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Nationality of Corporate Investors and International Claims against the Investor's Own State

Nationality of Corporate Investors and International Claims against the Investor's Own State I. INTRODUCTION Almost four decades ago, the International Court of Justice (ICJ) in Barcelona Traktion, in order to determine the nationality of a corporation, gave its preference to the test of incorporation or stege social, respectively, by stating that "the traditional rule attributes the right of diplomatic protection of a corporate entity to a state under the laws of which it is incorporated and in whose territory it has its registered ofhce".1 The Court denied the exercise of diplomatic protection on behalf of shareholders and, while recalling that there had been considerable development in the protection of foreign investments in the form of multilateral or bilateral treaties since the Second World War, observed with regard to the underdeveloped state of international investment law in 1970: "Considering the important developments of the last half-century, the growth of foreign investments and the expansion of international activities of corporations, in particular of holding companics, which are often multinational, and considering the way in which the economic interests of states have proliferated, it may at first sight appear surprising that the evolution of law has not gone further and that no generally accepted rules in the matter have crystallized on the international http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Journal of World Investment and Trade Brill

Nationality of Corporate Investors and International Claims against the Investor's Own State

Journal of World Investment and Trade , Volume 7 (6): 25 – Jan 1, 2006

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Publisher
Brill
Copyright
Copyright © Koninklijke Brill NV, Leiden, The Netherlands
ISSN
1660-7112
eISSN
2211-9000
DOI
10.1163/221190006X00027
Publisher site
See Article on Publisher Site

Abstract

I. INTRODUCTION Almost four decades ago, the International Court of Justice (ICJ) in Barcelona Traktion, in order to determine the nationality of a corporation, gave its preference to the test of incorporation or stege social, respectively, by stating that "the traditional rule attributes the right of diplomatic protection of a corporate entity to a state under the laws of which it is incorporated and in whose territory it has its registered ofhce".1 The Court denied the exercise of diplomatic protection on behalf of shareholders and, while recalling that there had been considerable development in the protection of foreign investments in the form of multilateral or bilateral treaties since the Second World War, observed with regard to the underdeveloped state of international investment law in 1970: "Considering the important developments of the last half-century, the growth of foreign investments and the expansion of international activities of corporations, in particular of holding companics, which are often multinational, and considering the way in which the economic interests of states have proliferated, it may at first sight appear surprising that the evolution of law has not gone further and that no generally accepted rules in the matter have crystallized on the international

Journal

Journal of World Investment and TradeBrill

Published: Jan 1, 2006

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