African Union law and the AfCFTA protocol on investment

In February 2023, the AU Assembly adopted three legal instruments, which are part of Phase II negotiations in the process towards creating an African Continental Free Trade Area (AfCFTA), one of the cornerstones of AU law and African economic integration: the Protocol on Intellectual Property Rights, the Protocol on Competition Policy and the Protocol on Investment, all attached to the Agreement Establishing AfCFTA. The Chapter focuses on the latter Protocol, which should prove to be of immense significance given that Africa is in dire need of greater flow of investments to foster economic growth and sustainable development.
The Protocol on Investment aims at establishing a balanced, transparent and mutually advantageous continental framework of principles and rules for the promotion, protection and liberalisation of foreign investment as well as for the prevention and resolution of investment disputes. In short, to create an attractive investment climate in Africa conducive to the development of partnerships and a more dynamic private sector. When fully implemented, the Protocol will introduce common rules and norms across the continent that will regulate, among others, expropriation, business ethics, human rights, labour standards, and environmental protection, therefore developing even further the content of AU law.
The Chapter examines the AU’s competence in the area of foreign investment law, within the parameters of the Constitutive Act and the broader legal system of the AU. In particular, it argues that the Constitutive Act affords to the AU a central role in the continent’s economic integration, which of course includes the development of an African investment law.
Based on the AU’s obligation to integrate Africa economically and in terms of its competence in international investment law, the Chapter concludes that the AU has become a global actor in transforming foreign investment law, providing coherence and ensuring the necessary legal certainty.