Necessities, Methods and Challenges of Pension Funds Foreign Investment

Document Type : Research Article

Authors

1 Faculty of Law, Theology and Political Science, Science and Research Unit, Islamic Azad University, Tehran, Iran

2 Department of Private Law, Faculty of Law, Theology and Political Science, Science and Research Unit, Islamic Azad University, Tehran, Iran

3 Department of Private Law, Faculty of Law, Theology and Political Science, Science and Research Unit, Islamic Azad University, Tehran, Iran. Email: Tehran, Iran

Abstract

Pension funds in order to be able to fulfill their obligations to the insured, mainly invest the funds received from the insured. These investments can be inside or outside the territory of the country where the fund was established and the latter can be through direct or indirect investment. Considering the importance of foreign investment for pension funds, this article has investigated the necessities, methods and challenges of this issue using the descriptive-analytical method and based on library studies with a comparative approach and the situation of Iran's pension funds has been examined in relation to each of these issues. The findings of this research show that in the present era, many pension funds have started foreign investment (mainly indirect type) based on the necessity of reducing investment risks, the limitation of the domestic capital market, and the low return on investment in the domestic market of their country. However, the foreign investment of pension funds in some countries is facing challenges and problems, some of which are legal and others are rooted in non-legal issues, especially economic issues. Although the foreign investment of Iran's pension funds has been accepted in the legal system of Iran, but due to legal and non-legal challenges, these financial institutions have not made foreign investment so far.

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Main Subjects

References

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Private Law
Volume 20, Issue 1
Spring & Summer
April 2023
Pages 119-133

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