Title
Agreement between the Government of Canada and the Government of the United Republic of Tanzania for the Promotion and Reciprocal Protection of Investments
Preamble
The Government of Canada and the Government of the United Republic of Tanzania, hereinafter referred to as the "Parties",
Desiring to intensify economic co-operation and promote sustainable development for the mutual benefit of both countries and to create and maintain favourable conditions for investments by investors of one Party in the territory of the other Party,
Recognizing that the promotion and reciprocal protection of such investments favour the economic prosperity and sustainable development of the two Parties by stimulating investment initiatives,
Have agreed as follows:
Body
Section A. Definitions
Article 1. Definitions
For the purpose of this Agreement:
Central government means:
(a) for Canada, the federal level of government; and
(b) for Tanzania, the Government of the United Republic of Tanzania;
Competition authority means:
(a) for Canada: the Commissioner of Competition or any successor; and
(b) for the United Republic of Tanzania: the Commissioner for Fair Competition or any successor;
Confidential information means confidential business information and information that is privileged or otherwise protected from disclosure under a Party's domestic law;
Covered investments means, with respect to a Party, investments in its territory of an investor of the other Party on the date of entry into force of this Agreement, as well as investments made or acquired thereafter;
Disputing investor means an investor that makes a claim under Section C;
Disputing party means either the respondent Party or the investor who has submitted a claim under Section C;
Enterprise means:
(a) any entity constituted or organized under applicable law, whether privately-owned or governmentally-owned, including any corporation, trust, partnership, sole proprietorship, joint venture or other association; and
(b) a branch of any such entity;
Existing means in effect on the date of entry into force of this Agreement;
Financial institution means any financial intermediary or other enterprise that is authorized to do business and regulated or supervised as a financial institution under the law of the Party in whose territory it is located;
Financial service means a service of a financial nature, including insurance, and a service incidental or auxiliary to a service of a financial nature;
ICSID means the International Centre for the 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 on 18 March 1965;
Information protected under its competition laws means:
(a) in the case of Canada, information within the scope of Section 29 of the Competition Act, R.S. 1985, c.34, or any successor provision; and
(b) in the case of the United Republic of Tanzania, information within the scope of Section 76 of the Fair Competition Act of 2003 or any successor provision;
Intellectual property rights means copyright and related rights, trademark rights, rights in geographical indications, rights in industrial designs, patent rights, rights in layout designs of integrated circuits, rights in relation to protection of undisclosed information, and plant breeders' rights;
Investment means:
(a) an enterprise;
(b) shares, stocks and other forms of equity participation in an enterprise;
(c) bonds, debentures, and other debt instruments of an enterprise;
(d) a loan to an enterprise;
(e) notwithstanding subparagraphs (c) and (d) above, a loan to or debt security issued by a financial institution is an investment only where the loan or debt security is treated as regulatory capital by the Party in whose territory the financial institution is located;
(f) an interest in an enterprise that entitles the owner to a share in income or profits of the enterprise;
(g) an interest in an enterprise that entitles the owner to share in the assets of that enterprise on dissolution;
(h) interests arising from the commitment of capital or other resources in the territory of a Party to economic activity in such territory, such as under:
(i) contracts involving the presence of an investor's property in the territory of the Party, including turnkey or construction contracts, and concessions such as to search for, develop, extract and process natural resources, or
(ii) contracts where remuneration depends substantially on the production, revenues or profits of an enterprise;
(i) intellectual property rights; and
(j) any other tangible or intangible, moveable or immovable, property and related property rights acquired in the expectation of or used for the purpose of economic benefit or other business purpose;
But investment does not mean:
(k) claims to money that arise solely from:
(i) 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 the other Party, or
(ii) the extension of credit in connection with a commercial transaction, such as trade financing, other than a loan covered by subparagraph (d); or
(l) any other claims to money, that do not involve the kinds of interests set out in subparagraphs (a) to (j);
Investment of an investor of a Party means an investment owned or controlled directly or indirectly by an investor of such Party;
Investor of a Party means a Party, a national of a Party or an enterprise of a Party, that seeks to make, is making or has made an investment;
Measure includes any law, regulation, procedure, requirement, or practice;
National means:
(a) in the case of Canada, a natural person who is a citizen or permanent resident of Canada; and
(b) in the case of the United Republic of Tanzania, a natural person deriving his or her status as a national of the United Republic of Tanzania from the law in force in the United Republic of Tanzania,
A natural person who is a citizen of one Party and a permanent resident of the other Party shall be deemed to be exclusively a national of the Party of his or her citizenship;
New York Convention means the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards, done at New York on 10 June 1958;
Person means a natural person or an enterprise;
Respondent Party means a Party against which a claim is made under Section C;
Returns means the amounts yielded by investments, and in particular, though not limited to, profits, capital gains, dividends, interest, royalties, returns in kind or other income;
Returns in kind means returns in the form of an article or commodity, for example in goods or natural produce, as opposed to money;
Sub-national government means:
(a) in the case of Canada, provincial, territorial or local governments;
(b) in the case of the United Republic of Tanzania, municipal authorities and local government authorities;
Territory means:
(a) the land territory, air space, internal waters and territorial sea over which a Party exercises sovereignty;
(b) the exclusive economic zone of a Party, as determined by its domestic law pursuant to Part V of the United NationsConvention on the Law of the Sea (UNCLOS), done at Montego Bay on 10 December 1982; and
(c) the continental shelf of a Party, as determined by its domestic law pursuant to Part VI of UNCLOS;
Tribunal means an arbitration tribunal established under Article 23 (Submission of a Claim to Arbitration) or Article 27 (Consolidation);
UNCITRAL Arbitration Rules means the arbitration rules of the United Nations Commission on International Trade Law, in their most recent form;
WTO Agreement means the Marrakesh Agreement Establishing the World Trade Organization, done at Marrakesh on 15 April 1994.
