[DRAFT] On Investment Equity

[Naboompu]

Have submitted before. Looking primarily at feedback on how to make more palatable to the less financially-inclined...

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Wrote a draft on investment equity and investors' rights. Comments and suggestions primarily on questions of legality, but content, argumentation and style as well are still welcome. I've included a prospective telegram as well for reference.

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Telegram:

As you may already be aware, my nation Naboompu has drafted a resolution, “On Investment Equity”, which is currently on the proposal floor.

One of the biggest issues in real life today is that of broadening economic growth to emerging markets in order to reduce global economic inequality. While the World Bank plays a pivotal role in providing long-term loans to finance capital projects, it also recognizes its complementary role in facilitating private foreign investment. The most critical obstacle to said investment is not the level of the taxation and subsidisation but rather the heightened exposure for foreign investors to political and regulatory risks abroad. To address this issue in the Nation States universe, my nation has drafted this proposal.

This proposal addresses the issue of investment equity by (i) ensuring a minimum standard of fair and equitable treatment for foreign investors and (ii) tasking an existing committee to resolve disputes. It is my sincerest hope to have your support in bridging the investment gap.

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Resolution:

Category: Free trade
Strength: Significant

The World Assembly:

Noting that previous General Assembly legislation on investment equity has only given the International Securities and Exchange Commission (ISEC) jurisdiction on tradable securities (such as bonds and common stocks);

Also noting that said legislation has not tasked ISEC to establish any guidelines for other asset classes, including but not limited to financials (such as loans and other receivables), other tangibles (such as commodities and real estate) and intangibles (such as patents, trademarks and copyrights);

Also noting that ISEC lacks an enforcement mechanism even in the context of tradable securities;

Also noting that ISEC lacks an arbitration process through which foreign investors may bring forth proceedings, with a timely and impartial settlement, against foreign governments;

Concerned about the lack of provisions for the protection and security of foreign investments;

Also concerned that foreign investors may not be accorded as favourable treatment as domestic or other foreign national investors;

Recognizing the pivotal role of private foreign investment in financing capital projects and the heightened exposure for foreign investors to political and regulatory risks abroad;

Holding that investment equity for foreign and domestic investors alike is important in the interest of expanding access to foreign capital markets and broadening economic growth to emerging markets;

Hereby, subject to extant legislation, enacts:

1. The World Assembly, for the purposes of this resolution, defines:
   
   1. “investment” as any form of financial and/or intellectual capital allocation by individuals, firms and/or government agencies towards the acquisition, management and/or disposition of tangible and/or intangible assets;
   2. a “WA national investor” as any individual with citizenship/permanent residency in a member nation, or a firm registered therein, or a government agency therein, that engages in investment activity;
   3. a “foreign investor” as any individual, firm or government agency engaging in investment activity in a foreign nation.
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2. WA national investors are accorded no less favourable treatment than domestic or other foreign investors with respect to the original purchase and/or acquisition, the intermediate operating, investing and/or financing activity as well as the final sale and/or disposition of investments.
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3. Member nations, notwithstanding the stipulations in Clause 2, are excepted given that an investment concerns foreign ownership, control and/or influence of defence security services.
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4. WA national investors are provisioned with a minimum standard of fair and equitable treatment in accordance with international law to fully protect and secure their investments from immoderate political and/or regulatory risks, including but not limited to restrictions on both the transfer and convertibility of currency and/or other forms of capital.
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5. Member nations are expressly prohibited from directly and/or indirectly engaging in nationalisation, expropriation and/or any act tantamount to such of the investments of WA national investors, except in the cases where said engagement is neither disproportionate to that of domestic investment nor purposed to dilute foreign investment; and not without commensurate compensation.
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6. ISEC, under the authority of the World Assembly, is henceforth tasked to resolve disputes between WA national investors and member nations regarding these four previous enactments as follows:
   
   1. Through ISEC, foreign investor(s) may bring forth proceedings against foreign government(s);
   2. ISEC will first seek resolution to the dispute through non-binding arbitration;
   3. Should resolution not be forthcoming, ISEC will then timely and bindingly arbitrate on the extent and severity of the alleged violations as well as the proportionate compensation.

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[Kenmoria]

“This looks like a good concept, and surprisingly well-researched. I do have a suggestion though: see if you can use a committee instead of the IEC, as, for a non-major role, a different one that already exists would suffice.”

[Imperium Anglorum]

This may be relevant: viewtopic.php?p=31755370#p31755370

[Naboompu]

“This looks like a good concept, and surprisingly well-researched. I do have a suggestion though: see if you can use a committee instead of the IEC, as, for a non-major role, a different one that already exists would suffice.”

Thanks. It seems as if the International Securities and Exchange Commission (ISEC) already does this to some extent and so this bill has been revised to broaden their scope instead.

This may be relevant: viewtopic.php?p=31755370#p31755370

Thanks, this was very helpful. It not only brought to my attention ISEC, but it helped me put this bill into context of past WA legislation.

[Bears Armed]

OOC

]Noting that investment equity is limited in scope to tradable securities (such as bonds and common stocks) by the International Securities and Exchange Commission (ISEC);

As currently written, this line effectively depends on GAR#401 not having been repealed and thus is a bit iffy under the 'House of Cards' rule. I suggest modifying it to something more along the lines of

]Noting that the only aspect of investment equity over which previous WA legislation has given the International Securities and Exchange Commission (ISEC) any jurisdiction consists of tradable securities (such as bonds and common stocks);

and continuing from there...

