Title

COOPERATION AND FACILITATION INVESTMENT AGREEMENT BETWEEN THE FEDERATIVE REPUBLIC OF BRAZIL AND

Preamble

The Federative Republic of Brazil

and

(hereinafter designated as the "Parties" or individually as "Party"),

Wishing to strengthen and to enhance the bonds of friendship and the spirit of continuous cooperation between the Parties;

Seeking to create and maintain favourable conditions for the investments of investors of a Party in the territory of the other Party;

Seeking to stimulate, streamline and support bilateral investments, thus opening new integration opportunities between the Parties;

Recognizing the essential role of investment in promoting sustainable development;

Considering that the establishment of a strategic partnership between the Parties in the area of investment will bring wide-ranging and mutual benefits;

Recognizing the importance of fostering a transparent and friendly environment for investments by investors of the Parties;

Reassuring their regulatory autonomy and policy space;

Wishing to encourage and strengthen contacts between the private sectors and the Governments of the two countries; and

Seeking to create a mechanism for technical dialogue and foster government initiatives that may contribute to a significant increase in mutual investment;

Agree, in good faith, to the following Cooperation and Facilitation Investment Agreement, hereinafter referred to as "Agreement", as follows:

Body

Part I. Scope of the Agreement and Definitions

Article 1. Objective

1. The objective of this Agreement is to promote cooperation between the Parties in order to facilitate and encourage mutual investment, through the establishment of a an institutional framework for the management of an agenda for further investment cooperation and facilitation, as well as through mechanisms for risk mitigation and prevention of disputes, among other instruments mutually agreed on by the Parties.

Article 2. Scope and Coverage

1. This Agreement Shall Apply to All Investments Made Before or after Its Entry Into Force.

2. This Agreement Shall Not Limit the Rights and Benefits Which an Investor of a Party enjoys Under National or International Law In the Territory of the other Party.

3. For greater certainty, the Parties reaffirm that this Agreement shall apply without prejudice to the rights and obligations derived from the Agreements of the World Trade Organization.

4. This agreement shall not prevent the adoption and implementation of new legal requirements or restrictions to investors and their investments, as long as they are consistent with this Agreement.

Article 3. Definitions

1. For the purpose of this Agreement:

1.1 Enterprise means: any entity constituted or organized under applicable law, whether or not for profit, whether privately owned or State--owned, including any corporation, trust, partnership, sole proprietorship, joint venture and entities without legal personality;

1.2 Host State means the Party where the investment is made.

1.3 Investment means a direct investment of an investor of one Party, established or acquired in accordance with the laws and regulations of the other Party, that s, directly or indirectly, allows the investor to exert control or significant degree of influence over the management of the production of goods or provision of services in the territory of the other Party, including but not limited to:

a) an enterprise;

b) shares, stocks, participations and other equity types in an enterprise;

c) movable or immovable property and other property rights such as mortgages, liens, pledges, encumbrances or similar rights and obligations;

include:

d) concession, license or authorization granted by the Host State to the investor of the other Party;

e) loans and debt instruments to a company:

f) intellectual property rights as defined or referenced to in the Trade-Related Aspects of Intellectual Property Rights of the World Trade Organization (TRIPS)

For the purposes of this Agreement and for greater certainty, "Investment" does not

i) an order or judgment issued as a result of a lawsuit or an administrative process;

ii) debt securities issued by a Party or loans granted from a Party to the other Party, bonds, debentures, loans or other debt instruments of a State-owned enterprise of a Party that is considered to be public debt under the legislation of that Party;

ii) portfolio investments, ie., those that do not allow the investor to exert a significant degree of influence in the management of the company; and

iii) claims to money that arise solely from commercial contracts for the sale of goods or services by an investor in the territory of a Party to a national or an enterprise in the territory of another Party, or the extension of credit in connection with a commercial transaction, or any other claims to money that do not involve the kind of interests set out in sub-paragraphs (a)-(e) above.

1.4 Investor means a national, permanent resident or enterprise of a Party that has made an investment in the territory of the other Party;

1.5 Income means the values obtained by an investment, including profits, interests, capital gains, dividends or "royalties".

