This chapter reveals the gap between the legal assumption that corporations and governments are formally separated and the reality of deep interdependence between governments and corporations in colonial settings, analyzing how this situation provided private business corporations with the legal infrastructure they needed to leverage their position to thrive in the colonization of Africa. It then explores related doctrines of international law – —diplomatic protection, human rights, and investment protection – —as additional aspects of the the international legal infrastructure that protected corporate actors from responsibilities while granting them significant benefits as individual rights bearers. This chapter chronicles the lingering presence and influence of international law on the regulatory options available for corporations operating both within and outside state borders.

As state ownership of private firms grows, morphs, and globalizes, states increasingly channel their influence through the financialized markets. The ensuing merger of the state’s commercial and sovereign roles suggests that state ownership is, again, becoming a vector of sovereign authority. This chapter analyzes the international legal system that has developed around surging state ownership. It suggests that the legal construction of distinctive “shareholder identities” in international economic law plays a key role in this complex regulatory matrix. Specifically, the chapter focuses on how arbitral tribunals adjudicating claims arising from international investment treaties use attribution, a doctrine of customary international law, in creating, maintaining, and disciplining state shareholders. Arbitral tribunals use the analytical category of the state shareholder in order to delineate and construct state and company identities and to understand the economic, political, and legal implications of those identities in the the global economy. Accordingly, the interactions between substantive international economic law and the law of state responsibility form important, but underappreciated, elements of this constitutive process, which comes to affect the institutional design of state shareholding and disincentivize hands-on control over state-owned entities.

The doctrine of attribution in international law has been defined, in large part, by the International Law Commission’s (ILC) provisions on attribution of conduct in the Articles on State Responsibility for Internationally Wrongful Acts (ARSIWA). It is uncontroversial to note that despite the influence of the ILC’s rules on attribution, the regime of international responsibility remains underdeveloped. In addition to being underinclusive, the rules of attribution in ARSIWA are beginning to appear outdated. The central question, therefore, is whether the rules of attribution in ARSIWA are flexible enough to accommodate two disparate trends. On the one hand, we have witnessed an outsourcing of public functions to private actors in areas such as immigration, prison management, and education, whereby privatization has reduced state control and, consequently, potential state responsibility. On the other hand, there is a marked centralization of power in SOEs, some of which are now playing a global role as investors. This chapter assesses whether the default rules on attribution are flexible enough to manage both ends of the spectrum of state activity, which will be a crucial issue for regulators going forward.

To explain the law of state responsibility and diplomatic protection, it helps to distinguish between primary rules and secondary rules. The primary rules of international law provide that certain acts or omissions are unlawful – for example, the law on the use of force would be considered primary rules of international law, a breach of which would be an internationally wrongful act. When those primary rules are breached, it is the secondary rules – the law of state responsibility – that come into play, to determine inter alia the consequences of that initial wrongful act, whether the wrongful act was committed by a state (thereby entailing that state’s responsibility), and what action the ‘wronged state’ may take in reply. The rules on state responsibility cover wrongful acts committed against another state, as well as certain wrongful acts committed against nationals of the state, including corporations; the law of diplomatic protection solely concerns how a state may raise a claim against another state for a wrong committed against one of its nationals, rather than against the state itself.

This chapter analyses how an international wrongful act accrues from the violation of a due diligence obligation and its consequences. The first part discusses due diligence obligations against secondary rules of ARSIWA concerning the existence of a wrongful act. It is argued that violations of due diligence obligations stem from omissions and that the difficulty of establishing responsibility for failure of due diligence typically concerns the application of rules governing the breach, rather than rules of attribution of conduct. Accordingly, a critical reappraisal of the genealogy of Article 14(3) of ARSIWA and breaches of preventive obligations is undertaken; the chapter argues that the ILC wrongly conceptualised the ‘event’ to be prevented as a secondary rule, this way confusing the relationship between prevention and due diligence. The rest of the chapter examines due diligence obligations against other relevant secondary rules, such as circumstances precluding wrongfulness (specifically, force majeure and distress), the relationship between due diligence and complicity, and how reparation is to be accorded following a breach of due diligence obligations.

This chapter explores the foundations of due diligence under international law. Due diligence emerged in the international practice of the nineteenth century concerning diplomatic protection and the security of states, and developed as a notion linked to the responsibility of states in connection with acts of private individuals. For a long time, due diligence was conceived as a concept pertaining to the realm of international responsibility and it was primarily associated with the measure of a state organ’s fault. The chapter illustrates how, during the twentieth century, due diligence migrated from the realm of secondary rules to primary rules. The chapter clarifies the relationship between due diligence and overlapping concepts, like international liability and the notion of general principles of international law. It is argued that due diligence should be construed as an identifier for a typology of international obligations, something that provides meaning and rationale to them. The chapter concludes by clarifying the difference between due diligence as a ‘qualifier’ for primary rules of states, and due diligence as a ‘process’ linked to the activities of non-state actors.

With the failure to codify, state responsibility for rebels went quiet. After the 1930s, there were no more of the great suites of mixed claims commissions. Scholarship on the topic dried up. Nevertheless, we can follow the trajectory of state responsibility for injuries to aliens by rebels as it split in two. On one hand, we have the International Law Commission (ILC)’s half-century odyssey to codify state responsibility, and on the other, the emergence of international investment law. The story of state responsibility for rebels and its legacy for both the modern law of state responsibility and international investment law have a number of implications for international law scholars and practitioners today: for specific legal issues in the law of state responsibility and international investment law, for our understanding of the development of these fields and for the state of the law today when it comes to responsibility for the acts of armed groups across various fields including international human rights and humanitarian law. Finally, it allows us to put together these fragments of state responsibility for rebels and tells us something about the whole, exposing how today international law prioritises the protection of foreign investment against rebels, and non-state armed actors more generally, in the decolonised world.

This chapter will evaluate the legal framework upon which the responses of states to terrorist and pirate hostage-taking have been premised. The exercise of jurisdiction over alleged offenders and the responsibility of states for failing to prevent or sanctioning hostage-taking in their territories will be discussed. This chapter will explain why by holding individuals or states accountable for hostage-taking, the human rights of victims are not effectively protected. By discussing the development of jurisdiction in international law and state responsibility and by applying these concepts to hostage-taking, it will be explained why they have left a gaping hole in the protection of the human rights of hostages.

Under the international law of State responsibility, the existence of an internationally wrongful act requires that three cumulative conditions be fulfilled: (1) attribution of a conduct to the State; (2) breach of a State’s international obligation by that conduct; and (3) a lack of circumstances precluding the wrongfulness of that conduct. A finding that such an internationally wrongful act occurred entails certain legal consequences, which in particular requires the State to provide full reparation for the damages caused. Chapter 15 analyses how these rules apply in the context of investor–State arbitration. More precisely, it focuses on attribution, circumstances precluding wrongfulness and reparation, with Part II of the textbook setting out a discussion of the relevant breaches of IIA obligations. This analysis is conducted in light of the relevant treaty and arbitration practices as well as the Articles on Responsibility of States for Internationally Wrongful Acts, which are almost systematically referred to by arbitration tribunals when dealing with those matters.