Title
AGREEMENT BETWEEN THE GOVERNMENT OF THE PEOPLE'S REPUBLIC OF CHINA AND THE GOVERNMENT OF REPUBLIC OF TAJIKISTAN FOR THE PROMOTION AND RECIPROCAL PROTECTION OF INVESTMENTS
Preamble
Preamble
The Government of the People's Republic of China and the Government of the Republic of Tajikistan (hereinafter referred to as the "Parties"),
Desiring to promote further economic cooperation between them with respect to investment;
Recognizing that agreement on the treatment to be accorded to investment will stimulate the flow of capital and the economic development of the Parties;
Agreeing that a stable, transparent, and non-discriminatory framework for investment will enhance the effective use of economic resources and improve living standards;
Recognizing the importance of providing effective means and procedures to protect rights and interests with respect to investment under national law as well as through international arbitration;
Desiring to achieve these objectives in a manner consistent with the protection of health, safety, and the environment;
Recognizing the right to regulate, and resolving to preserve the flexibility of the Parties to protect legitimate public welfare objectives, including public morals, public health, safety, the environment, and the conservation of living or non-living exhaustible natural resources;
Have agreed as follows:
Body
Section A. Investment Promotion and Protection
Article 1. Definitions
For purposes of this Agreement:
“claimant” means an investor of a Party that is a party to an investment dispute with the other Party.
“covered investment” means, with respect to a Party, an investment in its territory of an investor of the other Party in existence as of the date of entry into force of this Agreement or established, acquired, or expanded thereafter.
“disputing parties” means the claimant and the respondent.
“disputing party” means either the claimant or the respondent.
“enterprise” means any entity constituted or organized under applicable law, whether or not for profit, and whether privately or governmentally owned or controlled, including a corporation, trust, partnership, sole proprietorship, joint venture, association, or similar organization; and a branch of an enterprise.
“enterprise of a Party” means an enterprise constituted or organized under the law of a Party and a branch located in the territory of a Party and carrying out business activities there.
“existing” means in effect on the date of entry into force of this Agreement.
“freely usable currency” means “freely usable currency” as determined by the International Monetary Fund under its Articles of Agreement.
“government procurement” means the process by which a government obtains the use of or acquires goods or services, or any combination thereof, for governmental purposes and not with a view to commercial sale or resale, or use in the production or supply of goods or services for commercial sale or resale.
“ICSID Additional Facility Rules” means the Rules Governing the Additional Facility for the Administration of Proceedings by the Secretariat of the International Centre for Settlement of Investment Disputes.
“ICSID Convention” means the Convention on the Settlement of Investment Disputes between States and Nationals of Other States, done at Washington, March 18, 1965.
“investment” means every asset that an investor owns or controls, directly or indirectly, that has the characteristics of an investment, including such characteristics as the commitment of capital or other resources, the expectation of gain or profit, or the assumption of risk. Forms that an investment may take include:
(a) an enterprise;
(b) shares, stock, and other forms of equity participation in an enterprise;
(c) bonds, debentures, loans, and other debt instruments, including debt instruments issued by a Party or an enterprise; (1)
(d) futures, options and other derivatives;
(e) turnkey, construction, management, production, concession, revenue-sharing, and other similar contracts;
(f) intellectual property rights;
(g) licenses, authorizations, permits, and similar rights conferred pursuant to domestic law; (2) and
(h) other tangible or intangible, movable or immovable property, and related property rights, such as leases, mortgages, liens, and pledges.
“investment agreement” means a written agreement between a national authority (3) of a Party and a covered investment or an investor of the other Party, on which the covered investment or the investor relies in establishing or acquiring a covered investment other than the written agreement itself, that grants rights to the covered investment or investor:
(a) with respect to natural resources that a national authority controls, such as for their exploration, extraction, refining, transportation, distribution, or sale;
(b) to supply services to the public on behalf of the Party, such as power generation or distribution, water treatment or distribution, or telecommunications; or
(c) to undertake infrastructure projects, such as the construction of roads, bridges, canals, dams, or pipelines, that are not for the exclusive or predominant use and benefit of the government.
“investor of a Party” means a Party, a national or an enterprise of a Party, that attempts to make, is making, or has made an investment in the territory of the other Party.
“measure” includes any law, regulation, procedure, requirement, or practice.
“national” means: (4)
(a) for the People’s Republic of China,
a natural person who is a national of the People’s Republic of China as defined in the Nationality Law of the People’s Republic of China; and
(b) for the Republic of Tajikistan,
a natural person who is a national of the Republic of Tajikistan as defined in the Nationality Law of the Republic of Tajikistan.
“non-disputing Party” means the Party that is not a party to an investment dispute.
“person” means a natural person or an enterprise.
“protected information” means confidential business information or information that is privileged or otherwise protected from disclosure under a Party’s law.
