Title
AGREEMENT BETWEEN THE BELGIUM-LUXEMBOURG ECONOMIC UNION, on the one hand, AND ................................ on the other hand, ON THE RECIPROCAL PROMOTION AND PROTECTION OF INVESTMENTS.
Preamble
The Kingdom of Belgium, represented by
The Federal Government;
The Flemish Government;
The Government of the Walloon Region;
The Government of the Brussels-Capital Region as well as The Grand Duchy of Luxembourg,
on the one hand,
and
.................. , on the other hand
(hereinafter individually referred to as "the Contracting Party", or collectively referred to as "the Contracting Parties"),
The Contracting Parties:
desiring to strengthen their economic cooperation by creating favourable conditions for investments by investors of one Contracting Party in the territory of the other Contracting Party;
recognising that the encouragement and reciprocal protection under international agreement of such investments shall be conducive to the stimulation of individual business initiatives and shall increase prosperity and welfare in the Contracting Parties;
reaffirming their commitment to sustainable development and enhance the contribution of investment to sustainable development, in its economic, social and environmental dimensions, and to promote investment in a manner supporting high levels of environmental and labour protection and relevant international standards and agreements;
maintaining the principle that nothing in this Agreement shall in any way be construed as limiting the right of the Contracting Parties to adopt, maintain and enforce measures to pursue legitimate policy objectives such as amongst others the protection of public health, environment and public morals; the promotion of security and safety; the achievement of the sustainable development goals; social or consumer protection; the protection of labour standards; the integrity and stability of the financial system or the promotion and protection of cultural diversity.
have agreed as follows:
Body
Chapter I. OBJECTIVES AND GENERAL DEFINITIONS
Article 1. COVERAGE AND OBJECTIVES
1. The Contracting Parties, reaffirming their commitment to create a better climate for the development of investment between the Contracting Parties, hereby lay down the necessary arrangements for a high level of protection of investment.
2. Nothing in this Agreement shall in any way be construed as limiting the right of the Contracting Parties to adopt, maintain and enforce measures to pursue legitimate policy objectives such as amongst others the protection of public health, environment and public morals; the promotion of security and safety; the achievement of the sustainable development goals; social or consumer protection; the protection of labour standards; the integrity and stability of the financial system or the promotion and protection of cultural diversity.
3. This Agreement is without prejudice to the commitments resulting from the membership of the European Union of the Kingdom of Belgium and of the Grand Duchy of Luxembourg.
Article 2. DEFINITIONS
For the Purpose of this Agreement,
1. The term "enterprise" shall mean any entity constituted or organized under applicable law of the Contracting Parties, whether privately or governmentally owned or controlled, including a corporation, partnership, sole proprietorship, association, joint venture, or similar organisation; and a branch or representative office of any such entity.
2. The term "investor" shall mean :
a) natural persons who, according to the legislation of the Kingdom of Belgium, the legislation
of the Grand Duchy of Luxembourg or the legislation of ......., is considered as a citizen of the Kingdom of Belgium, a citizen of the Grand Duchy of Luxembourg or a citizen of ....... respectively;
b) legal persons of either Contracting Party which are established under the laws of that Contracting Party and their headquarters or their real economic activities are located in the territory of that Contracting Party.
For the purposes of this Agreement, an enterprise incorporated or constituted under the law of one
Contracting Party, but effectively controlled, directly or indirectly, by nationals or enterprises of the other Contracting Party, shall be treated as an enterprise of the latter Contracting Party.
3. The term "investment" shall mean every kind of asset that an investor owns or controls, directly or indirectly, that has the characteristics of an investment, which includes a certain duration and other characteristics such as the commitment of capital or other resources, the expectation of gain or profit, or the assumption of risk and that is at all times in compliance with the obligations of this Agreement. Forms that an investment may take include:
(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) any other kind of interest in an enterprise;
(f) an interest arising from:
(i) a concession conferred pursuant to the law of a Contracting Party or under a contract, including to search for, cultivate, extract or exploit natural resources,
(ii) a turnkey, construction, production or revenue-sharing contract; or (iii) other similar contracts;
(g) industrial and intellectual property rights;
(h) other moveable property, tangible or intangible, or immovable property and related rights;
(i) claims to money or claims to performance under a contract.
