The South African government has published a Position Paper reviewing bilateral investment treaties (BITs) entered into by South Africa. The review was partly prompted by BIT arbitral proceedings initiated against South Africa in cases like Piero Foresti, Laura de Carli and Others v. Republic of South Africa (ICSID Case no. ARB (AF)/07/1). That case concerns claims that South Africa’s post-apartheid mining rights legislation, which is intended to increase the mining participation of historically disadvantaged South Africans, amounts to expropriation, without providing adequate compensation.

In the review, the government states that it wants to demonstrate that South Africa is an investment friendly destination but it is concerned that existing BITs are based on a fifty year old model that is focused too much on the interests of investors from developed countries. It maintains that important issues of concern for developing countries are not being addressed. It believes that many BITs extend too far into developing countries' policy space without preserving sufficient flexibility in critical policy areas. It is also concerned that arbitral panels play too active a role in the implementation and interpretation of BITs.

In common with various other countries, the government is reviewing its BIT regime in order to ensure that foreign direct investment encourages and enhances sustainable development. The position paper states that revised BITs will go a long way to resolving many of the critical problems which the present BITs create.

Many of South Africa's BITs expire in the near future and external parties can expect a tougher set of negotiations for their renewal than for their initiation.