1.6 Measure means any measure adopted by a Party, whether in the form of law, regulation, rule, procedure, decision, administrative ruling, or any other form.

1.7 National means a natural person that has the nationality of a Party, according to its laws and regulations.

1.8 Territory means the territory, including its land and aerial spaces, the exclusive economic zone, territorial sea, seabed and subsoil within which the Party exercises its sovereign rights or jurisdiction, in accordance with international law and its internal legislation.

Part II. Regulatory Measures and Risk Mitigation

Article 4. Admission and Treatment

1. Each Party shall admit and encourage investments of investors of the other Party, according to their respective laws and regulations.

2. Each Party shall grant to investments and investors of the other Party treatment according to the due process of law.

3. In line with the principles of this Agreement, each Party shall ensure that all measures that affect investment are administered in a reasonable, objective and impartial manner, in accordance with their respective laws and regulations.

Article 5. National Treatment

1. Without prejudice to the exceptions in force under its legislation on the date of entry into force of this Agreement, each Party shall accord to investors of another Party treatment no less favourable than that it accords, in like circumstances, to its own investors with respect to the expansion, management, conduct, operation, and sale or other disposition of investments in its territory.

2. Without prejudice to the exceptions in force under its legislation on the date of entry into force of this Agreement, 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 its own investors with respect to the expansion, management, conduct, operation, and sale or other disposition of investments.

3. 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 public interest objectives.

4. For greater certainty, this Article shall not be construed to require any Party to compensate for any inherent competitive disadvantages which result from the foreign character of the investor or investments.

Article 6. Most-Favoured-Nation Treatment

1. Each Party shall accord to investors of another Party treatment no less favourable than that it accords, in like circumstances, to investors of any non-Party with respect to the expansion, management, conduct, operation, and sale or other disposition of investments in its territory.

2. 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 the expansion, management, conduct, operation, and sale or other disposition of investments.

3. This Article shall not be construed to require a Party to grant to an investor of another Party or their investments the benefit of any treatment, preference or privilege arising from:

(i) provisions relating to investment dispute settlement contained in an investment agreement or an investment chapter of a commercial agreement; or

(ii) any agreement for regional economic integration, free trade area, customs union or common market, of which a Party is a member .

4. 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 public welfare objectives.

Article 7. Expropriation

1. Each Party shall not directly nationalize or expropriate investments of investors of the other Party, except:

a) for a public purpose or necessity or when justified as social interest;

b) in a non-discriminatory manner;

c) on payment of effective compensation, according to paragraphs 2 to 4; and

d) in accordance with due process of law.

2. The compensation shall:

a) Be paid without undue delay;

b) Be equivalent to the fair market value of the expropriated investment, immediately before the expropriating measure has taken place ("expropriation date");

c) Not reflect any change in the market value due to the knowledge of the intention to expropriate, before the expropriation date; and

d) Be completely payable and transferable, according to Article 9.

3. The compensation to be paid shall not be inferior to the fair market value on the expropriation date, plus interests at a rate determined according to market criteria accrued since the expropriation date until the date of payment, according to the legislation of the Host State.

4. The Parties shall cooperate to improve the mutual knowledge of their respective national legislations regarding investment expropriation.

5. For greater certainty, this article only provides for direct expropriation, where an investment is nationalized or otherwise directly expropriated through formal transfer of title or ownership rights.

Article 8. Compensation for Losses

1. The investors of a Party whose investments in the territory of the other Party suffer losses due to war or other armed conflict, revolution, state of emergency, insurrection, riot or any other similar events, shall enjoy, with regard to restitution, indemnity or other form of, compensation, the same treatment as the latter Party accords to its own investors or the treatment accorded to investors of a third party, whichever is more favourable to the affected investor.

2. Each Party shall provide the investor restitution, compensation, or both, as appropriate, in accordance with Article 6 of this Agreement, in the event that investments suffer losses in its territory in any situation referred to in paragraph 1 resulting from:

(a) requisitioning of its investment or part thereof by the forces or authorities of the latter Party; or

(b) destruction of its investment or any part thereof by the forces or authorities of the latter Party.

