SOUTH AFRICA’S DRAFT PROMOTION AND PROTECTION OF INVESTMENT BILL

The South African Institute of International Affairs (SAIIA) critiques the draft Promotion and Protection of Investment Bill 2013, arguing that while it seeks to create regulatory space for socio-economic transformation, several provisions deviate from international standards. Key concerns include the subjective nature of 'public interest' and 'just and equitable' compensation for expropriation, the lack of clarity in investment screening processes, and the potential for 'denial of justice' due to the bill's subordination of customary international law to the South African Constitution. SAIIA suggests that these ambiguities may undermine foreign investor confidence, particularly following South Africa's decision to terminate bilateral investment treaties (BITs).

• The bill's reliance on the principle of 'public interest' is problematic because the term lacks a statutory definition, which could lead to arbitrary government actions and a lack of transparency for foreign investors.
• The interpretation clause potentially conflicts with international law by subjecting customary international law to the South African Constitution, which may expose the state to international challenges for denial of justice.
• The proposed investment screening process in Sections 5 and 6 is overly broad and lacks procedural detail, failing to specify which institutions will conduct examinations or the exact thresholds that trigger investigations.
• The bill's standard for expropriation compensation—'just and equitable'—is viewed as state-centric and subjective compared to the international 'Hull formula' of 'prompt, adequate and effective' compensation based on market value.
• Section 8(2) of the bill contains provisions that contradict customary international law by claiming that certain public policy measures or the lack of state ownership of acquired property mean an action is not expropriatory.
• The dispute resolution framework is criticized for lacking a clear hierarchy of local tribunals and for referencing the outdated Arbitration Act of 1965, which primarily governs commercial rather than investment arbitration.

APA

South African Institute of International Affairs (n.d.). SOUTH AFRICA’S DRAFT PROMOTION AND PROTECTION OF INVESTMENT BILL. https://saiia.org.za/wp-content/uploads/2015/05/SAIIA-Submission-Investment-protection-and-promotion-bill.pdf

Chicago

South African Institute of International Affairs. SOUTH AFRICA’S DRAFT PROMOTION AND PROTECTION OF INVESTMENT BILL. n.d. https://saiia.org.za/wp-content/uploads/2015/05/SAIIA-Submission-Investment-protection-and-promotion-bill.pdf.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=SOUTH AFRICA’S DRAFT PROMOTION AND PROTECTION OF INVESTMENT BILL |url=https://saiia.org.za/wp-content/uploads/2015/05/SAIIA-Submission-Investment-protection-and-promotion-bill.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairsndsouth, author = {{South African Institute of International Affairs}}, title = {{SOUTH AFRICA’S DRAFT PROMOTION AND PROTECTION OF INVESTMENT BILL}}, institution = {South African Institute of International Affairs}, url = {https://saiia.org.za/wp-content/uploads/2015/05/SAIIA-Submission-Investment-protection-and-promotion-bill.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }