Abstract
This paper critically examines provisions of intellectual property on multilateral and bilateral foreign investment treaties and the impact of intellectual property rights on the determination of types of foreign direct investment in the twenty-first century. It looks at China and India in particular, as countries that are attracting foreign direct investment much more than any other developing countries. It further comparatively and critically analyses current trends in foreign investment, current priority sectors of foreign investment and the effect and impact of intellectual property right protection on the determination of types and sectors for foreign investment.
The author would like to thank Professor Mark Perry for a Postdoctoral Fellowship, the Beijing Foreign Studies University Law School and University of New England School of Law (Australia) for inviting him at to an international intellectual property conference, and the Services Group/AECOM International Development for providing him with an advisory position (2006–2008).
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Notes
- 1.
GATT article III:4: “The products of the territory of any contracting party imported into the territory of any other contracting party shall be accorded treatment no less favorable than that accorded to like products of national origin in respect of all laws, regulations and requirements affecting their internal sale, offering for sale, purchase, transportation, distribution or use….”
- 2.
GATT article XI:1: “No prohibitions or restrictions other than duties, taxes or other charges, whether made effective through quotas, import or export licenses or other measures, shall be instituted or maintained by any contracting party on the importation of any product of the territory of any other contracting party or on the exportation or sale for export of any product destined for the territory of any other contracting party.”
- 3.
Trade-related investment measures includes those which “require:” “(a) purchase or use by an enterprise of products of domestic origin or from any domestic source…[i.e. domestic content requirements]; or (b) that an enterprise’s purchase or use of imported products be limited to an amount related to the volume or value of local products that it exports [i.e. trade balancing requirements].”
- 4.
Trade-related investment measures includes those which “restrict:” “(a) the importation by an enterprise of products used in or related to its local production, generally or to an amount related to the volume or value of local production that it exports; (b) the importation by an enterprise of products used in or related to its local production by restricting its access to foreign exchange to an amount related to the foreign exchange inflows attributable to the enterprise; or (c) the exportation or sale for export by an enterprise of products….”
- 5.
Regarding GATT exceptions, there is provision of waiver of obligations under GATT article XXV, which authorises the Contracting Parties in exceptional circumstances to waive their Agreement obligations. Likewise, balance-of-payments exception is available under GATT article XII which allows the Member state to introduce quotas in order to safeguard its external financial position and its balance of payments. GATT article XXIV of the provides that custom union and free trade area can deviate from their most favoured nation obligations under GATT article 1. The Escape Clause under GATT articles XIX (1)(a)-(b) of is a safeguard designed against imports. It allows the Member to suspend its obligations under GATT if as a result of unforeseen development and of the effect of a certain GATT obligation, any product is being imported in such quantities and in such conditions that it causes or threatens serious injury to domestic producers or directly competitive products. GATT article XX set forth a list of general exceptions, i.e. protection of human health, animal or plant life, etc., compelling circumstances that are deemed to override the interests and benefits of unrestrained international trade. GATT article XXI provides that GATT shall not apply in case of compelling interests of national security.
- 6.
Covered in part by GATTS article XVI, unless otherwise specified in the schedule of Commitments. GATTS article XVI, Market Access: “2. […] the measures which a Member shall not maintain or adopt, […] are defined as …limitations on the participation of foreign capital in terms of maximum percentage limit on foreign shareholding or the total value of individual or aggregate foreign investment.”
References
Akyuz, Yilmaz. 2015. Foreign direct investment, investment agreements and economic development: Myths and realities. Switzerland: South Center.
Avramovich, Michael. 1998. The protection of international investment at the start of the twenty-first century: Will anachronistic notions of business render irrelevant the OECD’s multilateral agreement in investment? John Marshall Law Review 31: 1201–1278.
Burt, Eric M. 1997. Developing countries and the framework for negotiations on foreign direct investment in the World Trade Organisation. American University International Law Review 12(6): 1015–1061.
Chow, Daniel C. 2015. Why China wants a bilateral investment treaty with the United States. Boston University International Law Journal 33: 101–138.
Chow, Daniel C., and Thomas J. Schoenbaum. 2010. International business transactions: Problems, cases and materials. Netherlands: Aspen Publishers.
Cirlig, Carmen-Christina. 2014. Overcoming transatlantic differences on intellectual property. Strasbourg: European Union.
Edwards, Robert H., and Simon N. Lester. 1997. Towards a more comprehensive world trade organisation agreement on trade related investment measures. Stanford Journal of International Law 33:169–214.
GATT Panel. 1984. Canada: Administration of the Foreign Investment Review Act. Geneva: WTO.
Guzman, Andrew T. 1998. Why LDCs sign treaties that hurt them: Explaining the popularity of bilateral investment treaties. Virginia Journal of International Law 38: 639–688.
Investment Issues Analysis Branch. 2006. Investment brief, Number 4. Geneva: UNCTAD.