Article 9. Transparency

1. Each Party shall ensure that its laws, regulations, procedures and general administrative resolutions related to any matter covered by this Agreement, in particular regarding qualification, licensing and certification, are published without delay and, when possible, in electronic format, as to allow interested persons of the other Party to be aware of such information.

2. Each Party shall endeavour to allow reasonable opportunity to those stakeholders interested in expressing their opinions on the proposed measures.

3. Whenever possible, each Party shall publicize this Agreement to their respective public and private financial agents, responsible for the technical evaluation of risks and the approval of loans, credits, guarantees and related insurances for investment in the territory of the other Party.

Article 10. Transfers

1. Each Party shall allow that the transfer of funds related to an investment be made freely and without undue delay, to and from their territory. Such transfers include:

(a) the initial capital contribution or any addition thereof in relation to the maintenance or expansion of such investment;

(b) income directly related to the investment;

(c) the proceeds of sale or total or partial liquidation of the investment;

(d) the repayments of any loan, including interests thereon, relating directly to the investment;

(e) the amount of a compensation.

2. Without prejudice to paragraph 1, a Party may, in an equitable and non-discriminatory manner and in good faith, prevent a transfer if such transfer is prevented under its laws relating to:

(a)bankruptcy, insolvency or the protection of the rights of creditors;

(b)criminal infractions;

(c)financial reports or maintenance of transfers’ registers when necessary to cooperate with law enforcement or with financial regulators; or

(d) the guarantee for the enforcement of decisions in judicial or administrative proceedings.

3.. Nothing in this Agreement shall be construed as to prevent a Party from adopting or maintaining temporary restrictive measures in respect of payments or transfers for current account transactions in the event of serious difficulties in the balance of payments and external financial difficulties or threat thereof.

4. Nothing in this Agreement shall be construed as to prevent a Party from adopting or maintaining temporary restrictive measures in respect of payments or transfers related to capital movements:

(a) in the case of serious difficulties in the balance of payments or external financial difficulties or threat thereof; or

(b) where, in exceptional circumstances, payments or transfers from capital movements generate or threaten to generate serious difficulties for macroeconomic management.

5. The adoption of temporary restrictive measures to transfers if there are serious difficulties in the balance of payments in the cases described in paragraphs 1 and 2, must be non-discriminatory and in accordance with the Articles of the Agreement of the International Monetary Fund.

Article 11. Tax Measures

1. No provision of this Agreement shall be interpreted as an obligation of one Party to give to an investor from the other Party, concerning his or her investments, the benefit of any treatment, preference or privilege arising out of any agreement to avoid double taxation, current or future, of which a Party to this Agreement is a party or becomes a party.

2. No provision of this Agreement shall be interpreted in a manner that prevents the adoption or implementation of any measure aimed at ensuring the equitable or effective imposition or collection of taxes, according to the Parties” respective laws and regulations, so long as such a measure is not applied as to constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction.

Article 12. Prudential Measures

1. Nothing in this Agreement shall be construed to prevent a Party from adopting or maintaining prudential measures, such as:

(a) the protection of investors, depositors, financial market participants, policy-holders, policy-claimants, or persons to whom a fiduciary duty is owed by a financial institution;

(b) the maintenance of the safety, soundness, integrity or financial responsibility of financial institutions; and

(c) ensuring the integrity and stability of a Party's financial system.

2. Where such measures do not conform with the provisions of this Agreement, they shall not be used as a means of circumventing the commitments or obligations of the Party under this Agreement.

Article 13. Security Exceptions

1. Nothing in this Agreement shall be construed to prevent a Party from adopting or maintaining measures aimed at preserving its national security or public order, or to apply the provisions of their criminal laws or comply with its obligations regarding the maintenance of international peace and security in accordance with the provisions of the United Nations Charter.

2. Measures adopted by a Party under paragraph 1 of this Article or the decision based on national security laws or public order that at any time prohibit or restrict the realization of an investment in its territory by an investor of another Party shall not be subject to the dispute settlement mechanism under this Agreement.