For greater certainty, claims to money does not include:
(i) claims to money that arise solely from commercial contracts for the sale of goods or services by a natural person or enterprise in the territory of a Contracting Party to a natural person or enterprise in the territory of the other Contracting Party.
(ii) the domestic financing of such contracts; or
(iii) any order, judgment, or arbitral award related to sub-subparagraph (i) or (ii).
4. The term "covered investment" shall mean with respect to a Contracting Party, an investment :
(a) in its territory;
(b) made in accordance with applicable laws at the time the investment is made;
(c) directly or indirectly owned or controlled by an investor of the other Contracting Party; and (d) existing at the date of entry into force of this Agreement, or made or acquired thereafter.
5. The term "returns" shall mean all amounts yielded by or derived from an investment or reinvestment, including but not limited to profits, interests, capital increases, dividends, royalties, payments in connection with intellectual property rights, payments in kind and all other lawful income. Returns that are invested shall be treated as investments. Any alteration of the form in which assets are invested or reinvested does not affect their qualification as investment;
The term "freely convertible currency" means freely usable currency as determined by the International Monetary Fund under its Articles of Agreement.
The term "territory" shall mean:
(a) the territory of the Kingdom of Belgium and the territory of the Grand Duchy of Luxembourg, in accordance with international law;
(b) the territory of ... in accordance with international law.
The term "environmental legislation" shall mean any legislation or regulation of the Contracting Parties, or provision thereof, the primary purpose of which is the protection of the environment, or the prevention of a danger to human, animal, or plant life or health.
The term "labour legislation" shall mean any legislation or regulation of the Contracting Parties, or provisions thereof, that purport to give effect, international labour standards.
The term "corporate social responsibility" (CSR) shall mean the improvement process by which investors or investments incorporate on a voluntary basis, systematically and coherently, social, environmental and economic considerations into their management.
The term "responsible business conduct" (RBC) shall mean that investors or investments comply with laws, such as those on human rights, environmental protection, labour relations and financial accountability among others, and respond to societal concerns.
The term "measure" shall mean inter alia a law, regulation, rule, procedures, decision, administrative action, requirement, practice or any form of treatment by:
(a) central, regional or local governments and authorities; and
(b) non-governmental bodies in the exercise of powers delegated by central, regional or local governments or authorities; and
(c) only for the purposes of Chapter II [Investment promotion and protection] and Chapter IV [Investor-to-state dispute settlement], any entity which is in fact acting on the instructions of or under the direction or the control of a Contracting Party in carrying out its conduct.
The term "confidential or protected information" shall mean:
(a) confidential business information; or
(b) information which is protected against disclosure to the public;
(i) in the case of information of the respondent, under the law of the respondent;
(ii) in the case of other information, under a law or rules that the Tribunal determines to be applicable to the disclosure of such information;
The term "ICSID" shall mean the International Centre for Settlement of Investment Disputes;
The term "New York Convention" shall mean the United Nations Convention on the Recognition and Enforcement of Foreign Arbitral Awards, done at New York on 10 June 1958;
The term "UNCITRAL Arbitration Rules" shall mean the arbitration rules of the United Nations Commission on International Trade Law;
The term "UNCITRAL Transparency Rules" shall mean the UNCITRAL Rules on Transparency in Treaty based Investor-State Arbitration;
The term "Tribunal" shall mean a tribunal established under Article 20 (G) and Article 20 (V) of this Agreement
The term "disputing party" shall mean the investor that initiates proceedings pursuant to Chapter IV or the respondent. For the purposes of Chapter IV [Investor-to-state dispute settlement] and without prejudice to Article 10, an investor does not include a Contracting Party.
The term "disputing parties" shall mean both the investor and the respondent.
Chapter II. PROMOTION AND PROTECTION OF INVESTMENTS
Article 3. SCOPE
1. The provisions in this Agreement shall apply to a measure adopted or maintained by a Contracting Party in its territory relating to:
a) An investor of the other Contracting Party; b) Acovered investment.
2. Investments made before the entry into force of this Agreement by investors of one Contracting Party in the territory of the other Contracting Party in accordance with the latter's laws and regulations shall also be governed by this Agreement.
3. Nothing in this Agreement shall in any way be construed as limiting the right of the Contracting Parties or any of their competent authorities to adopt, maintain and enforce measures, apply prohibitions or restrictions of any kind or take any other action directed to pursue legitimate policy objectives, such as the protection of public health, environment and public morals; the promotion of security and safety; the achievement of the sustainable development goals; social or consumer protection; the protection of labour standards; the integrity and stability of the financial system or the promotion and protection of cultural diversity.
