President signs law to protect foreign investment
President Asif Ali Zardari signs the Arbitration (International Investment Disputes) Bill 2011” into law on Thursday. PHOTO: SANA
With thanks : Tribune
Islamabad : In a major move to reassure international investors about security of their investment, President Asif Ali Zardari on Thursday signed “Arbitration (International Investment Disputes) Bill 2011” into law.
At a ceremony held at the Aiwan-e-Sadr, Zardari said, “This is a giant leap forward to create confidence in foreign investors and bring transparency in the settlement of investment disputes.”
Zardari expressed hope that the new law would prove instrumental in attracting foreign direct investment and further improve investment climate in the country. The government has already announced liberal incentives for foreign and local investors, he added.
Arbitration (International Investment Disputes) Bill 2011 was passed by the National Assembly on November 5, 2010 and the Senate on April 1, 2011.
President’s spokesperson Farhatullah Babar said that the government has already signed and ratified an international convention on settlement of investment disputes between states and their nationals. Domestic legislation was a pre-requisite for benefiting from the provisions of the convention, he said.
The convention envisages establishment of an international centre for settlement of investment disputes under the auspices of the World Bank. It also envisages constitution of a reconciliation commission and arbitration tribunal.
Any contracting state may renounce the convention through a written notice to the depository of the convention which will take effect six months after the receipt of such notice. The jurisdiction of the centre extends to any legal dispute arising directly out of an investment between a contracting state and a national of another contracting state.
The spokesperson said that with this new legislation, a major disincentive for foreign investors had been removed, who would now feel reassured to invest in Pakistan.
He said that the law was part of the president’s plan to offer incentives to address the country’s economic and investment problems. Incentives for expatriate Pakistanis had already resulted in increasing foreign remittances from a little over $6 billion in 2007 to an expected $11 billion this year, he added.
Published in The Express Tribune, April 29th, 2011.