Sovereign Wealth Funds as Participant of International Capital Market: Legal Issues

This article analyses sovereign wealth funds (SWFs) as a new vehicle for active participation of states in international capital flows. As well as multinational corporations, SWFs cannot be recognized as the subjects of international law, and the governments should not provide them with sovereign immunity.The rapid growth of SWF investments in economies of developed states causes reasonable concern of host-countries. In Russia this concern became the basis to forbid foreign governments to acquire control over business entities of strategic importance for national defense and state security. For these purposes the criterion of origin of capital is considered as effective means to indicate investors controlled by foreign governments