Nottebohm Case (Liechtenstein v. Guatemala).

Author(s): Oliver J. Lissitzyn

Source: The American Journal of International Law , Jul., 1955, Vol. 49, No. 3 (Jul.,
1955), pp. 396-403
Published by: Cambridge University Press

Stable URL: https://www.jstor.org/stable/2194879

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 JUDICIAL DECISIONS
BY OLivER J. LISSITZYN

Of the Board of Editors

Nationality-claims--naturalization in claimant state-effect of lack

of genuine connection with claimant state
NOTTEBOHM CASE (LIECHTENSTEN V. GUATEMALA). I.C.J. Reports,
1955, p. 4.
International Court of Justice.' Judgment of April 6, 1955.

Liechtenstein brought this case against Guatemala, asking the Court to

declare that

The Government of Guatemala in arresting, detaining, expelling and

refusing to readmit Mr. Nottebohm and in seizing and retaining his
property without compensation acted in breach of their obligations
under international law and consequently in a manner requiring the
payment of reparation.

Liechtenstein further asked damages and the restoration of Nottebohm's

property in Guatemala, or alternatively payment of the "estimated present
market value of the seized property had it been maintained in its original
condition. "
Guatemala asked the Court to declare the claim inadmissible (i) because
of the lack of prior diplomatic negotiations, (ii) on grounds of nationality
of the claimant, and (iii) for failure to exhaust local remedies. Guatemala
also contended that there was no violation of international law committed
by Guatemala in regard to Mr. Nottebohm. On the nationality point,
Guatemala contended that Nottebohm had not "properly acquired Liechten-
stein nationality in accordance with the law of the Principality," that
"naturalization was not granted to Mr. Nottebohm in accordance with the
generally recognized principles in regard to nationality," and that

Mr. Nottebohm appears to have solicited Liechtenstein nationality

fraudulently, that is to say, with the sole object of acquiring the status
of a neutral national before returning to Guatemala, and without any
genuine intention to establish a durable link, excluding German
nationality, between the Principality and himself.

The Court found that Nottebohm was born in Germany September 16,
1881, was German by birth, and still possessed German nationality in
October, 1939, when he applied for naturalization in Liechtenstein. He
became a resident of Guatemala in 1905 and remained in business there,

1 Composed for this case of Judge Hackworth, President; Judge Badawi, Vice Presi-
dent; Judges Basdevant, ZoriEi6, Klaestad, Read, Hsu Mo, Armand-Ugon, Kojevnikov,
Zafrulla Khan, Moreno Quintana, Cordova; and Judges ad hoc Guggenheim and Garcia
Bauer. The French text of the judgment is authoritative.

396

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 JUDICIAL DECISIONS 397

making trips back to Germany for business and to other countries for holi
days. After 1931 he paid a few visits to a brother who lived in Liechten-
stein. His other brothers, relatives and friends were in Germany and
Guatemala. He "continued to have his fixed abode in Guatemala until
1943." In the spring of 1939 he left Guatemala and went to Germany
and Liechtenstein, applying in Liechtenstein for naturalization through his
attorney on October 9, 1939. During October his naturalization was com-
pleted, he took the oath of allegiance, and on December 1 his Liechtenstein
passport was visaed by the Guatemalan Consul General in Zurich. Notte-
bohm returned to Guatemala early in 1940. In 1943 Nottebohm was taken
into custody and removed to the United States as a dangerous enemy alien,
where he was detained in internment until early 1946. Upon his release
he went to Liechtenstein. Meanwhile Guatemala had proceeded against
his property as that of an enemy alien.
It appeared that under Liechtenstein law the applicant for naturaliza-
tion must prove that his acceptance into the " Home Corporation"
(Ileimatverband) of a Liechtenstein commune has been promised, that he
will lose his former nationality (though this may be waived), that he has
resided at least three years in the territory of the Principality (though
"this requirement can be dispensed with in circumstances deserving special
consideration and by way of exception"), and that certain fees are paid.
The Court held, by 11 votes to 3, "that the claim submitted by the
Principality of Liechtenstein is inadmissible." Judges Klaestad and Read,
and Judge ad hoc Guggenheim, gave dissenting opinions.
In its opinion the Court stated:

