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Investment - UK International Investment Policy

Foreign direct investment (FDI) is  generally recognised as one of the key factors in economic growth and wealth. The UK government believes that investment flows benefit both developed and developing countries, creating opportunities for investors and helping developing countries to achieve sustainable development.

Investment Discussions in International Organisations

The UK is involved in international investment rules and policy discussions at a number of international fora;

WTO and Investment

The background to the UK Government’s view with regard to negotiations on foreign direct investment (FDI) in the WTO was the concept of setting in place a simple, basic framework of rules based on transparency and non-discrimination in the treatment of foreign investors. The government felt that a WTO agreement on FDI could provide the stable and predictable climate that foreign investors seek and help countries, especially in the developing world, that do not currently attract much FDI.

It is worth recalling that the EU/UK position differs greatly from the OECD Multilateral Agreement on Investment (MAI) negotiations. For example by conducting negotiations in the WTO,  developing countries would be involved. In addition, the MAI used a "top down" approach (every sector was included unless it was explicitly made an exception), but the EU proposed that a WTO negotiation take a "bottom up" approach (participants would make specific negotiated commitments regarding access to sectors for investment). Also unlike the MAI, the WTO would have only state-to-state dispute settlement procedures.

WTO Working Group on Trade and Investment (WGTI)

Established after the WTO Ministerial in Singapore in 1996 the WGTI had a remit to carry out analytical work on the relationship between trade and investment, including areas such as FDI flow, technology transfer, investment incentives and multilateral rules.

The aim was that negotiations on a multilateral investment agreement would be launched at the fifth ministerial conference at Cancun in 2003. However WTO members were unable to agree, by explicit consensus at that meeting, on this course of action. At the July 2004 meeting of the WTO General Council, a decision was taken (dated 1 August) that ‘no work towards negotiations on (trade and investment) will take place within the WTO during the Doha Round’.

The Government supported the idea of negotiations in principle (subject to the proviso that it would not sign up to something that it did not believe to be in the interests of developing countries), but has of course accepted this decision.  The Europe and World Trade Directorate continues to be responsible for developing UK policy on trade and investment in conjunction with other interested DTI Directorates, the Department For International Development and other Government Departments.

WTO Committee on Trade Related Investment Measures (TRIMs)

The TRIMs Committee is responsible for overseeing implementation of the WTO TRIMs Agreement, for example by discussing notifications of TRIMs that do not conform with the Agreement. The TRIMs Agreement commits WTO members not to impose discriminatory investment measures that distort trade, for example by imposing local content and performance requirements on foreign investors. The Agreement contains transitional arrangements allowing Members to maintain notified TRIMs for a limited time following the entry into force of the WTO (two years in the case of developed country Members, five years for developing country Members, and seven years for least-developed country Members). The WTO investment site (link above) also covers TRIMs and click here for a more detailed background note (16kb).

OECD Investment Committee (formerly known as the Committee on International Investment and Multinational Enterprises (CIME)). Click here for more information - International Investment: About

The Investment Committee has the task of further developing and strengthening co-operation among Member countries in the field of international investment and multinational enterprises. It  is also responsible for OECD Guidelines for Multinational Enterprises. Although the European Commission participates in the meeting, the UK has direct input and there is no agreed EU position.

OECD Working Party on the Guidelines for Multinational Enterprises

This Working Party overseas the implementation of the Guidelines and associated issues such as outreach to non-OECD countries. The UK is an active participant in this Working Party. Further information is available on www.dti.gov.uk/worldtrade/ukncp.htm.

UNCTAD Trade and Development Board: Commission on Investment, Technology and Related Financial Issues

This UNCTAD Commission examines global trends in foreign direct investment (FDI) flows; the inter-relationships between FDI, trade, technology and development; and the development implications of a possible multilateral framework on investment. It also assists developing countries to promote inward investment and improve their investment climate. There is an agreed EU position, however individual EU member states are still able to make individual contributions.

Energy Charter Treaty

The Energy Charter Treaty obliges Contracting Parties to endeavour to accord non-discriminatory treatment to Investors of other Contracting Parties as regards the Making of Investments. This obligation is relevant for the 38 Contracting Parties who have ratified the Treaty and for the five Signatories applying the Treaty provisionally. An investment committee regularly meets to discuss investment regimes in developing countries and other investment issues relevant to the treaty. The EU does coordinate on certain issues in the meeting but member states are free to make their own contributions too.

Investment Promotion and Protection Agreements (IPPAs)

IPPAs are international bilateral agreements between governments, which can protect and encourage British investment overseas. They are more commonly known internationally as Bilateral Investment Treaties (BITs). The UK has concluded 101 IPPAs with other countries, of which 94 are in force.

IPPAs are designed to encourage investor confidence by setting high standards of investor protection applicable in international law. Key elements include provisions for equal and non-discriminatory treatment of investors and their investments, compensation for expropriation, transfer of capital and returns and access to independent settlement of disputes.

