, p. 45.

[167]Notably, that the BIT between Italy and Pakistan did not contain umbrella clause.SeeImpreglio, ¶188.

[168]Badia, “Piercing the Veil of Investors in Nationality Claims,” p. 136.

[169]Diehl,Direct or Derivative Rights,p. 309.

[170]Braun,Investors as Subjects of Public International Law,p. 41.

[171]Thorn and Doucleff, “Disregarding the Corporate Veil and Denial of Benefits Clauses,” p. 5.

[172]Douglas, The International Law of Investment Claims, ¶530.

[173]Tercier and Tran Thang, “Criteria to Determine Investor Nationality,” p. 141.

[174]Schefer,International Investment Law,p. 147.

[175]Yannaca-Small, Definition of Investor and Investment in IIAs, p.10.

[176]Schefer,International Investment Law,p. 148.

[177]Thorn and Doucleff, “Disregarding the Corporate Veil and Denial of Benefits Clauses,” p. 5.

[178]Yannaca-Small, Definition of Investor and Investment in IIAs, p.17; Plokhenko, “Treaty Shopping in Investment Treaty Arbitration,” p. 200.

[179]Perkams, “The Definition of Nationality of Investors in IIAs,” p. 11-13; Thorn and Doucleff, “Disregarding the Corporate Veil and Denial of Benefits Clauses,” p. 5; Schefer,International Investment Law,p. 147.

[180]Yannaca-Small, Definition of Investor and Investment in IIAs, p.36.

[181]Schreuer,The ICSID Convention: A Commentary,¶689; Badia, “Piercing the Veil of Investors in Nationality Claims,” p. 141.

[182]Douglas,‘The Hybrid Foundations of Investment Treaty Arbitration,’p. 172.

[183]Ibid., pp. 172-173.

[184]Schreuer, Nationality of Investors, p. 522.

[185]Perkams, “The Definition of Nationality of Investors in IIAs,” p. 12.

[186]See De Visser,La protection diplomatique des personnes morales, p. 400 “Dans la généralité des cas cependant, on désigne par personnes morales des groupements d'individus qui poursuivent la réalisation d'une fin commune par la mise en commun de certains biens et de certaines activités.”

[187]Banifatemi and Walter,Commentary on Selected Model Investment Treaties, p. 256.

[188]Tietje and Bering,Beyond Formal Criteria: Determining Nationality of Corporations in ‘Hard Cases’,p. 34.

[189]CEAC v. Montenegro,¶155.

[190]Ibid., ¶¶200-201.

[191]Ibid., ¶199.

[192]Ibid., ¶207.

[193]Tenaris and Talta v. Venezuela (I),¶¶154.

[194]Ibid, ¶199.


[196]Ibid, ¶¶201-26.

[197]Tenaris and Talta v. Venezuela (II),¶¶189-90.

[198]Ibid, ¶193.

[199]Ibid, ¶230.

[200]Also referred to by commentators as “treaty shopping” or “treaty planning,” See Eljuri and Mata, “Resource Nationalism, Expropriation and Risk Mitigation,” p. 69.

[201]Ibid, p. 72; Plokhenko, “Treaty Shopping in Investment Treaty Arbitration,” p. 202.

[202]Happ and Klemm, “Consideration of denial of benefit clauses and any other mechanisms that limit the scope of BIT for investors,” p. 52.

[203]Feldmann, “Denial of Benefits afterPlama v. Bulgaria,” p. 463; Thorn and Doucleff, “Disregarding the Corporate Veil and Denial of Benefits Clauses,” p. 26.

[204]Eljuri and Mata, “Resource Nationalism, Expropriation and Risk Mitigation,” pp. 72-3.

[205]Ioannis Kardassopoulos v. The Republic of Georgia, Decision,para. 182

[206]ECT, Article 17(1) permits every contracting party to deny the advantages […] to legal entities if “Citizens or nationals of a third state own or control such entity and if that entity has no substantial business activities in the Area of a Contracting Party in which it is organised…”

[207]NAFTA, Article 1113 permits party A “to deny an enterprise investor of party B of NAFTA protection if investors of a non-party own or control the enterprise and either party A does not maintain diplomatic relations with the non-party or party A adopts of maintains measures with respect to the non-party that prohibit transactions with the enterprise or that would be violated or circumvented if the benefits of Chapter XI were accorded to the enterprise or its investment,” See Williams, Jurisdiction and Admissibility, p. 917.

[208]Voon, Mitchell, and Munro, “Legal Responses to Corporate Maneuvering in International Investment Arbitration,” p. 54; Happ and Klemm, “Consideration of denial of benefit clauses and any other mechanisms that limit the scope of BIT for investors,” p. 53.

[209]Thorn and Doucleff, “Disregarding the Corporate Veil and Denial of Benefits Clauses,” p. 26.

[210]Mistelis and Baltag, “Denial of Benefits and Article 17 of the Energy Charter Treaty,” p. 1312.

[211]McLachlan,International Investment Arbitration, ¶5.45.

[212]Tercier and Tran Thang, “Criteria to Determine Investor Nationality,” p. 146.

[213]Tokios Tokeles, ¶8.

[214]Ibid., ¶9.

[215]Ibid., ¶¶21-23.

[216]Ibid., ¶54.

[217]Ibid., ¶55.

[218]McLachlan,International Investment Arbitration, ¶5.47.

[219]Schreuer, Nationality Planning, p. 6.

[220]Tokios Tokeles, Dissenting Opinion of Prosper Weil, ¶30.

[221]Tercier and Tran Thang, “Criteria to Determine Investor Nationality,” p. 146.

Excerpt out of 58 pages


Piercing the Corporate Veil Doctrine in International Investment Agreements
Humboldt-University of Berlin  (International Dispute Resolution Master of Laws (LL.M.) Programme)
International Investment Arbitration
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piercing, corporate, veil, doctrine, international, investment, agreements
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Anastasiia Dulska (Author), 2017, Piercing the Corporate Veil Doctrine in International Investment Agreements, Munich, GRIN Verlag, https://www.grin.com/document/427445


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