Blue Bank International v. Venezuela: When Are Trust Assets Protected under International Investment Agreements?

Abstract

The award rendered by a tribunal in proceedings conducted under the auspices of the International Centre for Settlement of Investment Disputes (ICSID) between Blue Bank International and Venezuela in April this year is the first public decision addressing in detail the question of whether trustees can be considered protected investors with regard to trust assets under International Investment Agreements. This article analyses the findings of the Blue Bank tribunal with a view to more generally identifying requirements for the protection of trust assets under investment treaties. Based on a review of the relevant treaty provisions and the jurisprudence of arbitral tribunals it concludes that, in the absence of beneficial ownership, trustees will typically not be protected. By contrast, trust assets can be protected either where a treaty admits trusts themselves as investors or where the rights of beneficiaries are specific enough to amount to beneficial ownership.