Title
TREATY BETWEEN THE REPUBLIC OF BELARUS AND THE REPUBLIC OF INDIA ON INVESTMENTS
Preamble
The Republic of Belarus and the Republic of India (hereinafter referred to as the "Party" individually or the "Parties" collectively);
Desiring to promote bilateral cooperation between the Parties with respect to foreign investments; and
Recognizing that the promotion and the protection of investments of investors of one Party in the territory of the other Party will be conducive to the stimulation of mutually beneficial business activity, to the development of economic cooperation between them and to the promotion of sustainable development,
Reaffirming the right of Parties to regulate investments in their territory in accordance with their law and policy objectives,
Have agreed as follows:
Body
Chapter I. Preliminary
Article 1. Definitions
For the purposes of this Treaty:
1.1. "confidential information" means business confidential information, e.g. confidential commercial, financial or technical information which could result in material loss or gain or prejudice a disputing party's competitive position, and information that is privileged or otherwise protected from disclosure under the law of a Party.
1.2. "customary international law" means general and consistent practice accepted as law.
1.3. "Designated Representative" shall be defined by each Party through diplomatic channels.
1.4. "investment" means an enterprise constituted, organised ·and operated in good faith by an investor in accordance with the law of the Party in whose territory the investment is made, taken together with the assets of the enterprise, which have the characteristics of an investment such as the commitment of capital or other resources, certain duration, the expectation of gain or profit, the assumption of risk and contribution to the development ofthe Party in whose territory the investment is made.
An enterprise may possess the following assets:
a) Shares, stocks and other forms of equity instruments;
b) A debt instrument or security;
c) A loan
(i) Where the debtor is an affiliate of the investor, or
(ii) Where the original maturity ofthe loan is at least three years;
d) Licenses, permits, authorisations or similar rights which have any significant economic value, conferred in accordance with the law of a Party;
e) Rights conferred by contracts of a long-term nature such as those to cultivate, extract or exploit natural resources in accordance with the law of a Party;
f) Intellectual Property Rights as recognized by the law of the Party where investments are made;
g) Moveable or immovable property and related rights;
h) Any other interests of the enterprise which involve substantial economic activity and out of which the enterprise derives significant financial value.
For greater clarity, investment does not include the following assets of an enterprise:
(i) Portfolio investments of the enterprise;
(ii) Debt securities issued by a government or government-owned or controlled enterprise, or loans to a government or government-owned or controlled enterprise;
(iii) Any pre-operational expenditure relating to admission, establishment, acquisition or expansion of the enterprise incurred before the commencement of substantial business operations of the enterprise in the territory of the Party where the investment is made;
(iv) Claims to money that arise solely from commercial contracts for the sale of goods or services by a national or enterprise in the territory of a Party to an enterprise in the territory of another Party;
(v) Goodwill, brand value, market share or similar intangible rights;
(vi) Claims to money that arise solely from the extension of credit in connection with any commercial transaction;
(vii) An order or judgment sought or entered m any judicial, administrative or arbitral proceeding;
(viii) any other claims to money that do not involve the kind of interest or operations set out in the definition of investment in this Treaty.
1.5. For the purposes ofparagraph 4 of this Article, "enterprise" means:
(i) Any legal person or entity constituted, organised and operated in compliance with the law of a Party including any company such as joint stock company, corporation, partnership, sole proprietorship, or other association; and
(ii) A branch of any such entity established in the territory of a Party, if permitted by the law of such a Party and carrying out business activities there.
1.6. "investor" means:
(a) A natural person, who is a national or citizen of a Party in accordance with its law. A natural person who is a dual national or citizen, in accordance with its law, shall be deemed to be exclusively a national or citizen of the country of her or his dominant and effective nationality/citizenship, where she/he ordinarily or permanently resides. In no event the investor shall be a national of a Party in whose territory the investment is made; or
(b) A legal entity, other than a branch or representative office, that is constituted, organised and operated under the law of that Party and that has substantial business activities in the territory of that Party; or
(c) A legal entity, other than a branch or representative office, that is constituted, organised and operated under the laws of that Party and that is directly or indirectly owned or controlled by a natural person of that Party or by a legal entity mentioned under sub-clause (b) herein, that has made an investment in the territory ofthe other Party.
The concept of substantial business activity shall require an overall examination of all the circumstances on a case-by-case basis.
1.7. "law" includes:
In respect of Belarus: normative legal acts of the Republic of Belarus.
