Online Statements by National Investment Boards or Agencies and Their Potential Legal Effects

National investment boards or agencies operate in several countries with a view to attract foreign investment. Towards this objective, they often maintain websites highlighting the advantages of investing in their country. This article surveys some common categories of representations and promises made on the websites of national investment boards and discusses their potential legal implications. The article suggests that, under certain circumstances, such online statements may be viewed by tribunals as unilateral acts of states that create commitments under international law.

Unilateral acts of states and their value in international law

Various rulings of the International Court of Justice (ICJ), and its predecessor the Permanent Court of International Justice (PCIJ), have ackowledged that states can assume obligations on the international plane through unilateral statements.[1] In the Eastern Greenland case, the PCIJ held Norway to be bound by the ‘Ihlen Declaration,’ a statement by its Foreign Minister, in response to a query from a Danish diplomat, that Norway would not object to the Danish settlement of Greenland.[2]

Elaborating on the law in this regard, the ICJ stated in the Nuclear Tests case, with reference to the French statements that no further tests would be carried out in the South Pacific:

“It is well recognized that declarations made by way of unilateral acts, concerning legal or factual situations, may have the effect of creating legal obligations. Declarations of this kind may be, and often are, very specific. When it is the intention of the State making the declaration that it should become bound according to its terms, that intention confers on the declaration the character of a legal undertaking, the State being thenceforth legally required to follow a course of conduct consistent with the declaration. An undertaking of this kind, if given publicly, and with an intent to be bound, even though not made within the context of international negotiations, is binding. In these circumstances, nothing in the nature of a quid pro quo nor any subsequent acceptance of the declaration, nor even any reply or reaction from other States, is required for the declaration to take effect, since such a requirement would be inconsistent with the strictly unilateral nature of the juridical act by which the pronouncement by the State was made.”[3]

Distilling the key principles from the pronouncements of the ICJ and the PCIJ, the International Law Commission (ILC) has formulated a set of ‘Guiding Principles applicable to unilateral declarations of States capable of creating legal obligations.’[4] The ILC clarifies that “to determine the legal effects of such declarations, it is necessary to take account of their content, of all the factual circumstances in which they were made, and of the reactions to which they gave rise.”[5] Additionally, the ILC highlights the requirement that the statement must be made by an authority vested with the authority to bind the state internationally.

Against this background, it may be argued that statements made by national investment boards on their websites may, in certain circumstances, be categorised as unilateral acts/declarations of states and obligations may arise for the states concerned as a result. As recognized by the ICJ, “with increasing frequency in modern international relations other [natural or legal] persons representing a State in specific fields may be authorized by that State to bind it by their statements in respect of matters falling within their purview.”[6] As detailed below, the legal implications of online statements by national investment agencies depend on whether the statements are attributable to the state and whether the statement demonstrates an intention by the state to assume international obligations towards foreign investors/investment.

The effect of online statements – the experience so far

In Brandes Investment Partners v. Venezuela[7], the claimant attempted to source the consent of Venezuela for ICSID arbitration to statements published on the websites of various embassies of that country.[8] The arbitral tribunal rejected the submission and refused to construe these as a submission to ICSID jurisdiction. However, unfortunately the tribunal’s treatment of the issue was cursory and it did not supply reasons for this finding.[9] However, the fact that the tribunal examined the statements at issue in detail and did not dismiss them as inadmissible suggests that statements on websites may be an effective way of creating a commitment to submit to jurisdiction or a means of creating other commitments under international law.

A survey of statements by national investment board websites

A survey of the websites of various national investment boards identifies some of the representations and promises made to
investors in a bid to attract foreign investment. Below are the main categories of statements that appear on these websites along with examples for each:

1. General statements about economic conditions

Several national investment boards make statements on their websites about the state of the economy, growth projections, availability of labour and natural resources, infrastructure, growth projections, etc. Some examples are listed below:


National Investment Board Statement
Afghanistan Investment Support Agency « Afghanistan is a fast growing emerging market of strategic importance close to some of the largest and   fastest-growing markets in the world » »Afghanistan is rich in natural resources » »Even smaller investments may generate high profits in a short period of time. »“Security risk factors have been reduced to a manageable level in much of Afghanistan. The country has forged a new constitution and freely elected its president and parliament.”Statements on limited availability of   power, water, infrastructure, etc.
National Agency of Investment Development   (Algeria) Availability of natural resourcesEconomic stabilityAccess to regional marketsYoung and competitive work forceCompetitive production factors costsInfrastructureOpportunities for financing through public banks, investment funds & financial institutions
Prosperar (Argentina) “One of the fastest-growing countries worldwide: leader in Latin America for the past decade.”“Proven ability to sustain the economic growth cycle from the on-start of the global crisis, exceeding the average of   emerging countries.”
Board of Investment Bangladesh “Bangladesh offers a truly low competitive cost base. Wages and salaries are still lowest in the region, a strong business advantage. Yet this is an increasingly well-educated, adaptive and peaceful population with many skilled workers.”