Article 2. Substantive Obligations
1. This Agreement shall apply to measures adopted or maintained by a Party relating to:
(a) investors of the other Party; and
(b) covered investments.
2. The obligations in Section B shall apply to any person of a Party when it exercises any regulatory, administrative or other governmental authority delegated to it by that Party.
Article 3. Promotion of Investment
Each Party shall encourage the creation of favourable conditions for investors of the other Party to make investments in its territory.
Article 4. National Treatment
1. Each Party shall accord to investors of the other Party treatment no less favourable than that it accords, in like circumstances, to its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation and sale or other disposition of investments in its territory.
2. Each Party shall accord to covered investments treatment no less favourable than that it accords, in like circumstances, to investments of its own investors with respect to the establishment, acquisition, expansion, management, conduct, operation and sale or other disposition of investments in its territory.
3. The treatment accorded by a Party under paragraphs 1 and 2 means, with respect to a sub-national government, treatment no less favourable than the treatment accorded, in like circumstances, by that sub-national government to investors, and to investments of investors, of the Party of which it forms a part.
Article 5. Most-favoured-nation Treatment
1. Each Party shall accord to investors of the other Party treatment no less favourable than that it accords, in like circumstances, to investors of a non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation and sale or other disposition of investments in its territory.
2. Each Party shall accord to covered investments treatment no less favourable than that it accords, in like circumstances, to investments of investors of a non-Party with respect to the establishment, acquisition, expansion, management, conduct, operation and sale or other disposition of investments in its territory.
3. For greater certainty, the treatment accorded by a Party under this Article means, with respect to a sub-national government, treatment accorded, in like circumstances, by that sub-national government to investors, and to investments of investors, of a non-Party.
Article 6. Minimum Standard of Treatment
1. Each Party shall accord to covered investments treatment in accordance with the customary international law minimum standard of treatment of aliens, including fair and equitable treatment and full protection and security.
2. The concepts of "fair and equitable treatment" and "full protection and security" in paragraph 1 do not require treatment in addition to or beyond that which is required by the customary international law minimum standard of treatment of aliens.
3. 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.
Article 7. Compensation for Losses
Notwithstanding Article 16(6) (Reservations and Exceptions), each Party shall accord to investors of the other Party who suffer losses to their covered investments in its the territory, a treatment which is no less favourable than that accorded to its own investors or to investors of any third State, with respect to restitution, indemnification, compensation or other settlement that it adopts or maintains, due to war or other armed conflict, a state of national emergency, revolt, insurrection or riot. Resulting payments shall be transferable without delay in a freely convertible currency.
Article 8. Senior Management, Boards of Directors and Entry of Personnel
1. A Party may not require that enterprises of that Party, that are covered investments, appoint individuals of any particular nationality to senior management positions.
2. A Party may require that a majority of the board of directors, or any committee thereof, of enterprises that are covered investments be of a particular nationality or resident in the territory of the Party, provided that the requirement does not materially impair the ability of the investor to exercise control over its investment.
3. Subject to its laws, regulations and policies relating to the entry of aliens, each Party shall grant temporary entry to nationals employed by an investor of the other Party who seek to render managerial or executive services, or services that require specialized knowledge, to an investment of that investor in the territory of the Party.
Article 9. Performance Requirements
1. A Party may not impose the following requirements in connection with the establishment, acquisition, expansion, management, conduct or operation of an investment of an investor of a Party or of a non-Party in its territory:
(a) to export a given level or percentage of a good or service;
(b) to achieve a given level or percentage of domestic content;
(c) to purchase, use or accord a preference to a good produced or service provided in its territory, or to purchase a good or service from a person in its territory;
(d) to relate the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows associated with that investment;
(e) to restrict sales of a good or service in its territory that the investment produces or provides by relating those sales to the volume or value of its exports or foreign exchange earnings;
(f) to transfer technology, a production process or other proprietary knowledge to a person in its territory; or
(g) to supply exclusively from the territory of the Party a good that the investment produces or a service it provides to a specific regional market or to the world market.
2. A measure that requires an investment to use a technology to meet generally applicable health, safety or environmental requirements is not inconsistent with subparagraph 1(f).
