The Definition Of Investment And The Icsid Convention: Matters Arising Under The Nigerian Investment Promotion Act And International Investment Law

Abstract

This article contends that the omission to define investment in the Convention
on the Settlement of Investment Disputes between States and Nationals of
Other States (the ICSID Convention) has a trickledown effect on the Nigerian
Investment Promotion Act (the NIPC Act), in the context of investment treaty
law and arbitration. Its greatest impact is the relegation of the contribution
to economic development element of the definition of “investment” to a backseat
contrary to the purpose of the ICSID Convention. This article proposes a
simple thesis: the omission to define investment in the ICSID Convention has
fostered an amorphous definition of investment under the NIPC Act, thus
creating uncertainty, irrelevance and ambiguity. The uncertainty is a potential
problem in the conduct of foreign direct investment under the ICSID
Convention. The article recommends a review of the definition of “investment”
under the Act and the adoption of a definition that restricts foreign investment
within the territory of Nigeria and makes a contribution to economic
development its core element in line with the fundamental objective of the
ICSID Convention.