In respect of India:
(i) The Constitution, legislation, subordinate/delegated legislation, laws and bylaws, rules and regulations, ordinance, notifications, policies, guidelines, procedures, administrative measures/executive actions at all levels of government, as amended, interpreted or modified from time to time;
(ii) Decisions, judgments, orders and decrees by Courts, regulatory authorities, judicial and administrative institutions having the force of law within the territory of a Party.
1.8. "local government" includes:
In respect of Belarus: Local sub-regional Councils, local sub-regional executive committees and local administrations in accordance with the law of the Republic of Belarus.
In respect of India:
(i) An urban local body, municipal corporation or village level government; or
(ii) An enterprise owned or controlled by an urban local body, a municipal corporation or a village level government.
1.9. "measure" includes law, rule, procedure, decision, administrative action, requirement or practice.
1.10. "PCA Optional Rules" means the Permanent Court of Arbitration Optional Rules for Arbitration Disputes between Two States, 20 October 1992.
1.11. The term "Pre-investment activity" includes:
a) Any activities undertaken by the investor or its enterprise prior to the establishment of the investment in accordance with the law of the Party where the investment is made;
b) Any activity undertaken by the investor or its investment pursuant to compliance with sectoral limitations on foreign equity, and other limits and conditions applicable under any law relating to the admission of investments in the Party where the investment is made in specific sectors falls within the meaning of "Pre-investment activity".
1.12. "Regional government" means a State Government or a Union Territory administration in the case of India but does not include local governments; and in case of the Republic of Belarus means regional Councils and Minsk city council, regional executive committees and Minsk.
1.13. "territory" means:
In respect of India: the territory of the Republic of India in accordance with the Constitution of India, including its territorial waters and the airspace above it and other maritime zones including the Exclusive Economic Zone and continental shelf over which the Republic of India has sovereignty, sovereign rights, or exclusive jurisdiction in accordance with its law and the 1982 United Nations Convention on the Law of the Sea and international law.
In respect of Belarus: the territory of the Republic of Belarus in accordance with the Constitution of the Republic of Belarus, including land, internal waters and the airspace of the Republic of Belarus and the territory on which the Republic of Belarus exercises sovereignty and jurisdiction in accordance with international law.
1.14. For the purposes of Chapter IV:
(i) "Defending Party" means a Party against which a claim is made under Article 13.
(ii) "disputing party" means a Defending Party or a disputing investor.
(iii) "disputing parties" means a disputing investor and a Defending Party.
(iv) "disputing investor" means an investor of a Party that makes a claim against the other Party on its behalf under Article 13, and where relevant, includes an investor of a Party that makes a claim on behalf of the locally established enterprise.
(v) "ICSID" means the International Centre for Settlement of Investment Disputes.
(vi) "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.
(vii) "ICSID Convention" means the Convention on the Settlement of Investment Disputes between States and Nationals of other States, done at Washington on 18 March 1965.
(viii) "New York Convention" means the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral A wards, done at New York on 10 June 1958.
(ix) "Non-disputing Party" means the Party to this Treaty which is not a party to a dispute under Chapter IV ofthis Treaty.
(x) "UNCITRAL Arbitration Rules" means the arbitration rules of the United Nations Commission on International Trade Law.
Article 2. Scope and General Provisions
2.1. This Treaty shall apply to measures adopted or maintained by a Party relating to investments of investors of another Party in its territory, in existence as of the date of entry into force of this Treaty or established, acquired, or expanded thereafter and which have been admitted by a Party in accordance with its law.
2.2. Subject to the provisions of Chapter Ill ofthis Treaty, nothing in this Treaty shall extend to any Pre-investment activity related to establishment, acquisition or expansion of any investment, or to any measure related to such Pre-investment activities, including terms and conditions under such measure which continue to apply in the post-investment period to the management, conduct, operation, sale or other disposition of such investments.
2.3. This Treaty shall not apply to claims arising out of events which occurred, or claims which have been raised prior to the entry into force of this Treaty.
2.4. This Treaty shall not apply to:
(i) Any measure by a local government;
(ii) Any law or measure regarding taxation, including measures taken to enforce taxation obligations.
For greater certainty, it is clarified that where the State in which investment is made, decides that conduct alleged to be a breach of its obligations under this Treaty is a subject matter of taxation, such decision of that State, whether before or after the commencement of arbitral proceedings, shall be non-justiciable and it shall not be open to any arbitration tribunal to review such decision;
(iii) The issuance of compulsory licenses granted in relation to intellectual property rights, 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 national law and international obligations of the Party concerned;
(iv) Government procurement by a Party;
(v) Subsidies or grants provided by a Party;
(vi) Services supplied in exercise of governmental authority by the relevant body or authority of a Party. For the purposes of this provision, a service supplied in exercise of governmental authority means any service which is not supplied on a commercial basis.
