Investment Obligations Research Articles

Woningcorporaties en Vastgoedontwikkeling: Fit for Use?

Woningcorporaties en Vastgoedontwikkeling: Fit for Use?

Woningcorporaties en Vastgoedontwikkeling: Fit for Use?

Woningcorporaties en Vastgoedontwikkeling: Fit for Use?

Evolution of contract structures in water supply and sanitation

Today, public-private partnerships (PPPs) in the water supply and sanitation sector, including the affermage, are increasingly hybrid, performance-based models. These include evolved, more sophisticated affermage models – such as what we refer to as the performance-based affermage (PBA). This model is based on an incentive-driven and more equitable distribution of the efficiency gains between the operator and the contracting authority (CA). The operator's expenses are reduced through efficiency improvements; the operator's fee reduces and the payment to the CA increases. The operational surplus increases and its eventual distribution depends on whether or not the operator meets its financial and technical contractual targets. Hence the PBA model may be more politically attractive to public authorities whose bargaining power to demand improved service delivery from the operator is strengthened. Key preconditions for the successful implementation of a PBA include: (i) an incentive mechanism based on an audited and validated baseline, and (ii) a capable CA, leading to a balance of power and mutual respect between partners. This output-based affermage (PBA) option is structured with appropriate investment obligations and allocation of risks between the operator and the CA. These are based on each entity's ability to manage risks – and both are rewarded on their performance and the respective levels of risk assumed.

La dinámica de los acuerdos internacionales de inversión en los andinos

The purpose of this paper is to provide an overview of the dynamics of international investment agreements within Latin America with special emphasis on the Andean region. It is noted that in accordance with global trends in recent years in the region has generated a series of reactions and changes in the content of investment agreements, tending towards balance or rebalance the rights and obligations of states and foreign investors. Under this scheme, while Colombia and Peru continue with liberal policies that favor such agreements, they took a series of actions to improve their content, whereas Bolivia and Ecuador, took tough actions (renegotiation, denunciation of investment agreements and international forums) depending on the arrival of new political actors, their strategies for development and entry into force of new constitutions.

The Patient Protection and Affordable Care Act and the Future of Child Health Policy

The Patient Protection and Affordable Care Act and the Future of Child Health Policy

Balancing FDI Pressures: Initiatives from Southern Africa

This presentation considers the prospective development of policy frameworks for foreign direct investment in developing and emerging economies. It first considers the implications of two decisions on FDI in South Africa and the extent to which they dealt with potential inconsistencies between the state’s international trade and investment obligations and, respectively, domestic competition law and policy and constitutional principles. In identifying the circumstances which precluded any direct consideration of head to head clashes in these areas, it notes the absence of a state investment agency and screening at the establishment stages as key prospective elements in a more comprehensive investment framework. In recognition of the current development of a policy framework for FDI in South Africa, in the context of regional initiatives on the subject, the paper enumerates items for prospective inclusion in this area. The items are drawn from recent and contemporary developments in FDI law and policy in both developing and developed economies. The paper concludes with references to the difficult balancing acts which are required in this area as developing economies attempt to maintain attractiveness as destinations for FDI and retain, or recover, policy space in relating to national economic and political priorities.

Four COPs and counting: achievements, underachievements and looming challenges in the early life of the WHO FCTC Conference of the Parties

As the governing body of the WHO Framework Convention on Tobacco Control (FCTC), the Conference of the Parties (COP) is mandated to ‘keep under regular review the implementation of the...

The White Industries award – Shades of Grey

This article is a preface to India’s first engagement with investor-state dispute settlement – White Industries v. Republic of India. Notwithstanding its systemic implications at various levels, the award has left a denting comment on the functioning of the Indian judiciary – the workings of which were a principle point of challenge. The current piece attempts to trace the delicate line defining India’s investment obligations, the functioning of its courts and the extant relation between ‘denial of justice’ and ‘effective means’ as under India’s bilateral investment obligations. The article is divided into three principal sections – the first introduces India’s experience with investment arbitration and its bilateral investment agenda, the second is a contextual overview of acknowledged global standards of protection under transnational law and third discusses the White Industries arbitration - analyzing the legal contest therein and its outcome.

