4 Intellectual Property as Investment

Subject(s):

Intellectual property — Investment — Customary international law — Host state law

This chapter examines under what circumstances intellectual property (IP) rights constitute a covered investment entitled to protection under international investment law. It addresses the pivotal role played by the domestic IP law of the host state, as well as any choice of law issues. Based on the overarching notion of territoriality and host state’s law in determining which economic assets—particularly intangibles—are afforded legal protection, the book’s thesis is that only intellectual property rights recognized in the host state’s domestic legal order may constitute an investment within the meaning of an international investment agreement (IIA). The chapter then explores evolving treaty practice concerning the definition of ‘investment’ as it relates to intellectual property. The reference to intellectual property in IIAs as a form of asset or property that may qualify as a protected investment is long-standing and consistent in investment law treaty practice. The chapter also assesses whether IIAs can oblige contracting states to introduce new IP rights into their domestic legal orders if those rights are referenced as investments in the IIA.