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Decision on Jurisdiction

I. Procedure

1.
On November 5, 2002, the International Centre for Settlement of Investment Disputes ("ICSID" or "the Centre") received a Request for Arbitration against the Argentine Republic ("the Respondent" or "Argentina") from the AES Corporation ("the Claimant" or "AES"), a company incorporated in the State of Delaware, with headquarters in Arlington, Virginia, United States of America. The Request concerns AES' investment in eight electricity generation companies and three major electricity distribution companies in Argentina, and Argentina's alleged refusal to apply previously agreed tariff calculation and adjustment mechanisms.
2.
In its request, AES invoked the provisions of the 1991 Treaty between the United States of America and the Argentine Republic Concerning the Reciprocal Encouragement and Protection of Investment (the "Argentina-US Bilateral Investment Treaty" or the "BIT").1
3.
On November 6, 2002, the Centre, in accordance with Rule 5 of the ICSID Rules of Procedure for the Institution of Conciliation and Arbitration Proceedings (Institution Rules), acknowledged receipt and transmitted a copy of the request to the Argentine Republic and to the Argentine Embassy in Washington D.C.
4.
On December 19, 2002, the Secretary-General of the Centre registered the request, pursuant to Article 36(3) of the Convention on the Settlement of Investment Disputes between States and Nationals of other States (the "ICSID Convention" or "the Convention"). On the same date, the Secretary-General, in accordance with Institution Rule 7, notified the parties of the registration of the request and invited them to proceed, as soon as possible, to constitute an Arbitral Tribunal.
5.
Pursuant to the parties' agreement, the Tribunal in this case would comprise one arbitrator appointed by the Claimant, one arbitrator appointed by the Respondent, and a third, presiding, arbitrator, to be appointed by the Secretary-General of ICSID.
6.
On February 18, 2003, the Claimant appointed Professor Karl-Heinz Böckstiegel, a German national, as an arbitrator. On April 3, 2003, Argentina appointed Professor Domingo Bello Janeiro, a national of the Kingdom of Spain, as an arbitrator.
7.
With the agreement of both parties, the Secretary-General of ICSID appointed Professor Pierre-Marie Dupuy, a French national, as the President of the Arbitral Tribunal. On June 3, 2003, the Acting Secretary-General, in accordance with Rule 6(1) of the Rules of Procedure for Arbitration Proceedings (Arbitration Rules), notified the parties that all three arbitrators had accepted their appointments and that the Tribunal was therefore deemed to have been constituted on that date. On the same date, pursuant to ICSID Administrative and Financial Regulation 25, the parties were informed that Mr. Gonzalo Flores, Senior Counsel, ICSID, would serve as Secretary of the Arbitral Tribunal.
8.
The first session of the Tribunal with the parties was held on July 8, 2003, at the seat of the Centre in Washington, D.C. During the session the parties expressed their agreement that the Tribunal had been properly constituted in accordance with the relevant provisions of the ICSID Convention and the ICSID Arbitration Rules and that they did not have any objections in this respect.
9.
During the first session the parties agreed on a number of procedural matters reflected in written minutes signed by the President and the Secretary of the Tribunal. The Tribunal, after consultation with the parties, fixed the following schedule for the written phase of the proceedings: The Claimant would file a memorial on the merits within forty five (45) to ninety (90) days from the date of the first session; the Respondent would file a counter memorial on the merits within ninety (90) days from its receipt of the Claimant's memorial; the Claimant would file a reply within sixty (60) days from its receipt of the counter memorial; and the Respondent would file a rejoinder within sixty (60)days from its receipt of the Claimant's reply.
