Title
AGREEMENT BETWEEN THE GOVERNMENT OF THE DEMOCRATIC REPUBLIC OF CONGO (DRC) AND THE GOVERNMENT OF THE REPUBLIC OF RWANDA ON INVESTMENT PROMOTION AND PROTECTION
Preamble
PREAMBLE
The Government of the Democratic Republic of Congo and the Government of the Republic of Rwanda hereinafter referred to as the "Contracting Parties";
Wishing to strengthen the bonds of friendship and co-operation existing between the Parties;
Recognising the important contribution that such investments can make to the sustainable development of the Parties, including poverty reduction, increased productive capacity, economic growth, technology transfer and the promotion of human rights and human development;
Desire to promote, encourage and enhance investment opportunities that strengthen sustainable development in the Parties' territories;
Recognising that sustainable development requires the realisation of the economic, social and environmental pillars embedded in the concept;
Reaffirming the right of Parties to regulate and introduce new measures relating to an investment in their territories in order to meet national policy objectives and - by taking into account any asymmetry in the measures put in place - in particular, the need for developing countries to exercise this right;
Considering the Pan-African Investment Code of the African Union as well as the COMESA Common Investment Area Agreement, "ZICC" in short;
Aware that the reciprocal encouragement, promotion and protection of investments on the basis of the principle of equality and mutual benefit is likely to stimulate the commercial initiatives of investors and to increase the prosperity of both States
Have agreed as follows:
Body
Chapter One. COMMON PROVISIONS
Article 1. Objective
The main purpose of this Agreement is the reciprocal encouragement, enhancement, promotion and protection of investments made by investors of one contracting party in the territory of the other contracting party which support the sustainable development of each Party and, in particular, the host State where the investment is located.
This Agreement shall apply to all investments made by investors of one of the Contracting Parties in the territory of the other Party after its entry into force. However, this Agreement shall not have retroactive effect with respect to investment disputes arising before its entry into force.
Article 2. Definitions
Enterprise means any entity formed or organized in accordance with applicable law, whether for profit or not, and whether state-owned or privately controlled, including any corporation, trust, partnership, sole proprietorship, joint venture, association or similar body; and a branch of an enterprise.
State of origin means, with respect to
(a) a natural person, the Party of nationality or principal residence of the investor, in accordance with the laws of that Party
(b) a legal person, the Party of incorporation or registration of the investor and the place of development of its activities.
Host State refers to the Party where the investment is made
ICSID refers to the International Centre for Settlement of Investment Disputes, established under the Convention on the Settlement of Investment Disputes between States and Nationals of Other States.
Investment means an enterprise in the territory of a Party established, created or developed by an investor of the other Party, including the establishment, maintenance or acquisition of a juridical person or the acquisition of shares, bonds or other equity securities of such an enterprise, provided that the enterprise is established or acquired and is administered in accordance with the laws of the host State. An enterprise may own assets such as:
(a) shares, capital, unsecured bonds and other equity instruments of the company or of another company
(b) a debt instrument from another undertaking
(c) loans granted to a company
(d) movable or immovable property and other property rights such as mortgages, liens or pledges
(e) pecuniary claims or other benefits performed under contract with a financial value
(f) copyright, know-how, goodwill and industrial property rights such as patents, trademarks, industrial designs and trade names, insofar as they are recognised under the law of the host State
(g) rights granted by law or under contract, including licences to cultivate, extract or exploit natural resources.
It is understood that the investment does not include:
(a) debt securities issued by or loans to a government
(b) portfolio investments
(c) claims arising solely from commercial contracts for the sale of goods or services by a national or an enterprise in the territory of a Party to an enterprise in the territory of another Party, or (extension of credit in connection with a transaction (b) the right to claim the payment of any commercial or other pecuniary claim which does not contain the type of interest set out in points (a) to (g) of this Article.
Investor means a natural or legal person of the home State who invests in the territory of the host State, provided that:
a) natural persons who are nationals of either Contracting Party in accordance with its legislation
b) the legal person is constituted in accordance with the law of the home State and carries on business in the home State and/or the State of residence and carries on business in both the home State and the State of residence
Measure means any form of legally binding legal act that directly affects an investor or his investment, and includes any law, regulation, procedure, requirement, final judicial decision or binding enforcement decision:
(a) As regards the Republic of Rwanda, measures taken by the Central Administration or local governments or District authorities;
(b) With regard to the Democratic Republic of Congo, measures taken by the Parliament and the National Executive, the Provincial Edits and the Provincial or Local Executives
Portfolio investment means an investment representing less than 10% of the company's shares or not giving the portfolio investor the ability to exercise effective management or influence over the management of the investment.
