Arbitrating with States and State-Owned Enterprises: Extension of the Scope of the Arbitration Agreement and Enforcement of Awards on State Assets

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This article aims to illustrate how arbitral tribunals and municipal courts address the treatment of States and State-owned enterprises (SOEs) as parties to contracts concluded with foreign business undertakings. Accordingly, this analysis covers various issues, such as the extension of contractual obligations and of the subjective scope of an arbitration agreement from a SOE to the State, or the possibility to enforce an award rendered against the State on the assets of a SOE, and vice versa. The article addresses the attitude of judges and commercial arbitrators in treating public ownership as equivalent to private ownership for the purposes of applying corporate law doctrines aimed at piercing the corporate veil and private law doctrines, ending with the imputation of liability to the State based on the legal commitments negotiated or contracted by its SOEs. In this respect, it is submitted that adjudicators may also consider, with appropriate nuance, the guidance stemming from the international principles of attribution of conduct to States elaborated in the framework of the codification of the law of State responsibility for internationally wrongful acts.