The Investment Treaty Arbitration Review: Requirements of Ratione Personae in a Global Environment


Ratione personae, as a threshold jurisdictional requirement in an investment arbitration, has presented complexity in a dynamic global environment. For the purpose of investor-state dispute, an investor is generally defined as a national or an enterprise of a party that makes an investment that is entitled to protection under a given international investment agreement (IIA).2 Such broad definition triggers multiple issues in practice on the approach to be adopted in understanding the nationality requirement.

Due to lack of a clear guidance in the specific IIA and different facts involved in each case, tribunals differ as to the need to apply a substantive test to find the 'real and effective nationality' of a natural person or the real source of control for a juridical person in determining one's nationality, particularly where the investor concerned has the dual nationality of both the home state and the host state. In contrast, the formalistic approach requires the tribunal not to go beyond the text of the IIA and add additional requirements for the qualification of an investor. In the meantime, out of the concerns for the abuse of process in the corporate restructuring, tribunals often find it necessary to resort to public international law, particularly the principle of good faith to determine the validity of a nationality change. This chapter addresses a variety of considerations taken into account by the tribunals in choosing one approach over the other. In view of the importance of the underlying IIA, this chapter also discusses the IIAs that have incorporated public international law principles in handling the ratione personae requirements.


The essential character of investment treaty law is to afford protection to investors who are nationals of a contracting state other than the host state in which the investment is made.3 The ICSID Convention's definition of nationality has clearly reflected this two-fold test (i.e., for a national to bring a claim against the host country, the person must meet the positive requirement of being a national of a contracting state and the negative requirement of not being a national of the host state). However, depending on the language of the IIA, questions may arise as to whether the same two-fold test is universally applicable to non-ICSID cases. Further, dual nationality gives rise to a wider range of issues; for example, what is the determining factor in ascertaining a person's nationality and whether and to what extent the diplomatic protection 'real and effective nationality' test is applicable.

i Applicable test – is a substantive test necessary?

In examining an individual case, it is crucial to consider the provision controlling nationality in a particular treaty that may be applicable, as well as the language in Article 25 of the ICSID Convention (if that Convention applies).4 The starting point is that each state is to determine nationality under its own law.5 This principle of international law has been widely accepted in the practice of investment treaty arbitration.6 For example, the ICSID tribunal in Micula noted that this principle was consistent with Article 1(2)(a) of the bilateral investment treaty (BIT) that defined an investor as 'any natural person who is a citizen of a Contracting Party in accordance with its Laws'.7

Absent express provisions in the relevant BIT, respondent states often resort to a search for 'real and effective nationality' for nationals of dual nationality, such that lack of a genuine link with the home contracting state will disqualify the claimant from claiming under the BIT. However, the ICSID tribunals have rejected such arguments for the reason that neither the ICSID Convention nor the relevant BIT has included the 'genuine link' as an additional requirement to the determination of nationality.8 As noted by the Fakes tribunal, such additional requirement made sense when the state was asserting a claim on behalf of an individual in the context of diplomatic protection, but in treaty arbitration the state does not assert a claim.9 Even in the context of diplomatic protection, the additional factor suggested in the Nottebohm case has been used sparingly. As commented by the International Law Commission, in today's world of economic globalisation and migration, if the genuine link requirement proposed by Nottebohm was strictly applied, it would exclude millions of persons from the benefit of diplomatic protection.10 As a result, the claim to nationality remains largely formalistic in investment treaty cases and the threshold to prove effectiveness of the home state nationality is relatively low.11 On the other hand, the Siag majority found that the claimant individuals had lost their Egyptian (host state) nationality without the need to consider whether either individual had a genuine link to Italian (home state) nationality. In dissent, Professor Francisco Orrego Vicuña provided a compelling argument that upholding Mr Waguih Siag's standing and denying his Egyptian nationality were at odds with the meaning of the ICSID Convention.12