The Foreign & Commonwealth Office is the lead UK department for the negotiation of new IPPAs and IPPA policy in general. For further information please call FCO Economic Policy Department on 020 7270 2672.

Copies of UK IPPAs can be bought from the Stationery Office;

The Stationery Office Ltd
PO Box 29
Norwich
NR3 1GN

T: 0870 600 5522
F: 0870 600 5533
Email:
bookorders@theso.co.uk
Web:
www.clicktso.com

The full list of IPPAs is below:

Country

Date signed

Entry into force

Published text

Albania

30 March 1994

30 August 1995

TS(17) 1996 Cm 3072

Angola

04 July 2000

Not yet in force TS(01) 2002 Cm 5525

Antigua & Barbuda

12 June 1987

12 June 1987

TS (38) 1987 Cm 197

Argentina

11 December 1990

19 February 1993

TS (41) 1993 Cm 2278

Armenia

27 May 1993

11 July 1996

TS (102) 1996 Cm 3479

Azerbaijan

04 January 1996

11 December 1996

TS (19) 1997 Cm 3576

Bahrain

30 October 1991

30 October 1991

TS (21) 1992 Cm 1958

Bangladesh

19 June 1980

19 June 1980

Amended by E of N of 31 August 1981

TS (73) 1980 Cm 8013

Barbados

7 April 1993

7 April 1993

TS (54) 1993 Cm 2326

Belarus

1 March 1994

28 December 1994

TS (15) 1995 Cm 2768

Belize

30 April 1982

30 April 1982

Amended by E of N of 8 March 1983

TS (33) 1982 Cm 8631

Benin

27 November 1987

27 November 1987

TS (27) 1988 Cm 369

Bolivia

24 May 1988

16 February 1990

TS (34) 1990 Cm 1071

Bosnia and Herzegovina

02 October 2002

25 July 2003 TS(37) 2003 Cm 5973

Brazil

19 July 1994

not yet in force TS (01) 1997 Cm 3510

Bulgaria

11 December 1995

24 June 1997

TS (52) 1997 Cm 3748

Burundi

13 September 1990

13 September 1990

TS (11) 1991 Cm 3510

Cameroon

4 June 1982

7 June 1985

TS (40) 1985 Cm 9592

Chile

8 January 1996

21 April 1997

TS (37) 1997 Cm 3682

China

15 May 1986

15 May 1986

TS (33) 1986 Cm 9821

Colombia

09 March 1994

not yet in force

TS (01) 1994 Cm 2643

Congo

25 May 1989

9 November 1990

TS (85) 1994 Cm 2643

Coast Rica

07 September 1989

9 November 1990

TS (01) 1983 Cm 8767

Cote D’Ivoire

8 June 1995

9 October 1997

TS (78) 1997 Cm 3826

Croatia

11 March 1997

16 April 1998

TS (29) 1998 Cm 4013

Cuba

30 January 1995

11 May 1995

TS (50) 1995 Cm 2912

Czech & Slovak Republics

10 July 1990

26 October 1992

TS (42) 1993 Cm 2277

Dominica

23 January 1987

23 January 1987

TS (53) 1987 Cm 252

Ecuador

10 May 1994

24 August 1995

TS (18) 1996 Cm 3076

Egypt

11 June 1975

24 February 1976

TS (97) 1976 Cm 6638

El Salvador

14 October 1999

1 December 2000

TS (17) 2001 Cm 5085

Estonia

12 May 1994

19 December 1994

TS (30) 1995 Cm 2837

The Gambia

02 July 2002

Not Yet Into Force

TS (01) 2002 Cm 5602

Georgia

15 February 1995

15 February 1995

TS (41) 1995 Cm 2882

Ghana

22 March 1989

25 October 1991

TS (8) 1992 Cm 1804

Grenada

25 February 1988

25 February 1988

TS (33) 1988 Cm 381

Guyana

27 October 1989

11 April 1990

TS (47) 1990 Cm 1120

Haiti

18 March 1985

27 March 1995

TS (75) 1995 Cm 2973

Honduras

7 December 1993

8 March 1995

TS (34) 1995 Cm 2861

Hong Kong SAR

30 July 1998

12 April 1999

TS (9) 2000 Cm 4598

Hungary

9 March 1987

28 August 1987

TS (3) 1988 Cm 281

India

14 March 1994

6 January 1995

TS (27) 1995 Cm 2797

Indonesia

27 April 1976

24 March 1977

TS (62) 1977 Cm 6858

Jamaica

20 January 1987

14 May 1987

TS (28) 1987 Cm 168

Jordan

10 October 1979

24 April 1980

TS (52) 1980 Cm 7945

Kazakhstan

23 November 1995

23 November 1995

TS (30) 1996 Cm 3176

Kenya

13 September 1999

13 September 1999

TS (8) 2000 Cm 4597

Korea, Republic of

4 March 1976

4 March 1976

TS (45) 1976 Cm 6510

Kyrgyzstan

8 December 1994