4. Nothing contained in this Agreement shall apply to measures adopted by any Contracting Party, in accordance with its law, with respect to the financial sector for prudential reasons, including those measures aimed at protecting investors, depositors, insurance takers or trustees, or to safeguard the integrity and stability of the financial system.
5. This Agreement shall apply without prejudice to the obligations of the Contracting Parties deriving from their membership or participation in any existing or future customs unions, economic union, regional economic integration agreements or similar international agreement such as the European Union. Consequently the provisions of this Agreement may not be invoked or interpreted, neither in whole nor in part, in such a way as to invalidate, amend or otherwise affect the obligations of the Parties from such membership or participation.
6. The treatment granted by this article shall not be extended to the privileges granted by one Contracting Party to investors of a third State as a consequence of an agreement to avoid double taxation or other international agreements concerning taxation.
Article 4. PROMOTION AND PROTECTION OF INVESTMENT
1. Each Contracting Party shall promote investments in its territory by investors of the other Contracting Party and shall admit such investments in accordance with its legislation.
2. Investments made by investors of one Contracting Party in the territory of the other Contracting Party shall at all times be accorded fair and equitable treatment and full protection and security in accordance with paragraphs 3 to 6.
3. A Contracting Party breaches the obligation of fair and equitable treatment referenced in paragraph 2 where a measure or a series of measures constitutes:
a) denial of justice in criminal, civil or administrative proceedings; or
b) fundamental breach of due process, including a fundamental breach of transparency and obstacles to effective access to justice, in judicial and administrative proceedings; or
c) manifest arbitrariness; or
d) targeted discrimination on manifestly wrongful grounds, such as gender, race or religious belief; or
e) harassment, coercion, abuse of power or similar bad faith conduct.
4. When applying the above fair and equitable treatment obligation, a Tribunal may take into account whether a Party made a specific representation to an investor to induce a covered investment, that created a legitimate expectation, and upon which the investor relied in deciding to make or maintain the covered investment, but that the Party subsequently frustrated.
5. For greater certainty, "full protection and security" refers to the Contracting Partyâs obligations relating to physical security of investors and covered investments.
6. For greater certainty, a breach of another provision of this Agreement, or of any other international agreement, does not constitute a breach of this Article.
Article 5. NATIONAL TREATMENT
1. Each Contracting Party shall accord to an investor of the other Contracting Party and to a covered investment, treatment no less favourable than the treatment it accords, in like situations to its own investors and to their investments with respect to the establishment, acquisition, expansion, conduct, operation, management, maintenance, use, enjoyment and sale or disposal of their investments in its territory.
2. The treatment accorded by a Contracting Party under paragraph 1 means, with respect to a government in Belgium other than at the federal level, treatment no less favorable than the most favorable treatment accorded, in like situations, by that government to investors of that Contracting Party in its territory and to investments of such investors.
Article 6. MOST FAVOURED NATION TREATMENT
1. Each Contracting Party shall accord to an investor of the other Contracting Party and to a covered investment, treatment no less favourable than the treatment it accords in like situations, to investors of a third country and to their investments with respect to the establishment, acquisition, expansion, conduct, operation, management, maintenance, use, enjoyment and sale or disposal of their investments in its territory.
2. The treatment accorded by a Contracting Party under paragraph | means, with respect to a government in Belgium other than at the federal level, treatment no less favorable than the most favorable treatment accorded, in like situations, by that government to investors of that Party in its territory and to investments of such investors.
3. For greater certainty, a determination of whether an investment or an investor is in comparable situations for the purposes of paragraphs |. and 2. of this Article shall be made based on an assessment of the totality of circumstances related to the investor or the investment, including:
a) the effect of the investment on (i) the local community where investment is located;
(iii) the environment, including effects that relate to the cumulative impact of all investments within a jurisdiction;
b) the character of the measure, including its nature, purpose, duration and rationale; and
c) the regulations that apply to investments or investors.