Javorcik, Beata Smarzynska. 2007. Foreign direct investment, technology transfer and protection of intellectual property rights. Geneva: UNCTAD.
Jin, Xiao, and Jiang Ke. 2015. A Chinese perspective: Africa-China bilateral investment treaties. http://www.kwm.com/en/uk/knowledge/insights/bilateral-investment-treaties-20150316. Accessed 22 Nov 2015.
Liberti, Lahra. 2010. Intellectual property rights in international investment agreements: An overview. Paris: OECD.
Okediji, Ruth L. 2006. The international copyright system: Limitations, exceptions and public interest considerations for developing countries. Geneva: ICTSD.
Okediji, Ruth L. 2014. Is intellectual property “Investment”? Eli Lilly v. Canada and the international intellectual property system. University of Pennsylvania Journal of International Law 35(4): 1121–1138.
Owen, Michael. 2007. Address to the Indo-American chamber of commerce on intellectual property rights. Paper presented at the World Economic Forum, Mumbai.
Rowthorn, Robert. 2006. The renaissance of China and India: Implications for the advanced economies. Geneva: UNCTAD.
Sahin, Aylin Akturk. (2014). Philip Morris vs. Uruguay: Intellectual Property Debate in International Investment Arbitration. The Bolt. 7 November 2014. http://btlj.org/2014/11/philip-morris-vs-uruguay-intellectual-property-debate-in-international-investment-arbitration/. Accessed 4 May 2016.
Shenkin, Todd. 1994. Trade related investment measures in bilateral investment treaties and the GATT: Moving toward a multilateral investment treaty. University of Pittsburgh Law Review 55: 541–606.
Singh, Madhyam Kavaljit. 2015. The India-US bilateral investment treaty will not be an easy ride. http://www.eastasiaforum.org/2015/02/10/the-india-us-bilateral-investment-treaty-will-not-be-an-easy-ride/. Accessed 22 Nov 2015.
Smarzynska, Beata H., and Shang-Jin Wei. 2000. Corruption and composition of foreign direct investment: Firm-level evidence. Cambridge: National Bureau of Economic Research.
Sornarajah, Muthucumaraswamy. 1994. The international law of foreign investment. Cambridge: Cambridge University Press.
Udenze, Onyinye. 2014. The effect of corruption on foreign direct investments in developing countries. The Park Place Economist 22: 87–95.
UNCTD. 2007. Intellectual property provisions in international investment arrangements. Geneva: UNCTD.
United Nations. 2006. World Investment Report 2006: FDI from developing and transition economies. Geneva: United Nations.
United Nations. 2015. World Investment Report 2015: Reforming international investment governance. Geneva: New York.
US-China Business Council. 2014. Bilateral investment treaties: What they are and why they matter. https://www.uschina.org/reports/bilateral-investment-treaties-what-they-are-and-why-they-matter. Accessed 22 Nov 2015.
Vandevelde, Kenneth J. 2000. The economics of bilateral investment treaties. Harvard International Law Journal 41(2): 469–502.
Voon, Tania S., Andrew D. Mitchell, and James Munro. 2014. Intellectual property rights in international investment agreements: Striving for coherence in national and international law. In International economic law after the crisis: A tale of fragmented disciplines, ed. CL Lim, and Bryan Mercurio. Cambridge: Cambridge University Press.
Weber, Jorg. 2001. Existing proposals on bilateral and multilateral investment agreements and practices towards codes of conduct on TNCs and government with respect to FDI: UNCTAD-Civil society dialogue on selected development issues being addressed by the United Nations System. Geneva: UNCTAD.
White House. 2015. US-India joint statement: Shared effort—progress for all. https://www.whitehouse.gov/the-press-office/2015/01/25/us-india-joint-statement-shared-effort-progress-all. Accessed 22 Nov 2015.
Acknowledgement
The author would like to thank Professor Mark Perry for a Postdoctoral Fellowship, the Beijing Foreign Studies University Law School and University of New England School of Law (Australia) for inviting him at to an international intellectual property conference, and the Services Group/AECOM International Development for providing him with an advisory position (2006–2008).
Author information
Authors and Affiliations
Corresponding author
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2016 Springer International Publishing Switzerland
About this chapter
Cite this chapter
Karky, R. (2016). Intellectual Property Rights and Foreign Direct Investment Agreements. In: Perry, M. (eds) Global Governance of Intellectual Property in the 21st Century. Springer, Cham. https://doi.org/10.1007/978-3-319-31177-7_12
Download citation
DOI: https://doi.org/10.1007/978-3-319-31177-7_12
Published:
Publisher Name: Springer, Cham
Print ISBN: 978-3-319-31176-0
Online ISBN: 978-3-319-31177-7
eBook Packages: Law and CriminologyLaw and Criminology (R0)