10.
During the first session it was noted that consideration of eventual objections to jurisdiction from the Argentine Republic would be premature. It was thus agreed to leave the matter open for further discussion in due course.
11.
On October 7, 2003, the Claimant filed its Memorial on the Merits with accompanying documentation. On December 31, 2003 Argentina filed a Memorial with objections to jurisdiction.
12.
By letter of January 12, 2004, the Tribunal confirmed the suspension of the proceedings on the merits in accordance with ICSID Arbitration Rule 41(3), and invited the parties to file their views on a schedule for their presentations on jurisdiction. Both parties submitted their views on January 16, 2004, with the Claimant also requesting the Tribunal to join the questions of jurisdiction raised by Argentina to the merits of the dispute. Argentina, upon invitation of the Tribunal, filed a response to the Claimant's request on January 27, 2004.
13.
On February 18, 2004, the Tribunal, having carefully considered the positions of the parties, confirmed the suspension of the proceedings on the merits and fixed the following timetable for the filing of the parties' submissions on the question of jurisdiction: the Claimant would file a counter memorial on jurisdiction within thirty (30) days from the date of the Tribunal's decision; the Respondent would file a reply on jurisdiction within thirty (30) days from its receipt of the Claimant's counter memorial; and the Claimant would file a rejoinder on jurisdiction within thirty (30) days from its receipt of the Respondent's reply. The Tribunal would thereafter, decide, whether oral arguments on the question of jurisdiction would be necessary, and, if so, fix a date for a hearing on jurisdiction.
14.
In accordance with the timetable fixed by the Tribunal, the Claimant filed its Counter-Memorial on Jurisdiction on February 20, 2004. Argentina filed its Reply on Jurisdiction on March 26, 2004 and the Claimant filed its Rejoinder on Jurisdiction on April 26, 2004.
15.
By letter of May 13, 2004, the Tribunal informed the parties its desire to hold a hearing on jurisdiction and proposed dates for such hearing. The hearing was held, with the agreement of the parties, on October 23 and 24, 2004 in Paris, France. Messrs. David M. Lindsay, James H. Hosking and Stephen Kantor and Ms. Andrea Goldbarg, from the law firm of Clifford Chance US LLP and Mr. Mark Sandy, from the AES Corporation, attended the hearing on behalf of the Claimant. Ms. Luz Moglia, Ms. María Soledad Vallejos Meana and Mr. Ignacio Torterola, from the Procuración del Tesoro de la Nación Argentina, attended the hearing on behalf of the Respondent. During the hearing Messrs. Lindsay and Hosking and Ms. Goldbarg addressed the Tribunal on behalf of the AES Corporation. Mr. Torterola, Ms. Moglia and Ms. Vallejos Meana addressed the Tribunal on behalf of the Argentine Republic. The Tribunal posed questions to the parties, as provided in Rule 32(3) of the Arbitration Rules.
16.
The Tribunal has deliberated and considered thoroughly the parties' written submissions on the question of jurisdiction and the oral arguments delivered in the course of the October 23, 24, 2004 hearing. As indicated in paragraphs 12 and 13 above, the consideration of the merits has been suspended until the issue of the Centre's jurisdiction and the Tribunal's competence has been decided by the Tribunal. Having considered the basic facts of the dispute, the ICSID Convention and the 1991 Argentina-US BIT, as well as the written and oral arguments of the parties' representatives, the Tribunal has reached the following decision on the question of jurisdiction.