Time to Quit? Assessing International Investment Claims against Plain Tobacco Packaging in Australia

The Australian federal government recently introduced into Parliament legislation mandating the plain packaging of all tobacco products. Tobacco companies and others have raised various legal concerns with this tobacco control scheme, both at a domestic level in relation to constitutional and intellectual property law, and at an international level in relation to international economic law. Some Members of the World Trade Organization (WTO) have asked questions about the scheme in the WTO's Committee on Technical Barriers to Trade and Council for Trade-Related Intellectual Property Rights. In addition, Philip Morris (Asia) Limited has given notice of an investor-State dispute settlement claim against Australia regarding plain packaging pursuant to the Hong Kong--Australia Bilateral Investment Treaty. This article considers the merits of that claim as well as certain related procedural issues. It also compares Australia's investment obligations with respect to plain packaging under the Australia--United States Free Trade Agreement, as some allegations have been made that plain packaging may be inconsistent with those obligations. Oxford University Press 2011, all rights reserved, Oxford University Press.

Boxed In? Australia's Plain Tobacco Packaging Initiative and International Investment Law

This article uses Australia as a case study to identify the issues that may arise in ensuring compliance of plain tobacco packaging measures with international investment law. It explains how the tobacco industry could use investor–state dispute settlement under Australia's investment protection agreements, as Philip Morris Asia Limited has done in its claim under the Australia–Hong Kong bilateral investment treaty. It then considers whether the tobacco industry would satisfy the threshold requirement of having made a relevant investment, before considering whether plain packaging could be considered an expropriation or a breach of the fair and equitable treatment obligation or another investment standard. The article concludes that Australia has strong arguments that plain packaging is consistent with its international investment obligations.

Implications of International Investment Law for Tobacco Flavouring Regulation

Several countries now restrict the use of particular ‘flavours’ in cigarettes and other tobacco products. Various flavours may make cigarettes more attractive to consumers in general (for example by making them easier to smoke) or to particular groups such as children and young people. Domestic regulatory measures restricting tobacco flavouring therefore have a clear health objective. Nevertheless, tobacco companies may threaten to challenge these measures under international investment law, as they have done recently in relation to other tobacco control measures. Understanding the nuances and complexities of bilateral investment treaties (and investment chapters of preferential trade agreements) is therefore crucial for governments in designing flavouring measures and withstanding complaints in the context of foreign investment. Investment obligations do typically incorporate flexibility for governments to implement public health and other public policies, but governments must carefully craft flavouring measures for the relevant health purpose, avoiding unnecessary discrimination against foreign investors or investment. Governments should also take care in making any representations to existing or potential investors about the future of tobacco regulation in their territory. An analysis of flavouring measures under international investment law is vitally important as the Fourth Conference of the Parties to the WHO Framework Convention on Tobacco Control gets underway.

Investment Protection Law and Systemic Integration of Treaty and Custom

The creation of contemporary treaty-based structure of investment law may be traced to earlier skepticism about the adequacy or appropriateness of protection provided by customary investment law. The relationship of the results of recent efforts of law-making with customary rules is different both in nature and in clarity. The experience of the last decade permits testing theoretical assumptions about systemic integration against the benchmark of existing practice. The issue is addressed in two steps, first formulating an analytical perspective and then applying it to three case studies. First of all, VCLT Article 31(3)(c) may bring ‘relevant’ customary law into the interpretative process, suggesting either a narrow or broad reading of relevance. Express or implicit reliance or exclusion of custom, subsequent practice by States, the historical perspective of law-making, and theory of State responsibility are helpful in identifying the ‘relevance’ of custom. Secondly, the descriptive and prescriptive implications of systemic integration are demonstrated on the basis of three case studies. First of all, diplomatic protection is sometimes treated as relevant for investor-State arbitration. The benchmark for the relevance has been provided by the distinction between direct and derivative investor’s rights, but the permissibility of concurrence of investor-State and State-State proceedings may suggest a better perspective. Secondly, primary investment obligations in treaty and customary law often run in parallel. In these cases, rules are prima facie relevant, and the degree of permissible reliance therefore needs to be drawn in a different manner by engaging in another simultaneous interpretative exercise. Thirdly, cases dealing with treaty rules on non-precluded-measures and customary rules of necessity regarding the Argentinean crisis highlight inter-temporal challenges. Overall, the State practice and case law of the last decade highlight particular considerations and criteria that are useful in formulating the interpretative framework for dealing with customary investment law.

Corporate Human Rights Obligations under Stabilization Clauses

Lawyers, economists and social scientists alike have for a number of years agreed that foreign investment has the potential to act as a catalyst for the enjoyment of an individual's fundamental human rights, particularly in developing countries. This article discusses and critically analyses corporate human rights obligations and the lack thereof under stabilization clauses in foreign investment contracts. The balance of this article is devoted to exploring three main issues relating to corporate human rights obligations and stabilization clauses. First, stabilization clauses in foreign investment agreements are examined in relation to corporate obligations and responsibility for fundamental human rights. In doing so the substantive and procedural dimension of stabilization clauses is analysed. Second, using the concrete examples of the Mineral Development Agreement between Mittal Steel and the Government of Liberia Mittal Steel Agreement and of the Baku-Tblisi-Ceyhan Pipeline Project as case studies, this article considers an application of stabilization clauses in foreign investment contracts in relation to the fundamental human rights obligation of states and of corporations. Third, a proposal for reform in the form of a fundamental human rights clause is introduced. To be clear, the argument here is that the fundamental human rights obligations of investors, particularly of corporations, must be included in foreign investment agreements.