In non-ICSID cases, arguments have been made for and against applying an 'effective nationality' test where claimant individuals are dual home and host state nationals. The better view is that where an IIA does not specifically address the eligibility of dual nationals to bring arbitration proceedings, a tribunal may permit the application of the 'effective nationality' test to 'fill any perceived lacuna'.13 Nevertheless, the UNCITRAL tribunal in Armas was reluctant to apply such test to claimant individuals who were nationals of both Spain and Venezuela, holding that the BIT shall prevail.14

Several IIAs provide better guidance for dual nationals.15 For example, the definition of investor in the Canada-China BIT excludes natural persons having nationality of both Contracting Parties.16 Some treaties have required the dual national to claim his or her dominant and effective nationality, which is understood to mean that a dual national sharing the nationality of the host state may nevertheless bring a claim against the host state so long as it is not his or her 'dominant and effective' nationality.17

The increasing incorporation of 'effective nationality' test in the IIAs provides greater certainty in handling the issues arising from the growing mobility of nationals in the trend of globalization. Against this background, the principles of diplomatic protection will likely continue to play a role in the jurisprudence of investment treaty arbitration, although investment tribunals are free to develop a distinctive set of rules from those applied in general international law.

ii Burden of proof

Despite the pivotal role of each state in determining nationality, an international tribunal is empowered to decide for itself whether the person, on the facts and the domestic law before it, is in fact a national of the state in question for investment arbitration purposes.18

In assessing nationality, tribunals will generally recognise the certificate of nationality and other official documents as prima facie evidence.19 There exists a presumption in favour of the validity of a state's conferment of nationality,20 often provided by the claimant. To rebut such presumption, the burden of proof will immediately shift to the respondent state. Fraud or mistake can be a basis for disregarding a nationality at an international level.21 As such, tribunals have the power to investigate on the accuracy of the certificates issued by a state and in view of the totality of evidence, may consider the prima facie evidence effectively controverted. In such circumstances, the burden will remain on the claimant to prove his or her nationality.22 Notably, casting doubt is not sufficient and the threshold to overcome the presumption in favour of the prima facie evidence is high.23

When examining whether the nationality requirement under the domestic law has been met, tribunals would 'pay the utmost regards to the decisions of the municipal courts of a country', as the decisions represent the rules that are actually applied in that country.24 Inevitably, tribunals also find it helpful to rely on expert opinions on the interpretation of domestic laws.25

In the context of satisfying the two-fold test of dual nationality under Article 25(2)(a) of the ICSID Convention, the Ambiente tribunal has articulated a rather clear test for allocation of burden of proof between the claimant and the respondent state: the burden of showing that the claimants were Italian fell on the claimants, while the burden to 'disprove the negative elements' (i.e., prove that the claimants were not Argentinean) fell on the respondent.26


Similar to the determination of the nationality of a natural person, it is for each state to define the criterion for determining the nationality of a juridical entity.27

The test of incorporation is the most widely used criterion for the determination of a corporate's nationality.28 As the International Court of Justice has explained, '[t]he traditional rule attributes the right of diplomatic protection of a corporate entity to the states under the laws of which it is incorporated and in whose territory it has its registered office'.29 Some IIAs, including those concluded by China, have further required the companies to have economic interests or have the seat in the contracting state.30 As for the meaning of seat, it can either be statutaire, referring to the seat appearing in the company's bylaws or statutes, or réel, referring to the effective seat where the company is actually managed.31 Other IIAs extend the protections to the companies controlled by the natural persons and juridical persons of a contracting state.32 Such control test has been incorporated in Article 25(2) of the ICSID Convention to permit the local companies in the host state to claim against the host state if they are foreign-controlled and the host state consents to it.33

