The "principle of non-discrimination" : the protection of foreign investors under the Protection of Investment Act

Abstract

The Protection of Investment Act was assented to by the President of South Africa on 15 December 2015. The objective of this study is to ascertain if the Act adequately protects foreign investors in terms of the World Trade Organisation's principle of non-discrimination. The study begins with an introduction to the history and legal implications of the World Trade Organisation. It establishes the binding nature of the non-discrimination principle to the South African legal system and the consequent obligation to ensure non-discriminatory practices in the investment law regime adopted by South Africa. The Act is accordingly critically discussed in the context of the provisions concerning, fair administrative treatment, the right to establishment, national treatment and the effect of the regulation of security of investments. Elements of these provisions give rise to possible negation of the non-discrimination principle. These elements are based predominantly on nationalistic and ultimately protectionist considerations. They are contained in several qualifications established with regards to provisions dealing with non-discriminatory practice in terms of the Act. Recommendations are subsequently made with regards to ways in which to lessen the potential of the Act to be used for promulgating discriminatory practices. The recommendations made include the establishment of checks and balances in relation to the states' right to regulate investment. This is useful in quelling the promotion of protectionist measures within the South African investment regime at the expense of foreign investor protection.