ICSID 'Foreign' Investment Requirement in Case of Borrowed Funds

Abstract

In this essay, analysis of a specific question related to the notion of investor’s nationality will be asked - can one consider an investment and, respectively, investor as foreign, if the investor who invests abroad (e.g. purchase of shares of local company) also borrows abroad? In order to answer this dilemma, the object and purpose of “foreign” investment will be assessed (section II), followed by analysis of funding arrangements in the context of foreign investment (section III). Next, the relevant practice of investor-state tribunals will be assessed (section IV) which will provide a basis for conclusions in relation to implications of local funding to the notion of nationality in international investment law (section V).

Keywords: investment, nationality, ICSID, arbitration

JEL Classification: K33