Due to the complicated ways to structure investments, there were far more cases in which respondent states called for the application of substantive control test to lift the corporate veil of the claimant than if the claim is brought by a natural person. Tribunals in both ICSID and non-ICSID cases, however, seem reluctant to apply this test unless otherwise specified in the relevant BIT, although the company may be owned or controlled by nationals of the host state.34 In Tokios, Ukraine argued that to find jurisdiction to this case would be tantamount to allowing Ukrainian nationals to pursue international arbitration against their own government, which would be inconsistent with the object and purpose of the ICSID Convention.35 The majority nevertheless refused to pierce the corporate veil and impose an additional control requirement because if the contracting states wanted to impose such 'denial of benefits' provision with respect to the entities controlled by nationals of the denying party, they could have done so.36 According to the majority, the object and purpose of Article 25(2)(b) of the ICSID Convention is not to limit jurisdiction but to set its outer limits.37 The majority's approach was criticized by the dissenting Chairman Prosper Weil. As noted by the TSA tribunal, such a strict literal interpretation 'may appear to go against common sense in some circumstances, especially when the formal nationality covers a corporate entity controlled directly or indirectly by persons of the same nationality as the host State'.38

Weil's dissent identified the origins of capital a highly relevant issue,39 but such relevance was only considered by tribunals in interpreting the 'foreign control' under the second limb of Article 25(2)(b) of the ICSID Convention. Nevertheless, tribunals differ as to how many corporate layers after the one bearing the nationality of the host state shall be lifted to reach the real source of control. As one of the earliest cases to address this issue, the tribunal in Amco went only one step behind the nationality of the host state in finding jurisdiction over the claimant, which was directly controlled by a US company, but refused to take care of a control at the second, and possibly third, fourth or xth degree.40 In contrast, the tribunal in TSA went for the actual controller behind the second corporate layer. Specifically, the tribunal noted that 'the reasons for piercing of the corporate veil up to the real source of control is a fortiori more compelling under the second clause of Article 25(2)(b) when ultimate control is alleged to be in the hands of nationals of the host State'.41

The determination of control itself may be subject to controversy. While 100 per cent foreign ownership almost certainly would result in foreign control, there is no definite formula as to how much shareholding is enough. The tribunal may regard any criterion based on management, voting rights, shareholding or any other reasonable theory.42 Notably, in the circumstances where the shareholder cannot exercise affirmative control over the corporate through its shareholding or voting rights, it may nevertheless be treated as a controller if it possesses the capacity for an effective veto.43

In short, the determination of corporate nationality remains to be formalistic despite the respondent states' calls to take into account the object and purpose of the ICSID Convention. While the search for substantive control seems to be only relevant in the exception under the second limb of Article 25(2)(b) of the ICSID Convention, the debate on the tribunal's power to investigate into the source of actual control is far from settled. Because of a wide range of commercial arrangements available to structure investments, the investigations on the actual control will continue to present challenges. Unlike the presumption in favour of the certificate of nationality in proving a natural person's claim to the home state's nationality, the formal certificate of incorporation could be easily subject to challenge by various factors pointing to foreign control. As a result, the boundaries of protections afforded to a corporate structure under investment law may become increasingly flexible along with the free movement of capital.


Tribunals often have to look behind the formal requirements of nationality where respondent states object to jurisdiction on the basis of the claimant's abuse of a corporate structure with the principal aim of gaining access to protection under another country's treaty. At least 12 tribunals have dismissed the claimant's claims on the basis of the claimant's abuse of right.44

The timing of the corporate restructuring is the basis in determining its validity. As the Mobil tribunal recognised, the claimant's restructuring 'was a perfect legitimate goal as far as it concerned future disputes'.45 In practice, the dividing line between a valid nationality change and abuse of right may be complicated by factual uncertainties. In the view of the Pac Rim tribunal, this dividing line occurs 'when the relevant party can see an actual dispute or can foresee a specific future dispute as a very high probability and not merely as a possible controversy'.46 In Philip Morris, the tribunal dismissed the claims because the dispute was foreseeable at the time of the restructuring; according to the tribunal, a dispute is foreseeable when there is 'a reasonable prospect' that 'a measure which may give rise to a treaty claim will materialize'.47