“respondent” means the Party that is a party to an investment dispute. “territory” means: (5)
(a) with respect to the People’s Republic of China,
(i) the customs territory of the People’s Republic of China; (6)
(ii) the territorial sea thereof and any area beyond the territorial sea within which the People’s Republic of China may exercise sovereignty, sovereign rights or jurisdiction under its law.
(b) with respect to the Republic of Tajikistan, the customs territory of the Republic of Tajikistan.
“TRIPS Agreement” means the Agreement on Trade-Related Aspects of Intellectual Property Rights, contained in Annex 1C to the WTO Agreement.
“UNCITRAL Arbitration Rules” means the arbitration rules of the United Nations Commission on International Trade Law.
Article 2. Scope and Coverage
1. This Agreement applies to measures adopted or maintained by a Party relating to:
(a) investors of the other Party; and
(b) covered investments.
2. A Party's obligations under Section A shall apply:
(a) to all levels of government of that Party; and
(b) to any non-governmental body when it exercises any regulatory, administrative, or other governmental authority delegated to it by that Party.
3. For greater certainty, this Agreement does not bind either Party in relation to any act or fact that took place or any situation that ceased to exist before the date of entry into force of this Agreement.
Article 3. National Treatment (7)
Each Party shall accord to investors of the other Party, and to covered investments, treatment no less favorable than that it accords, in like circumstances, to its own investors and their investments with respect to the management, conduct, operation, and sale or other disposition of investments in its territory.
Article 4. Most-Favored-Nation Treatment
1. Each Party shall accord to investors of the other Party, and to covered investments, treatment no less favorable than that it accords, in like circumstances, to investors of any non-Party and their investments with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments in its territory.
2. Paragraph 1 of this Article shall not be construed to oblige any Party to extend to the investors of the other Party or covered investment any treatment, preference or privilege by virtue of any bilateral or multilateral agreement relating to investment in force or signed prior to the date of entry into force of this Agreement.
3. For greater certainty, the treatment referred to in this Article does not encompass dispute resolution mechanisms or procedures, such as those included in Section B, that are provided for in international investment or trade agreements.
Article 5. Minimum Standard of Treatment
1. Each Party shall accord to covered investments fair and equitable treatment and full protection and security in accordance with customary international law minimum standard of treatment of aliens. (8)
2. The concepts of "fair and equitable treatment" and "full protection and security" do not require treatment in addition to or beyond that which is required by that standard, and do not create additional substantive rights. The obligation in paragraph 1 of this article to provide:
(a) "fair and equitable treatment" includes the obligation not to deny justice in criminal, civil, or administrative adjudicatory proceedings in accordance with due process of law; and
(b) "full protection and security" requires each Party to provide the level of police protection required under customary international law.
3. A determination that there has been a breach of another provision of this Agreement, or of a separate international agreement, does not establish that there has been a breach of this Article.
4. For greater certainty, the mere fact that a Party takes or fails to take an action that may be inconsistent with an investor's expectations does not constitute a breach of this Article, even if there is loss or damage to the covered investment as a result.
Article 6. Compensation for Losses
1. Notwithstanding paragraph 3 of Article 15 [Non-Conforming Measures], each Party shall accord to investors of the other Party, and to covered investments, non-discriminatory treatment with respect to measures it adopts or maintains relating to losses suffered by investments in its territory owing to armed conflict, a state of national emergency, or civil strife.
2. Notwithstanding paragraph 1 of this article, if an investor of a Party, in the situations referred to in paragraph 1, suffers a loss in the territory of the other Party resulting from:
(a) requisitioning of its covered investment or part thereof by the latter's forces or authorities; or
(b) destruction of its covered investment or part thereof by the latter's forces or authorities, which was not required by the necessity of the situation,
the latter Party shall provide the investor restitution, compensation, or both, as appropriate, for such loss. Any compensation shall be made in accordance with paragraphs 2 through 4 of Article 7 [Expropriation and Compensation], mutatis mutandis.
Article 7. Expropriation and Compensation
1. Neither Party may expropriate or nationalize a covered investment either directly or indirectly through measures equivalent to expropriation or nationalization ("expropriation"), except:
(a) for a public purpose;
(b) in a non-discriminatory manner;
(c) on payment of compensation in accordance with this Article; and
(d) in accordance with due process of law.
2. The compensation referred to in paragraph 1(c) of this article shall:
(a) be paid without delay;
(b) be equivalent to the fair market value of the expropriated investment at the time when the expropriation was publicly announced or when the expropriation took place ("the date of expropriation"), whichever is earlier; and
(c) be fully realizable and freely transferable.
3. If the fair market value is denominated in a freely usable currency, the compensation referred to in paragraph 1(c) of this article shall be no less than the fair market value on the date of public announcement of expropriation or on the date of expropriation, whichever is earlier, plus interest at a commercially reasonable rate for that currency accrued from the date of expropriation until the date of payment, as appropriate.
