Herbert Smith Freehills and BIICL Investment Treaty Forum warmly invite you to attend ‘The Future of Investment Arbitration: Have We Reached a High Water Mark?’.
||Wednesday 1 November 2017
17:30: Panel discussion followed by drinks and networking
||Exchange House, Primrose Street, London, EC2A 2EG
Please click here to view map
||Click here to register with the BIICL events team directly.
Please note there are a limited number of complimentary spaces.
According to the Netherlands Embassy in Jakarta, Indonesia has informed the Netherlands that it has decided to terminate the Bilateral Investment Treaty between the two nations from 1 July 2015. The Embassy also states that “the Indonesian Government has mentioned it intends to terminate all of its 67 bilateral investment treaties“.
On 1 November 2013, the South African Department of Trade and Industry (DTI) has released its new “Promotion and Protection of Investment” bill (PPI Bill) for public comment (for a copy of the PPI Bill, see here).
The PPI Bill follows South Africa’s publicised plans to review its bilateral investment treaties (BITs), in particular those entered into right after the end of the apartheid era. The majority of those BITs have been, or are in the process of being, terminated by the South African government. As part of the DTI review, the South African Government has already issued cancellation notices to various European countries, in respect of its BITs with, amongst others, Belgium, Luxembourg and Spain (to see our previous blog post on this, see here), and most recently, Germany and Switzerland. Existing investors are still entitled to rely on the protections found in those BITs that have been terminated and remain able to do so for a period between 10 to 20 years after the BITs termination, depending on the relevant BITs sunset clause.
The PPI Bill, when passed as law, is intended to regulate the protection of all investments in South Africa in place of BITs.
The following key provisions in the PPI Bill and their implications are discussed further below.
- Definition of an “investment”.
- Absence of a fair and equitable treatment (FET) provision.
- Definition of “expropriation” and new principles of compensation for expropriation.
- Dispute resolution mechanism.
On 23 June 2013, South Africa served a notice of termination in respect of its BIT with Spain, thus ensuring that the investment treaty will terminate on 23 December 2013. Pursuant to Article XII of the BIT, the treaty entered into force for a period of 10 years from 23 December 1999, and thereafter for consecutive 2 year periods, unless terminated by 6 months’ notice before the date of expiry.
Investments made or acquired prior to 23 December 2013 will, however, continue to benefit from protection until 23 December 2023, by virtue of the survival clause in the BIT.
Those wishing to invest in South Africa should include contractual investment protection mechanisms, consider carefully how their investment is structured, and keep appraised of developments further to South Africa’s redistributive Black Economic Empowerment policy.