Innovation in the structuring of Islamic sukuk securities

PurposeThe purpose of this paper is to provide an analysis of different sukuk structures from a financial perspective. This examination includes murabahah and ijara‐based sukuk, the former offering a fixed return, and the latter, the most popular form of sukuk, a variable return. The potential for other more novel sukuk structures based on musharakah partnership contracts is also examined, and sukuk pricing issues are explored using alternative benchmarks to London Inter‐bank Offer Rate.Design/methodology/approachFlow charts are used to illustrate the financial transfers and the rights and obligations of sukuk investors as well as the beneficiaries of the funding. Historical data have used to assess whether the payments flows are more stable in the case of sovereign sukuk where the returns are based on gross domestic product (GDP) growth rather than interest.FindingsThe paper finds that special purpose vehicles are a prerequisite for the successful issuance and management of sukuk. The use of GDP‐based pricing benchmarks would have resulted in greater payments stability for sovereign debt in Saudi Arabia, but not for Malaysia.Research limitations/implicationsThe data analysis was restricted to two countries, but this could be extended. Alternative pricing benchmarks were suggested for sovereign sukuk but not for corporate sukuk.Practical implicationsMinistries of Finance and Central Banks of Muslim countries should review their debt financing policies and explore the potential of sovereign sukuk.Originality/valueLittle has been written previously on the use of musharakah partnership contracts for sukuk, and pricing issues have not hitherto been systematically investigated.

Interactions between Investment and Non-Investment Obligations in International Investment Law

The accelerated proliferation of international investment agreements, the growing number of treaties in other international domains, and the increase of investor-state arbitrations enhance the prospects of overlap between investment and non-investment obligations. The interactions between international-investment and non-investment obligations may be controlled by two main sets of rules: the relatively well-developed principles of public international law or the nascent body of rules emerging from international investment jurisprudence. As analyzed in this paper, investment tribunals have generally not resorted to the relevant principles of public international law. This practical disregard of the regulatory rules of general international law stands in stark contrast to the extensive reliance of investment tribunals on other rules of the Vienna Convention on the Law of Treaties. This current unawareness of investment tribunals may well change in the future with regard to fundamental human rights that are recognized in public international law as jus cogens rules. Contemporary international investment law does not offer a systematic set of rules to be applied to such questions. International investment tribunals that encountered such questions have tended to address these questions in a sporadic manner. Consequently, the paper examines these investment awards separately and seeks to trace some systematic principles that emerge from this jurisprudence. These principles relates to the relevance of non-investment treaties, the different impact of voluntary and non-voluntary obligations, the parties' motivations, chronological sequence of obligations and available information, and least restrictive measures.

Corporate governance in post-socialist Poland

In this paper, I focus specifically on how changes in the legal framework shape the ownership and control structure of new and recently privatized companies in the emerging market economy of post-socialist Poland. I discuss the market for capital, which also depends on the legal system, as investors’ decision to invest is bound up with the sort of protection they are likely to receive against those who appropriate their money for the operations of the firm. I argue that governmental actions aimed at stimulating investment and economic development in post-socialist Poland and the emergent model of corporate governance is conditioned both by internal dynamics - such as previous corporate arrangements and the origins of the commercial law - and by external factors - such as EU accession, directives and policies regarding investment obligations and shareholder rights.