II. Opening Considerations

A. Relevance of other ICSID Arbitral Tribunal's Decisions on Jurisdiction

17.

Prior to establishing its position with regard to the five objections made by the Argentine Republic to its jurisdiction, the Tribunal shall address some preliminary considerations made by both parties in their respective argumentations. All of them were raised in relation with an opinion expressed by the Claimant in its Counter-Memorial on Jurisdiction.2 In reaction to the objections filed by Argentina to the jurisdiction of this Tribunal, AES argued that:

"Each of Argentina's five objections are based on similar or identical arguments presented by it in other factually similar arbitrations in which Argentina is the respondent. In every instance, the same arguments have either been rejected or the corresponding ICSID tribunal has decided to join this objection to the merits."

18.

In its Counter-Memorial, AES further referred to several ICSID tribunal decisions on jurisdiction, including the Vivendi decisions I3 and II4, together with the CMS5 and the Azurix decisions on jurisdiction6. Later, and in particular during the hearing, AES further referred to other decisions which, in the meantime, had become available, such as the LG&E v. Argentina7, the ENRON v. Argentina8 and the SIEMENS A.G. v. Argentina9 decisions on jurisdiction. The argument made by the Claimant on the basis of these decisions, treated more or less as if they were precedents, tends to say that Argentina's objections to the jurisdiction of this Tribunal are moot if not even useless since these tribunals have already determined the answer to be given to identical or similar objections to jurisdiction.

19.
In response, Argentina raises a series of issues. They deal respectively with the legal basis for the jurisdiction of the Tribunal and with the way in which, according to the Respondent, the Tribunal should interpret them for determining whether it has or has not jurisdiction on this case. These arguments must indeed be considered in relation with the delimitation of the task of the Tribunal at this stage of the proceedings.
20.
After having recalled that the jurisdiction of ICSID arbitral tribunals is based upon the ICSID Convention (Art. 25), in conjunction with the bilateral treaty for the protection of investments in force between Argentina and the national State of the foreign investor, Respondent insists upon the specificity of each bilateral agreement as compared to others. Argentina says in particular that:

"Each bilateral Treaty for the protection of investments has a different and defined scope of application. It is not a uniform text"10.

21.
Argentina further contends that:

"The consent granted by signatory States of bilateral treaties shall not be extended by means of presumptions and analogies, or by attempting to turn the lex specialis into lex general (sic)."11

22.
In addition, Argentina states that:

"The reading of some awards may lead to believe that the tribunal has forgotten that it is acting in a sphere ruled by a lex specialis where generalizations are not usually wrong, but, what is worst, are illegitimate. Repeating decisions taken in other cases, without making the factual and legal distinctions, may constitute an excess of power and may affect the integrity of the international system for the protection of investments".12

26.
From the above derive at least two consequences: the first is that the findings of law made by one ICSID tribunal in one case in consideration, among others, of the terms of a determined BIT, are not necessarily relevant for other ICSID tribunals, which were constituted for other cases; the second is that, although Argentina had already submitted similar objections to the jurisdiction of other tribunals prior to those raised in the present case before this Tribunal, Argentina has a valid and legitimate right to raise the objections it has chosen for opposing the jurisdiction of this Tribunal. According to Article 41(2) of the ICSID Convention:

"Any objection by a party to the dispute that that dispute is not within the jurisdiction of the Centre, or for other reasons is not within the competence of the Tribunal, shall be considered by the Tribunal which shall determine whether to deal with it as a preliminary question or to join it to the merits of the dispute."

27.
Under the benefit of the foregoing observations, the Tribunal would nevertheless reject the excessive assertion which would consist in pretending that, due to the specificity of each case and the identity of each decision on jurisdiction or award, absolutely no consideration might be given to other decisions on jurisdiction or awards delivered by other tribunals in similar cases.
28.
In particular, if the basis of jurisdiction for these other tribunals and/or the underlying legal dispute in analysis present either a high level of similarity or, even more, an identity with those met in the present case, this Tribunal does not consider that it is barred, as a matter of principle, from considering the position taken or the opinion expressed by these other tribunals.
29.

In that respect, it should be noted that the US-Argentina BIT, in conjunction with the ICSID Convention, provides the very same basis for the jurisdiction in this case and in some previous ones, as, in particular, those in which Argentina faced or is still facing a dispute with ENRON Corp., CMS, AZURIX Corp, or LG&E and others; in each and every of these cases the tribunals respectively constituted have already delivered their decisions on jurisdiction.