Thus, the real issue before the Court is the admissibility of the claim
of Liechtenstein in respect of Nottebohm. Liechtenstein's first sub-
mission referred to above is a reason advanced for a decision by the
Court in favour of Liechtenstein, while the several grounds given by
Guatemala on the question of nationality are intended as reasons for
the inadmissibility of Liechtenstein's claim. The present task of the
Court is limited to adjudicating upon the admissibility of the claim
of Liechtenstein in respect of Nottebohm on the basis of such reasons as
it may itself consider relevant and proper.
In order to decide upon the admissibility of the Application, the
Court must ascertain whether the nationality conferred on Nottebohm
by Liechtenstein by means of a naturalization which took place in the
circumstances which have been described, can be validly invoked as
against Guatemala, whether it bestows upon Liechtenstein a sufficient
title to the exercise of protection in respect of Nottebohm as against
Guatemala and therefore entitles it to seise the Court of a claim re-
lating to him. In this connection, Counsel for Liechtenstein said.
"the essential question is whether Mr. Nottebohm, having acquired
the nationality of Liechtenstein, that acquisition of nationality is one
which must be recognized by other States. " This formulation is
accurate, subject to the twofold reservation that, in the first place,
what is involved is not recognition for all purposes but merely for the
purposes of the admissibility of the Application, and, secondly, that
what is involved is not recognition by all States but only by Guatemala.
The Court does not propose to go beyond the limited scope of the
question which it has to decide, namely whether the nationality con-

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398 THE AMERICAN JOURNAL OF INTERNATIONAL LAW

ferred on Nottebohm can be relied upon as against Guatemala in

justification of the proceedings instituted before the Court. It must
decide this question on the basis of international law; to do so is
consistent with the nature of the question and with the nature of the
Court's own function.
In order to establish that the Application must be held to be ad-
missible, Liechtenstein has argued that Guatemala formerly recognized
the naturalization which it now challenges and cannot therefore be
heard to put forward a contention which is inconsistent with its former
attitude.

The Court did not find in the facts anything "to show that before the
institution of proceedings Guatemala had recognized Liechtenstein's title
to exercise protection in favour of Nottebohm and that it is thus pre-
cluded from denying such a title. " Nor was any recognition by Guatemala
found in the correspondence concerning the case. The Court continued:

Since no proof has been adduced that Guatemala has recognized the
title to the exercise of protection relied upon by Liechtenstein as
being derived from the naturalization which it granted to Nottebohm,
the Court must consider whether such an act of granting nationality
by Liechtenstein directly entails an obligation on the part of Guatemala
to recognize its effect, namely, Liechtenstein 's right to exercise its
protection. In other words, it must be determined whether that uni-
lateral act by Liechtenstein is one which can be relied upon against
Guatemala in regard to the exercise of protection. The Court will deal
with this question without considering that of the validity of Notte-
bohm's naturalization according to the law of Liechtenstein.
It is for Liechtenstein, as it is for every sovereign State, to settle
by its own legislation the rules relating to the acquisition of its na-
tionality, and to confer that nationality by naturalization granted by
its own organs in accordance with that legislation. It is not necessary
to determine whether international law imposes any limitations on its
freedom of decision in this domain. Furthermore, nationality has its
most immediate, its most far-reaching and, for most people, its only
effects within the legal system of the State conferring it. Nationality
serves above all to determine that the person upon whom it is con-
ferred enjoys the rights and is bound by the obligations which the law
of the State in question grants to or imposes on its nationals. This
is implied in the wider concept that nationality is within the domestic
jurisdiction of the State.
But the issue which the Court must decide is not one which pertains
to the legal system of Liechtenstein. It does not depend on the law
or on the decision of Liechtenstein whether that State is entitled to
exercise its protection, in the case under consideration. To exercise
protection, to apply to the Court is to place oneself on the plane of
international law. It is international law which determines whether
a State is entitled to exercise protection and to seise the Court.
The naturalization of Nottebohm was an act performed by Liechten-
stein in the exercise of its domestic jurisdiction. The question to be
decided is whether that act has the international effect here under
consideration.
International practice provides many examples of acts performed
by States in the exercise of their domestic jurisdiction which do not
necessarily or automatically have international effect, which are not
necessarily and automatically binding on other States or which are

