TSA Spectrum de Argentina S.A. v. Argentine Republic
ICSID · Investment (ICSID and treaty) · Argentina · 19 Dec 2008
Why it matters
This award is a landmark for its application of the 'corporate veil' piercing doctrine in ICSID jurisdiction. The Tribunal looked beyond the immediate Dutch parent company to the ultimate French controller, finding that TSA was not a Dutch national under the BIT. This set a precedent for tribunals to examine the true nationality of control in investment treaty claims, particularly where there are allegations of abuse of corporate structure.
Summary
TSA Spectrum de Argentina S.A. ('TSA'), an Argentine company wholly owned by TSI Spectrum International N.V. ('TSI'), a Dutch company, brought an ICSID claim against Argentina under the Netherlands-Argentina BIT. TSA had been awarded a concession to manage Argentina's radio spectrum in 1997, but Argentina terminated the concession in 2004, alleging breaches and corruption. TSA initiated arbitration under the BIT, claiming expropriation and unfair treatment. Argentina raised four jurisdictional objections. The third objection was that TSA was not a 'national of another Contracting State' under Article 25(2)(b) of the ICSID Convention because TSA was an Argentine company, and the BIT's provision treating locally incorporated companies as foreign nationals if controlled by Dutch nationals did not apply. The Tribunal agreed, applying the 'corporate veil' piercing doctrine to look beyond TSI to its ultimate controller, a French national. Since the BIT only covered investors who were Dutch nationals or controlled by Dutch nationals, and the ultimate controller was French, TSA could not be treated as a Dutch national. The Tribunal dismissed the case for lack of jurisdiction, without reaching the merits. The award is notable for its strict interpretation of nationality requirements and its willingness to pierce the corporate veil to determine true control.
The detail
Parties: TSA Spectrum de Argentina S.A. v. Argentine Republic
Case number: ICSID Case No. ARB/05/5
Outcome: The Tribunal upheld Argentina's third jurisdictional objection, finding that TSA was not a national of the Netherlands under the ICSID Convention because its ultimate control was held by a French national, not a Dutch national. The case was dismissed for lack of jurisdiction.
Applicable law: ICSID Convention, Netherlands-Argentina BIT (1992), Argentine law
Issues in play: The key issue was whether TSA, an Argentine company controlled by a Dutch parent, could be treated as a 'national of another Contracting State' under Article 25(2)(b) of the ICSID Convention. The Tribunal applied the 'corporate veil' piercing doctrine to look beyond the Dutch parent to the ultimate French controller, finding that the BIT's definition of 'investor' did not extend to companies ultimately controlled by non-Dutch nationals.
Read the full decision at italaw ↗
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