(b) covered investments.
2. Nothing in this Chapter shall impose any obligation on either Party regarding measures pursuant to immigration laws and regulations.
3. This Chapter shall not apply to:
(a) government procurement;
(b) subsidies or grants provided by a Party, including government supported loans, guarantees, insurance, and any conditions attached to the receipt or continued receipt of such subsidies or grants;
(c) services supplied in the exercise of governmental authority;
(d) any taxation measure, except as provided for in Article 9.11 (Expropriation and Compensation) and Article 9.12 (Transfers); and
(e) any measure adopted or maintained by a Party to the extent that it is covered by Chapter 8 (Trade in Services).
4. Notwithstanding subparagraph 3(e), Article 9.5 (Treatment of Investment), Article 9.6 (Compensation for Losses), Article 9.11 (Expropriation and Compensation), Article 9.12 (Transfers), Article 9.13 (Subrogation), and Article 9.24 (Settlement of Investment Disputes between a Party and an Investor of the other Party) shall apply, mutatis mutandis, to any measure affecting the supply of a service by a service supplier of a Party through commercial presence in the territory of the other Party covered by Chapter 8 (Trade in Services), but only to the extent that any such measure relates to a covered investment and an obligation under this Chapter, regardless of whether such a service sector is scheduled in the Party's Schedule of Specific Commitments in Annex 8A (Schedule of Specific Commitments - Thailand) or Annex 8B (Schedule of Specific Commitments - Sri Lanka).
5. For the purposes of liberalisation, this Chapter shall apply to investments, subject to Article 9.9 (Reservations and Non-conforming Measures), in the non-service sectors.
6. Notwithstanding any other provisions of this Agreement, a Party shall not be prevented from taking measures for prudential reasons, including for the protection of investors, depositors, policy holders or persons to whom a fiduciary duty is owed by a financial service supplier, or to ensure the integrity and stability of the financial system or to ensure the stability of the exchange rate, including to prevent speculative capital flow. Where such measures are taken, they shall not be used as a means of avoiding the Party's commitments or obligations under this Agreement.
7. For greater certainty, the provisions of this Chapter do not impose any obligation on 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 9.3. National Treatment
1. Each Party shall accord to investors of the other Party, and to covered investments, treatment no less favourable than that it accords, in like circumstances, to its own investors and their investments with respect to the establishment, acquisition, expansion, management, conduct, operation, and sale or other disposition of investments.
2. For greater certainty, whether treatment is accorded in "like circumstances" depends on the totality of the circumstances, including whether the relevant treatment distinguishes between investments of investors on the basis of legitimate public welfare objectives.
Article 9.4. 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 it accords, in like circumstances, to investments in its territory of investors of a non-Party with respect to the establishment, acquisition, 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 welfare objectives.
4. The treatment, as set forth in paragraphs 1 and 2, shall not include:
(a) any preferential treatment accorded to investors or their investments under any existing bilateral, regional or international agreements, or any forms of economic or regional cooperation with any non-Party;
(b) in the case of Thailand, any measure that accords preferential treatment to ASEAN Member States under any agreements between all ASEAN Member States, in force or signed after the date of entry into force of this Agreement. For the avoidance of doubt, such agreements do not include agreements between ASEAN Member States and non-ASEAN Member States;
(c) in the case of Sri Lanka, any measure that accords preferential treatment to SAARC Member States under any agreements between all SAARC Member States, in force or signed after the date of entry into force of this Agreement. For the avoidance of doubt, such agreements do not include agreements between SAARC Member States and non-SAARC Member States;
5. For greater certainty, paragraphs 1 and 2 shall not be construed as granting to investors options or procedures for the settlement of disputes other than those set out in Article 9.24 (Settlement of Investment Disputes between a Party and an Investor of the other Party).
Article 9.5. Treatment of Investment
1. Each Party shall accord to covered investments of nationals or juridical persons of the other Party, fair and equitable treatment and full protection and security in its territory. No Party shall in any way impair by unreasonable or discriminatory measures the management, maintenance, use, enjoyment or disposal of investments in its territory of nationals or juridical persons of other Party. Each Party shall observe any obligation it may have entered into with regard to investments of nationals or juridical persons of the other Party.
2. For greater certainty:
(a) "fair and equitable treatment" requires each Party not to deny justice in any legal, criminal, civil, administrative or adjudicatory proceedings in accordance with the principle of due process;
(b) "full protection and security" requires each Party to take such measures as may be reasonably necessary to ensure the physical protection and security of the covered investments; and.
(c) the concepts of fair and equitable treatment and full protection and security in subparagraphs (a) and (b) do not require treatment in addition to or beyond that is required by the customary international law minimum standard of treatment of aliens, (9) and do not create additional substantive rights.
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.