2. General statements about the regulatory climate

Several national investment boards publish statements of a general nature on their websites about the legal and regulatory framework of the country. Some examples are provided below.

National Investment Board Statement
Afghanistan Investment Support Agency « The principles of a free market   economy are incorporated in the new Constitution {art. 10} just as the growth   of the private sector is a cornerstone of the National Development Strategy.   Consequently the President as well as the Government have focused intensely   on removing obstacles to private sector development. » »Afghanistan is still recovering   from a period of nearly three decades of war and devastation. Unsurprisingly,   many issues of state building still remain on the agenda. While the   international community helps with financial and technical assistance to push   for major reforms in many sectors, respective law-making has been slow. Much   of the legislation that will affect your business and is urgently needed to   foster investment and growth is still under discussion.”
Invest Barbados “Barbados has established a strong   regulatory framework for its international business sector. Clear and strong   legislation provides stringent guidelines for good governance which are in   turn enforced by regulators in each sector. Barbados’ approval by the OECD   speaks to the strength of this regulatory system.”
Investment Promotion and Major Works   Agency (Senegal) “L’attractivité   de la Destination Sénégal en termes d’investissement est soutenue par un   programme de réformes majeures de l’environnement des affaires décidées en   concertation avec les acteurs des secteurs public et privé concernés.”
National Investment Promotion Agency of   Mauritius “Commercial law in Mauritius is a   combination of the English Common Law and the French Code Napoléon.”“Employment rights and obligations in   Mauritius are now governed by the new Employment Right Act 2008. This relatively   new piece of legislation has been designed to cater for the needs of the   modern employment environment in Mauritius which now embodies a substantial percentage of foreign workers at all levels of the work stratum.”
Cyprus Investment Promotion Agency “Pro-business, based on common law »Accounting and Legal transparency”“The legal system is based on the U.K. Common Law principles and aligned with the EU laws and regulations (Acqui Communautaire).”


3. Specific statements on laws and regulations

Some national investment boards provide statements of a specific nature about certain laws and regulations. Some of them merely reproduce the text of existing laws in key areas of interest to the investors. Some examples are provided below.

National Investment Board Statement
Prosperar (Argentina) Provides an introduction to the employment law, tax law and environmental law with references to the titles   of legislations.
Board of Investment Bangladesh Provides links to various key national legislations
Investment Promotion and Major Works   Agency (Senegal) “Non, il n’existe pas de limite au rapatriement des bénéfices engendrés par une entreprise au Sénégal”.


4. Specific statements on incentives to investors

In certain cases, the websites of national investment boards provide details of incentives such as tax breaks available to investors. Some examples are listed below.

National Investment Board Statement
Prosperar (Argentina) Provides details of various sector specific, location specific, employment-related and other incentive schemes   for investors.
Board of Investment Bangladesh “Bangladesh offers some of the world’s most competitive fiscal non-fiscal incentives. BOI can advise further on this   matter.”Provides introductory details of: remittance of royalty, technical know-how and technical assistance fees;   repatriation facilities of dividend and capital at exit; permanent resident permits on investing US$ 75,000 and citizenship on investing US$ 500,000; tax holidays; depreciation allowance; cash and added incentives to exporting industries.
Malaysian Investment Development   Authority Provides sector-specific details of incentives available to the investors.
National Investment Promotion Agency of   Mauritius Also provides sector-specific details on investment incentives, such as a 50% annual allowance on declining balance for the purchase of electronic and computer equipment.
Kuwait Foreign Investment Bureau “1. What are the criteria for granting incentives under the current law for FDI projects?- Modern technology and administration as well as practical, technical   and marketing expertise.- Extending and activating the role of the Kuwaiti private sector.- Creating job opportunities for national labor force and training them.- Economic development plans and the targeted sectors.- Location”.
InvestHK (Hong Kong) Details of incubator programmes, loan guarantees and funds for marketing are provided.
Botswana Export Development and   Investment Authority Details of industrial rebate concessions,   general rebates, customs duty draw back facility, etc., are provided. For   example, the website states: “Machinery and equipment: All machinery and   equipment for purposes of manufacturing is imported duty-free.”


5. Statements about availability of international investment arbitration

In certain instances, statements on the websites of national investment boards deal with the availability of dispute settlement mechanisms including access to domestic courts or investment arbitration. Some examples are listed below:.

