LAWS6916 International Investment Law - Take-Home Assignment

Question 1:

1. You are an associate at a boutique law firm dedicated to advising multinational corporations and governments on issues of international investment law. The firm’s client, Big Oil Co Ltd (“BOC”), is a large Australian oil and gas company with subsidiaries having substantial business activities in China, Germany, New Zealand, Papua New Guinea, Singapore, and the United Kingdom. BOC is planning to make an investment in Egypt. The investment is to include, among other contributions, a USD 100 million loan to a joint venture company (“JVC”), which is to be incorporated in Egypt, and in which the other partner is a State agency of the Government of Egypt (“GOE”). The JVC will enter into a 40-year concession contract with the GOE (which is valued at USD 350 million), under which the JVC will agree to develop the oil and gas field and to be responsible for the construction of a 500km-long pipeline from the oil and gas field to Cairo. BOC will also agree to license its intellectual property rights to the JVC, and to buy government bonds from the GOE for USD 80 million (which the GOE has promised to re-invest in the JVC.) From the perspective of foreign investment protection, which subsidiary should BOC use as a vehicle to make the investment in Egypt? Please justify your answer.