B. The Law Applicable for this Tribunal's Jurisdiction.

III. Objections to Jurisdiction.

A. First objection: absence of a legal dispute.

40.
Argentina's first objection to jurisdiction is based on the purported absence of a legal dispute. This objection deals basically with the definition of what is to be understood under "legal dispute" in the sense in which it is used by Article 25 (1) of the ICSID Convention. This is an issue that has been abundantly considered by a number of commentators.18
41.
AES for its part answers by asserting first, that it is "the proper claimant"19 and second, that there is a legal dispute20. From this second point of view, AES rebuffs in particular the way in which Respondent tends to interpret and use in its own argumentation the Methanex decision.21
42.
The Tribunal considers that only the second out of the two points made by Claimant in response to Argentina's arguments is at this stage appropriate. The issue of whether a parent company can bring claims for the losses it has suffered as a result of its investment in a host State whether or not that investment is made in or through a subsidiary, discussed by AES in its Counter-Memorial on Jurisdiction,22 shall be considered later in this decision, in relation with the fourth objection to jurisdiction articulated by Argentina.
45.
Yet, on the basis of the elements already brought by the Memorial filed by AES together with a number of supporting evidence, AES' claim seems prima facie a substantial one. It deals with a series of legal issues which manifest an evident disagreement among the parties.
46.
AES declares to have invested 1 billion US dollars in the sector of electricity in Argentina; AES alleges to be in control of 6 generators and 3 distributors of electricity in Argentina; AES invokes the breach by Argentina of articles II(2)(a), II(2)(b), II(2)(c) and IV(1) of the Treaty binding upon Argentina and the United States of America on the protection of investments.25 It is precisely the substantial interest constituted by the importance of AES investment that the Claimant argues to have been affected by a determined Argentine legislation. AES depicts in particular some Argentine legislation including the Executive Decree N° 570/01, the National Emergency Law N° 25,561 and posterior decrees of application as being at the origin of the breach by Argentina of its international obligations. AES further provided the Tribunal with a detailed estimation of the cost of damages produced to its investment in Argentina by the enforcement of this legislation. Claimant has also articulated a documented claim for compensation.
47.
All these elements are prima facie convincing evidence for considering that the AES' claims involve a legal dispute in the terms of Article 25 of the ICSID Convention, therefore falling within the ICSID jurisdiction.

B. Second Objection: the legal dispute does not arise directly out of an investment.

48.
Article 25 (1) of the ICSID Convention not only retains that the jurisdiction of the Centre shall extend to any legal dispute. It also says that such a legal dispute must arise "directly out of an investment". On the basis of this supplementary condition, a second objection to jurisdiction was raised by Argentina. This objection is that the measures alleged by AES are not specifically related to AES investments. They were measures of general bearing, which aimed at restoring the economy of the country at the national level; they did not target AES in particular.
49.
According to Argentina, AES must "demonstrate a direct, proximate and immediate causation between the measure and its alleged investment."26
50.
AES response to this is that "it is sufficient that AES has made a prima facie showing that the measures instituted by Argentina directly affected its investments."27 In relation with this point, AES further refutes the interpretation and use made by Argentina of the Methanex decision.28
51.
In connection with these allegations, the Tribunal notes that the factual and legal elements at the origin of the present dispute are basically the same as those considered by other tribunals which, at the same time, share the same sources of jurisdiction (ICSID Convention and US-Argentina BIT). So was it, among others, in the CMS, the Azurix and the ENRON cases.
52.
It is then of real interest to look at the way in which these tribunals considered the measures reputed by claimants to be at the origin of the damage directly produced on their respective investments.
53.
In particular, the Argentinean legislation which brought to an end the regime of convertibility and parity of the Argentine peso with the United States dollar29 is, due to its concrete consequences on the interests of claimants invested in Argentina prior to December 2001, at the source of the respective claims filed before ICSID in the cases already mentioned above.
54.
In the decision on jurisdiction issued by the ICSID Tribunal in the CMS case, in particular, the Tribunal referred to the legislation referred to above in paragraph 53 and said pertinently that it should make:

"a clear distinction between measures of a general economic nature, particularly in the context of the economic and financial emergency discussed above, and measures specifically directed to the investment's operation."30

