An Analysis of the Criteria for Determining the Personal Jurisdiction of Legal Entities under the ICSID Arbitration Convention

Document Type : Scientific research

Authors

Mohammad Javad Abdollahi ¹

Mahsa Ebrahimi ²

¹ Assistant Professor, Department of Law, Kho.C., Islamic Azad University, Khomeinishahr, Iran.

² Ph.D Student in Private Law, Department of Law, Na.C., Islamic Azad University, Najafabad, Iran.

https://doi.org/10.22067/economlaw.2025.92646.1442

Abstract

The determination of the nationality of legal entities has consistently been one of the most controversial issues in international investment arbitration, including proceedings under the ICSID Convention. In this regard, Article 25 of the ICSID Convention, which governs the settlement of international investment disputes, places certain limitations on the scope of claims that may be referred to ICSID arbitration, including those involving corporations. Despite the ambiguities contained in this provision, neither legal scholars nor arbitral practice in the field of international investment disputes have reached a consensus on adopting a single criterion for establishing personal jurisdiction. Instead, different standards have been considered, such as the place of incorporation, the seat of the company, and the effective or dominant control test. The central question of this research is which criterion ICSID tribunals have adopted when confronted with international investment disputes and how the chosen criteria have been analyzed in practice. The findings of this study, based on library research and the note-taking method, indicate that neither scholars nor arbitral practice have settled on a uniform criterion for determining the element of nationality and personal jurisdiction of legal entities in disputes brought under the ICSID arbitration framework. Rather, depending on the circumstances of each case and the interpretation of the relevant bilateral investment treaty, arbitral tribunals have in practice adopted different approaches.

Keywords

ICSID Convention

personal jurisdiction

corporate nationality

control test

host State

investor

Subjects

• Foreign Investment Law

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