CYIL vol. 11 (2020)

CYIL 11 (2020) SOVEREIGN WEALTH FUND As the number of SWFs increases – indeed, SWFs have proliferated post-2000 44 – so this concern grows as well. This has to do with the suspicion that SWFs, arguably, “serve as a covert mechanism for extending (home) state power.” 45 Being state-owned, SWFs cause suspicion in the recipient countries. 46 Hence, the SWF is at the intersection of politics and investment. In fact, the SWF brings home the stark reality that sovereign investment in another sovereign’s jurisdiction has a political dimension notwithstanding the commercial and the technical appearance of the investment. 47 Most of the time, SWFs act as if they are pure commercial and financial actors in the private economic realm yet they face public intervention by the recipient national governments, who can restrain SWFs. Every recipient government decides for its own jurisdiction the eligibility of the investments made by foreign SWFs. For instance, in the U.S., all foreign government investments – including SWFs – can be blocked by the Committee on Foreign Investment in the United States for security reasons. 48 The Committee does this in the name of U.S. public interest and U.S. public security. This is U.S. public law. National public law has the authority to oversee, monitor and, if necessary, intervene in the actions of foreign SWFs. 5. Public law Public law comprises those relationships which are of direct concern to society 49 – they are concerned with public interest and public order. To protect the public interest, mandatory rules prevail. There is an unequal relationship, in that the state may oversee and ultimately overrule private actors and private transactions. Arguably, when a government acts, public law is at issue yet governments may behave as if they are private entities and individuals; a government may behave like a private corporation by engaging in financial and commercial transactions. This, however, would require the levelling of the field for the government to be on an equal footing with private corporations. The government which engages in commercial activities should not invoke sovereign immunity in foreign jurisdictions. Private law would (and should) be applied to the government which engages in commerce; as soon as a government behaves like a commercial entrepreneur, it exits the realm of public law and enters the domain of private law. As soon as a government enters into productive (and profitable) commercial relations, it becomes an entity equal to and not above or superior to private subjects. In brief, it can be argued that The Governance of Contemporary Sovereign Wealth Funds, Hastings Business Law Journal , vol. 6, no. 1, Winter 2010, p. 201. 44 GHAHRAMANI, Salar, Sovereign Wealth Funds, Transnational Law, and The New Paradigms of International Financial Relations , Yale Journal of International Affairs , Summer 2013, vol. 8, no. 2, pp. 53, 57. 45 CATA BACKER, Larry, Sovereign Wealth Funds as Regulatory Chameleons: The Norwegian Sovereign Wealth Funds and Public Global Governance Through Private Global Investment , Georgetown Journal of International Law , vol. 41, no. 2, 2010, p. 482. 46 GHAHRAMANI, Salar, Sovereign Wealth Funds, Transnational Law, and The New Paradigms of International Financial Relations , Yale Journal of International Affairs , Summer 2013, vol. 8, no. 2, pp. 57-58. 47 CATA BACKER, Larry, The Norwegian Sovereign Wealth Fund: Between Private and Public , Georgetown Journal of International Law, 40(4), p. 1272. 48 Accessible at https://home.treasury.gov/policy-issues/international/the-committee-on-foreign-investment-in- the-united-states-cfius (accessed on 02/04/2020). 49 MARTIN, Elizabeth A., Oxford Dictionary of Law , Oxford University Press, Oxford, 7th edition, 2003.

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