55.
The same tribunal further observed:

"What is brought under the jurisdiction of the Centre is not the general measures in themselves but the extent to which they may violate those specific commitments."31

56.
In the present case, the situation seems prima facie to be the same. At this stage, the Tribunal notes that AES' claims are not broadly based on Argentina's general economic policies. Their ground is provided by the fact that the regulatory and legal framework AES relied upon in making its investments was dismantled by the Argentinean legislative measures here at stake. It is, in particular, Argentina's alleged refusal to apply a previously agreed tariff calculation and adjustment regime which is at the core of AES' claims. It is also the impact of the legislative and regulatory measures taken by Argentina which is reputed by the Claimant to have breached the commitment made to it by the host State through the US-Argentina BIT.
57.
This Tribunal shares consequently the views earlier expressed by the Tribunal in the CMS decision on jurisdiction. What is at stake in the present case, as it was in the CMS one, are not the measures of a general economic nature taken by Argentina in 2001 and 2002 but their specific negative impact on the investments made by AES. As a sovereign State, the Argentine Republic had a right to adopt its economic policies; but this does not mean that the foreign investors under a system of guarantee and protection could be deprived of their respective rights under the instruments providing them with these guarantees and protection. Without anticipating, at this stage, on the consideration of the issue, whether this delicate balance between the respective rights of the host State and those of the investor were respected in substance, the present Tribunal states that it has jurisdiction for considering this issue.
58.
It should be further noted that reliance by Respondent on the Methanex case is inaccurate. As stated above, and in conformity with what has been strongly asserted from the outset by Argentina itself, one should take each agreement on its term and avoid drawing out of other treaties which are not applicable to this case, any conclusion neglecting the substantial difference of terminology, scope and meaning existing between these instruments.
59.
Now, it is well known that Methanex relied on the NAFTA. In that multilateral treaty, only binding upon the United States, Canada and Mexico, the definition of "investors" and of "investments" used in Chapter 11 (Investment) is quite specific in terms and substance. This definition is all the way narrower than the definition of "investment" provided by Article VII(1) of the US-Argentina BIT. The latter states that "an investment dispute is a dispute...arising out of or relating to (a) an investment agreement between the Party and such national or company;... or (c) an alleged breach of any right conferred or created by this Treaty with respect to an investment". This definition is much larger than the one at stake in Methanex, since NAFTA Article 1101(1) provides that Chapter 11 "applies to measures adopted or maintained by a Party to: a) investors of another Party [or] b) investments of investors of another Party in the territory of a Party." It should be stressed that the element of "directness" under NAFTA Chapter 11 deals with the way in which the measures at stake affect the investor or the investment. The measure must directly affect the investment. "Directness" in ICSID Convention (Art. 25) is something different.
60.
As to the interpretation of the terms "any legal dispute arising directly out of an investment" used in Article 25 of the ICSID Convention, it is well established by commentators relying on constant practice that it should not be given a restrictive interpretation.32 Under this provision, directness has to do with the relationship between the dispute and the investment rather than between the measure and the investment.

