Attribution
1. Although the JV Agreement was concluded between Claimant and Beritech, obligations
assumed by Beritech may be attributed to Respondent by the general international rule of
attribution as recognized in Articles 4 and 8 of ILC Draft articles on Responsibility of States
for Internationally Wrongful Acts.
2. Due to attribution rule, the tribunal in Nykomb v Latvia acknowledged as covered by the
umbrella clause a contract between the investor and a wholly owned state enterprise. In
Eureko v Poland, independent legal personality of Polish State Treasury did not preclude
liability of the host state for the breach of the umbrella clause. The way in which each state
chooses to divide the work between its subdivisions is without relevance (see also
SwemBalt v Latvia). These tribunals interpreted the umbrella clause without any limitations.
3. Claimant encourages the tribunal to follow the example given in Nykomb and Eureko.
Broad interpretation fits as most convenient to the purpose of the BIT and may be simply
justified by the rules of attribution, relevant also to other treaty standards (EnCana v
Ecuador).
4. Claimant may also rely on other awards which applied more restricted attitude to the issue
of attribution. According to SGS v Pakistan, obligation may be assumed by the host state or
its subdivisions or legal representative thereof, if their acts are attributable to the host state.
Respondent owns 70 % of shares of Beritech which renders him a controlling entity which
may determine actions of controlled Beritech independently from fragmented minority.
5. As stated in Consorzio Groupement L.E.S.I.-DIPENTA v Algeria, a contract may be
attributed to the host state where the government exercises important influence over the
entity and was to some extent involved in the contract negotiations. Respondent guarantees
compliance of Beritech with the JV Agreement. It is hardly probable that respondent did not
influence the negotiations of the JV Agreement.
6. The tribunal in Noble Ventures v Romania recognized an obligation assumed by state
ownership fund as covered by umbrella clause in view of the grant of of governmentals
power.