4. Paragraph 1. of this Article shall not apply to:
a) treatment by the Contracting Party under any bilateral or multilateral international agreement in force or signed by the Contracting Party prior to the date of entry into force of this Agreement;
b) treatment by the Contracting Party pursuant to:
i. bilateral or multilateral agreement establishing, strengthening or expanding a free trade area, customs union, common market, labour market integration commitment or similar international agreement; or
ii. investment contract concluded between Host State and investor promoting investment of such investor; or
iii. for the avoidance of any doubt, any provisions of Article 19 of this Agreement.
5. The provisions of paragraphs 1. of this Article shall not apply to subsidies or grants provided by the Contracting Party, including government-supported loans, guarantees and insurance.
Article 7. EXPROPRIATION
1. No Contracting Party shall nationalise or expropriate a covered investment either directly or indirectly through measures having an effect equivalent to nationalisation or expropriation (hereinafter referred to as 'expropriation') except:
(a) for a public purpose;
(b) under due process of law;
(c) in anon-discriminatory manner; and
(d) against payment of prompt, adequate and effective compensation.
For greater certainty, this paragraph shall be interpreted in accordance with Article 8 on the clarification of expropriation.
2. Such compensation shall amount to the fair market value of the investment at the time immediately before the expropriation or the impending expropriation became public knowledge, whichever is earlier, plus interest at a normal commercial rate, from the date of expropriation until the date of payment.
3. Such compensation shall be effectively realisable, freely transferable in accordance with Article 10 and made without delay.
4. The investor affected shall have a right, under the law of the expropriating Contracting Party, to prompt review of its claim and of the valuation of its investment, by a judicial or other independent authority of that Contracting Party, in accordance with the principles set out in this Article.
Article 8. CLARIFICATION OF EXPROPRIATION
The Contracting Parties Confirm Their Shared Understanding That:
1. Expropriation may be either direct or indirect: (a) direct expropriation occurs when an investment is nationalised or otherwise directly expropriated through formal transfer of title or outright seizure; and (b) indirect expropriation occurs where a measure or series of measures by a Contracting Party has an effect equivalent to direct expropriation, in that it substantially 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 of title or outright seizure.
2. The determination of whether a measure or series of measures by a Contracting Party, in a specific fact situation, constitutes an indirect expropriation requires a case-by-case, fact-based inquiry that considers, 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 Contracting Party has an adverse effect on the economic value of an investment does not establish that an indirect expropriation has occurred;
b) the duration of the measure or series of measures by a Contracting Party;
c) the extent to which the measure or series of measures interferes with distinct, reasonable investment backed expectations; and
d) the character of the measure or series of measures, notably their object, context and intent.
Article 9. LOSSES
1. Investors of Either Contracting Party Whose Investments Suffer Losses Due to Any Armed Conflict, civil strife, a state of emergency or natural disaster, in the territory of the other Contracting Party shall be accorded by the other Contracting Party treatment no less favourable than that accorded to its own investors or to investors of any third country, whichever is more favourable to the investor concemed, as regards restitution, indemnification, compensation or other settlement.
2. Notwithstanding paragraph | above, if an investor of the Contracting Party, in the situations referred to in paragraph 1, suffers a loss in the territory of the host Contracting Party resulting from:
(a) requisitioning of its investment or part thereof by the latterâs forces or authorities; or
(b) destruction of its investment or part thereof by the latter's forces or authorities, which was not required by the necessity of the situation, the latter Contracting Party shall provide the investor restitution or compensation which in either case shall be prompt, appropriate and effective and paid without undue delay.
Article 10. TRANSFERS
1. Each Contracting Party shall grant to investors of the other Contracting Party the free transfer of all payments relating to an investment, including, though not exclusively:
a) amounts necessary for establishing, maintaining or expanding the investment;
b) amounts necessary for payments under a contract, including amounts necessary for repayment of loans, interests, royalties, management fees and other payments resulting from licences, franchises, concessions and other similar rights, as well as salaries of expatriate personnel;
c) returns;
d) proceeds from the total or partial liquidation of investments, including capital gains or increases in the invested capital;
e) compensation paid pursuant to Article 7;
2. The nationals of each Contracting Party who have been authorised to work in the territory of the other Contracting Party in connection with an investment shall also be permitted to transfer their earnings and other remunerations to their country of origin.
3. Transfers shall be made in a freely convertible currency at the rate applicable on the day transfers are made to spot transactions in the currency used.
4. Each Contracting Party shall issue the authorisations required to ensure that the transfers can be made without undue delay, with no other expenses than the usual banking costs.