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 JUDICIAL DECISIONS 399

binding on them only subject to certain conditions: this is the case,

for instance, of a judgment given by the competent court of a State
which it is sought to invoke in another State.
In the present case it is necessary to determine whether the naturali-
zation conferred on Nottebohm can be successfully invoked against
Guatemala, whether, as has already been stated, it can be relied upon
as against that State, so that L'iechtenstein is thereby entitled to ex-
ercise its protection in favour of Nottebohm against Guatemala.
When one State has conferred its nationality upon an individual
and another State has conferred its own nationality on the same person,
it may occur that each of these States, considering itself to have acted
in the exercise of its domestic jurisdiction, adheres to its own view
and bases itself thereon in so far as its own actions are concerned.
In so doing, each State remains within the limits of its domestic
jurisd'iction.
This situation may arise on the international plane and fall to be
considered by international arbitrators or by the courts of a third
State. If the arbitrators or the courts of such a State should confine
themselves to the view that nationality is exclusively within the do-
mestic jurisdiction of the State, it would be necessary for them to find
that they were confronted by two contradictory assertions made by
two sovereign States, assertions which they would consequently have
to regard as of equal weight, which would oblige them to allow the
contradiction to subsist and thus fail to resolve the conflict submitted
to them.
In most cases arbitrators have not strietly speaking had to decide
a conflict of nationality as between States, but rather to determine
whether the nationality invoked by the applicant State was one which
could be relied upon as against the respondent State, that is to say,
whether it entitled the applicant State to exercise protection. Inter-
national arbitrators, having before them allegations of nationality by
the applicant State which were contested by the respondent State,
have sought to ascertain whether nationality had been conferred by the
applicant State in circumstances such as to give rise to an obligation
on the part of the respondent State to recognize the effect of that
nationality. In order to decide this question arbitrators have evolved
certain principles for determining whether full international effect
was to be attributed to the nationality invoked. The same issue is
now before the Court: it must be resolved by applying the same
principles.
The courts of third States, when confronted by a similar situation,
have dealt with it in the same way. They have done so not in con-
nection with the exercise of protection, which did not arise before them,
but where two different nationalities have been invoked before them
they have had, not indeed to decide such a dispute as between the two
States concerned, but to determine whether a given foreign nationality
which had been invoked before them was one which they ought to
recognize.
International arbitrators have decided in the same way numerous
cases of dual nationality, where the question arose with regard to the
exercise of protection. They have given their preference to the real
and effective nationality, that which accorded with the facts, that based
on stronger factual ties between the person concerned and one of the
States whose nationality is involved. Different factors are taken into
consideration, and their importance will vary from one case to the
next: the habitual residence of the individual concerned is an im-

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400 THE AMERICAN JOURNAL OF INTERNATIONAL LAW

portant factor, but there are other factors such as the centre of his
interests, his family ties, his participation in public life, attachment
shown by him for a given country and inculcated in his children, etc.
Similarly, the courts of third States, when they have before them
an individual whom two other States hold to be their national, seek
to resolve the conflict by having recourse to international criteria and
their prevailing tendency is to prefer the real and effective nationality.
The same tendency prevails in the writings of publicists and in
practice. This notion is inherent in the provisions of Article 3, para-
graph 2, of the Statute of the Court. National laws reflect this tend-
ency when, inter alia, they make naturalization dependent on condi-
tions indicating the existence of a link, which may vary in their pur-
pose or in their nature but which are essentially concerned with this
idea. The Liechtenstein Law of January 4th, 1934, is a good example.
The practice of certain States which refrain from exercising protec-
tion in favour of a naturalized person when the latter has in fact, by
his prolonged absence, severed his links with what is no longer for him
anything but his nominal country, manifests the view of these States
that, in order to be capable of being invoked against another State,
nationality must correspond with the factual situation. A similar
view is manifested in the relevant provisions of the bilateral nation-
ality treaties concluded between the United States of America and
other States since 1868, such as those sometimes referred to as the
Bancroft Treaties, and in the Pan-American Convention, signed at
Rio de Janeiro on August 13th, 1906, on the status of naturalized
citizens who resume residence in their country of origin.
The character thus recognized on the international level as pertain-
ing to nationality is in no way inconsistent with the fact that inter-
national law leaves it to each State to lay down the rules governing
the grant of its own nationality. The reason for this is that the di-
versity of demographic conditions has thus far made it impossible for
any general agreement to be reached on the rules relating to nation-
ality, although the latter by its very nature affects international re-
lations. It has been considered that the best way of making such
rules accord with the varying demographic conditions in different
countries is to leave the fixing of such rules to the competence of each
State. On the other hand, a State cannot claim that the rules it has
thus laid down are entitled to recognition by another State unless it
has acted in conformity with this general aim of making the legal bond
of nationality accord with the individual's genuine connection with
the State which assumes the defence of its citizens by means of pro-
tection as against other States.
The requirement that such a concordance must exist is to be found
in the studies carried on in the course of the last thirty years upon
the initiative and under the auspices of the League of Nations and the
United Nations. It explains the provision which the Conference for
the Codification of International Law, held at The Hague in 1930, in-
serted in Article I of the Convention relating to the Conflict of Nation-
ality Laws, laying down that the law enacted by a State for the pur-
pose of determining who are its nationals "shall be recognized by other
States in so far as it is consistent with . . . international custom, and
the principles of law generally recognized with regard to nationality."
In the same spirit, Article 5 of the Convention refers to criteria of the
individual's genuine connections for the purpose of resolving questions
of dual nationality which arise in third States.

