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Barcelona Traction Case
Barcelona Traction Case
Facts:
The Barcelona Traction, Light, and Power Co. was incorporated and
registered in Canada for the purpose of developing and operating electrical
power in Spain . After the Spanish Civil War, the company was declared
bankrupt by a Spanish court and its assets were seized.
The Belgian Government instituted a case against Barcelona
Traction, Light and Power Company, Limited for damage claimed to have
been caused to Belgian nationals, shareholders in the Canadian Barcelona
Traction Company, by the conduct of various organs of the Spanish State
for the expropriation of a corporation.
The Spanish Government raised four preliminary objections to the
application. The court rejected the first and the second objections
concerning the jurisdiction of the court and ruled on the merits of the third
and the fourth objections. The third objection of the Spanish Government
was that the Belgium Government lacked capacity to submit any claim for
wrongs done to a Canadian company even if the shareholders were
Belgian.
Issue:
1. Does the state of the shareholders of a company have a right of
diplomatic protection if the state whose responsibility is invoked is not the
national state of the company?
For the above reasons, the Court is of the opinion that Belgium lacks
standing to bring this action.
2. The concept of erga omnes appears in international law for the first
time in two paragraphs of the judgment in the Barcelona Traction Case
(Second Phase). The relevant text of the paragraphs 33 and 34 follow:
The facts of the Barcelona Traction Case do not give grounds for a
pronouncement as the one that the court made in the erga omnes
obligations. As seen above, since the Court dealt with Belgium’s right to jus
standi in seeking compensation for Belgian shareholders, the erga
omnes obligations pronouncement is not strongly related to the merits of
the case.