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The Group of Companies Doctrine Applied to Arbitrations Involving a State

Author: Marc HENRY

Type: Article

ref: 32006297-317

N0:3 of 2006

Pages: 297-317

According to some, the Dow Chemical case established a Corporate Group theory in the field of international arbitration, which consists of justifying an arbitral tribunal's jurisdiction over companies which have not formally signed an arbitration agreement on the basis of their membership of a Group to which one of the signatories to the agreement belongs. In its subjective approach, consisting of drawing consequences from conduct, such as interference or fraudulent intention, the Group of Companies Doctrine seems transposable to States and the entities which emanate from them. In its objective approach, consisting of finding that an arbitration agreement applies simply by noting membership of a Group, or making presumptions in favor of such an application, the Group of Companies theory seems hard to reconcile with the sovereignty of States, the distinctive nature of the links which may unite them with the entities emanating from them, and their non-exclusively economic purpose.