C. Third objection : AES' Claim is not Ripe.

62.
Argentina contends that, due to ongoing negotiations still taking place between AES' local subsidiaries and Argentine authorities, either at the national or at the local level, AES has prematurely brought its claim before ICSID. In relation with this assertion, Respondent further argues that the damages claimed in the electricity generation companies are not quantifiable.
63.
AES reacts by asserting first that "any ‘negotiations' by distribution companies do not strip ICSID of jurisdiction"33 and that, in fact, no real progress has been made with the renegotiation process in Argentina (sic at the October 23-24, 2004 hearing). AES also argues that electricity generation damages are quantifiable and recoverable34.
64.
In respect to the first aspect of Argentina's objection, according to which ongoing negotiations would prevent the claim from being legitimately filed, the Tribunal recalls what it has already said with regard to the basis and scope of its jurisdiction. This basis, as insisted upon by Argentina itself in its Memorial on Jurisdiction, is predominantly defined by the specific instruments binding upon the Argentine Republic i.e. the BIT and the ICSID Convention. This does not mean that the Tribunal could not apply, as the case may be, any customary rule of international law which it would consider compatible with the pertinent provisions of these two "leges specialia."
65.
The Tribunal recognizes that a negotiation process, being a diplomatic or political means of settlement of disputes and not a judicial one, presents some specific features. Consequently, negotiation should not be assimilated to judicial remedies. Still, there is no rule relevant in this procedure, either in the ICSID Convention or in the US-Argentina BIT, which would subordinate recourse to the ICSID system of settlement to any "prior exhaustion of local negotiations."
66.
In its Memorial on Jurisdiction, the Argentine Republic did not rely on any specific or general source of international law for supporting its argument. Argentina only referred to the case law of the US Supreme Court,35 which, as such, is irrelevant for the present case. There is no need here for having recourse to any "general principle of law" as mentioned in Article 38 of the Statute of the International Court of Justice. It is enough to concentrate on the two treaties mentioned above, the US-Argentina BIT and the ICSID Convention.
67.

In the US-Argentina BIT, Article VII(2) provides:

"In the event of an investment dispute, the parties to the dispute should initially seek a resolution through consultation and negotiation. If the dispute cannot be settled amicably, the national or company concerned may choose to submit the dispute for resolution (...).

68.
In the present case, the Tribunal notes that it is only following the established fact that the parties had been unable to resolve the dispute within six month that AES filed its Request for Arbitration with ICSID; and it did so pursuant to Article VII(3) of the US-Argentina BIT.36
70.
International practice confirms the interpretation given above. Without even considering here the numerous decisions that rejected recourse to local judicial remedies as a condition for jurisdiction, no ICSID Tribunal so far has subordinated its jurisdiction to the demonstration of prior ending of negotiations between the parties to the dispute. On the contrary, confronted with a very similar argument by Argentina, the Tribunal in CMS declared that:

"... it is not for the Tribunal to rule on the perspectives of the negotiation process or on what TGN might do in respect of its shareholders, as these are matters between Argentina and TGN or between TGN and its shareholders."37

71.
In the present case, equally, negotiations are reputed to go on in particular between two distributors, EDELAP and EDEN on the one side, the Argentinean authorities, respectively at the federal and at the local level, on the other side. But, even if the taking into account of such negotiations were relevant, it is impossible for this Tribunal to assess whether there is any reasonable prospect for any settlement to be reached at one stage or the other throughout negotiations.
72.
With respect to the second aspect of the objection raised by Respondent, which consists in saying that the damages claimed by AES in relation with electricity generation are not quantifiable, the Tribunal recalls that AES has provided the Tribunal on December 2003 with an expert report on damages. This document sets out in detail the quantification of AES' claim as it relates to electricity generation.38
73.
Furthermore, as rightly stated by the Azurix tribunal:

"the question before the Tribunal at this stage is whether it has jurisdiction; whether the Claimant can prove loss is a matter to be considered as part of the merits."39

74.
This Tribunal shares this view and finds accordingly no ground for accepting the third objection raised by Argentina to its jurisdiction.

D. Fourth Objection: AES is not the investor.

75.
The Argentine Republic argues that AES has failed to prove its status as an investor for the purposes of the US-Argentina BIT. According to Argentina:

"a) in view that the BIT with USA includes no specific provision on the applicable law, pursuant to article 42 of the ICSID Convention the law of the State that is a party to the dispute should apply, including its international private law rules and those international law rules that may be applicable, b) therefore, the determination of the rules applicable to the nationality of the parties under the BIT with USA shall be judged by the Argentine international private law, c) consequently, AES should have proven its lawful creation. This is so pursuant to Argentine international private law."40

76.
AES answers by saying that it has efficiently proven to be a US corporate citizen41 as well as it has demonstrated that it owns and controls the AES' entities by providing the Tribunal with sworn witness statements by top managers from AES and its subsidiaries.42
77.
For the Tribunal, the Respondent's position does not start from the right assumption as to the law applicable to the determination of the nationality of the private investor. First, as rightly contended by Claimant, the clear terms of the US-Argentina BIT, which define a company, should be taken into account. Pursuant to Article I(1)(b) of this treaty:

"Company' of a Party means any kind of corporation, company, association, state enterprise, or other organization, legally constituted under the laws and regulations of a Party or political subdivision thereof whether or not organized for pecuniary gain, and whether privately or governmentally owned."

