Shopping cartThe Journal of World Investment & Trade
Volumes & issues:
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Dark Past, Grey Present or Bright Future? - Foreign Investors’ Access to China’s Telecommunications Industry and a Political Economy Analysis of Recent Industrial Policy Moves
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Amid the global economic downturn, Eurozone crisis and Libya war in 2011, Alibaba, Yahoo and Softbank’s dispute over Alipay brought China’s telecoms industry and, more importantly, foreign investment policies into the global spotlight. This article considers Chinese legislative framework regulating foreign investment in China’s telecoms industry, and more importantly, two transactional models, that is, the CCF and VIE structures, foreign investors have adopted in the past three decades to access China’s restricted telecoms industry. This article attempts to unveil the underlying reasons foreign investors creating and utilizing these transactional models and, more importantly, China’s recent regulatory instruments Chinese authorities have taken in tackling the VIE structure in telecoms industry. From a political economy lens, this article offers a possible rationale underpinning such movements in light of China’s policy direction.
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Indirect FDI
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This article analyses indirect FDI, denoting investment projects, in which the ultimate owner is different from the immediate investor. Reasons for the existence of this type of investment projects can be mostly corporate strategies and tax considerations. The development impact of indirect FDI is not necessarily negative; however it varies by the key types of indirect FDI (delegation of power to regional headquarters, nearshoring, concealed investment, and round tripping). It also depends on how the project money is transhipped: through an affiliate abroad, or through a special purpose entity. Government polices may influence largely the extent and development impact of indirect FDI, especially through tax policies. The phenomenon deserves more attention in the future, as currently indirect FDI is an under-researched topic.
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Towards an Agreement on Investment in Mercosur: Conflict and Complementarity of International Investment Law and International Trade-in-Services Law
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This article is the first to analyze the 2010 guidelines established by Mercosur’s Common Market Council for drafting an Agreement on Investment for Mercosur, which up until now has lacked any regulations for the promotion and protection of investment. This agreement is important not only because it potentially would fill a large gap in Mercosur law and strengthen Mercosur’s emergent common market, but also because it ostensibly represents the first time that Brazil has shown a real willingness to create an international system for investment protection, which represents a monumental breakthrough for Brazil. However, the guidelines (provided at the end of this article in an appendix) appear to have been created using the Protocol of Montevideo on Trade in Services as the model, as opposed to the more directly relevant norms from the realm of international investment law. This article explores whether this approach will lead to an international investment agreement that adequately promotes and protects investment in Mercosur. This article asserts that a better approach would be to use models from the realm of international investment law because these types of protections are needed in order to reassure investors. The sub-working group charged with drafting this agreement still is working on the draft agreement. Therefore, this article aims to influence that drafting process and subsequent debates over this draft agreement prior to its conclusion.
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The Energy Charter Treaty and China: Member or Bystander?
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The security of energy investment is becoming an increasingly important factor for China’s harmonious economic development. Without a specific agreement concerning the protection and promotion of foreign energy investment between China and other states, to utilize the Energy Charter Treaty would be a better and feasible choice. This study will first present a brief overview of the legal protection of China’s OFDI, followed by an overview of investment protection and promotion under the ECT, and then it assesses the positive implications of China being a member state of the ECT together with the potential risk. A comprehensive discussion illustrates that accession will be a desirable result for China. Finally, it goes further to proclaim that an Asia-Europe Energy cooperation legal framework will be on its way provided that China enters into the ECT.
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The impact of the repeal of Glass-Steagall Act of 1933 in the context of the current financial crisis
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The paper critically examines the impact of the repeal of the Glass-Steagall Act in the context of the current financial crisis. It analyses the pre-Glass-Steagall paradigm, the Glass-Steagall regime and post-repeal paradigm. It discusses the impact of the repeal in specific various forms in this background. It also assesses whether Glass-Steagall should be brought back in its original form, in doing so it offers an alternative approach to deal with the future global financial crisis and it also suggests new rules for the protection of the consumers to avoid moral hazard.
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The EU Investment Policy: How to ensure a fair regulation of the concerned interests?
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Until the entry into force of the Treaty of Lisbon (ToL), the discipline of international investments at the European level has been characterized by an extreme fragmentation. The European Institutions have intervened to promote capital market liberalization, while Member States have been mainly concerned with the post-establishment aspects of international investments. As a result, the EU was unable to promote the protection of the host-State’s public interest as well as play a major role in the field of FDIs. To that extent, the paper argues that the changes made by the ToL to the content and scope of the Common Commercial Policy, through which the EU acquires an exclusive competence on FDIs, can represent a good opportunity to develop a new European Investment Policy aimed at balancing the rights of the investors with the host-State’s public interests, at the same time reinforcing internationally the EU political and economic role.
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The White Industries award - Shades of Grey
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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.
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