National Investment Board Statement
Algeria “An intensified protection and international arbitration agreements- Membership to international conventions   for the protection of investors, relating to guarantees and international arbitration.”
Invest Barbados “Barbados has entered into treaties for the promotion and protection of investment with Canada, China, Cuba, Germany, Italy, Mauritius, Switzerland, the UK and Venezuela. Investment treaties with the Belgium-Luxembourg Economic Union and Ghana are awaiting ratification.  Under these agreements, Barbadian entities   that invest in the other contracting state benefit from provisions offering protection including guarantees of non-discriminatory treatment of their investments, the transfer of investments and returns held in the host state and recourse to international arbitration to settle disputes with the host   state.”
General Investment Authority (Yemen) “In the event of any dispute between the investor and the government with regard to the project, the dispute may be referred to arbitration in accordance with the following rules:The arbitration rules and procedures of any national or regional approved arbitration center; orThe applicable arbitration rules and   procedures of the United Nations Commission on International Trade Law   (UNCITRAL)”.
Jordan Investment Board “At the international level, Jordan has acceded to numerous bilateral and multilateral investment treaties, many of   which provide for structured dispute settlement methods, such as the Treaty on the Settlement of Investment Disputes in the Arab Countries which provides for the settlement of disputes through conciliation and arbitration, and the   Treaty between Jordan and the Government of the United States of America on the Mutual Encouragement and Protection of Investment. Also, there is the Washington Convention on the Settlement of Investment Disputes.”
DR Congo Investment Promotion Agency “CIRDI membership (Investment Dispute Settlement   International Centre) based in Washington City ensures the settlement through arbitration of all disputes regarding investments in DRC”.


Legal effect of the statements

There are two key elements to determine the legal effect, if any, of statements by national investment boards on their websites. First, it will need to be determined whether the statements are attributable to the state in question so as to create international obligations binding on that state.[10] If the statement can be attributed to the state, then the statement needs to be interpreted in accordance with the principles applicable to unilateral declarations of states to determine its legal effect.

While dealing with the first aspect of this examination, the nature and domestic characterisation of the investment board in question, as well as the functions performed by it, attain a crucial role. Firstly, in accordance with the general rules of international law on attribution of responsibility to states[11], as codified in the ILC Articles on State responsibility, the conduct of all organs of a state are to be attributed to the state.[12] Accordingly, it will need to be examined whether a national investment board is part of the state machinery in such a manner as to warrant its classification as an organ of the state. If the investment board is a state organ, online statements by that board that consitute clear commitments under international law might be automatically considered as unilateral acts of the state to which the investment board is linked.

Secondly, the conduct of entities which are not organs of the state, but which exercise elements of governmental authority and are empowered by the state to do so, are also attributable to the state.[13] For instance, if the national investment board is in charge of the foreign investment policy of a state, one can deduce that the board in question is exercising some elements of governmental authority. Accordingly, an examination of the powers and functions exercised by the national investment board and the source of those powers will need to be examined in order to establish whether online statements by the said board can be considered as uniliateral commitments of the state where the board is operating.

Thirdly, the statement of the national investment board may also be attributable to the state if it can be established that the maintenance of the website or the making of the statement was de facto controlled or directed by the state[14] or that the state has acknowledged and adopted the statement as its own.[15]

Once the question of attribution is decided, one can proceed to determining the legal effects of a given statement which is attributable to a state.

Where the statements are of a specific nature, for example statements relating to incentives to investors, specific representations on legal provisions, or submission to investment arbitration, it may be argued that the statement amounts to a unilateral act which creates binding legal commitments for the state under international law. In such circumstances, the statement may be treated as a promise (i.e. a standing unilateral offer) that the state is obligated to uphold. In order to determine such a legal effect for an online statement by a national investment agency, one must examine its actual content as well as the circumstances in which it was made.[16] In other words, the online statement can create legal obligations “only if it is made in clear and specific terms”.[17]

General statements may, depending on the context, contribute to shaping the expectations of the investors.[18] Where these expectations are legitimate,[19] they may be protected through invocation of the fair and equitable treatment (FET) rule as current investment jurisprudence has highlighted.[20]

In both the cases, the language will need to be examined closely to determine whether the statement was of such a nature that, (i) the state’s intent to be bound by a commitment was expressed[21] and (ii) investors could reasonably base their expectations on the same. The general patterns of conduct followed by the state, representations by the state elsewhere, etc. could be relevant in making this determination.[22]


Investment arbitral tribunals are yet to develop a comprehensive jurisprudence on the legal effects of statements made by national investment boards on their websites in order to attract foreign investment. However, there is no logical ground to treat statements made on the internet any differently from statements made offline. Thus, whether a statement on the website of a national investment board creates international obligations for the state depends on whether (i) the statement is attributable to the state and (ii) whether the statement is of such a nature that it may qualify as a unilateral act binding the state under international law, when seen in its context.