In examining the validity of a corporate restructuring, the tribunals are more concerned with substance than formality and frequently adopt public international law, including the principle of good faith to ensure that 'only investments that are made in compliance with good faith are protected'.48 Tribunals will examine the true nature of the restructuring operation and can only be satisfied with the restructuring that is indeed 'an economic activity in the market place' rather than 'a rearrangement of assets within the family' to bring a claim that may otherwise be precluded.49

In contrast, the challenge to the change of nationality in the case of an individual investor is less prevalent,50 possibly because of the fact that a corporate structure frequently involves multiple layers rather than a single company directly owned by a natural person. Legitimate grounds may exist to apply the general principle of good faith to look behind an individual's acquisition of nationality. As the Fakes tribunal acknowledges, the 'effective nationality' test could be justified in light of the particular circumstances of a given case; for example, where a nationality of convenience is acquired 'in exceptional circumstances of speed and accommodation', for the purpose of bringing a claim or is acquired merely because such nationality has passed over several generations.51 The need to examine the good faith of an individual to acquire a nationality will be more apparent in cases of dual nationality, particularly in non-ICSID cases where tribunals undertake an 'effective nationality' analysis to determine the individual's dominant nationality.

The concerns for abuse of right frequently arise in the situation of parallel proceedings with overlapping claims. Generally, tribunals have consistently interpreted IIAs to allow shareholder claims for reflective loss, including both direct and indirect shareholders.52 However, where the shareholder has the same interest as the company it owns or other shareholders in the ownership tree, the shareholder's double pursuit of reflective loss may be considered as abusive53 and therefore, precluded from being pursued as a parallel proceeding. Notably, the threshold for a finding of abuse of right is high, which normally requires the 100 per cent ownership.54 In Eskosol, the tribunal refused to preclude the company from bringing claims after its shareholder who owned 80 per cent of the corporate shares already had done so, holding that it would not be appropriate for tribunals to preclude arbitration by qualified investors, simply because other qualified investors may have proceeded before them without their participation.55

To address the concerns of double recovery in parallel proceedings, some treaties have established a distinctive regime for covered shareholder claims. For example, the North American Free Trade Agreement (NAFTA) permits claims by a controlling shareholder on behalf of the company for loss incurred by the company and with recovery that accrues to the company, in addition to claims by shareholders on their own behalf.56 However, in their interpretations, NAFTA-party governments have stated that covered shareholders cannot bring reflective loss claims on their own behalf.57 Tribunal decisions have reached varying results, with more recent tribunals concluding in favour of the NAFTA parties' consistent interpretative statement that NAFTA prohibits reflective loss claims.58 With these development, one may wonder whether the dividing line between a legitimate act and an abuse of right is shifting its course towards more regulation and discouragement of forum selection.


While tribunals tend to place primary emphasis on the relevant IIA in making nationality determinations, they differ as to the weight to be applied on previous ratione personae decisions. In today's world of economic globalisation and migration, dual nationality and change of nationality will increasingly present challenges to determine a valid nationality of an investor and its entitlement to protections under a given treaty. The object and purpose of the IIA (and the ICSID Convention if it applies) as well as the principles of public international law will continue to feature in the debate on the interpretation of a qualified investor. In the meantime, the proliferation of the IIAs that have specifically addressed the issue at hand will help formulate a more consistent approach in interpreting the ratione personae requirements.


1 Huawei Sun is a partner and Xingyu Wan is an associate at Zhong Lun Law Firm.

2 See, e.g., Comprehensive and Progressive Agreement for Trans-Pacific Partnership, Article 9.1, 'investor of a Party means a Party, or a national or an enterprise of a Party, that attempts to make, is making, or has made an investment in the territory of another Party'.

3 Campbell McLachlan et al., International Investment Arbitration: Substantive Principles, 2nd edn, 2017, para. 5.01 at 156.

4 id., para. 5.38 at 169.

5 Convention on Certain Questions Relating to the Conflict of Nationality Laws (1930), Article 1, 'It is for each State to determine under its own law who are its nationals'.

