Abstract
International investment agreements (IIAs) are entered into on the
supposition that they attract investment and that investment leads to development. This reason accounts in part for the entering into force of 3320 IIAs by the end of 2017. Yet investor-state tribunals and scholars are divided on whether an investment’s contribution to the development of the host state is an element of the concept of investment. Some hold that
such contribution is an essential element of an investment and that a lack of contribution should deny an investment legal protection under IIAs. Others hold that contribution to development is not a criterion and that an investment does not need to make any specific contribution to the development of the host state to enjoy protection under an IIA. The purpose of this article is to show that establishing whether contribution to
development is an element of investment as a foundation and precondition for decision whether an investment is entitled to protection is not only circumlocutory, but more fundamentally, besides point. The more crucial issue is not whether contribution to development is a distinct element of investment but whether the attainment of development is a stated objective of an IIA. In light of the imperative to interpret a treaty in context and to advance its purpose, I argue that where attainment of development is a stated object of an IIA it is irrelevant to establish whether contribution is an element of investment but the IIA must nevertheless be interpreted in light of that and any other object. Therefore, I argue similarly that if the attainment of development is a stated object of an IIA, an investment’scontribution to development becomes an inherent element of investment within the context of the applicable IIA and the obligation to protect foreign investment must accordingly be linked to the contribution such investment would make to the development of the host state.
supposition that they attract investment and that investment leads to development. This reason accounts in part for the entering into force of 3320 IIAs by the end of 2017. Yet investor-state tribunals and scholars are divided on whether an investment’s contribution to the development of the host state is an element of the concept of investment. Some hold that
such contribution is an essential element of an investment and that a lack of contribution should deny an investment legal protection under IIAs. Others hold that contribution to development is not a criterion and that an investment does not need to make any specific contribution to the development of the host state to enjoy protection under an IIA. The purpose of this article is to show that establishing whether contribution to
development is an element of investment as a foundation and precondition for decision whether an investment is entitled to protection is not only circumlocutory, but more fundamentally, besides point. The more crucial issue is not whether contribution to development is a distinct element of investment but whether the attainment of development is a stated objective of an IIA. In light of the imperative to interpret a treaty in context and to advance its purpose, I argue that where attainment of development is a stated object of an IIA it is irrelevant to establish whether contribution is an element of investment but the IIA must nevertheless be interpreted in light of that and any other object. Therefore, I argue similarly that if the attainment of development is a stated object of an IIA, an investment’scontribution to development becomes an inherent element of investment within the context of the applicable IIA and the obligation to protect foreign investment must accordingly be linked to the contribution such investment would make to the development of the host state.
| Original language | English |
|---|---|
| Pages (from-to) | 144-194 |
| Number of pages | 50 |
| Journal | The University of Western Austalia Law Review |
| Volume | 44 |
| Issue number | 2 |
| Publication status | Published - 2018 |