Legal Approach For Ameliorating The Mechanism Of Oversea Investment Insurance In China

Oversea investment insurance is the mechanism that the domestic insurance institutions indemnifies, subject to the capital-exporting country providing the insurance or guarantee in favor of the national investors against the political risks likely to occur to the investment oversea thereby and the above investors applying to, especially obtaining the ratification from, domestic investment insurance institution, the national investors against the damages actually suffered from the political risks under the coverage of the ratified insurance. Oversea investment insurance is provided and guaranteed by the government, substantially some kind of"State Guarantee", with the distinct characteristics of the typical policy-orientation and non-profit-orientation. Oversea investment insurance's coverage only limits to political risks, mainly including the insurance against foreign exchange rate, expropriation, war etc., without against general commercial risks and natural disasters. Originating from USA and developing to date, oversea investment insurance has formed into bi-lateral, unilateral and combinatory modes respectively represented by USA, Japan and Germany.Since the past investment law in China is oriented by the import of investment from oversea, oversea investment insurance mainly caters for and matches with oversea investment insurance mechanism of capital-exporting country. In recent years, oversea direct investment of China has increased dramatically in terms of the quantity of investing enterprises and investment scale, especially the investment scale in developing countries. To be worthy of attention, developing countries is far more likely to occur the political risks than developed countries. In this sense, day by day looms the urgency to establish the oversea investment insurance mechanism more perfect and practical on the basis of the reality of China. At present, Sinosure sponsored by the government of China is in charge of oversea investment insurance, which currently covers expropriation, restriction of exchange, war and breach of government. In the past few years, oversea investment insurance, favored by the great function of investment insurance and governmental strong support, oversea investment insurance has achieved the eye-striking feats in practice. However, from the general perspective, oversea investment insurance stays in rudimental stage at present, where plenty of supposed functions have not been established and performed. At present in oversea investment insurance mechanism exists various problems such as legislative vacancy in relevant domestic law, SINOSURE being the sole insurer in charge of the ratification of insurance, deficiency in legal institution connecting and matching MIGA, overly expensive premium, scarce institutional bulwark in relation to the performance of subrogation. Therefore, the writer hereby takes careful legal approach, after referencing a number of articles and documents and collating the modes of oversea investment insurance prevalent in USA, Japan and Germany, and analyzes in detail furthering to some specific ameliorative suggestions, which can hopefully do good to the mechanism of oversea investment insurance for further amelioration in order to better escort oversea investment by national investor.This article consists of six parts. First part is preamble describing the current developing status of oversea investment of China and stressing the importance of oversea investment insurance in the protective system of oversea investment insurance. Second part is the overview of the mechanism of oversea investment insurance introducing the concept, feature, functions and historic development and the mutual relationship with international convention. Third part respectively introduces the practice of oversea investment insurance in USA, Japan and Germany and analyzes the long and short thereof. Fourth part introduces as an emphasis the practice of oversea investment insurance in China and specifically analyzes the achievements and problems. Fifth parts raises, on the basis of comprehensive analysis and detailed legal approach, the analysis and suggestion on the amelioration of the mechanism of oversea investment insurance in China, specifically on the completion in the soonest of specific legislation, the variation of current mode of ratification and insuring institution, specific practice of ameliorating oversea investment insurance, reinforcing the cooperation with multi-lateral investment guarantee institution and ICSID, practicing the specific investment dispute settlement mechanism etc., which hopefully can provide some reference to perfect oversea investment insurance in China.