78.
Second, Argentina wrongly considers that Article 42 of the ICSID Convention is applicable to this issue of nationality. This is not correct. As rightly pointed out by Professor Ch. Schreuer:

"[An] issue that is not governed by the rule of Art. 42 is the nationality of the investor. The nationality of a natural person is determined primarily by the law of the State whose nationality is claimed (.). The nationality of a juridical person is determined by the criteria of incorporation or seat of the company in question subject to pertinent agreements, treaties and legislation."43

79.
The same author indicates also that:

"During the Convention's preparatory work, it was generally acknowledged that nationality would be determined by reference to the law of the State whose nationality is claimed subject, where appropriate, to the applicable rules of international law (History, Vol. II, pp. 67, 286, 321, 448, 580, 705, 839)."44

80.
In the present case, the Tribunal is satisfied that AES, already at the stage of its Request for Arbitration, has indicated, and convincingly proved, to be incorporated in the State of Delaware with headquarters in Arlington, Virginia (USA). This was in particular evidenced by the production of a certificate signed by Mr. Leith Mann, AES' Assistant Secretary, attaching a true copy of AES' Certificate of Incorporation authenticated by Delaware's Secretary of State, in conformity with Delaware legislation. Mr. Mann also confirmed that at the time the Request for Arbitration was submitted the Certificate had not subsequently been modified and remained in force.45.
81.
Still under the same fourth objection, Argentina contends that AES has not "proven to have acquired the shares that allegedly give it a majority interest in the [operation] companies" because the evidence "appear[s] exclusively on information issued by claimant" rather than being "proven in a certifying way". Respondent further stated that:

"Ownership of or control over national are merely claimed and appear exclusively on information issued by claimant. For the purpose of determining the jurisdiction, AES should have proven in a certifying way the above mentioned requirements."46

82.
The Tribunal takes note of the fact that the Argentine Republic does not really seem to substantially challenge that AES actually became the majority shareholder of the operating companies. Neither does Argentina raise some doubts as to the true ownership or control by AES of the companies concerned. Argentina's argument remains basically of a formal or procedural nature. What is questioned by Respondent is "the probative value" of the material submitted by Claimant for evidencing its control as a majority shareholder of the said companies.47 This material consists of a sworn witness statement by Mr. Robert Venerus (Vice-President, AES Business Development Group) together with other witness statements by other managers in particular of EDELAP, EDEN and EDES, or AES Andes Generation Assets.48 These witness statements refer to corporate charts showing in detail the ownership structure of each of the AES' operating companies.49 In addition, AES provides a summary of the percentage it owns in each of the subsidiaries.50 In its Rejoinder on Jurisdiction, AES recognized that there had been a minor miscalculation in percentage ownership and further filed an erratum, which substantially did not alter the fact that AES is the majority shareholder in each and every one of the companies concerned.51
83.
It is consequently for the Tribunal to appreciate whether it is satisfied at this stage that the material and information provided by AES is accurate for evidencing its ownership and control of all the companies concerned. In this respect, the Tribunal notes that production of expert and witnesses reports is common practice in international arbitration. In consideration of this practice, the Tribunal itself, at its first session, had specifically requested that Claimant file such documentary evidence.52 This is in conformity with Arbitration Rule 34, which states that the Tribunal shall be the judge of the "admissibility of any evidence adduced and of its probative value."53
84.
Without excluding the possibility of requiring Claimant, later in the course of proceedings, to produce further evidence of ownership and control of its subsidiaries in Argentina, pursuant to Rule 34 mentioned above as well as to Article 1 of the Protocol of the US-Argentina BIT, the Tribunal considers that it was so far sufficiently informed and has no reason to consider in essence the kind of material produced by AES in this respect to be inaccurate.
85.
As a further related issue, the Tribunal wants to raise briefly the question of the actual protection of shareholders and that of their jus standi before an ICSID Tribunal.

