Cour de cassation - Pourvoi n° 24-10.445 ECLI:FR:CCASS:2026:C100299
Cour de cassation: Subsequent Diplomatic Notes Must Be Considered When Interpreting Investment Treaty Jurisdiction
Core issue
Can a French court disregard a later diplomatic note between treaty parties when deciding whether a dual national investor falls within the scope of an investment treaty arbitration clause?
The French Court of Cassation answered in the negative. It held that, under customary international law reflected in Article 31 of the Vienna Convention on the Law of Treaties, a court interpreting a treaty must take account of a subsequent agreement between the treaty parties concerning the interpretation or application of that treaty. On that basis, the Court quashed a Paris Court of Appeal decision that had upheld an arbitral tribunal’s jurisdiction under the U.S.–Vietnam trade relations agreement.
Background
The case arose from an investment dispute against the Socialist Republic of Vietnam. The claimant, Mme K, was Vietnamese by birth and later acquired U.S. nationality by naturalisation on 23 July 2014. Together with two Texas companies she had founded, U.S. Global Institute Inc. and Angels Company Inc., she alleged that she had invested in a Vietnamese power plant project through Tan Tao Energy Corporation. The claimants contended that Vietnam’s removal of the project from its electricity development master plan in March 2016 amounted to an expropriatory measure.
On 4 September 2019, the claimants commenced arbitration under the 1976 UNCITRAL Arbitration Rules, alleging breach of the 13 July 2000 Agreement between the United States and Vietnam on trade relations. The arbitral tribunal issued an award on jurisdiction on 8 December 2021. Vietnam then sought annulment of that jurisdictional award before the Paris Court of Appeal under Article 1520(1) of the French Code of Civil Procedure.
The Paris Court of Appeal’s approach
The Paris Court of Appeal rejected Vietnam’s annulment application.
The treaty did not contain an express provision dealing with dual U.S.–Vietnamese nationals. The Court of Appeal therefore treated Article 1(9) of the relevant BIT, which referred to a natural person who is a national of a party under its applicable law, as sufficient to cover the claimant. It also held that the materials produced by Vietnam did not justify reading an exclusion for dual nationals into the treaty.
Most importantly, the Court of Appeal refused to give weight to a diplomatic note issued by the U.S. Embassy on 4 April 2023. It considered the note non-contemporaneous with the treaty, treated it as merely an opinion of the embassy’s economic service, and found that its authority had not been established. The Court of Appeal also referred to the treaty’s joint committee as the designated body for treaty interpretation.
Cour de cassation’s holding
The Court of Cassation quashed the Paris Court of Appeal judgment.
It began from Article 1520(1) of the French Code of Civil Procedure, under which an award may be annulled where the arbitral tribunal wrongly accepted or declined jurisdiction. It then recalled a central point in investment treaty arbitration: a State’s consent to arbitration flows from a standing offer contained in the treaty, addressed only to the category of investors and investments defined by that treaty.
The Court then applied customary international law on treaty interpretation, as reflected in Article 31 of the Vienna Convention on the Law of Treaties. In its view, a court interpreting a treaty must consider, together with context, any subsequent agreement between the parties concerning the treaty’s interpretation or application.
On the diplomatic note, the Court of Cassation took a materially different view from the Court of Appeal. The note had been produced in the proceedings, was addressed by the U.S. Embassy to Vietnam, and its authenticity was not disputed. For the Court of Cassation, it established an agreement between the treaty parties concerning the treaty’s interpretation in the specific situation where the investor is a natural person with both U.S. and Vietnamese nationality. The Court of Appeal therefore erred by refusing to take it into account.
Result
The Court of Cassation set aside the Paris Court of Appeal’s judgment in full and remitted the case to a differently constituted formation of the Paris Court of Appeal. It also ordered U.S. Global Institute Inc., Angels Company Inc., and Mme K to bear costs and to pay Vietnam EUR 5,000 under Article 700 of the French Code of Civil Procedure.