3. A Party may not condition the receipt or continued receipt of an advantage, in connection with an investment in its territory of an investor of a Party or of a nonParty, on compliance with the following requirements:
(a) to achieve a given level or percentage of domestic content;
(b) to purchase, use or accord a preference to a good produced in its territory, or to purchase a good from a producer in its territory;
(c) to relate the volume or value of imports to the volume or value of exports or to the amount of foreign exchange inflows associated with that investment; or
(d) to restrict sales of a good or service in its territory that the investment produces or provides by relating those sales to the volume or value of its exports or foreign exchange earnings;
4.
(a) Paragraph 3 does not prevent a Party from conditioning the receipt or continued receipt of an advantage, in connection with an investment in its territory of an investor of a Party or of a non-Party, on compliance with a requirement to locate production, provide a service, train or employ workers, construct or expand particular facilities, or carry out research and development, in its territory;
(b) Subparagraph 1(f) does not apply if the requirement is imposed or the commitment or undertaking is enforced by a court, administrative tribunal or competition authority to remedy an alleged violation of domestic competition law.
5. Paragraphs 1 and 3 do not apply to a requirement other than the requirements set out in those paragraphs.
6. The provisions of:
(a) subparagraphs 1(a), (b) and (c), and 3(a) and (b), do not apply to a qualification requirement for a good or service with respect to export promotion and foreign aid programs;
(b) subparagraphs 1(b), (c), (f) and (g), and 3(a) and (b), do not apply to procurement by a Party or a State enterprise; and
(c) subparagraphs 3(a) and (b) do not apply to a requirement imposed by an importing Party relating to the content of a good necessary to qualify for a preferential tariff or preferential quota.
Article 10 . Expropriation
1. A Party shall not nationalize or expropriate covered investments either directly or indirectly through measures having an effect equivalent to nationalization or expropriation (hereinafter referred to as "expropriation") except for a purpose which is in the public interest, in accordance with due process of law, in a non-discriminatory manner and on payment of prompt, adequate and effective compensation.
2. Such compensation shall be equivalent to the fair market value of the expropriated investment immediately before the expropriation took 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 including the declared tax value of tangible property, and other criteria to determine fair market value.
3. Compensation shall be paid without delay and shall be fully realizable and freely transferable. Compensation shall be payable in a freely convertible currency and shall include interest at a commercially reasonable rate for that currency from the date of expropriation until date of payment.
4. The investor affected shall have a right under the law of the expropriating Party to prompt review of its case and of the valuation of its investment by a judicial or other independent authority of that Party in accordance with the principles set out in this Article.
5. For the purposes of this Article, direct expropriation occurs where an investment is nationalised or otherwise directly expropriated through formal transfer of title or outright seizure and indirect expropriation results from a measure or series of measures of a Party that have an effect equivalent to direct expropriation without formal transfer of title or outright seizure.
In the context of a any dispute arising under Section C, the determination of whether a measure or series of measures of a Party constitute an indirect expropriation shall be determined through a case-by-case, fact-based inquiry that shall consider, among other factors:
(a) 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 shall not establish that an indirect expropriation has occurred;
(b) the extent to which the measure or series of measures interfere with distinct, reasonable investment-backed expectations; and
(c) the character of the measure or series of measures.
Except in rare circumstances, such as when a measure or series of measures are so severe in the light of their purpose that they cannot be reasonably viewed as having been adopted and applied in good faith, non-discriminatory measures of a Party that are designed and applied to protect legitimate public welfare objectives, such as health, safety and the environment, do not constitute indirect expropriation.
6. This Article shall not apply to 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 applicable international trade agreements to which both Parties are party.
Article 11. Transfers (1)
1. Each Party shall permit all transfers relating to covered investments to be made freely and without delay, into and out of its territory. Such transfers include:
(a) contributions to capital;
(b) profits, dividends, interest, capital gains, royalty payments, management fees, technical assistance and other fees, returns in kind and other amounts derived from the covered investment;
(c) proceeds from the sale of all or any part of covered investments or from the partial or complete liquidation of covered investments;
(d) payments made under a contract entered into by the investor, or covered investments, including payments made pursuant to a loan agreement;
(e) payments made pursuant to Articles 7 (Compensation for Losses) and 10 (Expropriation); and
(f) payments arising under Section C.
2. Each Party shall permit transfers relating to covered investments to be made in the convertible currency in which the capital was originally invested, or in any other convertible currency agreed to by the investor and the Party concerned. Unless otherwise agreed by the investor, transfers shall be made at the market rate of exchange applicable on the date of transfer.
3. Notwithstanding paragraphs 1 and 2, a Party may prevent a transfer through the equitable, non-discriminatory and good faith application of its laws relating to:
(a) bankruptcy, insolvency or the protection of the rights of creditors;
(b) issuing, trading or dealing in securities;
(c) criminal or penal offences;
(d) reports of transfers of currency or other monetary instruments; or
(e) ensuring the satisfaction of judgments in adjudicatory proceedings.
4. A Party may not require its investors to transfer, or penalize its investors for failure to transfer, the income, earnings, profits or other amounts derived from, or attributable to, investments in the territory of the other Party.
5. Paragraph 4 shall not be construed to prevent a Party from imposing any measure through the equitable, non-discriminatory and good faith application of its laws relating to the matters in subparagraphs (a) through (e) of paragraph 3.