6 See, e.g., Hussein Nuaman Soufraki v. The United Arab Emirates, ICSID Case No. ARB/02/7 (Soufraki), Award, 7 July 2004, para. 55, 'It is accepted in international law that nationality is within the domestic jurisdiction of the State, which settles, by its own legislation, the rules relating to the acquisition (and loss) of its nationality'; Waguih Elie George Siag and Clorinda Vecchi v. The Arab Republic of Egypt, ICSID Case No. ARB/05/15, Decision on Jurisdiction, 11 April 2007 (Siag), para 143, 'It is well established that the domestic laws of each Contracting State determine nationality'; Ioan Micula, Viorel Micula, S.C. European Food S.A, S.C. Starmill S.R.L. and S.C. Multipack S.R.L. v. Romania, ICSID Case No. ARB/05/20, Decision on Jurisdiction and Admissibility, 24 September 2008 (Micula), para. 86, 'It is not disputed by the Parties that as a general principle it is for each State to decide in accordance with its law who is its national'.

7 Micula, paras 84 and 86.

8 See, e.g., Siag; Saba Fakes v. Republic of Turkey, ICSID Case No. ARB/07/20, Award, 14 July 2010 (Fakes).

9 Fakes, para. 68.

10 International Law Commission, Draft Articles on Diplomatic Protection, Article 4, p. 30.

11 See, e.g., Fakes, para. 80, 'The effectiveness of Mr. Fakes's Dutch nationality is demonstrated, inter alia, by the fact that both of his parents held Dutch nationality, his wife and three children are also Dutch, he has spent a significant part of his childhood and early adulthood in the Netherlands, has studied in the Netherlands, holds a Dutch passport and driver's licence . . . . Against this background, the tribunal is satisfied in the present case that the Claimant's links to the Netherlands are genuine and effective'; Siag, para. 200, 'Italian nationality was also acquired for recognized reasons i.e. marriage to an Italian in the case of Mr Siag and reacquisition following the death of a husband in the case of Ms Vecchi. The tribunal finds that the Claimants possess genuine links to Italy'.

12 Siag (Partial Dissenting Opinion, Professor Francisco Orrego Vicuña), paras 6–23. For comment on this case, see McLachlan et al., pp. 183 and 184.

13 McLachlan et al., p. 185, citing C Dugan, D Wallace, N Rubins and B Sabahi, Investor-State Arbitration, 2008, 304.

14 Serafín García Armas and Karina García Gruber v. Bolivarian Republic of Venezuela, PCA Case No 2013-3, Decision on Jurisdiction, 15 December 2014 (Armas), paras 174 and 206.

15 For a discussion of such relevant treaties, see McLachlan et al., pp. 175 and 176.

16 Canada–China BIT, Article 1.2, 'investor means with regard to either Contracting Party: (a) any natural person who has the citizenship or status of permanent resident of that Contracting Party in accordance with its laws and who does not possess the citizenship of the other Contracting Party.' See also China–Uruguay BIT, Article 1.2, 'This Agreement shall not apply to investments made in the Oriental Republic of Uruguay by natural persons who, in accordance with Uruguayan law, are considered double nationals'.

17 See, e.g., Agreement between the United States of America, the United Mexican States, and Canada, Article 14.1, 'investor of a Party means a Party, or a national or an enterprise of a Party, that attempts to make, is making, or has made an investment in the territory of another Party, provided however that: (a) a natural person who is a dual citizen is deemed to be exclusively a national of the State of his or her dominant and effective citizenship.' See also similar definition at Article 1 of the 2012 US Model BIT and relevant discussions at Patrick W Pearsall, David Manners-Weber, Covered Investors, The Investment Treaty Arbitration Review, 4th edn, 2019.

18 Soufraki, Award, 7 July 2004, para. 55; Soufraki, Decision of the ad hoc Committee on the Application for Annulment of Mr Soufraki, 5 June 2007, para. 93.

