Investment Codes

Abstract

Investment codes are standalone, unified codes with all rules relevant for inward foreign investment. This paper surveys their use and evolution. Investment codes have a two-fold purpose: to encourage foreign investment, and to maintain control over it. They typically reflect a compromise between control over and facilitation of foreign investment. On the one hand, they seek to insulate foreign investors from domestic policy change and political risk. On the other hand, they enable host countries to absorb foreign investment under a predictable framework provided by their domestic law.

Keywords: Investment Codes, foreign investment, protection, bilateral investment treaties, expropriation

JEL Classification: F21