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 JUDICIL DECISIONS 401

According to the practice of States, to arbitral and judicial decisions

and to the opinions of writers, nationality is a legal bond having as its
basis a social fact of attachment, a genuine connection of existence,
interests and sentiments, together with the existence of reciprocal
rights and duties. It may be said to constitute the juridical expres-
sion of the fact that the individual upon whom it is conferred, either
directly by the law or as the result of an act of the authorities, is i1
fact more closely connected with the population of the State conferring
nationality than with that of any other State. Conferred by a State,
it only entitles that State to exercise protection vis-a-vis another State,
if it constitutes a translation into juridical terms of the individual's
connection with the State which has made him its national.
Diplomatic protection and protection by means of international ju-
dicial proceedings constitute measures for the defence of the rights of
the State. As the Permanent Court of International Justice has said
and has repeated, "by taking up the case of one of its subjects and by
resorting to diplomatic action or international judicial proceedings on
his behalf, a State is in reality asserting its own rights-its right to
ensure, in the person of its subjects, respect for the rules of interna-
tional law" (P.C.I.J., Series A, No. 2, p. 12, and Series A/B, Nos.
20-21, p. 17).
Since this is the character which nationality must present when it
is invoked to furnish the State which has granted it with a title to the
exercise of protection and to the institution of international judicial
proceedings, the Court must ascertain whether the nationality granted
to Nottebohm by means of naturalization is of this character, or, in
other words, whether the factual connection between Nottebohm and
Liechtenstein in the period preceding, contemporaneous with and fol-
lowing his naturalization appears to be sufficiently close, so preponder-
ant in relation to any connection which may have existed between him
and any other State, that it is possible to regard the nationality con-
ferred upon him as real and effective, as the exact juridical expression
of a social fact of a connection which existed previously or came into
existence thereafter.
Naturalization is not a matter to be taken lightly. To seek and to
obtain it is not something that happens frequently in the life of a
human being. It involves his breaking of a bond of allegiance and his
establishment of a new bond of allegiance. It may have far-reaching
consequences and involve profound changes in the destiny of the in-
dividual who obtains it. It concerns him personally, and to consider
it only from the point of view of its repercussions with regard to his
property would be to misunderstand its profound significance. In
order to appraise its international effect, it is impossible to disregard
the circumstances in which it was conferred, the serious character
which attaches to it, the real and effective, and not merely the verbal
preference of the individual seeking it for the country which grants
it to him.
At the time of his naturalization does Nottebohm appear to have
been more closely attached by his tradition, his establishment, his in-
terests, his activities, his family ties, his intentions for the near future
to Liechtenstein than to any other State? . . .
The essential facts are as follows:
At the date when he applied for naturalization Nottebohm had been
a German national from the time of his birth. He had always re-
tained his connections with members of his family who had remained
in Germany and he had always had business connections with that