[Naboompu]

OOC

]Noting that investment equity is limited in scope to tradable securities (such as bonds and common stocks) by the International Securities and Exchange Commission (ISEC);

As currently written, this line effectively depends on GAR#401 not having been repealed and thus is a bit iffy under the 'House of Cards' rule. I suggest modifying it to something more along the lines of

]Noting that the only aspect of investment equity over which previous WA legislation has given the International Securities and Exchange Commission (ISEC) any jurisdiction consists of tradable securities (such as bonds and common stocks);

and continuing from there...

Thanks for this, Bears Armed. I've revised the first four lines with regards to the possible rule violation you pointed out. Are there any other changes you might recommend?

[Bears Armed]

OOC

]Noting that investment equity is limited in scope to tradable securities (such as bonds and common stocks) by the International Securities and Exchange Commission (ISEC);

As currently written, this line effectively depends on GAR#401 not having been repealed and thus is a bit iffy under the 'House of Cards' rule. I suggest modifying it to something more along the lines of

]Noting that the only aspect of investment equity over which previous WA legislation has given the International Securities and Exchange Commission (ISEC) any jurisdiction consists of tradable securities (such as bonds and common stocks);

and continuing from there...

Thanks for this, Bears Armed. I've revised the first four lines with regards to the possible rule violation you pointed out. Are there any other changes you might recommend?

It looks good to me, now.. but I'd still wait for more opinions.
(Old NSUN GA saying: "Proposal drafting is a marathon, not a sprint".)

[Naboompu]

Thanks for this, Bears Armed. I've revised the first four lines with regards to the possible rule violation you pointed out. Are there any other changes you might recommend?

It looks good to me, now.. but I'd still wait for more opinions.
(Old NSUN GA saying: "Proposal drafting is a marathon, not a sprint".)

Thank you for your feedback.

[Kenmoria]

“Could you put line breaks between the active clauses please, to aid comprehension and readability? Also, definition almost always, if not always, go beneath the ‘Hereby’ line as they are ones that have a measurable effect on the proposal.”

[Naboompu]

“Could you put line breaks between the active clauses please, to aid comprehension and readability? Also, definition almost always, if not always, go beneath the ‘Hereby’ line as they are ones that have a measurable effect on the proposal.”

Thank you, Kenmoria , and fixed.

[Naboompu]

Added a preamble (prospective telegram) to help promote the bill in later stages. Thoughts and suggestions are as always welcome on all aspects.

[South Odreria]

I would be more comfortable approving this if there were broader allowances for national security concerns. A country could, for example, have valid reasons for not wanting a foreign government to buy up the military-industrial complex.

[Wallenburg]

"What is a national investor?"

[Naboompu]

I would be more comfortable approving this if there were broader allowances for national security concerns. A country could, for example, have valid reasons for not wanting a foreign government to buy up the military-industrial complex.

Thanks, South Odreria, for your feedback. See the updated version above.

"What is a national investor?"

I've changed the wording to "foreign investor" as opposed to "foreign national investor". Hope this clarifies things.

[Wallenburg]

"What is a national investor?"

I've changed the wording to "foreign investor" as opposed to "foreign national investor". Hope this clarifies things.

Clause 2 says otherwise.

[Imperium Anglorum]

Preamble is too long, nobody is going to read it.

[Naboompu]

I've changed the wording to "foreign investor" as opposed to "foreign national investor". Hope this clarifies things.

Clause 2 says otherwise.

Thanks Wallenburg for this. Have added a definition of WA national investor to clarify. If you have any other concerns, fire at will.

Preamble is too long, nobody is going to read it.

I'll try and shorten/simplify it when I have a little time.

[Naboompu]

*bump*

[Imperium Anglorum]

The preamble is still probably too long. I'll have more feedback at a later date. Lots of real life stuff now that the government is reopened.

[Araraukar]

Preamble (telegram):

OOC: That's not what preamble is. Preamble is everything in the proposal that comes before the active clauses.

[Elyreia]

Aside from cleaning up the "preamble" section noted, this legislation looks good. Elyreia has no major objections at this time aside from cleaning up the document to make it more presentable and intelligible. We recommend a concept of Occham's Razor when it comes to legislation - make it as short as needed for the desired effect and without sacrificing understanding, but not so bloated that people become disinterested.

[Naboompu]

Preamble is too long, nobody is going to read it.

Aside from cleaning up the "preamble" section noted, this legislation looks good. Elyreia has no major objections at this time aside from cleaning up the document to make it more presentable and intelligible. We recommend a concept of Occham's Razor when it comes to legislation - make it as short as needed for the desired effect and without sacrificing understanding, but not so bloated that people become disinterested.

Thanks to the two of you for your feedback. I've shortened the preamble to the resolution and I think it is now somewhat clearer than before. Any other thoughts?

Preamble (telegram):

OOC: That's not what preamble is. Preamble is everything in the proposal that comes before the active clauses.

Sure. It was perhaps a poor choice of words, but I deliberately called the prospective telegram a "preamble" and put it above the resolution proper, because I wanted to see what people's thoughts were about how the telegram described the proposed resolution. Anyhow...

[Araraukar]

OOC: Make the definitions active, numbered clauses. Meaning, instead of "defining", use "defines", and give them numbers, or put all definitions under one "defines" clause, with each separate definition as a subclause.

[Naboompu]

OOC: Make the definitions active, numbered clauses. Meaning, instead of "defining", use "defines", and give them numbers, or put all definitions under one "defines" clause, with each separate definition as a subclause.

Done.

[Naboompu]

*bump*

Thoughts and suggestions as I prepare to push this to the floor within the week...