18 June 1998

TS (7) 1999 Cm 4259

Laos

1 June 1995

1 June 1995

TS (95) 1996 Cm 3473

Latvia

24 January 1994

15 February 1995

TS (60) 1995 Cm 2944

Lebanon

13 March 1999

16 September 2001

TS(03) 2002 Cm 5358

Lesotho

18 February 1981

18 February 1981 Amended by No. 13 of 19 January 1983

TS (31) 1981 Cm 8246

Lithuania

17 May 1993

21 September 1993

TS (3) 1994 Cm 2455

Malaysia

21 May 1981

21 October 1988

TS (16) 1989 Cm 707

Malta

4 October 1986

4 October 1986

TS (62) 1986 Cm 20

Mauritius

20 May 1986

13 October 1986

TS (6) 1987 Cm 65

Moldova

19 March 1996

30 July 1998

TS (8) 1999 Cm 4260

Mongolia

4 October 1991

4 October 1991

TS (22) 1992 Cm 1959

Morocco

30 October 1990

14 February 2002

TS (07) 2003 Cm 5749

Nepal

2 March 1993

2 March 1993

TS (55) 1993 Cm 2327

Nicaragua

04 December 1996

21 December 2001

 

Nigeria

11 December 1990

11 December 1990

TS (66) 1991 Cm 1661

Oman

25 November 1995

21 May 1996

TS (99) 1996 Cm 3476

Pakistan

30 November 1994

30 November 1994

TS (24) 1995 Cm 2794

Panama

7 October 1983

7 November 1985

TS (14) 1986 Cm 9736

Papua New Guinea

14 May 1981

22 December 1981 Amended by E of N of 4 May 1983

TS (15) 1982 Cm 8506

Paraguay

4 June 1981

23 April 1992

TS (56) 1992 Cm 2026

Peru

4 October 1993

21 April 1994

TS (35) 1994) Cm 2631

Philippines

3 December 1980

2 January 1981

TS (7) 1981 Cm 8148

Poland

8 December 1987

14 April 1988

TS (26) 1988 Cm 365

Romania

19 March 1976

22 November 1976

TS (15) 1977 Cm 6722

Senegal

7 May 1980

9 February 1984

TS (54) 1984 Cm 9292

Sierra Leone

13 January 2000

20 November 2001

TS (17) 2002 Cm 5490

Singapore

22 July 1975

22 July 1975 Amended by E of N of 9 January 1978

TS (151) 1975 Cm 6300

Slovenia

3 July 1996

12 May 1999

TS (50) 1999 Cm 4225

South Africa

25 November 1997

27 May 1998

TS (35) 1998 Cm 4039

Sri Lanka

13 February 1980

14 January 1981

TS (14) 1981 Cm 8186

St Lucia

18 January 1983

18 January 1983 Amended by E of N 8 February 1984

TS (25) 1983 Cm 8872

Swaziland

5 May 1995

5 May 1995

TS (76) 1995 Cm 2967

Tanzania

7 January 1994

19 August 1996

TS (90) 1996 Cm 3453

South Africa

20 September 1994

27 May 1998

TS (35) 1998 Cm 1988

Soviet Union (Russia)

6 April 1989

3 July 1991

TS (3) 1992 Cm 1791

Sri Lanka

13 February 1980

18 December 1980 Amended by E of N of 14 January 1981

TS (14) 1981 Cm 8186

Thailand

28 November 1978

11 August 1979 Amended by E of N 27 September 1979

TS (99) 1979 Cm 7732

Tonga

22 October 1997

22 October 1997

TS (71) 1997 Cm 3800

Trinidad & Tobago

23 July 1993

8 October 1993

TS (78) 1993 Cm 2417

Tunisia

14 March 1989

4 January 1990 Amended by E of N of 21 May 1991 & 23 December 1992

TS (18) 1990 Cm 976

Tunisia No. 15

Turkey

15 March 1991

22 October 1996

TS (13) 1997 Cm 3545

Turkmenistan

9 February 1995

9 February 1995

TS (1) 1995 Cm 2976

Uganda

24 March 1998

24 April 1998

TS (33) 1998 Cm 4037

Ukraine

10 February 1993

10 February 1993

TS (24) 1993 Cm 2192

United Arab Emirates

8 December 1992

15 December 1993

TS (24) 1994 Cm 2535

Uruguay

21 October 1991

1 August 1997

TS (69) 1997 Cm 3795

Uzbekistan

24 November 1993

24 November 1993

TS (8) 1994 Cm 2475

Vanuata 22 December 2003    
Venezuela 15 March 1995 1 August 1996 TS (83) 1996 Cm 3423

Vietnam

1 August 2002

1 August 1996 TS (96) 2003 Cm 5748

Yemen Arab Republic

25 February 1982

11 November 1983

TS (79) 1983 Cm 9096

Zimbabwe

1 March 1995

not yet in force

TS (06) 2003 Cm 5748


Further Information

Andrew Dey
Tel: 020 7215 8420
Fax: 020 7215 4252
Email: andrew.dey@dti.gsi.gov.uk