Party means a State which is a Party to this Agreement.
Territory means:
(a) with regard to the Democratic Republic of Congo and the areas adjacent to its territorial waters as well as the maritime areas and airspace over which, in accordance with international law, the Democratic Republic of Congo exercises its rights sovereignty over airspace, the seabed, the subsoil and their resources natural:
(b) with regard to the Republic of Rwanda, the land, internal waters, the airspace and other contiguous areas over which the Republic of Rwanda has or may be granted sovereign rights or jurisdiction in agreement with a third country.
Fair and equitable treatment: Fair and equitable treatment implies, in particular, that investors of one contracting party would not be deliberately deprived of the right to a fair hearing by the other contracting party, or treated in a manifestly unfair manner. In this case, the court must be satisfied that it is discriminatory or arbitrary, and that it does not conform to the legal system of the host country or to the general principles of law.
Transfers refers to international payments and transactions in cash or electronic form.
UNCITRAL Arbitration Rules means the Arbitration Rules of the United Nations Commission on International Trade Law as approved at the time of commencement of the arbitration pursuant to the submission of a notice of arbitration under these Rules, including any rules or annexes specific to arbitration processes between an investor and a State.
Article 3. Admission of Investments by Investors of the other Party
The Parties shall encourage and admit investments in accordance with their applicable laws and apply them in good faith.
Chapter II. RIGHTS OF INVESTORS AFTER ESTABLISHMENT
Article 4. Non-discrimination
Each Contracting Party shall accord to investors of the other Contracting Party and to their investments treatment no less favourable than that which it accords, in similar circumstances, to investors and investments from third States with regard to the management, administration, maintenance, use, enjoyment, sale or other disposition of investments situated in its territory.
(1) It is understood that the reference to "similar circumstances" requires a comprehensive case-by-case examination of all the circumstances of an investment, including:
(a) its effects on third parties and the local community;
(b) its effects on the local, regional or national environment, including the cumulative effects of all investments in the field of competence on the environment;
(c) the sector in which the investor is located;
(d) the objective of the measure;
(e) the regulatory process generally applied to the measure being designed; and
(f) other factors directly related to the Investment or the Investor in relation to the measure being measured.
The review referred to in this paragraph shall not be limited or biased by any factor.
(2) Nothing in this Article shall be construed to prevent a Party from adopting or maintaining a measure prescribing special formalities in connection with the investments of investors, such as the requirement that their investments be constituted in accordance with the law of the State Party, provided that such formalities do not materially impair the protections afforded by a Party to the investors of the other Party and their investments under this Agreement.
(3) Each Party shall accord to investments of investors of the other Party treatment no less favourable than that it accords, in like circumstances, to investments in its territory of investors of any non-Party with respect to management, direction, exploitation, sale or disposal of investments.
(4) The provisions of paragraph 4 above shall not be construed to require a Party to accord to investors of the other Party and investments of investors of the other Party the benefit of any treatment, preference or privilege arising from:
a. existing or future customs union, free trade area, free trade agreement, common market, monetary union or similar international agreement or other forms of regional cooperation to which either Party is or may become a Party; or the adoption of an agreement leading to the formation or extension of such union, area or agreement;
b. any existing bilateral investment agreement (also known as an "investment guarantee agreement", "investment promotion and protection agreement" or "IPA") "International investment agreements");
c. any existing or future international investment agreement between or among Member States of a regional economic community, including investment agreements between members of a regional economic community and one or more third States; or
d. any arrangement with a non-Party or parties of the same geographical region designed to promote regional co-operation in the economic, social, industrial or monetary fields in the framework of specific projects.
(5) For greater certainty, paragraphs 4 and 5 shall not be construed as giving investors any dispute settlement options or procedures other than those set out in Section One (Settlement of Disputes between a Party and an Investor of the other Party) of Chapter III (Settlement of Disputes).
(6) This Article constitutes the definition and scope of all references to non-discrimination or national treatment in all respects under this Agreement. Any References to such terms elsewhere in this Agreement shall be applied and interpreted in accordance with this Article.
Article 5. Fair and Equitable Treatment
(1) Each Contracting Party shall ensure fair and equitable treatment and full protection and security for investors of the other Contracting Party and for investments made in its territory.
