In his last work entitled “The Conflict of the Faculties” (Der Streit Der Facultäten), published in 1798, Immanuel Kant made the ironic comment that those who speak of law, including lawyers, do not understand its exact meaning. One could in fact consider that those specializing in international investment law present a more serious case when speaking of “investment,” even if the identification of an investment by an arbitral tribunal tends to look to the ordinary meaning of the term. Indeed, after more than thirty years of ICSID case law, the true meaning of “investment” remains unclear, despite the fact that it remains so central to the discipline.
The reason for this is simple. As everyone acknowledges, Article 25 of the ICSID Convention does not provide any definition of investment. Bilateral investment treaties (“BITs”) generally do, but the definition varies from one BIT to another. General international law, for its part, has no universally accepted definition of this term. As there is no “objective” definition, one might choose to adopt a “subjective” approach that looks to the definition of investment found in the text of a BIT, which has been adapted to the specificity of the relationship between the contracting States. A number of authors and arbitrators nevertheless criticize this approach, arguing that a given BIT must be interpreted in the light of the rules and principles set forth in the ICSID Convention, including its Preamble.