ABSTRACT
Peitsch draws attention to the distinction between direct foreign investment and foreign portfolio investment. ‘An investment is considered to constitute direct foreign investment when a lasting relationship is established between a legal person or entity resident in one country (the foreign investor) and an entity resident in another country (the foreign investment enterprise) in which the foreign investor obtains a controlling interest. This type of investment can be contrasted with (foreign) portfolio investment, in which the investor is not interested in exerting significant influence over management decisions’ (Barbara Peitsch, The OECD Observer, April-May 1995, no. 193, p. 32).