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402 THE AMERICAN JOURNAL OF INTERNATIONAL LAW

country. His country had been at war for more than a month, and
there is nothing to indicate that the application for naturalization
then made by Nottebohm was motivated by any desire to dissociate
himself from the Government of his country.
He had been settled in Guatemala for 34 years. He had carried on
his activities there. It was the main seat of his interests. He re-
turned there shortly after his naturalization, and it remained the
centre of his interests and of his business activities. He stayed there
until his removal as a result of war measures in 1943. He subse-
quently attempted to return there, and he now complains of Guate-
mala's refusal to admit him. There, too, were several members of his
family who sought to safeguard his interests.
In contrast, his actual connections with Liechtenstein were extremely
tenuous. No settled abode, no prolonged residence in that country at
the time of his application for naturalization: the application indi-
cates that he was paying a visit there and confirms the transient char-
acter of this visit by its request that the naturalization proceedings
should be initiated and concluded without delay. No intention of
settling there was shown at that time or realized in the ensuing weeks,
months or years-on the contrary, he returned to Guatemala very
shortly after his naturalization and showed every intention of remain-
ing there. If Nottebohm went to Liechtenstein in 1946, this was be-
cause of the refusal of Guatemala to admit him. No indication is
given of the grounds warranting the waiver of the condition of resi-
dence, required by the 1934 Nationality Law, which waiver was im-
plicitly granted to him. There is no allegation of any economic in-
terests or of any activities exercised or to be exercised in Liechtenstein,
and no manifestation of any intention whatsoever to transfer all or
some of his interests and his business activities to Liechtenstein.
It is unnecessary in this connection to attribute much importance to
the promise to pay the taxes levied at the time of his naturalization.
The only links to be discovered between the Principality and Notte-
bohm are the short sojourns already referred to and the presence in
Vaduz of one of his brothers: but his brother's presence is referred to
in his application for naturalization only as a reference to his good
conduct. Furthermore, other members of his family have asserted
Nottebohm's desire to spend his old age in Guatemala.
These facts clearly establish, on the one hand, the absence of any
bond of attachment between Nottebohm and Liechtenstein and, on the
other hand, the existence of a long-standing and close connection be-
tween him and Guatemala, a link which his naturalization in no way
weakened. That naturalization was not based on any real prior con-
nection with Liechtenstein, nor did it in any way alter the manner of
life of the person upon whom it was conferred in exceptional circum-
stances of speed and accommodation. In both respects, it was lacking
in the genuineness requisite to an act of such importance, if it is to be
entitled to be respected by a State in the position of Guatemala. It
was granted without regard to the concept of nationality adopted in
international relations.
Naturalization was asked for not so much for the purpose of obtain-
ing a legal recognition of Nottebohm's membership in fact in the popu-
lation of Liechtenstein, as it was to enable him to substitute for his
status as a national of a belligerent State that of a national of a neu-
tral State, with the sole aim of thus coming within the protection of
Liechtenstein but not of becoming wedded to its traditions, its inter-
ests, its way of life or of assuming the obligations-other than fiscal

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 JUDICIAL DECISIONS 403

obligations-and exercising the rights pertaining to the status thus

acquired.
Guatemala is under no obligation to recognize a nationality granted
in such circumstances. Liechtenstein consequently is not entitled to
extend its protection to Nottebohm vis-a-vis Guatemala and its claim
must, for this reason, be held to be inadmissible.
The Court is not therefore called upon to deal with the other pleas
in bar put forward by Guatemala or the Conclusions of the Parties
other than those on which it is adjudicating in accordance with the
reasons indicated above.

Gold of the National Bank of Albania-meaning of word "belonged"

-Inter-Allied Reparations Agreement-restitution
ARBITRAL OPINION RELATIVE TO THE GOLD OF THE NATIONAL BANK OF
ALBANIA. 10 Annuaire Suisse de Droit International 11 (1953).
Brussels, February 20, 1953. Sauser-Hall, Arbitrator.

In 1925 a private financial group, in which Italian interests played the

leading role, entered into an agreement with the Albanian Government
for the organization of a National Bank of Albania, as authorized by
special Albanian legislation. Under this legislation, the seat of the direc-
tion centrale of the Bank was to be at the Albanian capital, but the seat
of the Council (Conseil) and of the Committee of Administration (Comite
d'administration) could be established abroad. The Bank was to be the
depository of Albanian state funds and was to perform the functions of a
public treasury. It was given the power to coin metallic money and to
issue paper currency which was to be covered by a gold reserve.
The Bank was organized at a meeting in Rome in the form of a joint-
stock company (societe par actions), and its statutes, which were in con-
formity with the Albanian legislation, were approved by the Italian Min-
ister of Finance and deposited with the Albanian Minister of Finance.
Under the statutes, the seat of the Council and the Committee of Ad-
ministration was fixed at Rome, where all the shareholders' meetings were
held. The Bank's gold reserve was purchased in the international
market with Italian currency and, except for small amounts kept in the
Albanian offices of the Bank, was at all times deposited at Rome, mostly
at the Italian Mint (HoItel de la Monnaie). Italian nationals at the outset
held 45% of the common stock and all of the founders' shares. The
Albanian Government at no time held any of the Bank's capital. The
proportion of the common stock held by Albanian nationals gradually
dropped from 30%o at the beginning to 1.5%o by September, 1943. In
1935, the Italian Government nationalized by decree all of the stock held
by the Italian stockholders and also embarked on a program of purchasing
stock held by foreign interests, with the result that as of September 16,
1943, the Italian state owned 88.5%o of the Bank's common stock and
founders' shares.
On September 16, 1943, the Bank's gold in Rome was seized by the
German forces and removed to Berlin, where, under an agreement with
the Albanian Government, it was earmarked for the direction centrate

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