An Analysis on the Application of Bilateral Investment Treaty and ICSID to SWF Investment under the Framework of International Investment Law
|關鍵字:||國家主權基金;國際投資法;雙邊投保協議;ICSID;投資主體定位;Sovereign Wealth Fund(SWF);ICSID;The Foreign Investment and National Security Act 2007 (FINSA);Bilateral Investment Treaty;Santiago Principle Investment Protection|
After the result of the Mortgage Crisis, many developing countries' investment vehicles,"Sovereign Wealth Fund" (SWF), mostly from the Middle East and Asia, enter US markets through indirect investment, purchasing the stocks of long-established financial institutions. The SWF Phenomenon that the developed countries have transformed from capital-exporting countries to capital importing countries is recognized as a provocation to the European and US dominated international investment market. This newly-formed State Capitalism has led to European and U.S host state's concerns that there could be some political strategy behind SWF's acquisitions. SWFs are 100 % controlled by their state governments. Due to SWF’s sovereign nature, the close relationship with governments’ lack of transparency for investment information, unsound governance structure, SWF's legal position within international investment law and their suitable legal structure remain to be a topic of discussion. As for the legal structure of SWF varying from state to state, they can be categorized as three types: 1) a pool of State's assets 2) an entity with pubic legal personality 3) an entity with private legal personality. The three types of SWF influences the status of SWF under international investment law, the application of state immunity, and the standing resorts to International Centre for Settlement of the Investment Disputes (ICSID). This paper demonstrates the position of governing SWF investment, in reviewing how The Foreign Investment and National Security Act 2007 (FINSA) of US applies to foreign investment. Indeed, it is a state's inherent privilege to legislate regulation regarding foreign investment. Nvertheless, facilitating strict unilateral acts may lead to trade protectionism of international investment, increase the cost of investment, and decrease the efficiency of international capital flows. Furthermore, it is not generally acceptable to regulate SWF investment through unilateral acts. This paper proposes that even though of The OECD Declaration and Santiago Principle don't not having legal binding force, it can served as the boundaries of domestic regulations of the host state. Given SWF’s practice, SWF has been a longterm investor and willing to obey host-state’s regulation, since SWF has a strong motivation to corporate with host states commercially. This paper concludes that Bilateral Investment Treaty (BIT) can serve as a framework to discuss investment protection to SWF. Considering the application of BIT to SWF Investment, following issues shall be developed: Whether SWF benefits from those investment protection clauses－ National Treatment, Most-Favored-Nation Treatment, Fair and Equitable Standard and Indirect Expropriation clauses against host state depends on the definition of " investor " and " investment "in the relative BIT . On the contrary, from the standpoint of host states, how to invoke Essential Security Exception Clause to legalize its actions. Furthermore, whether SWF may act as claimant in ICSID arbitration will be analyzed in depth in this article.
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