(2) Parties shall ensure that their administrative, legislative and judicial processes do not operate in a manner that is arbitrary or likely {O deny administrative and judicial justice. procedural requirements for investors from other Parties or their investments.
(3) The Investors or their Investments, depending on the circumstances, are informed in good time of the administrative or judicial proceedings directly affecting the investment(s), unless, due to exceptional circumstances, such notification is contrary to domestic law.
(4) Administrative decision-making processes include the right of administrative review or of appeal of decisions, commensurate with the level of development and resources available to the Parties.
(5) The investor or investor must have access to the information held by the Commission shall inform the Government in good time and in accordance with national law, and subject to the limitations on access tO information provided for by the applicable national law.
(6) This Article constitutes the definition and scope of all references to non-discrimination or national treatment in all respects under this Agreement. Any reference to such terms elsewhere in this Agreement shall be applied and interpreted in accordance with this Article.
(7) A claim that there has been a breach of another provision of this Agreement or of a separate international agreement does not establish a breach of this Article.
Article 6. Expropriation
(1) A Party shall not, directly or indirectly, nationalise or expropriate investments in its territory except under the following conditions:
(a) In the public interest linked to the informed internal needs of the state in question;
(b} Non-discrimination
(c) compliance with a regular and legal procedure
(d) upon payment of fair and adequate compensation within a reasonable period of time.
(2) The assessment of fair and adequate compensation shall be based on an equitable balance between the public interest and the interests of the persons concerned, taking into account all relevant circumstances and having regard to the present and past use of the property, the history of its acquisition, the fair market value of the property, the purpose of the expropriation, the extent of the previous benefits realised by the foreign investor from the investment and the duration of the investment.
(3) All payments shall be made in a freely convertible currency. The payment shall include simple interest at the commercial rate prevailing in the host State from the date of expropriation until the date of actual payment. Upon payment, the compensation shall be freely transferable.
(4) Compensation which represents a heavy burden on a host State may be paid annually over as long a period as possible as agreed by the Parties to the arbitration, subject to interest at a rate agreed upon by the Parties to the arbitration or by a court.
(5) This Article does not apply to the granting of compulsory licences based on intellectual property rights, or to the revocation, imitation or creation of rights, the granting, revocation, limitation or creation of intellectual property rights, to the extent that such granting, revocation, limitation or creation is consistent with applicable international intellectual property agreements.
(6) Subject to the requirement that such measures shall not be applied in a manner that constitutes a means of arbitrary or unjustifiable discrimination within the meaning of Article 4 (not (b) Where a measure of a Party is designed and applied to protect or enhance legitimate public welfare objectives, such as public health, public safety, national security and the environment, it shall not constitute an indirect expropriation under this Agreement.
(7) A measure of general application shall not be deemed to be an expropriation of a debt obligation or loan covered by this Agreement solely because the measure imposes costs on the debtor which induce him not to pay his debt.
(8) The Investor affected by the expropriation shall have the right, under the law of the expropriating Party, to initiate a review by the judicial or other independent authority of that Party of the decision to proceed with the expropriation and the valuation of the expropriated investment in accordance with the principles set forth in this Article.
Article 7. Repatriation of Assets
(1) A Party must grant investors the right to:
(a) repatriate the capital invested and the return on investment;
(b) repatriate the funds to repay loans;
(c) repatriate the proceeds of the compensation after the expropriation, liquidation or sale of the investment in whole or in part, including an appreciation or increase in the value of the Investment Capital;
(d) transferring payments to maintain or develop the investment project, such as funds for the acquisition of raw or auxiliary materials, semi-finished products and replacement of fixed assets;
(e) remit the unspent income of expatriate staff from the investment project;
(f) repatriate the investor compensation paid under this Agreement; and
(g) payments arising from the settlement of a dispute by any means, including arbitration or the agreement of the Party to the dispute.
(2) Each Party shall ensure that transfers referred to in paragraph (1) of this Article are made in freely convertible currency at the market rate of exchange prevailing at the time of the transfer.
(3) Notwithstanding paragraph (1) of this Article, a country may prevent or delay a transfer by enforcing its laws and regulations concerning the transfer:
(a) bankruptcy, insolvency or protection of creditors' rights;
(b) issuance, trading or transactions in securities, financial products or services terme. on options or derived products;
(c) Criminal offences and the recovery of the proceeds of crime;
(d) The financial reports or record keeping of transactions where necessary to assist the law enforcement or financial regulatory authorities;
(e) orders or judgements made in judicial or administrative proceedings;
(f) taxation;
(g) Social security schemes, public pension schemes or compulsory savings schemes;
(h) employee severance pay; and
(i) the formalities required to register and satisfy the Central Bank the other authorities of a Party.
