THE PROMOTION AND PROTECTION OF INVESTMENT BILL IS IN LINE WITH GLOBAL TRENDS

THE PROMOTION AND PROTECTION OF INVESTMENT BILL IS IN LINE WITH GLOBAL TRENDS

The Promotion and Protection of Investment Bill affirms the country’s sovereign right to regulate in the public interest and pursue its broad transformational agenda. This is according to the Deputy Director-General of International Trade at the Department of Trade and Industry (the dti), Ms Xolelwa Mlumbi-Peter. She was presenting the Bill to the Portfolio Committee on Trade and Industry and the Select Committee on Trade and International Relations in Parliament, Cape Town today.

The primary objectives of the Bill are to clarify the level of protection that an investor may expect in South Africa and to further ensure that South Africa remains open to foreign investment.

Ms Mlumbi-Peter said the Bill follows a comprehensive review of the Bilateral Investment Treaties (BITs) and the risk associated with these.

“In addition, the Bill clarifies the BITs-type provision in a manner that is consistent with the South African Constitution. The Bill has been introduced at the opportune time given that such introduction of legislation is in keeping with global trends. This Bill contains the standards of protection applicable to investments whilst ensuring alignment to the South African Constitution and other applicable domestic legislation,” she said.

Mlumbi-Peter added that the international investment law concepts such as national treatment, protection and security, protection of property and the transfer of funds in line with constitutional principles and applicable norms are reflected in the Bill.

“Such provisions do not interfere with the protection afforded to investors under the existing BITs which would continue to prevail until expiration. The Bill confirms the investors’ right to make use of any legal avenue available in the South African legal system to enforce their rights. In addition, the Bill also provides for a state-state dispute settlement mechanism after exhaustion of the domestic remedies,” stated Mlumbi-Peter.

At a recent Portfolio Committee on Trade and Industry seminar, the United Nations Conference on Trade and Development (UNCTAD) endorsed the Bill and confirmed that the proposed legislation was timely and in line with global trends. UNCTAD’s Director of Investment and Enterprise, Mr James Zhan, re-affirmed that South Africa’s stance on the introduction of such legislation would achieve the appropriate balance of rights and obligations between investors and the state. He further emphasised that the Bill includes a dispute avoidance mechanism through mediation which is an innovative mechanism to deal with concerns of investors. 

The public participation process will be held for the duration of September wherein stakeholders’ submissions will be considered and deliberations thereto will be held by the relevant Parliamentary Committees.