Performance Requirements and the BITs of Bangladesh and Malaysia: A Comparison

Abstract

In absence of any global treaty, the BITs are playing an important role of regulating FDI in the host countries. According to UNCTAD, 2361 BITs are in force and like other members of the WTO, both Bangladesh and Malaysia also signed their BITs to facilitate trade. The primary purpose of economic globalization is the economic development of the developing and least-developed countries as well as the facilitation of benefits of the home states. In this article, the BITs signed between Bangladesh- Malaysia and by both Bangladesh and Malaysia with the same countries shall be analysed. The findings of this study will show that both Bangladesh and Malaysia BITs has provisions of protecting FDI but has no specific reference to performance requirements (except Malaysia-Germany BIT). This is significant because without written regulations, it will be difficult to take legal action against the MNEs. Therefore, the government should emphasize on this important factor while signing any future BITs. Recommendations are provided for consideration.