19 See, e.g., Soufraki, Award, 7 July 2004, para. 63; Siag, para. 151.

20 International Law Commission, Draft Articles on Diplomatic Protection, Article 4, p. 30.

21 Flegenheimer Case, 1958, 25 I.L.R., p. 108, 'From the standpoint of merit, even certificates of nationality the content of which is proof under municipal law of the issuing State, can be examined and, if the case warrants, rejected by international bodies rendering judgment under the Law of Nations, when these certificates are the result of fraud, or have been issued by favour in order to assure a person a diplomatic protection to which he would not otherwise entitled, or when they are impaired by serious errors'. See also Soufraki, Decision of the ad hoc Committee on the Application for Annulment of Mr Soufraki, 5 June 2007, para. 71.

22 Soufraki, Decision of the ad hoc Committee on the Application for Annulment of Mr Soufraki, 5 June 2007, para. 109.

23 RY Jennings and A Watts (eds), Oppenheim's International Law, 9th edn, 1992, p. 855, 'An international tribunal called upon to apply rules of international law based upon the concept of nationality has the power to investigate the state's claim that a person has its nationality. However, this power of investigation is one which is only to be exercised if the doubts cast on the alleged nationality are not only not manifestly groundless but are also of such gravity as to cause serious doubts with regard to the truth and reality of that nationality'; See also Micula, paras 87 and 95.

24 Case concerning the Payment in Gold of Brazilian Federal Loans Contracted in France, Permanent Court of International Justice, 12 July 1929, paras 80 and 81.

25 For example, the Siag tribunal referred to both parties' expert opinions in reaching the conclusion that Mr Siag did not have Egyptian nationality. Siag, paras 156–173.

26 McLachlan et al., p. 173, citing Ambiente Ufficio SpA v. Argentina (Decision on Jurisdiction and Admissibility, ICSID Case No. ARB/08/9), paras 312, 314 and 319; Also noting that the Siag tribunal had adopted a different approach that was less clear in allocating the burden of proof yet similarly helpful to the claimant, stating that in relation to a jurisdictional objection, the claimant did not have to disprove Egyptian nationality (i.e., the host state nationality), McLachlan et al., para. 5.52 at 173.

27 Christoph H Schreuer et al., The ICSID Convention: A Commentary, 2nd edn, 2009, p. 287, 'Definitions of corporate nationality in national legislation or in treaties providing for ICSID's jurisdiction are . . . part of the legal framework for the host State's submission to the Centre. Upon acceptance in writing by the investor, they become part of the agreement on consent between the parties'.

28 id., p. 279.

29 Case concerning the Barcelona Traction, Light and Power Company, Limited (Belgium v. Spain), Judgment, I.C.J., 5 February 1970, para. 70.

30 See, e.g., China–Swiss BIT, Article 1(2), 'the term investor refers with regard to either Contracting Party to . . . (b) legal entities . . . which are constituted or otherwise duly organised under the law of that Contracting Party and have their seat, together with real economic activities, in the territory of that same Contracting Party'; see also 2012 US Model BIT, Article 1, 'enterprise of a Party means an enterprise constituted or organized under the law of a Party, and a branch located in the territory of a Party and carrying out business activities there'; see also China–Netherlands BIT, Article 1.2, 'The term investor means . . . (b) economic entities, including companies, corporations, associations, partnerships and other organization, incorporated and constituted under the laws and regulations of either Contracting Party and have their seats in that Contracting Party, irrespective of whether or not for profit and whether their liabilities are limited or not'.

31 Orascom TMT Investments S.à r.l. v. People's Democratic Republic of Algeria, ICSID Case No. ARB/12/35, Award, 31 May 2017, para. 273.

32 See, e.g., China–Uzbekistan BIT, Article 1.2, 'The term “investor” means nationals or enterprises of one Contracting Party who are investing or have invested in the territory of the State of other Contracting Party: (a) the term “national” means natural persons who have nationality of either Contracting Party in accordance with the applicable laws of that Contracting Party; (b) the term “enterprise” means any entities . . . incorporated or constituted under the applicable laws and regulations of either Contracting Party and have their seats and substantial business activities in that Contracting Party . . . (c) legal entities constituted under the laws of a non-Contracting Party but directly owned or controlled by nationals in paragraph (a) or enterprises in Paragraph (b)'.