2.5. The Annex in this Treaty constitutes an integral part of this Treaty and is to be accorded the same effect as other provisions in this Treaty.
Chapter II. Obligations of Parties
Article 3. Treatment of Investments
3.1. No Party shall subject investments made by investors of the other Party to measures which constitute a violation of customary international law through:
(i) Denial of justice in any judicial or administrative proceedings; or
(ii) Fundamental breach of due process; or
(iii) Targeted discrimination on manifestly unjustified grounds, such as gender, race or religious belief; or
(iv) Manifestly abusive treatment, such as coercion, duress and harassment.
3.2. Each Party shall accord in its territory to investments of the other Party and to investors with respect to their investments full protection and security. For greater certainty, "full protection and security" only refers to Party's obligations relating to physical security of investors and to investments made by the investors of the other Party and not to any other obligation whatsoever.
3.3. A determination that there has been a breach of another provision of this Treaty, or of a separate international agreement, does not establish that there has been a breach of this Article.
3.4 While considering an alleged breach of this article, a Tribunal shall take account of whether the investor or, as appropriate, the locally established enterprise, pursued action for remedies before domestic courts or tribunals prior to initiating a claim under this Treaty.
Article 4. Non-discriminatory Treatment
4.1. Each Party shall apply to investors or to investments made by investors of the other Party, measures that accord no less favourable treatment than that it accords, in like circumstances, to its own investors and to investments by such investors, in a non-discriminatory manner, with respect to the management, conduct, operation, sale or other disposition of investments in its territory.
For greater certainty, whether treatment is accorded in "like circumstances" depends on the totality of the circumstances, including whether the relevant treatment distinguishes between investors or investments on the basis of legitimate regulatory objectives. These circumstances include, but are not limited to, (a) the goods or services consumed or produced by the investment; (b) the actual and potential impact of the investment on third persons, the local community, or the environment, and (c) the practical challenges ofregulating the investment.
4.2. The treatment accorded by a Party under paragraph 1 of this Article means, with respect to a Regional government, treatment no less favourable than the treatment accorded, in like circumstances, by that Regional government to investors, and to investments of investors, of the Party of which it forms a part.
Article 5. Expropriation
5.1. Neither Party may nationalize or expropriate an investment of an investor (" expropriation") of the other Party either directly or through measures having an effect equivalent to expropriation (indirectly), except for reasons of public purpose, in accordance with the due process of law and on payment of adequate compensation. For the avoidance of doubt, any measure of expropriation relating to land shall be for the purposes as set out in a law of a Party concerned relating to land acquisition and any questions as to public purpose and compensation shall be determined in accordance with the procedure specified in such law. Such compensation shall at least be equivalent to the fair market value of the expropriated investment immediately on the day before the expropriation takes place ("date of expropriation"), and shall not reflect any change in value occurring because the intended expropriation had become known earlier. Valuation criteria shall include going concern value, asset value, and other criteria, as appropriate, to determine fair market value.
5.2. Payment of compensation shall be made in a freely convertible currency. Interest on payment of compensation, where applicable, shall be paid in simple interest at a commercially reasonable rate from the date of expropriation until the date of actual payment. On payment, compensation shall be freely transferable in accordance with Article 6.
5.3. (a) Expropriation may be direct or indirect:
(i) Direct expropriation occurs when an investment is nationalised or otherwise directly expropriated through formal transfer of title or outright seizure; and
(ii) Indirect expropriation occurs if a measure or senes of measures of a Party has an effect equivalent to direct expropriation, in that it substantially or permanently deprives the investor of the fundamental attributes of property in its investment, including the right to use, enjoy and dispose of its investment, without formal transfer oftitle or outright seizure.
(b) The determination of whether a measure or a series of measures have an effect equivalent to expropriation requires a caseby-case, fact-based inquiry, that takes into consideration:
(i) The economic impact of the measure or series of measures, although the sole fact that a measure or series of measures of a Party has an adverse effect on the economic value of an investment does not establish that an indirect expropriation has occurred;
(ii) The duration ofthe measure or series of measures of a Party;
(iii) The character of the measure or series of measures, notably their object, context and intent; and
(iv) Whether a measure by a Party, breaches that Party's prior binding written commitment to the investor whether by contract, licence or other legal document.
5.4. The Parties agree that an action taken by a Party in its commercial capacity shall not constitute expropriation or any other measure having similar effect.
5.5. Non-discriminatory regulatory measures by a Party or measures or awards by judicial bodies of a Party that are designed and applied to protect legitimate public interest or public purpose objectives such as public health, safety and the environment shall not constitute expropriation under this Article.
