Nationality of Physical Persons

1. Nationality of Physical Persons Nationality and Investment Treaty Claims London, Friday 6 May 2005 Devashish Krishan

2. Nationality of Physical Persons • 1875 – “I am an Englishman” • Continental influence – Napoleonic Code • World War I – nationality as dominant concept politically and legally whereby individual (non-State entity) acquired the standing/capacity/capability to derive international interests and rights under international law • No coherent international approach – failure of 1930 Hague Convention • BIT context – economically speaking, nationality crucial to the benefit for the home State under the BIT

3. Proof of Nationality • International Tribunal is a judge of its own competence; can order production of evidence • No rules in ICSID Convention/UNCITRAL Rules/BITs • Proposal in ICSID – To allow decision by Home State’s Government to control would be to give too much power to the Investor’s state • Burden of Proof is on Claimant and claims are inadmissible in absence of proof of nationality (Expropriated Religious Properties award, 1920)

4. Proof of Nationality (Contd.) • Absent coherent rules on nationality in a given legal system, int’l tribunals have determined that persons have had the nationality of a State on the basis of its own judgment, even though it may not have been entirely clear whether the law of that State regarded them as nationals (Cayuga Indians award (G.B.)/USA, 1926), and sometimes even when they were not regarded as citizens for domestic purposes (Kahane (successor)/Parisi and the Austrian State decision, 1929-30) • Tribunals have declined jurisdiction on the basis of nationality when the individual may have been regarded as a national for domestic purposes (Soufraki/UAE award)

5. Proof of Nationality (Contd.) • Nationality proof is a question of fact that arises when the question of law is answered in the affirmative – does the individual have the standing/capacity/capability to invoke BIT rights, including arbitration, under the applicable law? This is question of jurisdiction rationae materiae primarily, which is determined by an analysis of rationae personae. • Distinct from the question of whether the Tribunal/ICSID Centre had jurisdiction rationae personae (to investigate Claimant’s standing as opposed to the question of standing itself). This question answered under the provisions of Article 25, ICSID or absence thereof – Can the Centre/Party transmit the claim to the contracting host State triggering the latter’s obligation to answer to the ICSID Secretariat/UNCITRAL arbitration?

6. Proof of Nationality (Contd.) • The Tribunal in Soufraki/UAE, looked to Int’l law which points to Municipal Law which points to relevant criteria. The Tribunal looks to the fact of whether the potential Claimant satisfies such criteria and adopts the finding as a matter of fact, not law. • Therefore, nationality is determined as a question of international law using Municipal law as a question of fact. • No determination of the nationality concept as used domestically is made – the individual’s status as a national for domestic purposes remains unchanged. The Tribunal only makes a determination on his/her status as a national for international purposes.

7. C X3 – International interests/rights Soufraki/U.A.E. X8 – Stateless national Cayuga Indians arbitration Kahane (successor) case Any Third State X7 – Triple national of A, B and C X6 – Dual national of B and C X5 – Dual national of A and C Nottebohm case Flegenheimer claim North Transsylavania Nationality case Olguin/Paraguay X Individual Initiates Claim Against B X2 – Int’l rights Straightforward claim Feldman/Mexico X1 – Local Courts No Int’l Law esp. Economic Law; maybe human rights and Jus cogen rights X4 – Dual national of A and B Champion Trading and others/Egypt Iran/US Claims Tribunal Case A/18 Canevaro claim, 1910 ICSID Convention Article 25(1)(a) B A Bilateral Investment Treaty with investor-State arbitration BIT Party 1 – Home State (Claimant) BIT Party 2 – Host State (Respondent)

8. Multiple Nationality • X4 to X7 are the only situations where interpretation is needed • Nationality key that opens first door to consent by delimiting it • Hurdles – (a) ICSID (positive and negative rule); (b) BIT (any additional rules); (c) Other Int’l Law principles of nationality • BIT/ad hoc arbitration – absent express provision, no limits on jurisdiction in terms of nationality. Consent still necessary • Outer limits of ICSID jurisdiction – agreement between individual and host State as to his nationality not to be binding; Consent is the cornerstone of ICSID jurisdiction • “National of a contracting State” – means no question of theories of “master” or “effective” nationality – minimum criteria to invoke jurisdiction

9. “Effective Nationality” Theory • “Effective Nationality” – Nottebohm Case: Expansive or narrow view? • “Effective link” should only operate in favour of defendant state with which the individual has a closer connection that with the Claimant state: the absence of an effective link is relevant to negating the existence of nationality only in particular circumstances.

10. End thoughts • Is there a distinction between nationality for arbitral jurisdiction, particularly ICSID, and for capacity/standing/capability to hold BIT rights, including right to arbitrate? • Soufraki – what was violated was the element of consent, not the element of nationality in ICSID Article 25. • X is a national of A and B (B being defendant State) – would the analysis under ICSID Convention and BIT/UNCITRAL Rules ad hoc arbitration lead to same result? • Is the doctrine of effective nationality under Nottebhom dictum apposite to BIT arbitration? Is it in harmony with the teleological purpose prescribed by Article 31, VCLT?

11. Cases • Cayuga Indians case (G.B./USA), (1926) RIAA Vol. 6, 173. • Kahane (Successor)/Parisi and the Austrian State, Case No. 131, Annual Digest 5 (1929-1930), 213. • Soufraki/United Arab Emirates, ICSID award. • Expropriated Religious Properties, (1913) RIAA Vol. 1, 7. • Feldman/Mexico, NAFTA Award. • Nottebohm case, ICJ Rep. 1955, 4. • Flegenheimer claim (USA/Italy)1958 I.L.R. 91. • North Transsylvania Nationality case, 1971 I.L.R. 43. • Olguin/Paraguay, ICSID award. • Champion Trading and others/Egypt, ICSID award. • Case No. A/18, 5 Iran-U.S.C.T.R. 251. • Canevaro claim (Italy/Peru – 1910), RIAA Vol. 11, 397.