The Dilemma of Overseas Investment Protection and Institutional Coordination from the Perspective of International Public Law

Rongfeng Zhang

doi:10.54097/2bgz7b93

Authors

Rongfeng Zhang

DOI:

https://doi.org/10.54097/2bgz7b93

Keywords:

Public International Law, Overseas Investment Protection, Institutional Coordination, Bilateral Investment Treaties (BITs), Dispute Resolution Mechanism, China’s Overseas Investment Practice

Abstract

The overall picture of foreign direct investment (FDI) across the world has been characterized by a steady decline. Being one of the key aspects of the international economic collaboration, overseas investment faces a more significant challenge of protecting the legal rights and interests, and there are numerous practical issues that require a systematic approach to their solution. According to the main principles of public international law, this article refers to the authoritative information provided in the World Investment Report 2025 published by UNCTAD, the official case statistics of the International Centre for Settlement of Investment Disputes (ICSID) and the 2023 Statistical Bulletin of China Outward Foreign Direct Investment. It explores the pragmatic challenges and the underlying cause of overseas investment protection based on the framework of public international law, offers specific institutional coordination solutions, and gives recommendations to the improvement in line with the Chinese experience of overseas investment. The research has established that the disintegration of the investment treaty system, the clash of interests between the sovereign of the host country and the investor, and the lack of effective functioning of the mechanism of resolving disputes have significantly limited the efficacy of the protection of overseas investment. The lag of public international law rule updates behind investment practice and the notable divergences in legal concepts among countries are the core causes of the above-mentioned dilemmas. This paper aims to offer practical insights for the international community to address investment protection issues, promote investment liberalization and facilitation, and facilitate the sound recovery of the global investment market.

Downloads

Download data is not yet available.

References

[1] Puig, S., & Shaffer, G. (2018). Imperfect alternatives: institutional choice and the reform of investment law. American Journal of International Law, 112(3), 361-409.

[2] McLachlan, C. (2008). Investment treaties and general international law. International & Comparative Law Quarterly, 57(2), 361-401.

[3] Byers, M. (2001). Introduction: Power, Obligation, and Customary International Law. Duke J. Comp. & Int'l L., 11, 81.

[4] Schill, S. W. (2009). The multilateralization of international investment law (Vol. 2). Cambridge University Press.

[5] Van Harten, G. (2008). Investment treaty arbitration and public law. Oxford University Press.

[6] Simmons, B. A. (2014). Bargaining over BITs, arbitrating awards: The regime for protection and promotion of international investment. World politics, 66(1), 12-46.

[7] Cotula, L. (2023). International investment law and climate change: reframing the ISDS reform agenda. The Journal of World Investment & Trade, 24(4-5), 766-791.

[8] Newcombe, A. P., & Paradell, L. (2009). Law and practice of investment treaties: standards of treatment. Kluwer Law International BV.

[9] Chaisse, J., & Bauer, C. (2018). Cybersecurity and the protection of digital assets: assessing the role of international investment law and arbitration. Vand. J. Ent. & Tech. L., 21, 549.

[10] Chaisse, J., & Kirkwood, J. (2020). Chinese puzzle: anatomy of the (invisible) Belt and Road investment treaty. Journal of International Economic Law, 23(1), 245-269.

[11] Wang, H. (2017). New multilateral development banks: Opportunities and challenges for global governance. Global Policy, 8(1), 113-118.