33 ICSID Convention, Article 25(2)(b), 'National of another Contracting State means: . . . (b) . . . 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'. This is generally referred to as the second limb of the Article 25(2)(b).

34 In ICSID cases, the issue is how to interpret the first limb of Article 25(2)(b), which provides that a juridical person must hold the nationality of a contracting state other than the state party to the dispute. See, e.g., Tokios Tokelés v. Ukraine, ICSID Case No. ARB/02/18, 29 April 2004 (Tokios), paras 28 and 52, 'We find no basis in the BIT or the Convention to set aside the Contracting Parties' agreed definition of corporate nationality with respect to investors of either party in favour of a test based on the nationality of the controlling shareholders'. In non-ICSID cases, the issue lies in the interpretation of the relevant BIT. See Saluka Investments B.V. v. The Czech Republic, UNCITRAL, Partial Award, 17 March 2006 (Saluka), paras 240–242, 'That agreed definition required only that the claimant-investor should be constituted under the laws of (in the present case) The Netherlands, and it is not open to the Tribunal to add other requirements which the parties could themselves have added but which they omitted to add'; see also Yukos Universal Limited (Isle of Man) v. The Russian Federation, UNCITRAL, PCA Case No. 2005-04/AA227, Interim Award on Jurisdiction and Admissibility, 30 November 2009, paras 411–415, 'Claimant was organised “in accordance with the law applicable” in a Contracting Party. Claimant accordingly qualifies as a company so organized in the instant case. The Tribunal is not entitled, by the terms of the ECT, to find otherwise. In so concluding, the Tribunal follows the holding of the Partial Award in Saluka.' (In a judgment dated 18 February 2020, the Hague Court of Appeal ruled against Russia's grounds to set aside the award. It is likely that Russia will appeal this ruling to the Netherlands's Supreme Court, see

35 Tokios, para. 22. Nationals of Ukraine owned 99 per cent of the claimant, a Lithuanian company, and comprised two-thirds of its management.

36 Tokios, paras 36 and 39. Actually, Article 1(2)(c) of the Ukraine–Lithuania BIT contained an additional category of nationals – any entity established in any third state controlled, directly or indirectly, by nationals of either Ukraine of Lithuania, or by entities with their seat in the contracting party.

37 Tokios, para. 49.

38 TSA Spectrum de Argentina S.A. v. Argentine Republic, ICSID Case No. ARB/05/5, Award, 19 December 2008 (TSA), para. 145.

39 Tokios (Dissenting Opinion, Chairman Prosper Weil), para. 19.

40 Amco Asia Corporation and others v. Republic of Indonesia, ICSID Case No. ARB/81/1, Decision on Jurisdiction, 25 September 1983 (Amco), para. 14.

41 TSA, paras 152–154.

42 Vacuum Salt Products Ltd. v. Republic of Ghana, ICSID Case No. ARB/92/1, Award, 16 February 1994, paras 43 and 44.

43 Aguas del Tunari, S.A. v. Republic of Bolivia, ICSID Case No. ARB/02/3, Decision on Respondent's Objections to Jurisdiction, 21 October 2005, para. 317.

44 Carmen Martinez Lopez and Lucy Martinez, Corruption, Fraud and Abuse of Process in Investment Treaty Arbitration, The Investment Treaty Arbitration Review, 4th edn, 2019.

45 Venezuela Holdings, B.V., et al (case formerly known as Mobil Corporation, Venezuela Holdings, B.V., et al.) v. Bolivarian Republic of Venezuela, ICSID Case No. ARB/07/27, Decision on Jurisdiction, 10 June 2010 (Mobil), paras 190, 204–206. The tribunal accepted that the main, if not the sole purpose of the restructuring was to gain access to ICSID arbitration but held that such purpose is perfectly legitimate as far as it concerned future disputes. The tribunal upheld its jurisdiction over the disputes arising after the restructuring and rejected its jurisdiction over the pre-existing disputes.