Article 9.6. Compensation for Losses
1. Each Party shall accord to investors of the other Party, whose covered investments suffered losses due to war or other armed conflict, state of national emergency, civil strife or other similar events in its territory, treatment no less favourable than that it accords, in like circumstances, to its own investors or investors of a non-Party, relating to restitution, indemnification, compensation or other forms of settlement.
2. Notwithstanding paragraph 1, 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 investment or part thereof by the other Party's forces or authorities; or
(b) destruction of its investment or part thereof by the other Party's forces or authorities, which was not required by the necessity of the situation,
the other Party shall provide the investor restitution, compensation, or both, as appropriate, for such loss.
Article 9.7. Performance Requirements
The provisions of the WTO Agreement on Trade-related Investments Measures (TRIMs), which are not specifically mentioned in or modified by this Agreement shall apply, mutatis mutandis, to this Agreement.
Article 9.8. Senior Management and Boards of Directors
1. A Party shall not require that a juridical person of that Party that is a covered investment, appoint to a senior management position a natural person of any particular nationality.
2. A Party may require that a majority of the board of directors, or any committee thereof, of a juridical person of that Party that is a covered investment, be of a particular nationality or resident in the territory of that Party, provided that the requirement does not materially impair the ability of the investor of the other Party to exercise control over its investment.
3. For the avoidance of doubt, nothing in this Article shall be construed to limit a Party from exercising its rights as a shareholder.
Article 9.9. Reservations and Non-Conforming Measures
1. Article 9.3 (National Treatment), Article 9.4 (Most-Favoured-Nation Treatment), Article 9.7 (Performance Requirements), and Article 9.8 (Senior Management and Board of Directors), shall not apply to:
(a) any existing non-conforming measure that is maintained by a Party at:
(i) the central level of government, as set out by that Party in List A of its Schedule in Annex 9A (Schedule of Reservations and Non-Conforming Measures for Investment - Thailand) or Annex 9B (Schedule of Reservations and Non-Conforming Measures for Investment - Sri Lanka);
(ii) a regional level of government, as set out by that Party in List A of its Schedule in Annex 9A (Schedule of Reservations and Non-Conforming Measures for Investment - Thailand) or Annex 9B (Schedule of Reservations and Non-Conforming Measures for Investment - Sri Lanka); or
(iii) a local level of government;
(b) the continuation or prompt renewal of any non-conforming measure referred to in subparagraph (a); or
(c) an amendment to any non-conforming measure referred to in subparagraph (a) to the extent that the amendment does not decrease the conformity of the measure, at the date of entry into force of this Agreement, with Article 9.3 (National Treatment), Article 9.4 (Most-Favoured-Nation Treatment), Article 9.7 (Performance Requirements), and Article 9.8 (Senior Management and Board of Directors).
2. Article 9,3 (National Treatment), Article 9.4 (Most-Favoured-Nation Treatment), Article 9.7 (Performance Requirements), and Article 9.8 (Senior Management and Board of Directors) shall not apply to any measure that a Party adopts or maintains with respect to sectors, subsectors, or activities, as set out by that Party in List B of its Schedule in Annex 9A (Schedule of Reservations and Non-Conforming Measures for Investment - Thailand) or Annex 9B (Schedule of Reservations and Non-Conforming Measures for Investment - Sri Lanka).
3. No Party shall, under any measure adopted after the date of entry into force of this Agreement and covered by List B of its Schedule in Annex 9A (Schedule of Reservations and Non-Conforming Measures for Investment - Thailand) or Annex 9B (Schedule of Reservations and Non-Conforming Measures for Investment - Sri Lanka), require an investor of the other Party, by reason of its nationality, to sell or otherwise dispose of an investment that exists at the time the measure becomes effective, unless otherwise specified in the initial approval by the relevant authorities.
4. Article 9.3 (National Treatment) and Article 9.4 (Most-Favoured-Nation Treatment) shall not apply to any measure that falls within Article 5 of the TRIPS Agreement, and any measure that is covered by an exception to, or derogation from, the obligations imposed by Article 3 or 4 of the TRIPS Agreement.
Article 9.10. Transparency
1. To achieve the objectives of this Chapter, each Party, to the extent possible, shall:
(a) make publicly available all relevant laws, regulations, and administrative guidelines of general application that pertain to, or affect, investments in the territory of the Party;
(b) promptly, and at least annually, inform the other Party of the introduction of any new law or of any changes to existing laws, regulations, or administrative guidelines of general application which significantly affect investments or commitments of a Party under this Chapter;
(c) promptly, and at least annually, inform the other Party of any investment-related agreements or arrangements which it has entered into and where preferential treatment was granted; and
(d) establish or designate an enquiry point where, upon request of any natural person or juridical person of the other Party, all information relating to the measures required to be published or made available under subparagraphs (b) and (c) may be promptly obtained.