On improving the world: the value(s) of WICS

Models of giftedness are not versions of the way the world is, but programmes for improving the world. They uphold visions of the good life, good society, and worthy character. They are vehicles for values. Sternberg acknowledges this in his conclusion: ‘The important thing is to work together toward a common good—toward devising the best ways to select students so as the maximize their positive future impact’. The important questions to ask of WICS concern values, e.g. Is the job of schools and programmes to select future leaders and not, say, to foster the self-realization of all citizens? Can other conceptions of giftedness also help improve the world? Is it better to see ‘gifts’ as things that can be ‘squandered’ as judged externally or as self-defined aspects of a person that carry no investment obligations? The world would, no doubt, be better if some gifted schools and fellowship and scholarship programmes adopted WICS. The world would not be improved if they all accepted Sternberg’s proposal to adopt WICS or any common model of giftedness. The proposal is unrealistic, morally questionable, and undesirable. Why would we expect large numbers of programmes to adopt a common model? In a world with diverse cultures and values, wouldn’t programmes adopt models tied to their particular missions and world views? WICS, for example, has an implicit ethic in which ‘great’ leader, ‘contribution to society’, ‘positive future impact’, ‘wisdom’, and other value-laden concepts have specific meanings. Sternberg assumes we share a notion of the ‘common good’, but he offers no reason to expect that institutions with specific missions (e.g. a Krishnamurti gifted school or a socialist scholarship programme) would share values. Why should programmes adopt a common model? Efficiency and presenting ‘a common face’ are not compelling reasons. Should scholarship programmes and gifted schools accept only students perceived to have a ‘positive future impact’ or a capacity to deliver a good return on the effort invested in educating them? Where should the ‘Dennys’ of the world, whose future failure Sternberg assumes is determined long before college, attend school? Why would we want all gifted schools and programmes to adopt the same model of giftedness? A common model is on Sternberg’s own terms an ‘uncreative’ strategy. We don’t know what sorts of people will become ‘leaders’ (we wouldn’t need models if we did); we don’t know the future; we don’t how to educate to guarantee specific outcomes. In an unpredictable world, isn’t it better if schools try

State of the Canada–U.S. Relationship: Culture

The bilateral cultural issues of the 1980s and 1990s between Canada and the U.S. centered on trade involving Sports Illustrated, Country Music Television, Borders Books, film distribution and satellite television. These took place within the context of commitments in multilateral and regional agreements dealing with cultural trade issues. Except in the case of Sports Illustrated, the disputes were resolved in the political arena outside the provisions of either the World Trade Organization (WTO) or the North American Free Trade Agreement (NAFTA). The cultural exemption/retaliation provisions of the latter have yet to be tested. With the new millennium, some of the old issues remain but new ones have appeared. This paper summarizes current and prospective issues and then focuses on two aspects of the topic. The first, the growing importance of foreign markets for the Canadian cultural industries, has received limited attention to date; the second is current, a proposal for an international agreement on cultural diversity to address the frictions that arise at the interface between domestic cultural policies and international trade and investment obligations. The two are related in that the thrust of the draft agreement is inconsistent with the direction being taken by prominent members of the Canadian creative community. Background Historically, Canadian cultural policy has been inward looking, espousing ways to protect Canadians from inflows from the U.S. while at the same time being supportive of Canadian cultural producers. The rhetoric of cultural protectionism repeats the following phrases: promoting Canadian cultural sovereignty and identity; assuring shelf space for Canadian products; allowing Canadians to tell their stories to each other; countering the commercial advantage enjoyed by U.S. producers that have a large domestic market and dump their product into Canada; overcoming American discrimination against the consumption of foreign content; supporting Canadian ownership of producers and distributors in the pursuit of national sovereignty, unity and identity; asserting that Canadian owners will cross-subsidize the production of Canadian content; affirming that cultural content is unlike that of other goods and services and cannot be subject to traditional economic analysis; and maintaining that trade in cultural goods and s ervices should be exempted from trade agreements. Most recently, this viewpoint has been expanded to include the need to protect and promote cultural diversity. Versions of this rhetoric can be found in the statements of those supporting existing Canadian cultural policies, and especially in the speeches of the Minister of Canadian Heritage and publications of this department. Seldom is an attempt made to evaluate whether the policies have achieved and are achieving their objectives. Elsewhere we have noted their deficiencies (Acheson and Maule, 1999, 329-48). The nationalist rhetoric ignores some inconvenient facts. Canadian consumers often choose not to watch the content that is the result of subsidies and tax incentives, especially Canadian films and television drama programs. Audiences for the Canadian public broadcaster have been dwindling. Canadian private broadcasters, film distributors and book publishers have been rewarded handsomely for importing foreign content and fight to maintain this privilege. At the same time, some are active exporters and are anxious to sell further ownership to foreign investors. The system of subsidies has been subject to abuse, in some cases supporting the importation of non-Canadian material. And technology is undermining the effectiveness of measures like content quotas. The U.S. rhetoric that counters the positive claims of cultural nationalism is that these industries are part of the entertainment sector of the economy that is governed by market forces. Whatever unique features the cultural industries have, they should be treated like any other industry as far as trade and investment negotiations are concerned; they should be subject to GATT (General Agreement on Tariffs and Trade) commitments for goods and GATS (General Agreement on Trade in Services) commitments for services trade. …