The Journal of

WORLD INVESTMENT

ABSTRACTS 

Hugo Perezcano: Investment Protection Agreements—Should a Multilateral Approach Be Reconsidered?

Investment protection agreements (Ipas) have become one of the most important instruments of economic policy worldwide, as attested to by their sheer numbers as well as the number of countries that have subscribed them. In addition, they are being increasingly put to the test before international tribunals. Notwithstanding the large number of Ipas in existence, they all seek to promote and protect investments in a similar manner. Thus, the questions arise as to why the continued failure to establish a uniform set of rules at the multilateral level and whether there is room for moving in that direction. This article examines the international framework of investment protection in general terms and explores certain advantages in moving towards multilateral rules.

Hugo Perezcano is General Counsel for Trade Negotiations at the Secretariat of the Economy of Mexico.

A.A. Konoplyanik: Financing the Russian Oil and Gas Sector—The Effects of International Law Instruments

The purpose of this article is to show how multilateral international law instruments, in particular the Energy Charter Treaty (Ect) and various related arrangements, can affect the risks and costs of project financing in the oil and gas industries. The analysis basically consists of five sections. One looks at the evolution of mechanisms employed to finance oil and gas projects as they become more challenging at the same time as energy market structures become more complex. The second describes the principal stages covered on the way to full project financing in the oil and gas industries in Russia. The third section is a brief overview of Russia's credit rating history, which mirrors the changes in the overall assessment of investment project risks in the country. The fourth reviews the underlying rationale of energy market development and the parallel build-up of safety nets available for investors, and the fifth section is devoted to the Energy Charter process and the ways in which the Ect and related mechanisms help reduce the risks of project financing and the costs of raising external capital.

A.A. Konoplyanik is Deputy Secretary-General of the Energy Charter Secretariat in Brussels, Belgium. Among other important posts he has held, Mr Konoplyanik was formerly Deputy Minister of Fuel and Energy of the Russian Federation responsible for external economic relations and direct foreign investment.

Martin Roy: Implications for the Gats of Negotiations on a Multilateral Investment Framework—Potential Synergies and Pitfalls

This article investigates how possible investment disciplines in the World Trade Organization could interact with the General Agreement on Trade in Services (Gats), which already contains substantive disciplines with respect to some forms of foreign investment in services sectors. Should a multilateral investment framework (Mif) cover investments in both goods and services at the expense of the Gats? Should services sectors be excluded completely from the scope of an Mif? Looking at disciplines on services and investment included in some regional and bilateral trade agreements, the article highlights key implications of various approaches to the interaction between two such sets of rules. It argues that some avenues could avoid creating discrepancies in the treatment of investments in goods and in services under Wto rules, while leaving untouched the basic structure of the Gats.

Martin Roy is an economist in the Trade in Services Division of the World Trade Organization in Geneva, Switzerland. He holds a Ph.D. from the School of Advanced International Studies of Johns Hopkins University, in Washington, D.C.

Lucian Cernat: Trade and Competition Policy in the Digital Era—Towards a Regulatory Framework for Global e-Business

Despite optimistic forecasts about its role in the global economy, electronic commerce seems to be affected by a "home bias" effect, being primarily confined to domestic sales rather than international trade. The current article looks into the prospects for the development of an increased reliance on cross-border e-commerce and the potential role that a multilateral regulatory framework might play toward that end. The article identifies some of the existing cross-border barriers to e-commerce and assesses the relevance of the existing Wto regulatory framework in this developing sector.

Lucian Cernat is an associate economist with the United Nations Conference on Trade and Development's Division on International Trade, Competition Law and Policy Branch, in Geneva, Switzerland, and a specialist on Wto and competition policy issues.

Victor Mosoti: Non-Discrimination and its Dimensions in a Possible Wto Framework Agreement on Investment—Reflections on the Scope and Policy Space for the Development of Poor Economies

The creation of a favourable environment for the free flow of foreign direct investment (Fdi) is an increasingly recognized and critical development strategy for the developing world. Whereas no multilateral agreement exists to discipline Fdi flows at the moment, it is only a matter of time before one is created. When that happens, it is perhaps inevitable that the capital-exporting countries will insist on the inclusion in any agreement of provisions on "non-discrimination" such as are found in existing agreements on trade in goods and services and on intellectual property rights. This article examines the nature of such non-discrimination provisions, the tension that exists between their implications and traditional notions of State sovereignty, and their potential for limiting the policy-making space available to poor economies to control and direct their economic development. While arguing that the extension of non-discrimination provisions to a multilateral investment framework should be largely a good thing, the author also urges that care be taken to ensure that it not unduly restrain governments from putting into place policies that permit channeling of Fdi in ways that can produce the maximum benefits for development.

Victor Mosoti is Legal Officer in the Development Law Service of the United Nations Food and Agriculture Organization in Rome, Italy.

Ana Stanič: Doing Business in Uzbekistan—A Guide to its Foreign Investment Framework

This article provides the first comprehensive guide to the framework of laws and international agreements that govern foreign investment in Uzbekistan today. In particular, the article analyses the key laws governing investment in the country, including the Law on Foreign Investments of 1998, as amended in 1999, and the Law on Guarantees and Measures for Protection of Rights of Foreign Investors of 1998. The most important rights accorded to investors under the Energy Charter Treaty and those international protection agreements to which Uzbekistan is a party are also examined. It is the author's view that the current investment framework is overly complex, non-transparent and internally inconsistent and, thus, essentially discourages foreign investment in the country.

Anna Stanič holds an LL.M. from Cambridge University, U.K.; is a Visiting Fellow at the British Institute of International and Comparative Law in London; and is an associate arbitrator of the Chartered Institute of Arbitrators.

Noah D. Rubins: Investment Arbitration in Brazil

Brazil has largely remained at the periphery of the new international legal order surrounding foreign investment, which is typified by bilateral treaties and investor–State arbitration. Unlike most developing States in Asia and Africa, and some in Latin America, Brazil has been hesitant to provide broad-based consent to arbitration of international investment disputes through domestic law or international treaty. Furthermore, up until very recently, the effectiveness of investment arbitration involving Brazil was questionable due to the country's failure to ratify either the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards or the Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States. Despite recent signs that the Brazilian system may now be ready to accept and adopt the global arbitration regime that has reaped such benefits for other industrializing nations, however, at present investors can only gain some protection by including specific dispute arbitration provisions in their concession or investment agreements with the Brazilian government.

Noah D. Rubins is an associate in the international arbitration practice at Freshfields Bruckhaus Deringer in Paris, France. He is also the author of Must the Victorious Investor-Claimant Relinquish Title to Expropriated Property? which appeared in the June 2003 issue of The Journal of World Investment.