2. Nothing in this Chapter shall require a Party to furnish or allow access to any confidential information, including information concerning particular investors or investments, 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.
Article 9.11. Expropriation and Compensation
1. A Party shall not nationalise or expropriate, either directly or through measures having effect equivalent to nationalisation or expropriation (hereinafter referred to as "expropriation"), (10) a covered investment of an investor of the other Party, unless such a measure is taken on a nondiscriminatory basis, for a public purpose in accordance with due process of law, and upon payment of compensation in accordance with this Article.
2. The compensation referred to in paragraph 1 shall:
(a) be equivalent to the fair market value of the expropriated investment at the time when, or immediately before, the expropriation was publicly announced, or when the expropriation occurred, whichever is applicable;
(b) be effectively realisable and freely transferable in accordance with Article 9.12 (Transfers) between the territories of the Parties;
(c) not reflect any change in value occurring, because the intended expropriation had become known earlier; and
(d) be paid without delay. (11)
3. In the event of delay, the compensation shall include an appropriate interest in accordance with the laws and regulations of the Party making the expropriation. The compensation, including any accrued interest, shall be payable either in the currency in which the investment was originally made or, if requested by the investor, in a freely usable currency.
4. If an investor requests payment in a freely useable currency, the compensation referred to in paragraphs 2 and 3 shall be converted into the currency of payment at the market rate of exchange prevailing on the date of payment.
5. This Article does 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 Chapter 10 (Intellectual Property) and the TRIPS Agreement. (12)
Article 9.12. Transfers
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) capital and additional amounts to maintain or increase an investment;
(b) profits, capital gains, dividends, interest, royalty payments, technical assistance and technical and management fees, license fees, and other current income accruing from any covered investment;
(c) proceeds from the total or partial sale or liquidation of any covered investment;
(d) payments made under a contract relating to the covered investment, including a loan agreement;
(e) payments made pursuant to Articles 9.6 (Compensation for losses) and Articles 9.11 (Expropriation and Compensation);
(f) payments arising out of the settlement of a dispute by any means including adjudication, arbitration or the agreement of the parties to the dispute; and
(g) earnings and other remuneration of personnel engaged from abroad in connection with the covered investment.
2. Each Party shall permit such 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. Notwithstanding paragraphs 1 and 2, a Party may prevent or delay 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 offences and the recovery of the proceeds of crime;
(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;
(f) taxation;
(g) social security, public retirement, or compulsory savings schemes;
(h) severance entitlement of employees; and
(i) requirement to register and satisfy other formalities imposed by the Central Bank and other relevant authorities of that Party.
4. Nothing in this Chapter shall affect the rights and obligations of a Party as a member of the IMF under its Articles of Agreement as may be amended, including the use of exchange actions which are in conformity with the Articles of Agreement as may be amended, provided that the Party shall not impose restrictions on any capital transactions inconsistently with its obligations under this Chapter regarding such transactions, except under Article 9.18 (Temporary Safeguard Measures) or at the request of the IMF.
Article 9.13. Subrogation
1. If a Party or its designated agency makes a payment to an investor of that Party under a guarantee, a contract of insurance or other form of indemnity that it has granted on non-commercial risk in respect of a covered investment, the other Party shall recognise the subrogation or transfer of any right or claim in respect of such investment. The subrogated or transferred right or claim shall not be greater than the original right or claim of the investor.
2. Where a Party or its designated agency has made a payment to an investor of that Party and has taken over rights and claims of the investor, that investor shall not, unless authorised to act on behalf of the Party or its designated agency making the payment, pursue those rights and claims against the other Party.
3. In the exercise of subrogated rights or claims, a Party or its designated agency exercising such rights or claims shall disclose the coverage of the claims arrangement with its investors to the other Party.
Article 9.14. Denial of Benefits
1. A Party may deny the benefits of this Chapter to an investor of the other Party and to the investorâs covered investments if the investor is a juridical person owned or controlled by a person of a non-Party or of the denying Party, and such juridical person has no substantive business operations in the territory of the other Party.
2. The denying Party shall, to the extent practicable, notify the other Party before denying the benefits. If the denying Party provides such notice, it shall consult with the other Party at the request of the other Party.
Article 9.15. Promotion of Investment
The Parties shall endeavour to promote and increase awareness of the Parties as an investment area, including through:
(a) encouraging investments between the Parties;
(b) organising investment promotion activities between the Parties;
(c) promoting business matching events;
(d) organising and supporting the organisation of various briefings and seminars on investment opportunities and on investment laws, regulations, and policies; and
(e) conducting information exchanges on other issues of mutual concern relating to investment promotion.
