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Antony Anghie, Deutsche Bank AG v Democratic Socialist Republic of Sri Lanka: ‘All that is Solid Melts into Air’ , ICSID Review - Foreign Investment Law Journal, Volume 30, Issue 2, Spring 2015, Pages 356–364, https://doi.org/10.1093/icsidreview/siv011
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I. INTRODUCTION
The broad framework of debate surrounding the meaning of ‘investment’ in ICSID jurisprudence is by now fairly clear, even if the issue, which has generated a large literature, remains unsettled. Broadly, however, it is agreed that ‘investments’ are protected whereas simple contractual rights are not. In Deutsche Bank AG v Democratic Socialist Republic of Sri Lanka, the Tribunal held that a derivative instrument, a hedging agreement, constituted an ‘investment’. The decision raises interesting and important inter-related issues. First, it raises the question of how complex financial instruments, derivatives and hedging agreements, might be characterized within the system of international investment arbitration. Second, it suggests that no nexus needs to exist between ‘investments’ and ‘development’. Third, the Tribunal’s somewhat casual treatment of the specific language of the treaty raises questions about treaty interpretation and the importance of consent to the entire foundation of international investment arbitration. This Comment outlines the facts of the dispute, the reasoning of the majority and the detailed dissent.