4.If the fair market value is denominated in a currency that is not freely usable, the compensation referred to in paragraph 1(c) of this article converted into the currency of payment at the market rate of exchange prevailing on the date of payment shall be no less than:
(a) the fair market value on the date of public announcement of expropriation or on the date of expropriation, whichever is earlier, converted into a freely usable currency at the market rate of exchange prevailing on that date, plus
(b) interest at a commercially reasonable rate for that freely usable currency accrued from the date of expropriation until the date of payment.
5. This Article does not apply to the issuance of compulsory licenses granted in relation to intellectual property rights in accordance with the TRIPS Agreement, or to the revocation, limitation, or creation of intellectual property rights, to the extent that such issuance, revocation, limitation, or creation is consistent with the TRIPS Agreement.
6. The Parties confirm their shared understanding that:
(a) An action or a series of actions by a Party cannot constitute an expropriation unless it interferes with a tangible or intangible property right or property interest in an investment.
(b) This article addresses two situations: The first is direct expropriation, where an investment is nationalized or otherwise directly expropriated through formal transfer of title or outright seizure. The second is indirect expropriation, where an action or series of actions by a Party has an effect equivalent to direct expropriation without formal transfer of title or outright seizure.
(c) The determination of whether an action or series of actions by a Party, in a specific fact situation, constitutes an indirect expropriation, requires a case-by-case, fact-based inquiry that considers, among other factors:
(i) the economic impact of the government action, although the fact that an action or series of actions by a Party has an adverse effect on the economic value of an investment, standing alone, does not establish that an indirect expropriation has occurred;
(ii) the extent to which the government action interferes with distinct, reasonable investment-backed expectations; and
(iii) the character and objective of the government action.
(d) Except in rare circumstances, non-discriminatory regulatory actions by a Party that are designed and applied to protect legitimate public welfare objectives, such as public moral, public health, safety, and the environment, do not constitute indirect expropriations.
Article 8. Transfers (9)
1.Each Party shall permit all transfers relating to a covered investment to be made freely and without delay into and out of its territory. Such transfers include:
(a) contributions to capital;
(b) profits, dividends, capital gains, and proceeds from the sale of all or any part of the covered investment or from the partial or complete liquidation of the covered investment;
(c) interest, royalty payments, management fees, and technical assistance and other fees;
(d) payments made under a contract, including a loan agreement;
(e) payments made pursuant to Article 6 [Compensation for Losses] and Article 7 [Expropriation and Compensation];
(f) payments arising out of a dispute; and
(g) earnings and remuneration of a national of a Party who works ina covered investment in the territory of the other Party.
2. Each Party shall permit transfers relating to a covered investment to be made in a freely usable currency at the market rate of exchange prevailing at the time of transfer.
3.Each Party shall permit returns in kind relating to a covered investment to be made as authorized or specified in a written agreement between the Party and a covered investment or an investor of the other Party.
4. Notwithstanding paragraphs 1 through 3 of this Article, a Party may prevent a transfer through the equitable, non-discriminatory, and good faith application of its laws and regulations relating to:
(a) bankruptcy, insolvency, or the protection of the rights of creditors;
(b) issuing, trading, or dealing in securities, futures, options, or derivatives;
(c) criminal or penal offenses;
(d) financial reporting or record keeping of transfers when necessary to assist law enforcement or financial regulatory authorities;
(e) ensuring compliance with orders or judgments in judicial or administrative proceedings; or
(f) securing compliance with other laws and regulations that are not inconsistent with this Agreement.
5. In the event of serious balance-of-payments difficulties, external financial difficulties, or threat thereof, nothing in this Agreement shall be construed to prevent a Party from adopting or maintaining restrictive measures with regard to payments or transfers relating to the movements of capital. Any measures adopted or maintained under this paragraph shall:
(a) be consistent with the Articles of Agreement of the International Monetary Fund, as applicable;
(b) be temporary and be phased out progressively as the situation specified in this paragraph improves, and shall not exceed eighteen months in duration; however, if extremely exceptional circumstances arise, a Party may extend such measures for one twelve-month period after advance notice and consultations with the other Party;
(c) not be inconsistent with Article 3 [National Treatment] and Article 4 [Most Favored Nation Treatment];
(d) not be inconsistent with Article 7 [Expropriation and Compensation];
(e) not result in multiple exchange rates; and
(f) be promptly notified to the other Party and published as soon as practicable.
Article 9. Performance Requirements
1. Neither Party may, in connection with the establishment, acquisition, expansion, management, conduct, operation, or sale or other disposition of an investment of an investor of the other Party or of a non-Party in its territory, impose or enforce any requirement or enforce any commitment or undertaking: (10)
(a) to export a given level or percentage of goods or services;
(b) to achieve a given level or percentage of domestic content of goods or services;
(c) to purchase, use, or accord a preference to goods produced or services supplied in its territory, or to purchase goods or services from persons or enterprises in its territory;
(d) to relate in any way the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows associated with such investment;
(e) to restrict sales of goods or services in its territory that such investment produces or supplies by relating such sales in any way to the volume or value of its exports or foreign exchange earnings;
(f) to transfer a particular technology, a production process, or other proprietary knowledge to a person in its territory;