Article 14. Corporate Social Responsibility

1. Investors and their investment shall strive to achieve the highest possible level of contribution to the sustainable development of the Host State and the local community, through the adoption of a high degree of socially responsible practices, based on the voluntary principles and standards set out in this Article.

2. The investors and their investment shall endeavour to comply with the following voluntary principles and standards for a responsible business conduct and consistent with the laws adopted by the Host State receiving the investment:

a) Contribute to the economic, social and environmental progress, aiming at achieving sustainable development;

b) Respect the internationally recognized human rights of those involved in the companies' activities;

c) Encourage local capacity building through close cooperation with the local community;

d) Encourage the creation of human capital, especially by creating employment opportunities and offering professional training to workers to;

e) Refrain from seeking or accepting exemptions that are not established in the legal or regulatory framework relating to human rights, environment, health, security, work, tax system, financial incentives, or other issues;

f) Support and advocate for good corporate governance principles, and develop and apply good practices of corporate governance;

g) Develop and implement effective self-regulatory practices and management systems that foster a relationship of mutual trust between the companies and the societies in which its operations are conducted;

h) Promote the knowledge of and the adherence to, by workers, the corporate policy, through appropriate dissemination of this policy, including programs for professional training;

i) Refrain from discriminatory or disciplinary action against employees who submit grave reports to the board or, whenever appropriate, to the competent public authorities, about practices that violate the law or corporate policy;

j) Encourage, whenever possible, business associates, including service providers and outsources, to apply the principles of business conduct consistent with the principles provided for in this Article; and

k) Refrain from any undue interference in local political activities.

Article 15. Investment Measures and Combating Corruption and Illegality

1. Each Party shall adopt measures and make efforts to prevent and fight corruption, money laundering and terrorism financing with regard to matters covered by this Agreement, in accordance with its laws and regulations.

2. Nothing in this Agreement shall require any Party to protect investments made with capital or assets of illicit origin or investments in the establishment or operation of which illegal acts have been demonstrated to occur and for which national legislation provides asset forfeiture.

Article 16. Provisions on Investment and Environment, Labor Affairs and Health

1. Nothing in this Agreement shall be construed to prevent a Party from adopting, maintaining or enforcing any measure it deems appropriate to ensure that investment activity in its territory is undertaken in a manner according to labor, environmental and health legislations of that Party, provided that this measure is not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination or a disguised restriction.

2. The Parties recognize that it is inappropriate to encourage investment by lowering the standards of their labor and environmental legislation or measures of health. Therefore, each Party guarantees it shall not amend or repeal, nor offer the amendment or repeal of such legislation to encourage the establishment, maintenance or expansion of an investment in its territory, to the extent that such amendment or repeal involves decreasing their labor, environmental or health standards. If a Party considers that another Party has offered such an encouragement, the Parties will address the issue through consultations.

Part II. Institutional Governance and Dispute Prevention

Article 17. Joint Committee for the Administration of the Agreement

1. For the purpose of this Agreement, the Parties hereby establish a Joint Committee for the administration of this Agreement (hereinafter referred as “Joint Committee”).

2. This Joint Committee shall be composed of government representatives of both Parties designated by their respective Governments.

3. The Joint Committee shall meet at such times, in such places and through such means as the Parties may agree. Meetings shall be held at least once a year, with alternating chairmanships between the Parties. 4. The Joint Committee shall have the following functions and responsibilities:

a) Supervise the implementation and execution of this Agreement;

b) Discuss and divulge opportunities for the expansion of mutual investment;

c) Coordinate the implementation of the mutually agreed cooperation and facilitation agendas;

d) Consult with the private sector and civil society, when applicable, on their views on specific issues related to the work of the Joint Committee;

e) Seek to resolve any issues or disputes concerning investments of investors of a Party in an amicable manner; and

f) Supplement the rules for arbitral dispute settlement between the Parties.

5. The Parties may establish ad hoc working groups, which shall meet jointly or separately from the Joint Committee.

6. The private sector may be invited to participate in the ad hoc working groups, whenever authorized by the Joint Committee.

Article 18. Focal Points or “Ombudsmen"