46 Pac Rim Cayman LLC v. Republic of El Salvador, ICSID Case No. ARB/09/12, Decision on the Respondent's Jurisdictional Objections, 1 June 2012 (Pac Rim), para. 2.99.

47 Philip Morris Asia Limited v. The Commonwealth of Australia, UNCITRAL, PCA Case No. 2012-12, Award on Jurisdiction and Admissibility, 17 December 2015 (Philip Morris), paras 554, 566–569 and 588.

48 Phoenix Action, Ltd. v. The Czech Republic, ICSID Case No. ARB/06/5, Award, 15 April 2009 (Phoenix), paras 100, 106 and 113.

49 Phoenix, para. 140.

50 As noted by McLachlan, the problem of changing nationality for the purpose of treaty protection has less relevance in the case of an individual investor. McLachlan et al., para. 5.170 at 208.

51 Fakes, para. 78, citing A. Sinclair, 'ICSID's Nationality Requirement', in TJ Grierson Weiler (ed.), Investment Treaty Arbitration and International Law, 2008, at p. 101 and Champion Trading Company et al. v. Egypt (ICSID Case No. ARB/02/9), Decision on Jurisdiction, October 21, 2003, at pp. 16–17.

52 Vera Korzun, Shareholder Claims for Reflective Loss: How International Investment Law Changes Corporate Law and Governance, University of Pennsylvania Journal of International Law 40(1) (January 2018), pp. 215 and 218.

53 Eskosol S.p.A. in liquidazione v. Italian Republic, ICSID Case No. ARB/15/50, Decision on Respondent's Application Under Rule 41(5), 20 March 2017 (Eskosol), para. 167, 'there may be certain circumstances in which a foreign shareholder and the local company in which it holds shares have such identical interests that it would be abusive to permit arbitration of a given dispute by one after the other already has concluded an arbitration over the same dispute'.

54 Ampal-American Israel Corporation and others v. Arab Republic of Egypt, ICSID Case No. ARB/12/11, Decision on Jurisdiction, 1 February 2016, paras 330–333; See also RSM Production Corporation and others v. Grenada, ICSID Case No. ARB/10/6, Award, paras, 7.1.5–7.1.7.

55 Eskosol, paras 167–170.

56 NAFTA Article 1116(1), 'An investor of a Party may submit to arbitration under this Section a claim that another Party has breached an obligation under: (a) Section A . . . and that the investor has incurred loss or damage by reason of, or arising out of, that breach'; Article 1117(1), 'An investor of a Party, on behalf of an enterprise of another Party that is a juridical person that the investor owns or controls directly or indirectly, may submit to arbitration under this Section a claim that the other Party has breached an obligation under: (a) Section A… and that the enterprise has incurred loss or damage by reason of, or arising out of, that breach'; see also Bilcon of Delware et al v. Government of Canada, PCA Case No. 2009-04, Award on Damages, 10 January 2019 (Bilcon), para. 370, 'NAFTA Article 1116 permits claims by an investor where there has been a breach of NAFTA and “the investor has incurred loss or damage by reason of, or arising out of, that breach”. NAFTA Article 1117 permits claims by an investor in respect of an enterprise that it controls directly or indirectly where there has been a breach of NAFTA and “the enterprise has incurred loss or damage by reason of, or arising out of, that breach”.'

57 UNCITRAL Work Group III (Note by the Secretariat), Shareholder Claims and Reflective Loss (October 2019), para. 28 at 7.

58 id., citing Bilcon, para. 389. The tribunal stated: 'Articles 1116 and 1117 (of NAFTA) are to be interpreted to prevent claims for reflective loss from being brought under Article 1116 . . . . Moreover, the Tribunal takes account of the common positions of the NAFTA Parties in their submission to Chapter Eleven tribunals.'

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