| Summary: | Right of shareholders to raise claims against host state in International legal forums is a relatively recent subject mainly discussed in investment arbitrations field. In classical international law, shareholders did not have any jus standi in raising direct claim against host state and diplomatic protection was the only means for claiming any remedy. This matter was generally touched on by International Court of Justice in Barcelona Traction case. The Court by distinguishing between “right” and “interest” considered that only the right of shareholders is protected. Nevertheless, it recognized the possibility of remedying reflective rights if there exits a supporting treaty. In this article the questions if shareholders possess any jus standi to make indirect or reflective claims against host state and how the investment arbitrations have reacted to indirect claims of shareholders for reflective loss, will be reviewed. Further, how the domestic law legal systems, such as Iran and England, have reacted to the claims of shareholders for reflective loss is considered. The article concludes that shareholders do not have a any jus standi in domestic law such as England for raising indirect claims and the position is not clear under Iranian law. However, Under modern international law, investment agreements provides for the possibility of shareholders raising indirect claims against host states that emanate from the consent of the state given in the under laying investment treaty. Although this type of treaties do not have express provision on damages and indirect claims, the investment arbitration precedents shows that the general conditions provide ground for accepting the right of shareholders to raise indirect claims.
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