National investment boards, in their zeal to woo foreign investors should not lose sight of these potential legal implications of the statements on their websites. Close attention needs to be paid to the content on such websites and the boards need to proceed with caution in this regard. Addition of adequate disclaimers or an advice to consult other official sources may be in order.

Authors: Makane Moïse Mbengue is an associate professor, Faculty of Law, at the University of Geneva and a visiting professor at Sciences Po Paris (School of Law). Deepak Raju (LL.M., University of Cambridge, 2013) is a former associate at Clarus Law Associates, New Delhi.

 [1] See M. M. Mbengue, “Investment National Legislation and Unilateral Acts of States”, in E. de Brabandere and T. Gazzini, International Investment Law. The Sources of Rights and Obligations, Martinus Nijhoff Publishers, 2012, pp. 183-214.

[2] Legal Status of Eastern Greenland (Norway v. Denmark) [1933] P.C.I.J. Ser. A/B, No. 53, p. 71.

[3] Nuclear Tests Case (New Zealand v. France), Judgment, I.C.J. Reports 1974, p. 472, para. 46.

[4] ILC, Guiding Principles Applicable to Unilateral Declarations of States Capable of Creating Legal Obligations, Yearbook of the International Law Commission, 2006, vol. II, Part Two (“Guiding Principles”).

[5] Ibid., Article 3.

[6] Armed Activities on the Territory of the Congo (New Application : 2002) (Democratic Republic of the Congo v.  Rwanda), Jurisdiction and Admissibility, Judgment, I.C.J. Reports 2006, p. 27, para. 47.

[7] Brandes Investment Partners, LP  v. The Bolivarian Republic Of Venezuela  (ICSID case No.Arb/08/3), Award, 2 August 2011.

[8] Ibid., para 50.

[9] The Tribunal merely stated in para. 100 of its award: “The Tribunal has analyzed those references thoroughly and has failed to find in them any express manifestation by the Respondent of its consent to ICSID jurisdiction”.

[10] As explained by the ICJ, “it is a well-established rule of international law that the Head of State, the Head of Government and the Minister for Foreign Affairs are deemed to represent the State merely by virtue of exercising their functions, including for the performance, on behalf of the said State, of unilateral acts having the force of international commitments” (Armed Activities on the Territory of the Congo (New Application : 2002) (Democratic Republic of the Congo v.  Rwanda), Jurisdiction and Admissibility, Judgment, I.C.J. Reports 2006, p. 27, para. 46). Thus, a national investment board is not generally deemed to represent a state and because of that it is necessary to prove on a case-by-case basis whether in the performance of a specific act it is representing or not a state.

[11] Generally, the law of state responsibility applies for the purpose of attribtuting an internationally wrongful act to a state, i.e. when a potential breach of international law by the said state is alleged by another state. However, we consider that the rules on attribution can be relevant and applicable in order to determine in which circumstances online statements by national investment boards can be qualified as unilateral commitments of a state as such.

[12] ILC, Responsibility of States for Internationally Wrongful Acts, Yearbook of the International Law Commission, 2001, vol. II, Part Two (“ARSIWA”), Article 4.

[13] ARSIWA, Article 5.

[14] ARSIWA, Article 8.

[15] ARSIWA, Article 11.

[16] See by analogy, Nuclear Tests (Australia  v. France), Judgment, I.C.J. Reports 1974, pp. 269-270, para. 51; Frontier Dispute (Burkina Faso/Republic of Mali), Judgment, I.C.J. Reports 1986, pp. 573-574, paras. 39-40.

[17] See by analogy, Nuclear Tests (Australia  v. France) (New Zealand  v. France), I.C.J. Reports 1974, p. 267, para. 43; p. 269, para. 51; p. 472, para. 46; p. 474, para. 53.

[18] See generally, International Thunderbird Gaming Corporation v. The United Mexican States, UNCITRAL, Separate Opinion of Professor Thomas Walde, para. 37 (December 2005); Saluka Investments BV (The Netherlands) v. The Czech Republic, UNCITRAL, Partial Award, para. 307 (17 March 2006); Abhijit PG Pandya and Andy Moody, ‘Legitimate Expectations in Investment Treaty Arbitration: An Unclear Future’ (2010–11) 15 Tilburg L Rev 93, 105.

[19] See generally, EDF (Services) Limited v. Romania, ICSID Case No ARB/05/13, Award, 8 October 2009, para. 219.

[20] Metalclad Corporation v. United Mexican States, ICSID Case No ARB(AF)/97/1, Award, 30 August 2000, paras. 37–59, 74–101.

[21] See generally, Anglo-Iranian Oil Co. Case (United Kingdom v. Iran), I.C.J. Reports 1952, p. 93.

[22] See generally, Pandya & Moody, supra note 9.