4 Securing and Maintaining the Investment: Implicit Good-Faith Requirements in the Definition of Investment

Subject(s):

Investor — Full protection and security — Good faith — Corruption claim

This chapter examines how the definition of ‘investment’ is informed by references to good faith by analysing ‘investment’ at the various stages of the process of securing and maintaining an investment. It first reviews a number of cases that support the idea that in order to benefit from a bilateral investment treaty, the investment must have been secured as well as maintained in good faith. In particular, it looks at bilateral investment treaties that either offer liberal protection to investors or restrict that protection. It also considers cases of corruption relating to the issue of securing the investment and goes on to show that investment tribunals may view the issue of maintaining the investment as an issue of merits, whereas securing the investment is a preliminary, jurisdictional matter. The chapter concludes with a discussion of the advantages and disadvantages of incorporating good faith into the requirement of investment.