Sedco Inc v. National Iranian Oil Company and the Islamic Republic of Iran

Abstract

Claims — Nationality of claims — Corporations — Iran–United States Claims Settlement Declaration — Nature of claims — Whether based on concept of diplomatic protection — Requirement that claimant be a United States corporation — Requirement that 50% or more of the shares be owned by United States nationals — Proof that requirement satisfied — Indirect claims — Claim by United States corporation regarding assets of foreign subsidiary — Claim regarding company incorporated in Iran — Whether within jurisdiction of Iran-United States Claims Tribunal — Doctrine of continuous ownership of claim

Expropriation — Definition — Taking of property — Iran-United States Treaty of Amity, Economic Relations and Consular Rights, 1955, Article IV(2) — Whether formal act of nationalization required — Joint owner effectively excluded from participation in management of company — Whether amounting to expropriation of interest in company

Expropriation — Compensation — Standard of compensation — Distinction between lawful and unlawful expropriations — Concept of full value — Iran-United States Treaty of Amity, Economic Relations and Consular Rights, 1955, Article IV(2) — Whether customary international law requiring compensation at full value — Effect of lump sum settlement agreements — Effect of United Nations General Assembly resolutions — Arbitral practice

Expropriation — Compensation — Valuation of expropriated property — Basis of assessment — Fair market price — Price which a willing buyer would pay a willing seller — Reduction in value due to political conditions — Whether conditions to be taken into account — Whether effect on value of anticipation of nationalization relevant — Insured value of property

Nationality — Corporations — Proof of nationality — Requirement that 50% or more of shares be owned by United States nationals — Proof — Relationship between parent and subsidiary companies

International tribunals — Iran-United States Claims Tribunal — Jurisdiction — Ownership of claims — Indirect claims — Claims by United States corporation on behalf of foreign subsidiary — Claim by United States corporation regarding shareholder interest in Iranian corporation

Treaties — Termination — Iran-United States Treaty of Amity, Economic Relations and Consular Rights, 1955 — Whether terminated or rendered inapplicable by state of relations between Iran and United States — The law and practice of the Iran-United States Claims Tribunal