5.6. While considering an alleged breach of this Article, Tribunal shall take account of whether the investor or, as appropriate, the locally established enterprise, pursued action for remedies before domestic courts or tribunals prior to initiating a claim under this Treaty.
Article 6. Transfers
6.1. Subject to its law, each Party shall permit all funds of an investor of the other Party related to an investment in its territory to be freely transferred on a non-discriminatory basis after payment of the respective taxes and duties. Such funds include, in particular, but not limited to:
(i) Contributions to capital;
(ii) Profits, dividends, capital gains and proceeds from the sale of all or any part of the investment or from the partial or complete liquidation ofthe investment;
(iii) Interest, royalty payments, management fees, and technical assistance and other fees;
(iv) Payments made under a contract, including a loan agreement;
(v) Payments made pursuant to Article 5 [Expropriation], Article 7 [Compensation for losses] and under Chapter IV.
6.2 Unless otherwise agreed to between the Parties, currency transfer under paragraph 1 of this Article shall be permitted in the currency of the original investment or any other convertible currency. Such transfer shall be made at the market rate of exchange on the date of transfer.
6.3. Nothing in this Treaty shall prevent a Party from conditioning or preventing a transfer through a non-discriminatory, good faith application of its law, including actions relating to:
(i) Bankruptcy, insolvency or the protection of the rights of the creditors;
(ii) Compliance with judicial, arbitral or administrative decisions and awards;
(iii) Compliance with labour obligations;
(iv) Financial reporting or record keeping of transfers when necessary to assist law enforcement or financial regulatory authorities;
(v) Issuing, trading or dealing in securities, futures, options, or derivatives;
(vi) Compliance with the law on taxation;
(vii) Criminal or penal offences and the recovery of the proceeds of crime;
(viii) Social security, public retirement, or compulsory savmgs schemes, including provident funds, retirement gratuity programs and employees insurance programs;
(ix) Severance entitlements of employees;
(x) Requirement to register and satisfy other formalities imposed by the central bank and other relevant authorities of a Party; and
(xi) Requirements to lock-in initial capital investments, as per the respective Party's law , where applicable, provided that, any new measure which would require a lock-in period for investments will not apply to existing investments.
6.4. Notwithstanding anything in paragraphs 1 and 2 ofthis Article to the contrary, the Parties may temporarily restrict transfers in the event of serious balance-of-payments difficulties or threat thereof, or in cases where, in exceptional circumstances, movements of capital cause or threaten to cause serious difficulties for macroeconomic management, in particular, monetary and exchange rate policies.
Article 7. Compensation for Losses
Each Party shall accord to investors of the other Party, and to investments by such investors, non-discriminatory treatment with respect to measures, including restitution, indemnification, compensation or other settlement, it adopts or maintains relating to losses suffered by investments in its territory owing to war or other armed conflict, civil strife, state of national emergency or a natural disaster.
Article 8. Subrogation
8.1. If a Party or its designated agency makes a payment to any of its investors under a guarantee or a contract of insurance it has entered into in respect of an investment, the other Party shall recognize the validity of the subrogation in favour of such Party or agency to any right or title held by the investor.
8.2 A Party or its designated agency which is subrogated to the rights of an investor in accordance with paragraph 1 of this Article shall be entitled in all circumstances to the same rights as those of the investor in respect of the investment. Such rights may be exercised by the Party or its designated agency thereof, or by the investor if the Party or any agency so authorizes.
Article 9. Entry and Sojourn of Personnel
Subject to its law relating to the entry and sojourn of non-citizens , each Party shall permit natural persons of the other Party employed by theinvestor or the locally established enterprise to enter and remain in its territory for the purpose of engaging in activities connected with the investment.
Article 10. Transparency
10.1. Each Party shall, to the extent possible, ensure that its law in respect of any matter covered by this Treaty are promptly published or otherwise made available in such a manner as to enable interested persons and the other Party to become acquainted with them.
10.2 Each Party shall, as provided for in its laws and regulations:
(i) Publish any such measure that it proposes to adopt; and
(ii) Provide interested persons and the other Party a reasonable opportunity to comment on such proposed measures.
10.3. Each Party shall, upon request by the other Party, promptly respond to specific questions from and provide information to the other Party with respect to matters referred to in paragraph 1 of this Article.
10.4. Nothing in this Treaty shall require a Party to furnish or allow access to confidential information, the disclosure of which would impede law enforcement, or otherwise be contrary to the public interest, or which would prejudice legitimate commercial interests of particular juridical persons, public or private.