Barcelona Traction was a corporation that controlled light and power utilities in Spain and was incorporated in Toronto, (Canada) September 12, 1911 by Frederick Stark Pearson. It was operated in Spain but was owned mostly by Belgians. The company was developed by American engineer Dannie Heineman. The government of Spain in the 1960s made business more difficult for foreigners in Spain. The Belgian stockholders lost money and wanted to sue in the International Court of Justice, but in the court Judge Fornier ruled on the side of the Spanish, holding that only the nationality of the corporation (the Canadians) can sue. The case of Belgium v. Spain decided in 1970 on this topic of Barcelona Traction is popular in international law because it demonstrates the importance of protections of corporate nationality in paper (or nominal) terms over effective nationality (siège social) where the ownership lives. Unless a principle of law permits a country to espouse a national's claim in the ICJ, there cannot be an espousal.
The case is important as it demonstrates how the concept of diplomatic protection under international law can apply equally to corporations as to individuals. It also expanded the notion of obligations owed erga omnes (in relation to everyone) in the international community.
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