Article 9.16. Facilitation of Investment
Subject to its laws and regulations, each Party shall endeavor to cooperate in investment facilitation between the Parties including through:
(a) creating the necessary environment for all forms of investment;
(b) simplifying procedures for investment applications and approvals;
(c) promoting the dissemination of investment information, including investment rules, laws, regulations, policies, and procedures; and
(d) establishing or maintaining either contact points, one-stop investment centres, focal points or other entities in the respective host Party to provide assistance and advisory services to investors, including the facilitation of operating licences and permits.
Article 9.17. Special Formalities and Treatment of Information
1. Nothing in Article 9.4 (National Treatment) shall be construed to prevent a Party from adopting or maintaining a measure that prescribes special formalities in connection with covered investments, such as a requirement that covered investments be legally constituted under its laws or regulations, provided that such formalities do not materially impair the protections afforded by that Party to investors of the other Party and investments pursuant to this Chapter.
2. Notwithstanding Article 9.4 (National Treatment) and Article 9.5 (Most- Favoured Nation Treatment), a Party may require an investor of the other Party or its covered investment, to provide information concerning that investment solely for informational or statistical purposes. The Party shall protect such business information that is confidential from any disclosure that would prejudice the competitive position of the investor or the investment. Nothing in this paragraph shall be construed to prevent a Party from otherwise obtaining or disclosing information in connection with the equitable and good faith application of its law.
Article 9.18. Temporary Safeguard Measures
1. A Party may adopt or maintain restrictions on payments or transfers related to covered investments as defined in Article 9.1 (Definitions) in the event that it is in serious balance of payments and external financial difficulties or under threat thereof, or where, in exceptional circumstances, movements of capital cause or threaten to cause serious difficulties for macroeconomic management, in particular, monetary and exchange rate policies.
2. Such restrictions shall be applied on a non-discriminatory basis such that the other Party is treated no less favourably than any non-Party and be applied in good faith so as to avoid unnecessary damage to the commercial, economic, and financial interests of the other Party.
3. The duration of the restrictions stipulated in paragraph 1 shall not exceed those necessary to deal with the circumstances described in paragraph 1, provided that such restrictions are consistent with the IMF Articles of Agreement.
4. Such restrictions shall be temporary and be phased out progressively as the situation specified in paragraph 1 improves.
5. Where such restrictions are adopted or maintained, they shall not be used as a means of avoiding the Party's commitments or obligations under this Chapter or under the IMF Articles of Agreement.
Article 9.19. General Exceptions
Subject to the requirement that such measures are not applied in a manner which would constitute a means of arbitrary or unjustifiable discrimination between the Parties or their investors where like conditions prevail, or a disguised restriction on investors or investments made by investors of the other Party, nothing in this Chapter shall be construed to prevent the adoption or enforcement by any Party of measures:
(a) necessary to protect public morals or to maintain public order; (13)
(b) necessary to protect human, animal or plant life or health; (14)
(c) necessary to secure compliance with laws or regulations which are not inconsistent with the provisions of this Chapter including those relating to:
(i) the prevention of deceptive and fraudulent practices or to deal with the effects of a default on contracts;
(ii) the protection of the privacy of individuals in relation to the processing and dissemination of personal data and the protection of confidentiality of individual records and accounts; or
(iii) safety;
(d) imposed for the protection of national treasures of artistic, historic or archaeological value; or
(e) relating to the conservation of exhaustible natural resources (15).
Article 9.20. Security Exceptions
1. For the purposes of this Chapter, nothing in this Chapter shall be construed:
(a) to require a Party to furnish any information, the disclosure of which it considers contrary to its essential security interests;
(b) to prevent a Party from taking any actions which it considers necessary for the protection of its essential security interests including:
(i) relating to fissionable and fusionable materials or the materials from which they are derived;
(ii) relating to the traffic in arms, ammunition and implements of war and to such traffic in other goods and materials, or relating to the supply of services, as carried on directly or indirectly for the purpose of supplying or provisioning a military establishment;
(iii) taken to protect critical public infrastructures, including communication, power and water infrastructures, from deliberate attempts intended to disable or degrade such infrastructures;
(iv) taken in time of national emergency or war or other emergency in international relations; or
(c) to prevent a Party from taking any action in pursuance of its obligations under the United Nations Charter for the maintenance of international peace and security.
2. A Party that takes actions under subparagraph 1(b) or (c) shall inform the other Party to the fullest extent possible of the actions taken and of their termination.
Article 9.21. Term of Bilateral Investment Treaty
1. Subject to paragraph 2, the Parties agree that the Agreement between the Government of the Kingdom of Thailand and the Government of the Democratic Socialist Republic of Sri Lanka Concerning the Promotion and Protection of Investments, signed at Bangkok, Thailand, on 3 May 1996 ("BIT"), as well as all the rights and obligations derived from the said agreement, shall cease to have effect on the date of entry into force of this Agreement.