(4) Where, in the opinion of a Party, payments and capital movements in respect of an Investor or an Investment covered by this Agreement cause or are likely to cause serious harm:
(a) difficulties for balance of payments purposes;
(b) external financial difficulties; and/or
(c) difficulties in macroeconomic management, including monetary or exchange rate policy,
the Party concerned may take provisional safeguard measures on capital movements in order to eliminate them as soon as conditions permit.
(5) Where a Party takes measures under paragraph 4 of this Article:
(a) these measures must remain in place for a maximum period of twelve months, subject to paragraph 6 of this Article; and
(b) the Party taking such measures shall enter into consultations with the other Party at its request, with a view to reviewing such measures and seeking to identify the minimum impact of such measures on an investor.
(6) If, in the opinion of a Party taking the measures, it becomes necessary to extend them for a further period following an extended period due to the extended conditions described in paragraph 4 of this Article, the Party shall offer to consult with the other Party with a view to seeking the minimum impact of such measures on an investor. Such measures shall again be taken on a temporary basis with a view to their withdrawal as soon as conditions permit and, in any event, for a period not exceeding 12 months from their renewal.
Article 8. Protection and Security
(1) In the event of war or other armed conflict, revolution, insurrection or riot within or affecting the territory of the Host State, a Party shall afford to investments of investors of the other Party protection and security no less favourable than that afforded to investments of its own investors or to investments of investors of any third State.
(2) Investors of a Party whose investments in the territory of the other Party suffer losses as a result of a breach of paragraph 1 of this Article, in particular as a result of war or any other armed conflict, revolution, insurrection or riot in the territory of the host State, shall be accorded by the host State treatment in respect of restitution, compensation, indemnification or other settlement no less favourable than that accorded by the host State to investors of a third State.
Chapter III. RIGHTS AND OBLIGATIONS OF INVESTORS AND PARTIES
Article 9. Compliance with National Laws
Investors and their investments must comply with all applicable national laws and regulations of the Host State.
Article 10. Corporate Governance Framework
(1) Investors and their investments must meet or exceed nationally and internationally accepted standards of corporate governance in their industry, including transparency and accounting practices,
(2) Investors and their Investments shall ensure that all transactions with related or affiliated companies are at arm's length or at fair market price. Investors and their Investments shall not engage in any improper transfer pricing practices with each other or with any related or affiliated companies.
Article 11. Sociopolitical Obligations
(1) Investors and their investments must comply with sociopolitical obligations, including:
(a) respect for national sovereignty and compliance with national laws, regulations and administrative practices;
(b) respect for sociocultural values;
(c) non-interference in internal political affairs; and
(d) non-interference in intergovernmental relations;
(2) Investors and their investments must not influence or attempt to influence the appointment of the person holding public office or financing political parties.
(3) Investors and their investments shall not engage in any act that is likely to be prejudicial to public policy, morality or the public interest, Investors shall not engage in restrictive practices and attempt to make gains by illegal means.
Article 12. Bribery and Corruption
(1) Investors and their Investments shall not offer, promise or give any pecuniary value or other benefit, directly or through agents, to a public official of the Host State, to a member of the family of a public official, to a business associate or to any other person closely connected with a public official, for his own account or for the account of a third party, in order that the official or third party acts or refrains from acting in the exercise of official functions to obtain a favour in relation to a proposed Investment or any other right in relation to an Investment.
(2) Investors and their investments shall not be complicit in any of the acts described in paragraph 1 of this Article, including inciting, aiding, abetting or conspiring to commit or authorise such acts.
(3) A breach of this Article by an Investor or an Investment shall be deemed to constitute a failure by the Investor to establish, acquire or undertake, as the case may be, the Investment in accordance with the laws of the Host State.
(4) The Parties to this Agreement shall, in accordance with applicable law, prosecute and, upon conviction, punish persons who have violated the applicable law in the performance of this obligation.
Article 13. Commercial Ethics and Human Rights
(1) Investors and their Investments shall comply with the UN Guiding Principles on Business and Human Rights and make modifications to them as necessary for local circumstances.
(2) Investors and their Investments shall:
(a) Support and respect the protection of internationally proclaimed human rights;
(b) Ensure that they are not complicit in human rights violations;