Phoenix Action ICSID 투자중재 사건의 분석

The notion of investment which deserves protection under International Center for Settlement of Investment Dispute (“ICSID”) was a main issue at Pheonix Action case. Among many other ICSID cases which dealt with the concept of investment, Pheonix Action case has its own significance in that the ICSID Tribunal made its decision based on the rationale whether there was a bona fide investment or not. Pheonix Action, an Israeli company, claimed that its investment would be ICSID-protected investment as it would meet the requirement of “diversity of nationality”. However, underlying facts and circumstances revealed that the Israeli company was a sham company, which was incorporated with the sole purpose of instituting ICSID proceedings by creating the diversity of nationality. Phoenix Action accused the Czech government right after the purchase of two Czech companies, which is its alleged investment transaction. The only shareholder of Pheonix Action, who originally used to be a Czech national and left for Israel while he was being examined by several prosecutions. The sole shareholder used to own the two Czech companies while he was a Czech citizen. The two Czech companies had been in dispute in a civil action and with Czech government. With these facts and circumstances, the ICSID Tribunal had to determine that the Pheonix Action's alleged investment was not bona fide “investment”within the meaning of Article 25 of the ICSID Convention and Article 7 of the Israel-Czech Bilateral Investment Treaty. This case has implications in that the ICSID Tribunal confirmed the importance of substance of a transaction by acknowledging that only bona fide investments deserve protection in international investment arbitration regime as well. In this regard, legal ramifications of the bona fide principle is expected to be found in other legal areas such as international tax regime involving sham companies as the sham companies' corporate veil can be pierced unless they are bona fide.