E. Fifth Objection: Forum Selection Clause Precludes ICSID Arbitration

90.
According to Argentina, the "Argentine Companies AES claims to control have executed national forum selection clauses, with express waiver of all other authority and jurisdiction. That circumstance prevents this arbitration from proceeding."58
91.
Claimant first observes that Argentina makes reference only to the concession contracts and related documents pertaining to some entities (EDES, EDELAP, Alicurá and Hidroeléctrica San Juan) but to none of the other AES Entities.59 AES also relies on the case law of recent ICSID tribunals which rejected the same argument in several other ICSID arbitrations in which Argentina is the respondent as well as in some other cases involving other countries60. AES contends that, as a national of the US, it is entitled to have Argentina's breach of international law determined by this Tribunal, as is expressly contemplated by the US-Argentina BIT.61
92.
As a matter of fact, Argentina's argumentation is inaccurate inasmuch as it establishes confusion between two distinct legal orders: the international and the national one. What is at stake is an alleged breach of Argentina's obligations in international law as set out in the US-Argentina BIT, of which AES, as a national company of the United States, may seek immediate reparation through the special ICSID system of settlement of disputes; this is in exception to the classical and ordinary means provided under general international law by the display of diplomatic protection exercise by the national State of the company alleging to have suffered damage.
95.
The Tribunal concurs with a position already adopted by previous tribunals confronted with the same argument raised by Argentina. In CMS, the Tribunal took note of the decisions already rendered in Lanco, Vivendi I and Vivendi II, which had rejected the very same argument. It said:

"The Tribunal shares the views expressed in those precedents. It therefore holds that the clauses in the License or its Terms referring certain kinds of disputes to the local courts of the Argentine Republic are not a bar to the assertion of jurisdiction by an ICSID tribunal under the [US-Argentina BIT], as the functions of these various instruments are different."62

96.
Further to this decision, the Azurix Tribunal maintained the same analysis. It also rejected the Argentinean argument in the following terms:

"The tribunals in the cases cited concluded that such forum selection clauses did not exclude their jurisdiction because the subject-matter of any proceeding before the domestic courts under the contractual agreements in question and the dispute before the ICSID tribunal was different and therefore the forum selection clauses did not apply. This reasoning applies equally to the waiver of jurisdiction clause in this case."63

97.
The present Tribunal cannot but share the views already expressed by these tribunals, dealing with the same argument, repeated again and again by Argentina. In particular, this Tribunal wants to stress that the comparison raised by Respondent in its Reply on Jurisdiction64 between the waiver of jurisdiction met in this case and the famous "Calvo Clause" is inaccurate.
98.
This is so simply because this very clause only made sense by reference to the general international law rule of diplomatic protection; the "Calvo Clause" was in essence a clause by which private persons mistakenly pretended to renounce to a right which in law did not belong to them but to their national State: the right for this State to exercise in favor of its nationals its diplomatic protection.
99.
Since under the ICSID system of settlement of disputes, exercise of diplomatic protection is per definition put aside, it is irrelevant to compare it with a clause the rationale of which is inseparable from diplomatic protection. As a consequence, the Tribunal cannot but reject Argentina's fifth objection.

IV. Conclusion.

100.
For the reasons stated above the Tribunal decides that the present dispute is within the jurisdiction of the Centre and the competence of the Tribunal. The Tribunal has, accordingly, made the necessary Order for the continuation of the procedure pursuant to Arbitration Rule 41(4).
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